Rma Engineering S.A.R.L v. United States

In the United States Court of Federal Claims
No. 14-1202
Filed: August 29, 2018
**************************************** Breach of Contract;
* Constructive Change;
Contract Disputes Act of 1978, 41 U.S.C. §§
* 601–613 (2006);
* Duty of Good Faith and Fair Dealing;
* Federal Acquisition Regulation, 48 C.F.R. §§
* 6.101 (Competition Requirements), 16.202-1
* (Firm, Fixed-Price Contract), 49.103 (Methods
of Settlement), 52.221-13 (Change Order
RMA ENGINEERING S.A.R.L., d/b/a/ * Extensions), 52.233-1 (Disputes), 52.236-2
RMV ARCHITECTS, * (Differing Site Conditions), 52.236-3 (Site
* Investigations and Conditions Affecting
Plaintiff, * Work), 52.236-13 (Safety Equipment),
* 52.242-14 (Excusable Delays), 52.243-7
(Change Order), 52.246-12 (Inspection of
v. * Construction), 52.249-2 (Termination For
* Convenience), 52.249-10 (Termination For
THE UNITED STATES, * Default), 53.301-1436 (Settlement Proposal
* (Total Cost Basis));
Defendant. * Ratification;
Rules of the United States Court of Federal Claims
* 9(k) (Pleading Requirements for Contract
* Claims), 11(b)(3) (Representations to the
* Court), 12(b)(1) (Subject Matter Jurisdiction),
* 12(b)(6) (Failure to State a Claim), 15
* (Amending Pleadings);
Safety and Health Regulations for Construction, 29
* C.F.R. §§ 1926.1–1926.1442;
* Tucker Act Jurisdiction, 28 U.S.C. § 1491.
****************************************
John M. Manfredonia, Manfredonia Law Offices, LLC, Creskill, New Jersey, Counsel for
Plaintiff.
Sean Siekkinen, United States Department of Justice, Civil Division, Washington, D.C.,
Counsel for the Government.
MEMORANDUM OPINION AND ORDER
BRADEN, Senior Judge.
On November 9, 2017, the Government filed a Motion To Dismiss a Second Amended
Complaint filed by RMA Engineering S.A.R.L d/b/a RMV Architects (“RMA”) that alleged
twenty-three counts arising from the United States Army’s (“Army”) August 4, 2010 decision to
terminate an August 1, 2009 contract awarded to RMA for default. In response, RMA filed a
March 22, 2018 Cross-Motion, requesting that the court grant RMA leave to file a Third Amended
Complaint. For the reasons discussed herein, the Government’s Motion To Dismiss is granted as
to Counts 1 through 9 and 11 through 23, but denied as to Count 10. RMA’s Cross-Motion For
Leave To Amend is denied.
To facilitate review of this Memorandum Opinion And Order, the court has provided the
following outline:
I. FACTUAL BACKGROUND.
A. On August 1, 2009, The United States Army Awarded Contract No. W90BRJ-09-
C-0036 To RMA Engineering S.A.R.L.
B. On August 1, 2009, RMA Engineering S.A.R.L. Received A Notice To Proceed.
C. On August 4, 2010, The United States Army Terminated The August 1, 2009
Contract For Default.
II. PROCEDURAL HISTORY.
III. DISCUSSION.
A. Jurisdiction.
B. Standing.
C. The Government’s November 9, 2017 Motion To Dismiss, Pursuant to RCFC
12(b)(1).
1. The Government’s Argument.
2. RMA Engineering S.A.R.L.’s Response.
3. The Government’s Reply.
4. The Court’s Resolution.
a. Standard Of Review For A Motion To Dismiss, Pursuant To RCFC
12(b)(1).
b. RMA Engineering S.A.R.L.’s Claim For Wrongful Termination
(Count 1).
c. RMA Engineering S.A.R.L.’s Claims For Delay, Post-Termination
Costs, Breach of Contract, And Breach Of The Duty Of Good
Faith And Fair Dealing (Counts 2, 21, 22, and 23).
D. The Government’s November 9, 2017 Motion To Dismiss, Pursuant To RCFC
12(b)(6).
1. The Government’s Argument.
2. RMA Engineering S.A.R.L.’s Response.
3. The Government’s Reply.
4. The Court’s Resolution
a. Standard Of Review For A Motion To Dismiss, Pursuant To RCFC
12(b)(6).
b. Differing Site Conditions (Counts 3 and 10).
c. Constructive Changes (Counts 4–9, 11–14, and 17–20).
d. Misrepresentation Or Unjust Enrichment (Counts 15 and 16).
e. Post-Termination Costs (Count 21).
E. RMA Engineering S.A.R.L.’s March 22, 2018 Cross-Motion For Leave To File A
Third Amended Complaint.
1. RMA Engineering S.A.R.L.’s Argument.
2. The Government’s Response.
2
3. RMA Engineering S.A.R.L.’s Reply.
4. The Court’s Resolution.
a. Governing Precedent.
b. Whether The Third Amended Complaint Is Unduly Delayed Or
Prejudicial To The Government.
c. Whether The Third Amended Complaint Is Futile.
i. Differing Site Conditions (Counts 3 and 10).
ii. Constructive Change (Counts 4–9, 11–14, and 17–20).
iii. Uncompensated Pre-Award Design Work (Counts 15–16).
IV. CONCLUSION.
I. FACTUAL BACKGROUND.1
A. On August 1, 2009, The United States Army Awarded Contract No. W90BRJ-
09-C-0036 To RMA Engineering S.A.R.L.
On August 1, 2009, the Army awarded Contract No. W90BRJ-09-C-0036 (the “Contract”)
to RMA to build training facilities at the Saudi Arabian National Guard (the “SANG”) base in
Khashm Al An, Riyadh, Saudi Arabia (the “Project”). Gov’t App’x at 1–2. The Contract was a
Foreign Military Sales procurement, whereby RMA agreed to design and build a two-story
administrative building, one warehouse, and three sunshades for outdoor training for the 43rd
Mechanized Infantry Battalion. 2d Am. Compl. ¶¶ 1, 2, 12. The Contract provided that the
administrative building and warehouse would be original designs, but the covered training shelter
would be a “modified and site adapted design.” Gov’t App’x at 9–10.
A Joint Engineering Team (“JET”) was designated with “cognizance over all technical
aspects of the [C]ontract and . . . [responsibility] for monitoring [c]ontractor performance.” Gov’t
App’x at 27. The JET included personnel from the SANG and the Army, including the Contracting
Officer’s Representative (“COR”). 2d Am. Compl. ¶ 2. The JET was responsible for reviewing
three phases of proposed designs, i.e., the S-1, S-2, and S-3. Gov’t App’x at 11.
The Contract required RMA to submit the S-1 design to the JET and, “[u]pon receipt of
JET S-1 comments, [RMA was to] incorporate all comments in the drawings and documents,
concurrently with the preparation of S-2[ design].” Gov’t App’x at 11. Thereafter, RMA was
required to submit the S-2 design to the JET for additional comments and approval. Gov’t App’x
at 11. Then, RMA was required to incorporate any JET comments on the S-2 design into the S-3
design, i.e., the final design. Gov’t App’x at 11. RMA was required to build each of the structures
according to the S-3 design and, on completion, the buildings were to be “complete and usable in
all respects[.]” Gov’t App’x at 12.
1
The facts discussed herein were derived from the September 6, 2017 Second Amended
Complaint (“2d Am. Compl.”) and Appendix, filed with the Government’s November 9, 2017
Motion To Dismiss (“Gov’t App’x”).
3
The Contract provided that RMA agreed to supply “all materials, equipment, labor,
supervision, and resources required to design and construct” for a firm, fixed-price2 of 4,370,771
Saudi Riyals, of which 352,500 Saudi Riyals would be paid for the S-1, S-2, and S-3 designs.
Gov’t App’x at 7–9.
On August 1, 2009, the Army issued a Notice To Proceed that required RMA to complete
all work within 180 days, i.e., by February 6, 2010. 2d Am. Compl. ¶ 14; Gov’t App’x at 21.
Mobilization was to begin after the S-1 design was approved by the JET; full payment would be
made “in accordance with Contract Paragraph G.7” and under the relevant CLINs. Gov’t App’x
at 12.
RMA was required to construct all required buildings, in “accordance with the technical
specifications, contract drawings, approved site adapt drawings, and contract requirements.”
Gov’t App’x at 15. “[C]hanges in or deviation from the scope of work” could be made, but could
be authorized only by the Contracting Officer (“CO”), by a contract modification. Gov’t App’x
at 27.3 Because the Contract was a Foreign Military Sales procurement, the following clause was
included:
All communication by the [c]ontractor with all officials, representatives, and/or
offices of the Saudi Arabian Government in all matters pertaining to the design or
construction of this contract, shall be through and in full liaison with the [CO]. This
does not relinquish [c]ontractor responsibility for obtaining routine items to
conduct day-to-day business, such as visas, permits, and custom clearances.
Gov’t App’x at 37.
Importantly, RMA was required to
perform [a] Geotechnical Investigation in order to establish soil bearing capacity
and other soil characteristics at the site. . . . The [c]ontractor shall prepare a
Geotechnical [R]eport, prepare a site topographic plan, prepare a site plan for
facilities (existing and new), prepare a site adapt analysis, and prepare site adapt
drawings for construction of the facilities included in this total [P]roject.
Gov’t App’x at 12–13.
2
A “firm, fixed[-]price contract” is one that “provides for a price that is not subject to any
adjustment on the basis of the contractor’s cost experience in performing the contract,” placing
maximum risk on the contractor along with “full responsibility for all costs and resulting profit or
loss.” 48 C.F.R. § 16.202-1.
3
The COR was authorized “to act on behalf of the [CO].” Gov’t App’x at 27. The COR,
however, was not “authorized to make any commitments or changes that [would] affect price,
quality, quantity, delivery, or any other term or condition of the contract.” Gov’t App’x at 27. In
addition, the Contract provided that the “presence or absence of a Government inspector does not
relieve [RMA] from any contract requirement, nor is the inspector authorized to change any term
or condition of the specification without the [CO’s] written authorization.” Gov’t App’x at 18.
4
The Geotechnical Investigation and Report were to be used by RMA to “design [the]
building foundation and other design works . . . consistent with [the] site specific geotechnical
condition.” Gov’t App’x at 128. Failure “to take the action described and acknowledged in this
paragraph [would] not relieve [RMA] from responsibility for estimating properly the difficulty
and cost of successfully performing the work.” Gov’t App’x at 128.
The Contract also incorporated FAR 52.236-34 concerning Site Investigation and
Conditions Affecting the Work. Gov’t App’x at 84.
4
FAR 52.236-3 provides,
(a) The [c]ontractor acknowledges that it has taken steps reasonably necessary to
ascertain the nature and location of the work, and that it has investigated and
satisfied itself as to the general and local conditions which can affect the work or
its cost, including but not limited to . . . (4) conformations and conditions of the
ground. . . . The [c]ontractor also acknowledges that it has satisfied itself as to the
character, quality, and quantity of surface and subsurface materials or obstacles to
be encountered insofar as this information is reasonably ascertainable from an
inspection of the site, including all exploratory work done by the Government, as
well as from the drawings and specifications made part of this contract. Any failure
of the [c]ontractor to take the actions described and acknowledged by this
paragraph will not relieve the [c]ontractor from responsibility for estimating
properly the difficulty and cost of successfully performing the work, or for
proceeding to successfully perform the work without additional expense to the
Government.
(b) The Government assumes no responsibility for any conclusions or
interpretations made by the [c]ontractor[,] based on the information made available
by the Government. Nor does the Government assume responsibility for any
understanding reached or representation made concerning conditions which can
affect the work by any of its officers or agents before the execution of this contract,
unless that understanding or representation is expressly stated in this contract.
48 C.F.R. § 52.236-3.
5
In addition, the Contract incorporated a number of other standard Federal Acquisition
Regulation (“FAR”) provisions, including FAR 52.221-13,5 FAR 52.233-1,6 FAR 52.236-2,7 FAR
5
This clause provided that any change order granting a time extension may “provide that
the contract completion date will be extended only for those specific elements related to the
changed work and that the remaining contract completion dates for all other work will not be
altered.” Gov’t App’x at 21–22.
6
This clause provided that the Contract was subject to the Contract Disputes Act of 1978,
41 U.S.C. §§ 601–613 (recodified as amended at 41 U.S.C. §§ 7101–7109) (hereinafter “CDA”),
and “all disputes arising under or relating to” the Contract were to be resolved in accordance with
that clause. Gov’t App’x at 80. That clause defined a “claim” and set forth the procedures for
submitting a claim to the CO, and provided that the “[CO]’s decision shall be final unless the
[c]ontractor appeals or files a suit as provided in the [CDA].” Gov’t App’x at 81.
7
This clause provided, in relevant part, that
(a) The [c]ontractor shall promptly, and before the conditions are disturbed, give a
written notice to the [CO] of (1) subsurface or latent physical conditions at the
site which differ materially from those indicated in this contract, or (2) unknown
physical conditions at the site, of an unusual nature, which differ materially
from those ordinarily encountered and generally recognized as inhering in work
of the character provided for in the contract.
(b) The [CO] shall investigate the site conditions promptly after receiving the
notice. If the conditions do materially so differ and cause an increase or
decrease in the [c]ontractor’s cost of, or the time required for, performing any
part of the work under this contract, whether or not changed as a result of the
conditions, an equitable adjustment shall be made under this clause and the
contract modified in writing accordingly.
* * *
(d) No request by the [c]ontractor for an equitable adjustment to the contract for
differing site conditions shall be allowed if made after final payment under this
contract.
Gov’t App’x at 83–84.
6
52.236-13,8 FAR 52.242-14,9 FAR 52.243-7,10 FAR 52-246-12,11 FAR 52.249-2,12 and FAR
52.249-10.13
8
This clause provided that the contractor must “[p]rovide appropriate safety barricades,
signs, and signal lights; . . . [c]omply with the standards issued by the Secretary of Labor at 29
[C.F.R.] part 1926 and 29 [C.F.R.] part 1910; . . . and [e]nsure that any additional measures the
[CO] determines to be reasonably necessary for the purposes are taken.” Gov’t App’x at 88.
9
This clause provided, in relevant part, that
(b) If the performance of all or any part of the work is, for an unreasonable period
of time, suspended, delayed, or interrupted (1) by an act of the [CO] in the
administration of this contract, or (2) by the [CO]’s failure to act within the time
specified in this contract (or within a reasonable time if not specified), an
adjustment shall be made of an increase in the cost of performance of this contract
(excluding profit) necessarily caused by the unreasonable suspension, delay, or
interruption, and the contract modified in writing accordingly. However, no
adjustment shall be made under this clause for any suspension, delay, or
interruption to the extent that performance would have been so suspended, delayed,
or interrupted by any other cause, including the fault or negligence of the
[c]ontractor, or for which an equitable adjustment is provided for or excluded under
any other term or condition of this contract.
(c) A claim under this clause shall not be allowed (1) for any costs incurred more
than 20 days before the [c]ontractor shall have notified the [CO] in writing of the
act or failure to act involved (but this requirement shall not apply as to a claim
resulting from a suspension order), and (2) unless the claim, in an amount stated, is
asserted in writing as soon as practicable after the termination of the suspension,
delay, or interruption, but not later than the date of final payment of the contract.
Gov’t App’x 22.
10
This clause provided, in relevant part, that
(b) Any other written or oral order (which, as used in this paragraph (b), includes
direction, instruction, interpretation, or determination) from the [CO] that causes a
change shall be treated as a change under this clause; Provided that the [c]ontractor
gives the [CO] written notice stating . . . [t]he date, circumstances, and source of
the order; and . . . [t]hat the [c]ontractor regards the order a change order.
Gov’t App’x at 94.
7
11
This clause provided, in relevant part, that
(f) The [c]ontractor shall, without charge, replace or correct work found by the
Government not to conform to contract requirements, unless in the public
interest the Government consents to accept the work with an appropriate
adjustment in contract price.
* * *
(h) If, before acceptance of the entire work, the Government decides to examine
already completed work by removing it or tearing it out, the [c]ontractor, on
request, shall promptly furnish all necessary facilities, labor, and material. If
the work is found to be defective or nonconforming in any material respect due
to the fault of the [c]ontractor or its subcontractors, the [c]ontractor shall defray
the expenses of the examination and of satisfactory reconstruction. However,
if the work is found to meet contract requirements, the [CO] shall make an
equitable adjustment for the additional services involved in the examination and
reconstruction, including, if completion of the work was thereby delayed, an
extension of time.
Gov’t App’x at 18–19.
12
This clause provided, in relevant part, that
(a) The Government may terminate performance of work under this [C]ontract in
whole or, from time to time, in part if the [CO] determines that a termination is
in the Government’s interest. The [CO] shall terminate by delivering to the
[c]ontractor a Notice of Termination specifying the extent of termination and
the effective date.
(b) After receipt of a Notice of Termination, and except as directed by the [CO],
the [c]ontractor shall immediately proceed with the following obligations,
regardless of any delay in determining or adjusting any amounts due under this
clause:
(1) Stop work as specified in the notice.
(2) Place no further subcontracts or orders (referred to as subcontracts in this
clause) for materials, services, or facilities, as except as necessary to
complete the continued portion of the [C]ontract.
(4) Assign to the Government, as directed by the [CO], all right, title, and
interest of the [c]ontractor under the subcontracts terminated, in which case
the Government shall have the right to settle or to pay any termination
settlement proposal arising out of those terminations.
8
RMA also was required to verify the “[l]ocations of nearest acceptable utility tie-ins . . .
during site visits and preliminary surveys prior to offer” and was “responsible for [the] rerouting
of any utilities impacted by the new construction work.” Gov’t App’x at 33. The Contract defined
“utility systems” as “all exterior utilities, such as water, sewer, drainage, electricity, telephone, and
other similar systems.” Gov’t App’x at 13. Likewise, the Contract required RMA to “indicate in
(5) With approval or ratification to the extent required by the [CO], settle all
outstanding liabilities and termination settlement proposals arising from the
termination of subcontracts; the approval or ratification will be final for the
purposes of this clause.
Gov’t App’x at 101–05.
13
This clause provided, in relevant part, that
(a) If the [c]ontractor refuses of fails to prosecute the work or any separable part,
with the diligence that will insure its completion within the time specified in this
contract including any extensions, or fails to complete the work within this time,
the Government may, by written notice to the [c]ontractor, terminate the right to
proceed with the work (or the separable part of the work) that has been delayed.
* * *
(b) The [c]ontractor’s right to proceed shall not be terminated nor the [c]ontractor
charged with damages under this clause, if – (1) The delay in completing the work
arises from unforeseeable causes beyond the control and without the fault or
negligence of the [c]ontractor. Examples of such causes include – (i) Acts of God
or of the public enemy, (ii) Acts of the Government in either its sovereign or
contractual capacity, (iii) Acts of another [c]ontractor in the performance of a
contract with the Government, (iv) Fires, (v) Floods, (vi) Epidemics, (vii)
Quarantine restrictions, (viii) Strikes, (ix) Freight embargoes, (x) Unusually severe
weather, or (xi) Delays of subcontractors or suppliers at any tier arising from
unforeseeable causes beyond the control and without the fault or negligence of both
the [c]ontractor and the subcontractors; and (2) the [c]ontractor, within 10 days
from the beginning of any delay (unless extended by the [CO]), notifies the [CO]
in writing of the cases of the delay. The [CO] shall ascertain the facts and the extent
of delay. If, in the judgment of the [CO], the findings of fact warrant such action,
the time for completing the work shall be extended. The findings of the [CO] shall
be final and conclusive on the parties, but subject to appeal under the Disputes
clause.
(c) If, after termination of the [c]ontractor’s right to proceed, it is determined that
the [c]ontractor was not in default, or that the delay was excusable, the rights and
obligations of the parties will be the same as if the termination had been issued for
the convenience of the Government.
Gov’t App’x at 105–06.
9
design drawing submittals the method of connecting all facilities to electrical power” and that
electrical power must “connect to the nearest SEC14 facility in a manner proposed by the contractor
and approved by . . . [the] JET.” Gov’t App’x at 15. Other provisions provided that RMA was
“responsible for tie-in of all required utilities and paying of all connection and testing fees” that
may be required by SEC or the Army. Gov’t App’x at 33, 37.
Although the Contract required RMA to connect the buildings to electrical power, it also
provided that “[e]lectrical service is not available for use under this contract, therefore all electric
current required by the [c]ontractor shall be the responsibility of the [c]ontractor, furnished at its
own expense.” Gov’t App’x at 36. As for other services, RMA was to:
 “include in the design of the Office Building a communication system that includes
both telephone and data service to each work space. Telephone service is to be
connected to the nearest appropriate telephone panel. Data communication shall
include cable runs from individual workspaces to a central area to be connected in
[the] future to a data server. Connection to a server or provision of a server will be
done by others.” Gov’t App’x at 15.
 “provide and connect the telephone system as described in the addendum in
[S]ection C.” Gov’t App’x at 130.
 “provide a complete data system in each site in accordance with SANG Information
Center Specifications, Appendix A, Division 16, Tec Specs, Attachment 1, Section
J. The data network shall be connected in accordance [with] the addendum in
[S]ection C.” Gov’t App’x at 131.
 “locate the appropriate connection points for [water, sewage, and irrigation, and,
d]uring design submittals, . . . propose the method of connection of these utilities.
All necessary utilities must be connected in a manner that satisfies SANG
specification[s] and provides for a complete and [usable] facility.” Gov’t App’x at
15.
And, within five calendar days of the Contract’s award, RMA was required to provide the
Army with “a complete list of personnel who [would] work on the [P]roject. Each request for [a]
personnel pass [was to] include [the] worker’s name, nationality, [a] copy of [the worker’s]
passport and igama [sic],15 blood type, and four (4) 2 x 3 cm size photographs.” Gov’t App’x at
33. RMA also was to “be ready as directed by [the] SANG security to present original passport
and igama [sic] for verification.” Gov’t App’x at 34.
14
The Contract did not define “SEC,” but this term appears to refer to an electricity
provider.
15
The Contract did not define “iqama.” According to the Government, an iqama is a
“visa.” Gov’t Mot. at 21.
10
B. On August 1, 2009, RMA Engineering S.A.R.L. Received A Notice To
Proceed.
On August 1, 2009, the Army issued a Notice To Proceed. 2d Am. Compl. ¶ 17. Shortly
after performance began, RMA experienced delays in accessing the Project site that prevented
mobilization16 by September 1, 2009, as required by the Contract. 2d Am. Compl. ¶¶ 17–18. For
example, the “[SANG] prevented equipment and material deliveries [from proceeding] through
the security checkpoint[,]” because “trucks were turned back and forced to return several days later
at a rescheduled time.” 2d Am. Compl. ¶ 18. In addition, cement trucks were denied entry to the
site, so several concrete deliveries required for foundation work had to be rescheduled. 2d Am.
Compl. ¶ 28.
On August 9, 2009, Riyadh Geotechnique & Foundations (“RGF”) began a geotechnical
investigation of the site of the Project that was completed on August 13, 2009. 2d Am. Compl. ¶
114. On August 19, 2009, RGF provided the results to RMA that found the “subsurface soils
contained backfill materials consisting of trash, metal pieces, debris and materials, unprocessed
stone fragments in excess of six (6) inches in diameter and unsafe (non-blended) backfilling and
material harmful to building structures.” 2d Am. Compl. ¶ 115. RGF “recommended removal of
these . . . materials and replacement with clean soil” and that the building foundation be “at least
1.5 meters at the lowest topographical elevation and 1.8 meters deep at the highest topographical
elevation.” 2d Am. Compl. ¶ 116.
On August 26, 2009, RMA notified the Army by letter that RMA continued to experience
Project site access delays. 2d Am. Compl. ¶ 19. On September 6, 2009, RMA began the process
to obtain layout and utility clearances for excavation work. 2d Am. Compl. ¶ 23. On September
9, 2009, RMA advised the Army and the SANG that it still was experiencing Project site access
problems and the “SANG promised to communicate with the police department ‘to expedite
[RMA’s] access to [the Project] site[.]’” 2d Am. Compl. ¶ 20.
On September 12, 2009, RMA revised plans to conform to the foundation depths
recommended by RGF. 2d Am. Compl. ¶ 118. On September 22, 2009, RMA completed
mobilization. 2d Am. Compl. ¶ 21. Thereafter, however, RMA continued to experience delays.
2d Am. Compl. ¶¶ 15, 24. Although the Contract required RMA to submit design drawings to the
JET prior to construction to facilitate the Army’s review and approval within seven calendar days,
neither the Army nor the SANG reviewed design submittals in a “timely manner.” 2d Am.
Compl. ¶ 15.
On October 3, 2009, RMA sent a letter to “Defendant” stating that it encountered a
waterline that “conflicted with the location of the building’s foundation, [so] it had to be
16
The Contract did not define “mobilization,” but described a “Contractor’s Mobilization
Area” to be used “for operation of [RMA’s] construction equipment and plants, shops, warehouses,
and offices[;]” upon completion of construction, “all facilities [were to] be dispose[d] of in
accordance with applicable Saudi Arabian Government [l]aws and [r]egulations.” Gov’t App’x at
12, 35. This area also was to be “cleared of construction debris and other materials and the area
restored to its final grade.” Gov’t App’x at 35.
11
relocated.” 2d Am. Compl. ¶¶ 31–32. This required that the main water supply be shut off, but
RMA had to wait approximately one week for that to occur. 2d Am. Compl. ¶ 33.
On October 10, 2009, the JET requested that RMA redesign the first floor of the
administrative building to include a pantry, instead of a store room, causing RMA to incur
additional cost and delay. 2d Am. Compl. ¶¶ 65–66.
In early November 2009, RMA completed relocating the waterline.17 2d Am. Compl. ¶
33. By mid-November 2009, the JET requested that all submittals be reviewed and approved by
JET engineers. 2d Am. Compl. ¶ 16. By that time, however, RMA had experienced 45 days of
delay, because over 200 submittals were not “timely approved.” 2d Am. Compl. ¶¶ 15, 16. RMA
also encountered other delays. For example, RMA “planned on” installing, and the “Defendant”
approved, a 15-ton Air Handling Unit (“AHU”), although it was not readily available in Riyadh,
Saudi Arabia. 2d Am. Compl. ¶ 57. But, during construction, an unspecified individual directed
RMA to install an 18-ton AHU. 2d Am. Compl. ¶ 58. This required RMA to redo calculations
for “system, electrical roof supports, piping, ductwork, and other items.” 2d Am. Compl. ¶ 58. In
addition, RMA received approval for lighting fixtures listed in a supplier’s catalog, but after RMA
installed most of the wiring, “Defendant” requested a change to the electrical wiring for light
fixtures. 2d Am. Compl. ¶ 38.
On December 14, 2009, RMA completed excavation and foundation work. 2d Am.
Compl. ¶¶ 24, 119. This, however, was 92 days later than RMA anticipated, because, in addition
to Project site access delays, RMA needed to perform additional excavation, foundation work,
unsuitable soil removal, and subsurface waterline relocation. 2d Am. Compl. ¶¶ 24–26.
On January 14, 2010, RMA began to remove electrical wiring from the walls and ceiling
before installing new wiring and conduits. 2d Am. Compl. ¶¶ 38–39.
On January 20, 2010, RMA submitted a roofing and waterproofing system to the Army for
approval that included a single layer of extremely durable synthetic rubber roofing membrane, or
EPDM rubber membrane. 2d Am. Compl. ¶¶ 46–47. On an unspecified date thereafter, RMA
began to install the waterproofing system, but after that work was substantially completed, the
Army requested a roofing and waterproofing system with a double-layer EPDM rubber membrane.
2d Am. Compl. ¶ 48.
On January 30, 2010, RMA was required to rework toilet plumbing, including dismantling
walls and pipes, because the Army made several changes to the plumbing requirements during a
site inspection. 2d Am. Compl. ¶¶ 35–36.
On or about February 3, 2018, the JET “verbally approved the light fixtures shown in a
supplier catalog.” 2d Am. Compl. ¶ 177. On February 15, 2010, RMA completed the toilet
plumbing changes, as well as the concrete walls, floors, and roof deck. 2d Am. Compl. ¶¶ 29, 36.
17
The Second Amended Complaint alleges, in separate paragraphs, that this work was
completed on November 9, 2009, and on November 11, 2009. 2d Am. Compl. ¶¶ 33, 161.
12
On February 23, 2010, the COR approved RMA’s submitted lighting drawings. 2d Am. Compl. ¶
42. On February 28, 2010, RMA submitted an order for the light fixtures. 2d Am. Compl. ¶ 42.
From March 2, 2010 to March 7, 2010, RMA installed the 18-ton AHU. 2d Am.
Compl. ¶ 59. Beginning on March 12, 2010, RMA began replacing piping to connect the waterline
of the office building’s water supply to the main waterline, after the Army directed it to install a
2.5-inch waterline in lieu of the 2-inch waterline previously installed, despite RMA’s insistence
that doing so was “economic waste.” 2d Am. Compl. ¶¶ 52–55.
On March 17, 2010, RMA completed the additional electrical wiring replacement. 2d Am.
Compl. ¶ 40. Two days later, RMA completed the office building waterline replacement. 2d Am.
Compl. ¶ 55.
On March 31, 2010, RMA submitted a double-layer EPDM rubber membrane roofing and
waterproofing system for approval. 2d Am. Compl. ¶ 49.
During a site inspection on April 1, 2010, “the Government” approved the double-layer
EPDM rubber membrane roofing and waterproofing system. 2d Am. Compl. ¶ 49.
Between April 1, 2010 and April 3, 2010, light fixtures were delivered to the Project site.
2d Am. Compl. ¶¶ 42, 177. Thereafter, RMA installed some of the fixtures. 2d Am. Compl. ¶ 44.
During a subsequent site visit, however, a JET inspector rejected the light fixtures, requiring RMA
to “restart[] the lighting approval process.” 2d Am. Compl. ¶¶ 43, 178.
From April 3, 2010 to April 8, 2010, RMA installed the double-layer EPDM rubber
membrane roofing and waterproofing system, causing a six-day delay. 2d Am. Compl. ¶¶ 46, 50.
On an unspecified date, “Defendant” directed RMA to install telephone and data wiring
and a main circuit breaker at a transformer on the Project site, causing RMA to incur additional
delay and cost. 2d Am. Compl. ¶¶ 61–64.
In addition, throughout construction, JET engineers imposed “stringent safety measures,”
including safety handrails, temporary stairs, and wood platforms that required RMA to incur delay
and cost. 2d Am. Compl. ¶¶ 68–69.
C. On August 4, 2010, The United States Army Terminated The August 1, 2009
Contract For Default.
On May 10, 2010, RMA submitted a Request for Equitable Adjustment (“REA”) to the CO
in the amount of $174,634, for “compensation for additional foundation works and relocation of
water main not included in the original contract scope for this [P]roject.” Gov’t App’x at 146.
The REA requested “a fair and final decision on this subject by the [CO] on our behalf” and
represented that “supporting documents” were attached “by way of evidence that work executed
justifies the calculated amounts.” Gov’t App’x at 146.
On June 20, 2010, the Army issued a Cure Notice informing RMA that it intended to
terminate the Contract, if the administrative building and warehouse were not substantially
13
completed by June 30, 2010 and July 20, 2010, respectively. 2d Am. Compl. ¶ 72. At the time,
the Project was in the “punch list stage.” 2d Am. Compl. ¶¶ 73, 78.
On June 26, 2010, the CO issued Modification P00002 (the “Modification”) extending the
completion date for: (1) the administrative building, by 153 days, or until June 30, 2010; and (2)
the warehouse building, by 173 days, or until July 20, 2010. 2d Am. Compl. ¶ 71. The
Modification cited FAR 52.249-10, “Default (Fixed-Price Construction),” and contained the
following release provision:
In consideration for the modification agreed to herein as complete and equitable
adjustment for the above change, the contractor hereby releases the Government
from any and all liability under this contract from further equitable adjustments
attributable to such facts or circumstances giv[ing] rise to the change incorporated
herein.
Gov’t App’x at 143.
Around June 28, 2010, after several meetings between the JET and RMA’s lighting
supplier, the Army approved new light fixtures. 2d Am. Compl. ¶ 43. On June 30, 2010, i.e., the
new completion date, the administrative building was substantially completed. 2d Am. Compl. ¶
74. With the Army’s approval, however, RMA continued to work on the administration building
after June 30, 2010. 2d Am. Compl. ¶ 76.
On July 4, 2010, RMA completed installation of the new light fixtures. 2d Am. Compl. ¶
44. On July 20, 2010, the warehouse was substantially completed. 2d Am. Compl. ¶ 75. With the
Army’s approval, RMA continued to work on the warehouse after July 20, 2010. 2d Am.
Compl. ¶ 77. As of July 31, 2010, the Project was 88.56% complete. 2d Am. Compl. ¶ 79.
Sometime in July 2010, however, RMA submitted a Request for Equitable Adjustment (“REA”).
2d Am. Compl. ¶ 86.
On August 1, 2010, RMA met with General Saud of the SANG, who stated that he intended
to request the CO to terminate the Contract for default, even though RMA explained the reasons
for the delay and emphasized that the buildings were substantially completed. 2d Am. Compl. ¶
80.
On August 4, 2010, i.e., nine days after the CO issued the Modification, the Army
terminated the Contract for default. 2d Am. Compl. ¶ 81. On that same day, RMA requested that
the Army change the termination to a termination for convenience (the “Convenience Request”)
and requested compensation for preliminary design work, undisclosed surface and subsurface
conditions, and other delays. 2d Am. Compl. ¶ 82.
On September 4, 2010, RMA sent a second REA to the CO again requesting that the CO
change the termination to one for convenience and that RMA “be reimbursed via an equitable
adjustment to the [C]ontract[.]” Gov’t App’x at 147. That REA cited “undisclosed material
conditions at the construction site, unknown physical conditions of an unusual nature, numerous
changes to the contract, untoward delays, to include frequent denials of access to the work site,
and unlawful acts of non-authorized personnel all of which have inequitably caused [RMA] to
suffer additional costs in the amount of . . . [$1,742,571.91].” Gov’t App’x at 148. The September
14
4, 2010 REA added that RMA had “substantial material in support of its claim, to include daily
logs of work progress and site conditions, correspondence by and between [RMA] and
Government officials[,] and records of unlawful actions by unauthorized personnel, all of which
shall be made available to the [CO] and government auditors in accordance with applicable
regulations at the Government’s request.” Gov’t App’x at 148. The REA included the following
certification:
I, Jean Yves Rousseau, on behalf of the contractor, RMV Architects, certify that
this claim is made in good faith, that the supporting data are accurate and complete
to the best of my knowledge and belief; that the amount requested accurately
reflects the contract adjustment for which the contractor believes the Government
is liable; and that I am duly authorized to certify the claim on behalf of the
contractor.
Gov’t App’x at 148.
Over seven months later, on April 18, 2011, the Army responded and asked for a “cost
proposal/cost break-out” of the new total compensation amount. 2d Am. Compl. ¶ 83. On June
26, 2011, RMA provided the Army with a “Construction Cost Analysis & Pay Estimate Summary”
and a Critical Path Method graph. 2d Am. Compl. ¶ 84.
On July 4, 2011, RMA submitted a third REA supplementing the June 26, 2011 submission
with a “Statement of Costs” that detailed RMA’s claimed damages. 2d Am. Compl. ¶ 85; Gov’t
App’x at 149–52.
On October 26, 2011, RMA requested that the Army issue a final decision. 2d Am.
Compl. ¶ 86. On December 30, 2011, RMA again requested that the Army issue a final decision.
2d Am. Compl. ¶ 87.
On January 7, 2012, the Army requested that the Defense Contract Audit Agency conduct
a contract closeout audit of the Contract. 2d Am. Compl. ¶ 88.
On January 30, 2012, RMA submitted a fourth REA that revised RMA’s claimed damages.
2d Am. Compl. ¶ 89. Thereafter, on July 23, 2012, August 1, 2012, October 1, 2012, and
December 17, 2012, RMA sent letters requesting that the Army either settle RMA’s claim or issue
a final decision. 2d Am. Compl. ¶ 89.
On January 23, 2013, the Army advised RMA to submit a Standard Form 1436, Settlement
Proposal Total Cost Basis, used to calculate costs for a termination for convenience. 2d Am.
Compl. ¶ 90. On March 31, 2013, RMA provided a completed Standard Form 1436 to the Army.
2d Am. Compl. ¶ 91. On June 22, 2013, July 7, 2013, August 19, 2013, and September 15, 2013,
RMA continued to request that the Army settle RMA’s claim or issue a final decision. 2d Am.
Compl. ¶ 91.
On December 15, 2013, the CO denied all of RMA’s CDA claims, including a request to
convert the termination for default to a termination for convenience, as well as prior requests for
compensation for: pre-award design work performed at the Army’s request; additional foundation
15
and backfilling work, due to different site conditions; relocating a subsurface waterline; and other
delays. 2d Am. Compl. ¶¶ 92–93.
II. PROCEDURAL HISTORY.
On December 15, 2014, RMA filed a Complaint in the United States Court of Federal
Claims. ECF No. 1. On April 14, 2015, the Government filed an Answer. ECF No. 8. On June
5, 2015, the parties filed a Joint Preliminary Status Report. ECF No. 10. On that same day, the
court issued a Discovery Scheduling Order. ECF No. 11.
On August 14, 2015, the Government filed an Amended Answer to the December 15, 2014
Complaint. On January 4, 2016, the court convened a telephone status conference. ECF No. 16.
On February 18, 2016, RMA filed an Amended Complaint. ECF No. 17. On March 1,
2016, the court convened another telephone status conference. On March 30, 2016, the
Government filed an Answer to the February 18, 2016 Amended Complaint. ECF No. 19. On
June 10, 2016, the parties filed a Joint Motion To Amend the court’s June 5, 2015 Discovery
Scheduling Order (ECF No. 20), that the court granted on June 13, 2016 (ECF No. 21).
On August 31, 2016, RMA filed a Consent Motion To Substitute Counsel (ECF No. 22)
that the court granted that same day.
On December 8, 2016, the parties filed a Second Motion To Amend the court’s June 5,
2015 Discovery Scheduling Order (ECF No. 23), that the court granted on December 12, 2016
(ECF No. 24).
On January 22, 2017, RMA’s counsel filed a Motion To Withdraw As Attorney. ECF No.
25. On January 26, 2017, the Government filed a Response. ECF No. 26. On January 30, 2017,
the court issued a Memorandum Opinion And Order requiring RMA’s counsel to show cause.
ECF No. 27. On January 31, 2017, RMA’s counsel filed a Response to the January 30, 2017
Memorandum Opinion And Order. ECF No. 29. On February 3, 2017, the court issued an Opinion
that granted RMA’s counsel’s Motion To Withdraw. See RMA Engineering S.A.R.L. v. United
States, 130 Fed. Cl. 544 (Fed. Cl. 2017).
On March 2, 2017, RMA filed a Consent Motion To Substitute Counsel. ECF No. 32. On
June 5, 2017, RMA’s new counsel informed the court that RMA intended to file a Second
Amended Complaint within 45 days. ECF No. 33. On July 17, 2017, RMA’s counsel informed
the court that a Second Amended Complaint would be filed no later than August 30, 2017. ECF
No. 33.
On August 31, 2017, the court issued an Order directing RMA to show cause why the case
should not be dismissed, because a Second Amended Complaint was not filed nor was a motion
filed to amend the December 12, 2016 Discovery Scheduling Order. ECF No. 33. On that same
day, RMA filed a Second Motion To Amend Pleadings (ECF No. 34), that the court granted on
September 5, 2017 (ECF No. 36).
16
On September 6, 2017, RMA filed a Second Amended Complaint. ECF No. 37. On
September 14, 2017, RMA filed a Response to the court’s August 31, 2017 Show Cause Order.
ECF No. 39.
On November 9, 2017, the Government filed a Motion To Dismiss RMA’s Second
Amended Complaint, pursuant to Rules of the United States Court of Federal Claims (“RCFC”)
12(b)(1) and 12(b)(6). ECF No. 42.
On January 8, 2018, RMA filed a Response to the Government’s November 9, 2017 Motion
To Dismiss, together with a Cross-Motion For Leave To File A Third Amended Complaint. ECF
No. 45. That Response, however, inadvertently included privileged materials, so on February 23,
2018, the parties filed a Joint Motion To Amend/Correct the Response And Cross-Motion, together
with a Joint Motion For Extension Of Time to respond and reply to the corrected filing. ECF No.
49. On that same day, the court granted both Joint Motions. ECF No. 50.
On March 22, 2018, RMA filed a corrected Response And Cross-Motion For Leave To
File A Third Amended Complaint. ECF No. 51. On April 23, 2018, the Government filed a Reply
And Response to RMA’s January 8, 2018 Response And Cross-Motion. ECF No. 52. On April
30, 2018, RMA filed a Reply. ECF No. 53. On that same day, the Government filed a Notice that
included new information regarding the prejudice argument raised in the April 23, 2018 Reply
And Response. ECF No. 54.
III. DISCUSSION.
A. Jurisdiction.
The United States Court of Federal Claims has jurisdiction, under the Tucker Act, to
adjudicate any claim that arises under the CDA, 41 U.S.C. §§ 601–613,18 and has been submitted
to a CO for a final decision. See 28 U.S.C. § 1491(a)(2) (“The [United States] Court of Federal
Claims shall have jurisdiction to render judgment upon any claim by or against, or dispute with, a
contractor arising under section [609(a)(1)] of title 41 . . . on which a decision of the [CO] has
been issued[.]”); see also 41 U.S.C. § 609(a)(1) (“[I]n lieu of appealing the decision of a [CO] . . .
to an agency board, a contractor may bring an action directly on the claim in the United States
Court of Federal Claims[.]”).
18
The Contract’s Disputes Clause incorporates the 2006 version of the CDA, that is
codified at 41 U.S.C. §§ 601–613 (2006). Gov’t App’x at 80. Accordingly, the court refers to that
codification.
17
A claim “arises under” the CDA, if it is based on
any express or implied contract . . . made by an executive agency for— (1) the
procurement of services, other than real property in being; (2) the procurement of
services; (3) the procurement of construction, alteration, repair, or maintenance of
real property; or (4) the disposal of personal property.
41 U.S.C. § 602(a).
A “claim” is defined as “a written demand or written assertion by one of the contracting
parties seeking, as a matter of right, the payment of money in a sum certain, the adjustment or
interpretation of contract terms, or other relief arising under or relating to this contract.” 48
C.F.R. § 52.233–1. Although a CDA claim need not be submitted in any particular form or use
any particular wording, it must contain “a clear and unequivocal statement that gives the [CO]
adequate notice of the basis and amount of the claim.” Contract Cleaning Maint., Inc. v. United
States, 811 F.2d 586, 592 (Fed. Cir. 1987). The CDA also requires that the claim indicate to the
CO that the contractor is requesting a “final” decision. See James M. Ellet Constr. Co. v. United
States, 93 F.3d 1537, 1543 (Fed. Cir. 1996).
The September 6, 2017 Second Amended Complaint includes twenty-three CDA counts
arising from the Army’s August 4, 2010 decision to terminate an August 1, 2009 contract awarded
to RMA for default: Count 1 alleges wrongful termination; Count 2 alleges excusable and
compensable delays; Counts 3 and 10 allege differing site conditions; Counts 4 through 9, 11
through 14, and 17 through 20 allege constructive changes to the Contract; Counts 15 and 16 allege
pre-award misrepresentations that caused uncompensated work and cost overruns; Count 21
alleges uncompensated post-termination work; Count 22 alleges a breach of contract; and Count
23 alleges a breach of the implied duty of good faith and fair dealing. 2d Am. Compl. ¶¶ 94–227.
The Government’s RCFC 12(b)(1) challenges to claims in the Second Amended Complaint are
addressed below.
B. Standing.
Standing is “the threshold question in every federal case, determining the power of the
court to entertain the suit.” Warth v. Seldin, 422 U.S. 490, 498 (1975). The party invoking federal
jurisdiction “bears the burden of establishing the[] elements [of standing].” Spokeo, Inc. v. Robins,
136 S. Ct. 1540, 1547 (2016); see also Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992) (same).
To meet this burden at the pleading stage, the complaint must “clearly . . . allege facts
demonstrating each element.” Spokeo, 136 S. Ct. at 1547 (internal correction and quotation marks
omitted); see also McKinney v. United States Dep’t of Treasury, 799 F.2d 1544, 1557 (Fed. Cir.
1986) (“The facts alleged in the complaint, taken as true for purposes of a standing analysis, must
be sufficient to show that a party has suffered, or is likely to suffer, an injury in fact.”).
18
As a matter of law, to establish standing in the United States Court of Federal Claims,19 a
complaint must allege sufficient facts to show that a plaintiff:
(1) . . . has suffered an “injury in fact” that is (a) concrete and particularized and (b)
actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable
to the challenged action of the defendant; and (3) it is likely, as opposed to merely
speculative, that the injury will be redressed by a favorable decision.
Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 180–81 (2000); see also
Figueroa v. United States, 466 F.3d 1023, 1029 (Fed. Cir. 2006) (same).
In addition, “[t]o have standing to sue the sovereign on a contract claim, a plaintiff must
be in privity of contract with the United States.” Anderson, 344 F.3d at 1351. In other words, the
contract at issue must be between the plaintiff and the Government. See Ransom v. United States,
900 F.2d 242, 244 (Fed. Cir. 1990) (“To maintain a cause of action pursuant to the Tucker Act that
is based on a contract . . . between the plaintiff and the [G]overnment[.]”).
The September 6, 2017 Second Amended Complaint alleges that RMA was in privity of
contract with the Government. 2d Am. Compl. ¶ 1 (“On August 1, 2009, the U.S. Army . . .
awarded Plaintiff a contract to design and build a new two-story administrative building,
warehouse, and sun shade canopies at a [SANG] military base[.]”). In addition, the September 6,
2017 Second Amended Complaint alleges that RMA incurred financial injury that is concrete,
particularized, and fairly traceable to the Army’s actions. See generally 2d Am. Compl. ¶¶ 94–
227. And, any financial injury established by RMA can be addressed by a monetary award. 2d
Am. Compl. at 29 (Prayer for Relief).
For these reasons, the court has determined that RMA has standing to seek an adjudication
of the claims alleged in the September 6, 2017 Second Amended Complaint.
C. The Government’s November 9, 2017 Motion To Dismiss, Pursuant to RCFC
12(b)(1).
1. The Government’s Argument.
The Government presents three jurisdictional arguments. First, although Counts 1 and 21
of the Second Amended Complaint allege that the Government’s termination for default was
wrongful and request that the court convert the termination to one for convenience, neither was
timely filed in the United States Court of Federal Claims. Gov’t Mot. at 35. That is so, because
the CO issued a notice of termination for default on August 4, 2010, to inform RMA that the
contract “is terminated . . . in accordance with contract clause FAR 52.249-10 . . . [that is]
incorporated in full text by contract paragraph 1.49.” Gov’t Mot. at 35 (citing Gov’t App’x 144–
19
The standing requirements of Article III of the United States Constitution also apply to
the United States Court of Federal Claims. See Anderson v. United States, 344 F.3d 1343, 1350
n.1 (Fed. Cir. 2003) (stating that the United States Court of Federal Claims, “though an Article I
court, . . . applies the same standing requirements enforced by other federal courts created under
Article III”) (internal citation omitted).
19
45). In addition, that notice informed RMA that it “ha[d] the right to appeal under the Disputes
[C]lause.” Gov’t Mot. at 35–36 (citing Gov’t App’x 144–45). RMA had twelve months from the
date it received the termination notice to file a complaint in the United States Court of Federal
Claims, i.e., until August 4, 2011. See 41 U.S.C. § 609(a)(3). RMA did not do so until December
15, 2014. Gov’t Mot. at 36 (citing Compl. ¶ 20).
Second, the United States Court of Federal Claims does not have jurisdiction to adjudicate
Count 2 of the Second Amended Complaint, because RMA never presented a delay claim to the
CO. Gov’t Mot. at 32. The REAs that RMA submitted on September 4, 2010, July 4, 2011, and
January 30, 2012, did not inform the CO that RMA was requesting compensation for not being
able to work. Gov’t Mot. at 33 (citing Gov’t App’x 147–59; see also Bell BCI Co. v. United States,
72 Fed. Cl. 164, 168 (Fed. Cl. 2006) (“There is a distinction in the law between: (1) a ‘delay’
claim; and (2) a ‘disruption’ or ‘cumulative impact’ claim. Although the two claim types often
arise together in the same project, a ‘delay’ claim captures the time and cost of not being able to
work, while a ‘disruption’ claim captures the cost of working less efficiently than planned.” (italics
in original)). In particular, the September 4, 2010 REA did not state the length or cost was caused
by the Government’s delay. Gov’t Mot. at 33 (citing Gov’t App’x at 148). Nor did the July 4,
2011 REA explain how or why delays occurred, if the Government caused the delays, or if the
costs were incurred by those delays. Gov’t Mot. at 33 (citing Gov’t App’x at 149–52). Likewise,
the January 30, 2012 REA failed to describe or explain the delays and did not specify any costs
incurred from the delay. Gov’t Mot. at 33 (citing Gov’t App’x at 155).
Third, the United States Court of Federal Claims does not have jurisdiction to adjudicate
Counts 22 and 23, because RMA did not first submit breach of contract and breach of the duty of
good faith and fair dealing claims to the CO. Gov’t Mot. at 37–38; see also 41 U.S.C. § 605(a).
2. RMA Engineering S.A.R.L.’s Response.
The United States Court of Federal Claims has jurisdiction to adjudicate Count 2, because
RMA adequately notified the CO of the delays in the REAs and the CO’s final decision addressed
RMA’s delay claims. Pl. Resp. at 34–35 (citing Rollock Co. v. United States, 115 Fed. Cl. 317,
327 (Fed. Cl. 2014) (“For the court to exercise jurisdiction over a claim made under the CDA, the
contractor must first submit a written claim to the [CO] and the [CO] must issue a final decision
on the claim.”)). The United States Court of Federal Claims also has jurisdiction to adjudicate
Counts 22 and 23, as they recite the same operative facts as RMA’s other CDA claims. Pl. Resp.
at 35–36 (citing MW Builders, Inc. v. United States, 134 Fed. Cl. 469, 492–93 (Fed. Cl. 2017)
(“[T]he United States Court of Federal Claims may adjudicate a claim, if it arises from the ‘same
operative facts’ and requests ‘essentially the same relief,’ as a claim presented to the CO, even if
the complaint at issue alleges a ‘slightly different legal theory.’” (quoting Scott Timber Co. v.
United States, 333 F.3d 1358, 1365 (Fed. Cir. 2003)))).
Nor are the wrongful termination claims in Counts 1 and 21 of the Second Amended
Complaint time-barred. Pl. Resp. at 36–37. The August 4, 2010 Notice Of Termination did not
advise RMA of the right to appeal, as required by the CDA. Pl. Resp. at 36. Therefore, the CO’s
final decision was defective and did not trigger the limitations period. Pl. Resp. at 36–37 (citing
Pathman Constr. Co. v. United States, 817 F.2d 1573, 1578 (Fed. Cir. 1987) (“A [CO’s] final
20
decision that does not give the contractor adequate notice of its appeal rights is defective and
therefore does not trigger the running of the limitations period.”)).
3. The Government’s Reply.
As to Counts 22 and 23, the Government adds that RMA concedes that the REAs did not
expressly notify the CO of these claims. Gov’t Reply at 26 (citing Pl. Resp. at 35–36). Nor do
these claims arise from the same operative facts as those underlying the claims that RMA did
present to the CO. Gov’t Reply at 26 (citing Pl. Resp. at 35). “A claim arises from the same
operative facts as those presented to the [CO] if the [CO] had ‘clear notice . . . of the contractor’s
entire claim,’ including the basic theory and allegations supporting the new claim.” Gov’t Reply
at 26–27 (quoting E&E Enters. Glob., Inc. v. United States, 120 Fed. Cl. 165, 174 (Fed. Cl. 2015)
(citation omitted)). Counts 22 and 23 also do not provide clear and unequivocal notice that the
Army hindered, failed to cooperate, or committed subterfuge, evasion, or other acts rising to the
level of bad faith. Gov’t Reply at 26–27 (citing Reliance Ins. Co. v. United States, 931 F.2d 863,
866 (Fed. Cir. 1991) (“No claims that the Government breached the contract or its duty of good
faith are properly before the court. [Appellants] only submitted to the [CO] claims for equitable
adjustment to the contract. [Appellants] did not submit to the [CO] a clear and unequivocal claim
that the VA breached the contract or its duty of good faith.”)). Compare 2d Am. Compl. ¶¶ 218–
27, with Gov’t App’x at 153–55.
4. The Court’s Resolution.
a. Standard Of Review For A Motion To Dismiss, Pursuant To
RCFC 12(b)(1).
A challenge to the United States Court of Federal Claims’ “general power to adjudicate in
specific areas of substantive law . . . is properly raised by a [RCFC] 12(b)(1) motion[.]”
Palmer v. United States, 168 F.3d 1310, 1313 (Fed. Cir. 1999); see also RCFC 12(b)(1) (allowing
a party to assert, by motion, “lack of subject-matter jurisdiction”). When considering whether to
dismiss an action for lack of subject matter jurisdiction, the court is “obligated to assume all factual
allegations [of the complaint] to be true and to draw all reasonable inferences in plaintiff’s favor.”
Henke v. United States, 60 F.3d 795, 797 (Fed. Cir. 1995). Nevertheless, the plaintiff bears the
burden of establishing jurisdiction by the preponderance of the evidence. See Reynolds v. Army &
Air Force Exch. Serv., 846 F.2d 746, 748 (Fed. Cir. 1988).
b. RMA Engineering S.A.R.L.’s Claim For Wrongful Termination
(Count 1).
On August 4, 2010, the Army terminated the Contract for default. 2d Am. Compl. ¶ 95.
The Notice Of Termination states that the CO “determined that [RMA’s] failure to perform is not
excusable” and “constitutes a decision that [RMA] is in default as specified, and [RMA] has the
right to appeal under the Disputes [C]lause.” Gov’t App’x at 144. The Disputes Clause provides
that the Contract is “subject to the Contract Disputes Act of 1978, as amended[.]” Gov’t App’x at
80. The CDA states that “[w]ithin ninety days from the date of receipt of a [CO]’s decision under
[41 U.S.C. § 605], the contractor may appeal such decision to an agency board of contract
appeals[.]” 41 U.S.C. § 606. If a contractor elects to file a suit in the United States Court of
21
Federal Claims, a complaint must be filed within twelve months from the date of receipt of a CO’s
decision. Id. § 609(a)(3). Failure to file within the prescribed time period is fatal to a contractor’s
claim. See Renda Marine, Inc. v. United States, 509 F.3d 1372, 1380 (Fed. Cir. 2007) (“‘Absent
commencement of such review within the prescribed period of time, the decision becomes
impervious to any substantive review.’” (quoting United States v. Kasler Elec. Co., 123 F.3d 341,
346 (6th Cir. 1997))).
The August 4, 2010 Notice Of Termination is a claim by the Government against RMA
under the CDA. See Malone v. United States, 849 F.2d 1441, 1443 (Fed. Cir. 1988) (“[A]
government decision to terminate a contractor for default is a government claim.”). The CDA
requires that “[a]ll claims by the [G]overnment against a contractor relating to a contract shall be
the subject of a decision by the [CO].” 41 U.S.C. § 605(a). Section 609 of the CDA informs the
terminated contractor that it may appeal “the decision of a [CO] under [41 U.S.C. § 605]” in the
United States Court of Federal Claims. Id. § 609(a)(1). But, this section requires that “[a]ny action
under [41 U.S.C. § 609(a)(1)] shall be filed within twelve months from the date of the receipt by
the contractor of the decision of the [CO] concerning the claim.” Id. § 609(a)(3).
RMA argues that 41 U.S.C. § 609(a)(3) was not triggered by the August 4, 2010 Notice Of
Termination, but that is not correct, since it was a final decision by the CO. Gov’t App’x at 144.
RMA cites Pathman Construction as support for the proposition that the August 4, 2010 Notice
Of Termination was not a final decision, because it did not sufficiently notify RMA of the right of
appeal. Pl. Resp at 36–37. It is true that the United States Court Of Appeals for the Federal Circuit
has held that when a CO’s “final decision . . . does not [afford a] contractor adequate notice of
appeal rights,” that notice is defective and “does not trigger the running of the limitations period.”
Pathman Constr., 817 F.2d at 1578. Therefore, in Pathman, the plaintiff prevailed, because the
Government failed to provide any written notice of termination, much less one apprising the
contractor of the right to appeal. See id. (“Where a [CO] has not rendered a final decision, the
contractor has not been apprised of his appeal rights, as the [CDA] requires.”). That is not the
situation here, because the August 4, 2010 Notice stated that RMA “ha[d] the right to appeal under
the Disputes Clause.” Gov’t App’x at 144. Nor does RMA’s explanation that it is “not familiar
with the disputes process generally” (Pl. Resp. at 36–37) excuse RMA from reading the Contract
and complying with the Disputes Clause. See Turner Constr. Co. v. United States, 367 F.3d 1319,
1321 (Fed. Cir. 2004) (“The parties [to a Government contract] are charged with knowledge of
law and fact appropriate to the subject matter, and reasonable professional competence in reading
and writing contracts is presumed.”).
Because the Notice Of Termination informed RMA of the right to appeal under the CDA,
the court next determines whether the twelve-month statutory period began to run from the August
4, 2010 Notice Of Termination or from some later date. That depends on three factual predicates:
(1) whether RMA requested the CO to reconsider the termination; (2) whether the CO
demonstrated a willingness to reconsider; and (3) if so, when the CO issued a reconsideration
decision. See Guardian Angels Med. Serv. Dogs, Inc. v. United States, 809 F.3d 1244, 1248–50
(Fed. Cir. 2016) (rejecting an argument that the statutory appeals period ran from the date of the
Notice Of Termination, where the CO agreed to obtain and review materials relevant to
reconsideration of a decision to terminate a contract for default). Specifically, “[i]n evaluating
whether [a Notice Of Termination] qualified as a final [CO] decision sufficient to trigger the
22
twelve-month statutory appeal period, our focus must be on the [CO]’s actions, not on her own
after-the-fact characterization of those actions.” Id. at 1250.
On September 4, 2010, RMA sent a letter to the CO stating, “[b]y this document, [RMA]
requests that the Government change the termination from ‘Default’ to one of ‘Termination for the
Convenience of the Government,’ and restore [RMA’s] rights . . . as provided at paragraph I-49(c)
of the [C]ontract; and that [RMA] be reimbursed via an equitable adjustment to the [C]ontract[.]”
Gov’t App’x at 147. On July 4, 2011, RMA sent another letter to the CO, with an attachment
showing different costs than those submitted on September 4, 2010, although RMA did not repeat
its prior request to convert the default termination to one for the Government’s convenience.
Compare Gov’t App’x at 147–48 (9/4/10 letter requesting the termination for default be converted
to one for convenience), with Gov’t App’x at 149–52 (7/4/11 letter that did not request
reconsideration of the termination for default). No subsequent action was taken by the CO,
however, that reflected any willingness to reconsider the decision to terminate the Contract for
default.
In the alternative, RMA argues that the Army’s January 23, 2013 request that RMA submit
a SF 143620 evidences the CO’s willingness to reconsider whether RMA’s contract properly was
terminated for default. Pl. Resp. at 37. RMA reasons that, because the SF 1436 form is used in
negotiated settlements of fixed price contracts that are terminated for convenience, the CO was
willing to change the basis for RMA’s termination. See 48 C.F.R. §§ 49.103 (“Settlement of
terminated cost-reimbursement contracts and fixed-price contracts terminated for convenience
may be effected by (a) negotiated agreement[.]”), 49.206-2(b) (“When use of the inventory basis
is not practicable or will unduly delay settlement, the total-cost basis (SF-1436) may be used[,] if
approved in advance by the [termination CO.]”). Count 1, however, does not allege that the CO
ever requested a SF 1436. 2d Am. Compl. ¶ 90 (“On January 23, 2013, the Army recommended
that [RMA] submit Standard Form 1436[.]” (italics added)). In any event, even if the Army did
so, it occurred two and a half years after RMA’s August 23, 2013 request to reconsider the
termination. The United States Court of Appeals for the Federal Circuit has held that “courts have
uniformly concluded that administrative agencies possess inherent authority to reconsider their
decisions, subject to certain limitations, regardless of whether they possess explicit statutory
authority to do so.” Tokyo Kikai Seisakusho, Ltd. v. United States, 529 F.3d 1352, 1360 (Fed. Cir.
2008). But, that “inherent authority” exists only “in the absence of a specific statutory limitation,”
such as that provided by the CDA. Id. (quoting in parenthetical Macktal v. Chao, 286 F.3d 822,
825–26 (5th Cir. 2002)).
The CDA states that a CO’s final decision is “not subject to review by any forum, tribunal,
or Government agency, unless an appeal or suit is timely commenced[.]” 41 U.S.C. § 605(b)
(2006). Therefore, even if the CO requested a SF 1436 two years after the initial decision, at that
time, the CO did not have authority to reconsider RMA’s termination. See Dayley v. United States,
169 Ct. Cl. 305, 308 (Ct. Cl. 1965) (“[U]nless there is legislation to the contrary[,] it is the inherent
right of every tribunal to reconsider its own decisions within a short period after the making of the
20
SF 1436 is a standard form used to propose settlement terms for fixed-price contracts
terminated for the Government’s convenience. See 48 C.F.R. § 53.301-1436 (SF 1436 entitled
“Settlement Proposal (Total Cost Basis)”).
23
decision and before an appeal has been taken or other rights vested.”) (italics added).21 In this
case, the CO elected not to reconsider the termination of RMA’s Contract and RMA did not submit
that claim to the court in a timely manner. See 41 U.S.C. § 605(b).
For these reasons, the court has determined that it does not have jurisdiction to adjudicate
Count 1 of the Second Amended Complaint.
c. RMA Engineering S.A.R.L.’s Claims For Delay, Post-
Termination Costs, Breach of Contract, And Breach Of The
Duty Of Good Faith And Fair Dealing (Counts 2, 21, 22, and 23).
The Government also posits that the United States Court of Federal Claims does not have
jurisdiction to adjudicate the delay claims alleged in Count 2, the breach of contract claim alleged
in Count 22, and the breach of the duty of good faith and fair dealing claim alleged in Count 23.
Gov’t Mot. at 32–38. The court considers each of these arguments in turn.
Under the CDA, a claim for payment must first be presented to the CO for a final decision.
See 41 U.S.C. § 605(a). A contractor only may file a complaint in the United States Court of
Federal Claims, after a final decision is made by the CO.22 See 41 U.S.C. § 609(a)(1); see also K-
Con Bldg. Sys. Inc. v United States, 778 F.3d 1000, 1004 (Fed. Cir. 2015) (“Jurisdiction requires
both that a claim meeting certain requirements have been submitted to the relevant contacting
officer and that the [CO] have issued a final decision on that claim.”). The United States Court of
Appeals for the Federal Circuit has interpreted this requirement as authorizing the United States
Court of Federal Claims to adjudicate a CDA claim, if it arises from the “same operative facts”
and requests “essentially the same relief,” as a claim presented to the CO, even if the complaint
alleges a “slightly different legal theory” than was presented to the CO. See Scott Timber, 333
F.3d at 1365–66. But, a complaint that alleges a new claim, “either request[s] different remedies,”
e.g., expectation damages instead of consequential damages “or assert[s] grounds that are
materially different from each other factually or legally” first must be submitted to the CO. See
K-Con Bldg., 778 F.3d at 1005; see also id. at 1006 (“[M]erely adding factual detail or legal
21
The United States Court of Appeals for the Federal Circuit has held that United States
Court of Claims decisions, issued prior to September 30, 1982, are binding precedent.
See S. Corp. v. United States, 690 F.2d 1368, 1369 (Fed. Cir. 1982).
22
On July 10, 2010, RMA could have filed an appeal in the United States Court of Federal
Claims, because RMA’s claims statutorily were “deemed” denied, since the CO had not acted on
them. See 41 U.S.C. § 603(c)(5) (“Any failure by the [CO] to issue a decision on a contract claim
within the period required will be deemed to be a decision by the [CO] denying the claim and will
authorize [an] appeal or suit on the claim as otherwise provided in this chapter.”). RMA’s decision
not to do so, however, does not render the Second Amended Complaint time barred, since the CO
did not issue a final decision until December 15, 2013. See 41 U.S.C. § 609(a)(3) (2006) (“Any
action under [41 U.S.C. § 609(a)(1) or 41 U.S.C. § 609(a)(2)] shall be filed within twelve months
from the date of the receipt by the contractor of the decision of the [CO] concerning the claim.”);
see also Pathman Constr. Co., 817 F.2d at 1574 (“[T]he limitations period does not begin to run
until the [CO] renders an actual written decision on the contractor's claim[.]”).
24
argumentation does not create a different claim, but presenting a materially different factual or
legal theory . . . does create a different claim.”). Instead, “[a]ll that is required is that the contractor
submit in writing to the [CO] a clear and unequivocal statement that gives the [CO] adequate notice
of the basis and amount of that claim.” Contract Cleaning Maint., 811 F.2d at 592.
On May 10, 2010, RMA submitted a REA to the CO in the amount of $174,634, for
“additional foundation works and relocation of water main not included in the original contract
scope for this [P]roject.” Gov’t App’x at 146. The REA stated, “[i]n view of the substantial
documentation, explanations[,] and records indicating the increased quantities of excavations,
backfill, reinforced concrete, and water piping works that have been done by RM[A] and accepted
on site, we also request a fair and final decision on this subject by the [CO] on our behalf.” Gov’t
App’x at 146. The REA also represented that “supporting documents” were attached “by way of
evidence that work executed justifies the calculated amounts.” Gov’t App’x at 146. Neither the
Government nor RMA provided any of these “supporting documents” to the court.
On September 4, 2010, RMA sent a second REA to the CO requesting compensation for
“preliminary work” in the amount of $95,802.24. Gov’t App’x at 147. That REA stated that
“[RMA] has been faced with undisclosed material conditions at the construction site, unknown
physical conditions of an unusual nature, numerous changes to the [C]ontract, untoward delays, to
include frequent denials of access to the work site, and unlawful acts of non-authorized personnel
all of which have inequitably caused [RMA] to suffer additional costs in the amount of . . .
[$1,742,571.91].” Gov’t App’x at 148. RMA added that it “has substantial material in support of
its claim, to include daily logs of work progress and site conditions, correspondence by and
between [RMA] and Government officials[,] and records of unlawful actions by unauthorized
personnel, all of which shall be made available to the [CO] and government auditors in accordance
with applicable regulations at the Government’s request.” Gov’t App’x at 148. No supporting
data was attached to the September 4, 2010 REA, but a certification, required by FAR 33.207, was
included attesting that:
I, Jean Yves Rousseau, on behalf of the contractor, RMV Architects, certify that
this claim is made in good faith, that the supporting data are accurate and complete
to the best of my knowledge and belief; that the amount requested accurately
reflects the contract adjustment for which the contractor believes the Government
is liable; and that I am duly authorized to certify the claim on behalf of the
contractor.
Gov’t App’x at 148.
On July 4, 2011, RMA sent a third REA to the CO that stated:
Further to our letter no. 74 of June 26, 2011, where we indicated that RM[A] was
in the process of updating the amount formerly requested and claimed, please find
the enclosed RM[A] Statement of Costs. The RM[A] Statement of Costs describes
our claim and request for compensation due in excess of USD 2,297,959.
Gov’t App’x at 149.
25
The July 4, 2011 REA also stated, “[w]e also seize this opportunity to request further
guidance as to your expected time frame for the resolution of this matter.” Gov’t App’x at 149.
The attached Statement of Costs identified the following items for reimbursement:
 “[P]re-contract design” costs consisting of a “conceptual design phase;”
 “[P]roject construction extra charges” consisting of
o “Increased Cost – Denials of Access to the Work Site,”
o “Site Safety Standards Construction,”
o “Process of Submittal Procedure Approval,”
o “Site Access[;] ID Procedures System,”
o “RM[A] Construction Management Services,”
o “Cost of Site Demarcation,”
o “Re-design of Foundations & Footing + Waterline Relocation,”
o “Sunshades (3) Re-design (New Site Location),” and
o “As-Built Drawings Design;”
 “[C]onstruction additional works” consisting of
o “Site Generator Power Supply,”
o “REA #1 (Foundations & Footing),”
o “Telephone/Data Wiring,”
o “Main Circuit Breaker at SCECO Inst.,”
o “Bathrooms Plumbing Modifications,”
o “Pantry Network [at] First Floor,”
o “Main Water Supply Modification,”
o “[AHU] Overcost,”
o “Lighting Fixture Wiring/EMT,” and
o “Lighting Fixture After Standards Changes;”
 “[P]ost-contract” costs for material and equipment removal from the Project site;
 “[C]ost for managing wrongful termination for default;” and
 “[P]roject critical path.”
Gov’t App’x at 151–52.
On January 30, 2012, RMA sent a fourth REA to the CO stating that “untoward delays”
caused RMA 181 days of delay, at a to-be-determined cost. Gov’t App’x at 152 (listing costs for
181 days of delays as “TBD”). The reason cited for the delays was “frequent denials of access to
the work site.” Gov’t App’x at 148. The CO’s final decision listed three reasons why RMA’s
delay claim was denied. Gov’t App’x at 168. First, RMA “did not specifically identify[] or
provide documentation to support[] any delays of denials of access caused by the Government.”
Gov’t App’x at 168. Second, the “Critical Path Method” that RMA submitted to the CO was “only
a copy of daily reports and weekly meeting minutes showing items discussed and actions. The
item submitted does not qualify to be a critical path delay analysis and therefore was not analyzed
as such.” Gov’t App’x at 168. Third, RMA “did not provide any specific documentation on how
the Government delayed [its] performance.” Gov’t App’x at 168.
Count 2 alleges “the Project’s critical path was delayed a total of 181 days due to the delay
events beyond [RMA]’s fault or control.” 2d Am. Compl. ¶ 110. Count 2 does not, however,
explain how RMA arrived at 181 days, nor which of the delays described in the Second Amended
26
Complaint at paragraphs 15–16, 18, 21, 24–25, 28–29, 33, 36, 38–40, 44–50, 52–55, and 57–70
are included this Count. The potential Project site access delays were the only delay claims
presented to the CO for a final decision. 2d Am. Compl. ¶¶ 18, 21. These claims, however, were
deficient for other reasons identified by the CO. Gov’t App’x at 168.
For this reason, the court has determined that is does not have jurisdiction to adjudicate the
delay claims alleged in Count 2 of the Second Amended Complaint. See RCFC 12(b)(1).
The Government contends that, because the court does not have jurisdiction to adjudicate
the wrongful termination claim alleged in Count 1, it also does not have jurisdiction to adjudicate
the claims for post-termination costs alleged in Count 21. Not so. The court must independently
consider whether it has jurisdiction to adjudicate the claims alleged in Count 21. Count 21 of the
Second Amended Complaint alleges that, after contract termination, RMA incurred costs for
demobilization, preparation of updated as-built drawings, preparation of the Project’s Critical Path
Method graph, and “additional management costs that would not have been incurred but for the
wrongful termination.” 2d Am. Compl. ¶ 217. The July 4, 2011 REA listed “Post-Contract” costs
that included material and equipment removal, i.e., demobilization, “cost of managing wrongful
termination for default,” and “[P]roject critical path,” along with claimed amounts for each. Gov’t
App’x at 152. The July 4, 2011 REA also listed a claimed amount for “as-built drawings design”
under “Project Construction Extra Charges.” Gov’t App’x at 151. Therefore, the claims alleged
in Count 21 were timely presented to the CO.
Count 22 of the Second Amended Complaint alleges that the Government breached the
Contract. 2d Am. Compl. ¶¶ 218–23. “[A] breach of contract is a failure to perform a contractual
duty when it is due.” Trauma Serv. Grp. v. United States, 104 F.3d 1321, 1325 (Fed. Cir. 1997);
see also Franconia Assocs. v. United States, 536 U.S. 129, 142–43 (2002) (“Failure by the
promisor to perform at the time indicated for performance in the contract establishes an immediate
breach.”); RESTATEMENT (SECOND) OF CONTRACTS § 235(2) (“When performance of a duty under
a contract is due any non-performance is a breach.”). Although the Second Amended Complaint
alleges that the collective facts alleged in Counts 1 through 21 are tantamount to a breach of
contract, none of the REAs notified the CO that RMA claimed the Army breached the Contract by
failing to perform a contractual duty.
Count 23 of the Second Amended Complaint alleges that the Government breached the
implied duty of good faith and fair dealing. 2d Am. Compl. ¶¶ 224–27. In Reliance Insurance
Company, our appellate court held that the United States Court of Federal Claims did not have
jurisdiction to adjudicate a contractor’s claim that the Government breached the duty of good faith
and fair dealing, when the contractor “only submitted to the [CO] claims for equitable adjustment
to the contract.” 931 F.2d at 866. RMA contends that the operative facts of Counts 1 through 21
also support Count 23, i.e., a breach of the duty of good faith and fair dealing. See Scott Timber,
333 F.3d at 1365 (holding that claims are the same for jurisdictional purposes, if they “arise from
the same operative facts, claim essentially the same relief, and merely assert differing legal theories
for that recovery”).
As a matter of law, a contract is a predicate to a claim for the breach of the duty of good
faith and fair dealing, but the scope of the duty of good faith and fair dealing does not necessarily
require a breach of the underlying contract. See Metcalf Constr. Co. v. United States, 742 F.3d
27
984, 990–91 (Fed. Cir. 2014) (“What is promised or disclaimed in a contract helps define what
constitutes lack of diligence and interference with or failure to cooperate in the other party’s
performance. . . . In short, while the implied duty exists because it is rarely possible to anticipate
in contract language every possible action or omission by a party that undermines the bargain, the
nature of that bargain is central to keeping the duty focused on honoring the reasonable
expectations created by the . . . contracting parties.” (internal quotation marks and citations
omitted)). In this case, the REAs stated only that RMA was claiming additional costs for
“undisclosed material conditions at the construction site, unknown physical conditions of [an]
unusual nature, numerous changes to the contract, untoward delays[,] to include frequent denials
of access to the work site, and unlawful acts of non-authorized personnel all of which have
inequitably caused [RMA] to suffer additional costs in the amount of [$1,742,571.91].” Gov’t
App’x at 148. The REAs did not inform the CO that the Army interfered with RMA’s performance
or intended or attempted to destroy RMA’s reasonable expectations regarding the fruits of the
Contract, i.e., the operative facts of a claim for breach of the duty of good faith and fair dealing.
Gov't App'x at 146–59; see also Metcalf, 742 F.3d at 991 (“The covenant of good faith and fair
dealing imposes obligations on both contracting parties that include the duty not to interfere with
the other party’s performance and not to act so as to destroy the reasonable expectations of the
other party regarding the fruits of the contract.”) (internal quotation marks, omissions, and italics
omitted). Therefore, the REAs did not inform the CO that RMA was asserting a claim for breach
of the duty of good faith and fair dealing.
For these reasons, the court has determined that it does not have jurisdiction to adjudicate
the claims alleged in Counts 1, 2, 22, and 23 of the Second Amended Complaint. Therefore, those
claims are dismissed. See RCFC 12(b)(1). Since RMA provided the CO with the operative facts
concerning differing site conditions, the court has determined that it has jurisdiction to adjudicate
the claim alleged in Count 21.
D. The Government’s November 9, 2017 Motion To Dismiss, Pursuant To
RCFC 12(b)(6).
1. The Government’s Argument.
The Government next argues that Counts 3 through 20 of the Second Amended Complaint
fail to state claims for differing site conditions, constructive change, unjust enrichment,
misrepresentation of fact, or breach of implied in fact contract for two principal reasons. Gov’t
Mot. at 8–32. First, RMA agreed to a firm, fixed-price Contract requiring it to “furnish all labor,
materials, equipment, supervision[,] and resources required to design and construct New
Equipment Training Facilities[,] . . . including associated site work,” for the fixed price set in the
contract. Gov’t Mot. at 10–11 (citing Gov’t App’x at 7, 9). The United States Court of Appeals
for the Federal Circuit has held that “full payment under a valid fixed price-type contract is all to
which a contractor is entitled,” and the “risk of loss for misjudging what it takes to perform, or for
deliberately underbidding, is on the contractor, not the Government.” AT&T v. United States, 177
F.3d 1368, 1383–84 (Fed. Cir. 1999). The Contract provided that “[a]ny failure of [RMA] to take
the actions described and acknowledged [in FAR 52.236-3] will not relieve [RMA] from
responsibility for estimating properly the difficulty and cost of successfully performing the work,
or for proceeding to successfully perform the work without additional expense to the
Government.” Gov’t App’x at 84. In addition, RMA expressly acknowledged that it had: (1)
28
“taken steps reasonably necessary to ascertain the nature and location of the work[;]” (2)
“investigated and satisfied itself as to the general and local conditions [that] can affect the work or
[RMA’s] cost[;]” and (3) “satisfied itself as to the character, quality, and quantity of surface and
subsurface materials or obstacles to be encountered insofar as this information is reasonably
ascertainable[.]” Gov’t App’x at 84 (FAR 52.236-3, Site Investigation and Conditions Affecting
the Work).
Second, all of the allegedly additional work either was required as part of the firm, fixed-
price contract or was not authorized and thus not compensable. Gov’t Mot. at 13–32. Neither the
Second Amended Complaint nor its prior iterations23 allege that the CO, i.e., the only person with
authority to bind the Government, ordered or approved any additional work or cost beyond the
scope of the Contract. Gov’t Mot. at 14. Therefore, RMA seeks reimbursement, as if the Contract
was priced on a time-and-materials basis. Gov’t Mot. at 14. But, allowing RMA to recover for
the failure to exercise care in submitting an accurate bid would defeat the purpose of firm, fixed-
price contracts. See AT&T, 177 F.3d at 1383–84 (“[O]ur precedents are unequivocal that full
payment under a valid fixed price-type contract is all to which a contracting party is entitled. The
risk of loss for misjudging what it takes to perform, or for deliberately underbidding, is on the
contractor, not the Government.”).
Next, the Government discussed the specific deficiencies in Counts 3 through 20 of the
Second Amended Complaint. Count 3 alleges that the quality of the subsurface soils at the Project
site concerns a differing site condition, but fails to state a claim on which relief can be granted,
because RMA was responsible for taking reasonable steps to “ascertain the nature and location of
the [required] work[.]” Gov’t Mot. at 15 (citing Gov’t App’x at 84). The Contract stated that a
geotechnical study was necessary to “determine the subsurface conditions at the site.” Gov’t Mot.
at 15–16 (quoting Gov’t App’x at 11–13). RMA “agreed to perform the geotechnical study and to
incorporate the results into [RMA’s] foundation design for a firm[, ]fixed[-]price[.]” Gov’t Mot.
at 16 (citing Gov’t App’x at 7–15). As a matter of law, however, a contractor cannot seek
additional compensation where the contractor’s “willingness to hazard the contract was prompted
by an unwarranted assumption that it could ask for more money[,] if the geotechnical aspects of
the foundation proved to be difficult[,]” or where such assumptions were “compounded by [the
contractor’s] subsequent reliance on erroneous advice about the difficulty of preparing the
foundation, leading it to spend . . . far more than it budged for geotechnical work.” Liquidating
Tr. Ester Du Val of KI Liquidation, Inc. v. United States, 116 Fed. Cl. 338, 375 (Fed. Cl. 2014).
In addition, any allegations that the SANG made representations to RMA about the Project site’s
subsurface conditions, prior to contract award, are not relevant, because only the CO could
authorize changes to the Contract. Gov’t Mot. at 17 (citing Gov’t App’x at 27); see also Three S
Consulting v. United States, 104 Fed. Cl. 510, 523 (Fed. Cl. 2012), aff’d, 562 F. App’x 964 (Fed.
23
The First Amended Complaint alleged that the CO and an individual mistakenly
identified as the CO’s “replacement” told RMA to follow instructions from the JET, although this
allegation was not present in the Second Amended Complaint. Compare 1st Am. Compl. ¶ 12
(“The Army’s [CO] for the Project . . . and [her] replacement . . . worsened this ambiguity by
telling RM[A] that RM[A] was to take direction from [the] JET[.]”), with 2d Am. Compl. (omitting
this allegation).
29
Cir. 2014) (“[O]nly the [CO] has authority to enter into, administer, or terminate contracts and
make related determinations and findings.” (internal quotation marks omitted)).
Counts 4 through 9 fail to state claims for constructive change for: (1) providing generators;
(2) installing telephone and data wiring; (3) installing a main circuit breaker; (4) making changes
to toilet plumbing at the behest of the JET; (5) building a pantry instead of a store room; and (6)
installing a larger AHU than planned. 2d Am. Compl. ¶¶ 122–55. None of these Counts, however,
allege “whether or how many of the materials, finishes, or methods differed from the specifications
and drawings attached to the [C]ontract.” Gov’t Mot. at 29. Neither do they take account of the
fact that RMA agreed to perform all necessary work to construct the office building and warehouse
for a firm, fixed-price and specifications for that work were included in the Contract. Gov’t Mot.
at 28–29 (citing Gov’t App’x at 7, 121, 123). Nor do they allege that “such changes were ordered
or authorized by anyone with authority to bind the United States.” Gov’t Mot. at 30 (citing
Winter v. Cath-dr/Balti Joint Venture, 497 F.3d 1339, 1344 (Fed. Cir. 2007) (“To demonstrate
entitlement to an equitable adjustment, [a plaintiff] must prove that the contract was modified by
someone with actual authority. Where a party contracts with the government, apparent authority
of the government’s agent to modify the contract is not sufficient; an agent must have actual
authority to bind the government.”)).
Counts 10 and 11 also fail to state claims for constructive change or differing site
conditions, because the Contract required RMA to “perform all necessary utility connections as
part of the site works line item,” including “locating, verifying, relocating, connecting, and
repairing water lines[.]” Gov’t Mot at 24–25 (citing Gov’t App’x at 15, 33, 37, 84, 86, 138–140;
see also Comtrol, Inc. v. United States, 294 F.3d 1357, 1365 (Fed. Cir. 2002) (affirming dismissal
of claim relating to relocation of pipeline, because the drawings put the contractor “on notice that
a [] pipeline recently existed and that its relocation was anticipated,” and “a reasonable contractor
[therefore] would have inquired about the location and condition of the pipeline”). RMA’s
allegation that the water line was not located where the Army represented does not support Counts
10 and 11, because the Contract required RMA to verify “locations of nearest utility tie-ins . . .
during site visits and preliminary surveys prior to offer[.]” Gov’t App’x at 33 (italics in original).
The Contract also provided that RMA warranted that it had taken all necessary steps to “ascertain
the nature and location of the work” before the Contract was awarded, including investigating and
satisfying itself “as to the general and local conditions which can affect the work or [RMA’s] cost,”
such as “the availability of . . . water, electric power, and roads” and “the conformation and
conditions of the ground.” Gov’t App’x at 84.
Counts 12, 13, and 14 fail to state a claim for constructive change for work that RMA
performed when the “Defendant” allegedly caused RMA to: (1) replace and reinstall the conduit
and wiring; (2) remove and reinstall light fixtures; and (3) install a different waterproof membrane
on the administrative building’s roof. 2d Am. Compl. ¶¶ 170–88. As with Counts 4 through 9,
these counts fail to allege how the work exceeded the Contract’s scope or that the CO authorized
any changes that would give rise to a claim for constructive change. Gov’t Mot. at 27–30.
Counts 15 and 16 fail to state claims for breach of an implied in fact contract,
misrepresentation, or unjust enrichment, because they respectively allege that RMA performed
design work prior to contract award for which it was not compensated and “the Government” failed
to fulfill a promise to award future contracts in exchange for RMA bidding on the Project. 2d Am.
30
Compl. ¶¶ 189–203. The Contract, however, required RMA to perform all design work for a firm,
fixed-price. Gov’t Mot. at 27 (citing Gov’t App’x at 7; 48 C.F.R. § 16.202-1). “[O]ral
explanations or instructions given before the award of the contract [are not] binding.” Gov’t Mot.
at 27 (quoting Manuel Bros. v. United States, 55 Fed. Cl. 8, 37 (Fed. Cl. 2002) (determining that,
because oral statements regarding “normal soils” were made at a pre-bid conference but were not
incorporated in the contract, a contractor should not have relied on those statements when
preparing its bid), aff’d, 95 F. App’x 344 (Fed. Cir. 2004); see also Oppenheim v. United States,
No. 07-852T, 2009 WL 586118, at *7 (Fed. Cl. Mar. 6, 2009) (determining that plaintiffs could
not “disavow the terms to which they agreed,” namely, that there was to be a fixed schedule of
predetermined payments); S&M Mgmt. Inc. v. United States, 82 Fed. Cl. 240, 249 (Fed. Cl. 2008)
(determining that representatives of the CO did not have authority to orally modify the contract
where such authority was expressly disclaimed by the contract terms)).
Count 17 of the Second Amended Complaint also fails to state a claim for constructive
change, because it does not describe how the allegedly-changed design submittal and approval
process deviated from the Contract’s terms. Gov’t Mot. at 19. The Contract called for a “three-
phase incremental design submittal and approval process for a firm[, ]fixed[-]price[,]” for RMA
to submit to the SANG “drawings and designs for each part of the [P]roject . . . for approval prior
to construction,” and for “incremental submission of design drawings, review and comment by
[the] JET, and incorporation of [the] JET’s comments into revised final drawings prior to
construction.” Gov’t Mot. at 19 (citing Gov’t App’x at 7, 10, 11–12). RMA also was required to
maintain “up-to-date as-built drawings on a daily basis” and the CO was to review and approve
the “final set of as-built” drawings . . . ‘at the time of final inspection of each facility.’” Gov’t
Mot. at 20 (citing Gov’t App’x at 41). The process that the JET requested to be used in November
2009 was identical to that required by the Contract. Gov’t Mot. at 20 (citing 2d Am. Compl. ¶¶
205–07; Gov’t App’x at 10–12, 133–41). Moreover, the Contract expressly disavowed any
understandings or representations not incorporated into the contract. Gov’t App’x at 84.
Likewise, Counts 18 and 19 allege that “unreasonably stringent safety measures” and
“increased security measures” were constructive changes to the [C]ontract, but RMA agreed to the
“extensive safety, security, and site access measures as part of the [C]ontract, including the
measures alleged in these counts.” Gov’t Mot. at 21. But, the Contract required RMA to: “(1)
provide detailed information for each worker’s identification pass[;]” (2) “provide updated
information at least ten days ahead of time for new workers[;]” (3) “obtain all necessary
‘authorizations, permits, and licenses necessary [for] quarry operations, batch plant operations,
and haul routes[;]’” (4) provide descriptions and advance notice for “‘proper clearance . . . from
the Saudi Arabian Government’ for all personnel and equipment[;]” and (5) follow and abide by
“applicable Saudi Arabian Government laws and regulations[.]” Gov’t Mot. at 21–22, (citing
Gov’t App’x at 33–38). In addition, the Contract’s safety clause required RMA to “provide and
maintain environments and procedures” that will “safeguard the public and Government personnel,
property, materials, supplies, and equipment” throughout the Project site, and to “submit a written
proposed plan for implementing this [safety] clause . . . before commencing work[.]” Gov’t Mot.
at 22 (quoting Gov’t App’x at 88). The CO could “notify the contractor . . . and request immediate
initiation of corrective action,” if the CO learned of any noncompliance with the safety clause.
Gov’t Mot. at 22 (quoting Gov’t App’x at 88). Counts 18 and 19, however, “do[] not claim that
the procedures . . . in the [C]ontract were modified in any way.” Gov’t Mot at 23 (citing 2d Am.
Compl. ¶¶ 209–13). To the extent that they allege that the “Army or [the SANG] imposed
31
procedures above and beyond those specified in the [C]ontract,” such conclusory allegations do
not explain how the “alleged safety, security, or site access procedures exceeded the requirements
in the [C]ontract and regulations[.]” Gov’t Mot. at 23 (citing Compl. ¶ 210; 29 C.F.R. §§
1926.501–1926.502 (fall protection); 29 C.F.R. § 1926.1052 (stairways); 29 C.F.R. §§ 1926.450–
1926.454 (scaffolds)); see also Brooks v. United States, No. 14-228C, 2014 WL 4930905, at *2
(dismissing a case for failure to provide sufficient information “necessary for this case to
proceed”).
Count 20 does not state a claim for constructive change, as it fails to describe any design
work that “exceeded the scope of the firm[, ]fixed-price [C]ontract, nor that any changes were
ordered or authorized by the [CO].” Gov’t Mot. at 25–26 (citing, e.g., Brooks, 2014 WL 4930905,
at *2 (dismissing vague and unsupported allegations for failure to state a claim); Jones, 122 Fed.
Cl. 543, 545–46 (Fed. Cl. 2015) (same)). RMA agreed to construct a training shelter that would
be complete and usable according to previously approved design drawings. Gov’t Mot. at 26
(citing Gov’t App’x at 9, 12). The Contract also required RMA to maintain an adequate inspection
system by conducting inspections, maintaining records, and furnishing “all facilities, land, labor,
and material reasonably needed for performing [the inspections and tests.]” Gov’t Mot. at 26
(citing Gov’t App’x at 18). In addition, the Contract required RMA to conduct all work under the
“‘general direction of the [CO] . . . to ensure strict compliance with the terms of the [C]ontract’”
and “replace or correct work found by the Government not to conform to [C]ontract requirements”
at no increase in contract price unless Government consented to adjusting the contract price. Gov’t
Mot. at 26 (italics omitted) (quoting Gov’t App’x at 18).
Nor do vague allegations that “the Army,” “the Defendant,” or “the Government” may
have instituted changes plausibly suggest that the CO ordered or authorized them. Gov’t Mot. at
31 (quoting 2d Am. Compl. ¶¶ 4–7, 9, 12, 14).
Finally, Count 21 fails to state a claim for post-termination costs, because RMA had twelve
months from the date it received the August 4, 2010 Notice Of Termination to file a complaint in
the United States Court of Federal Claims. See 41 U.S.C. § 609(a)(3).24 RMA did not do so until
December 15, 2014. Gov’t Mot. at 36 (citing Compl. ¶ 20).
2. RMA Engineering S.A.R.L.’s Response.
RMA responds that the Second Amended Complaint sufficiently pled causes of action for
compensation for additional work. Pl. Resp. at 10–31. Count 3 sets forth “elements necessary to
establish a claim for additional costs due to differing site conditions[]:” the subsurface conditions
in the contract differed materially from actual conditions; the actual conditions were reasonably
unforeseeable based on available pre-award information; RMA reasonably relied on the Contract;
and RMA suffered damages as a result of material variation between actual and represented
24
The Government’s argument appears to be that, if the court determines that it has
jurisdiction to adjudicate Count 21, pursuant to RCFC 12(b)(1), nevertheless, failure to file a
complaint within twelve months prohibits the court from granting relief, pursuant to RCFC
12(b)(6). See Gov’t Mot. at 36 (“Counts 1 and 21 . . . should therefore be dismissed as untimely
pursuant to RCFC 12(b)(1) or RCFC 12(b)(6).”).
32
conditions. Pl. Resp. at 13 (citing Comtrol, 294 F.3d at 136225 (listing elements required to state
a claim for differing site conditions)). Count 3 also sufficiently alleges both Type 1 and Type 2
differing site conditions, because the unsuitable soil discovered during a post-award geotechnical
investigation was unforeseeable at the time of award and differed materially from the
Government’s pre-award representations. Pl. Resp. at 10–12 (citing 2d Am. Compl. ¶¶ 114–15,
117, 121; see also Randa/Madison Joint Venture III v. Dahlberg, 239 F.3d 1264, 126926 (Fed. Cir.
2001) (discussing the difference between Type I and Type II differing site conditions)). The
Government’s claim that RMA assumed the risk of all unknown subsurface conditions contradicts
the differing site conditions clause. Pl. Resp. at 11 (citing Pl. App’x at 5). This is so, because the
Contract states that the duty to investigate the site before award extends to the “character, quality,
and quantity of surface and subsurface materials or obstacles to be encountered insofar as this
information is reasonably ascertainable from an inspection of the site[.]” Pl. Resp. at 11 (italics
in original) (quoting Pl. App’x at 81). The pre-award investigation did not show the information
RGF found in the “subsequent soils.” 2d Am. Compl. ¶ 115.
Count 4 alleges that RMA incurred additional costs to supply electric generators and states
a plausible claim for constructive change. 2d Am. Compl. ¶¶ 123–27. Although the Government
refers to a provision stating that “electrical service is not available for use under this [C]ontract[,]”
in fact, the Contract states that the “owner will furnish the necessary electrical power,” to allow
RMA to perform testing on electrical systems. Pl. Resp. at 14–15 (bold and italics omitted) (citing
Gov’t Mot. at 29) (quoting Technical Specification Section 16415, “Electrical Work, Interior,”
Subsection 3.2).27
Count 5 states a claim for constructive change, because the communications provision of
the Contract “did not require[] [RMA] to install telephone/data wiring in the administrative
building or warehouse[.]” Pl. Resp. at 15 (citing 2d Am. Compl. ¶¶ 129, 131; Pl. App’x at 127–
28).
Count 6 states a claim for constructive change, because the Government “does not state
which [C]ontract provision allegedly required [RMA] to install a main circuit breaker.” Pl. Resp.
at 16. Because the “main circuit breaker was required to bring power to the new building,” RMA
installed the main circuit breaker “[w]ith [the Army’s] knowledge” and the CO “knowingly
accepted the benefits of the new main circuit breaker;” as such, “[the Army] should . . . compensate
[RMA.]” Pl. Resp. at 16 (citing 2d Am. Compl. ¶¶ 134, 136).
Count 7 states a claim for constructive change arising from changes made to the toilet
plumbing. Pl. Resp. at 17–18 (citing 2d Am. Compl. ¶¶ 139–43). The Army knew or should have
25
Since RMA did not provide a pinpoint citation, the court has supplied one that appears
most relevant.
26
Since RMA did not provide a pinpoint citation, the court has supplied one that appears
most relevant.
27
Although RMA refers to Technical Specifications associated with the Contract several
times, RMA did not provide the court with these Technical Specifications.
33
known of the plumbing changes and, in any event, accepted the benefits of the additional plumbing
work. Pl. Resp. at 17 (citing 2d Am. Compl. ¶¶ 141–42). Although the Government references
the technical specifications index that included a plumbing section, RMA argues that the technical
specification does not justify the inspectors’ decision to compel RMA to redo certain toilet
plumbing work. Pl. Resp. at 17.
Counts 8 and 9 also sufficiently state constructive change claims, regarding RMA building
a pantry, instead of a store room, and installing a larger 18-ton AHU than initially required. Pl.
Resp. at 18–20. RMA contends that the CO knew or should have known that this work was
requested. Pl. Resp. at 18–19.28 Similarly, the CO also knew or should have known that RMA
was “forced to perform” tasks necessary to install the larger AHU, and therefore “cannot stand
idly by as a contractor performs additional work[,] accept the benefits of this additional work[,]
and . . . [not] pay for it.” Pl. Resp. 19–20. The Army is liable for this work “by . . . ratification.”
Pl. Resp. at 20.
Count 10 states a claim for differing site conditions, because the waterline’s location
differed from the location shown on the drawing provided by the Army, and “differed materially
from conditions ordinarily found to exist.” Pl. Resp. at 20 (citing 2d Am. Compl. ¶¶ 157, 162–
63). RMA argues that the Army was informed of this in an October 3, 2009 letter and the COR
agreed that the waterline must be relocated. Pl. Resp. at 21. Accordingly, RMA “moved the
waterline from the existing location to the location described in the As-Built Drawing SANG 2030-
5007.” Pl. Resp. at 21 (citing 2d Am. Compl. ¶ 161). The Government’s argument that RMA
assumed the risk that it would have to relocate the waterline does not obviate the differing site
conditions Clause. Pl. Resp. at 21 (citing Gov’t Mot. at 25 (citing Pl. App’x at 32, 63–64); see
also Weeks Dredging & Constr. v. United States, 13 Cl. Ct. 193, 238 (Cl. Ct. 1987) (determining
that, although “the case law holds that a contractor need not conduct its own surveys or borings,
nor hire its own geologist and geotechnical engineer[,]” a contractor nevertheless is “accountable
to discover and pursue reasonable indications . . . which would put a reasonable and prudent
contractor . . . on notice that there may be subsurface conditions different than those indicated in
the contract[.]”); Farnsworth & Chambers Co. v. United States, 171 Ct. Cl. 30, 35 (1965) (holding
that a pre-award inspection provision does not “obligate bidders to discover, at their peril,
subsurface conditions hidden by the river’s water and thus unavailable to any reasonable pre-award
inspection”)).
Count 11 states a claim for constructive change that should be granted for the same reasons
as Count 10. Pl. Resp. at 20–21.29
28
RMA relies on new factual allegations contained in the proposed Third Amended
Complaint to support this proposition; therefore, the court does not address this argument in
determining whether the Second Amended Complaint states a claim on which relief can be granted.
29
Count 10 alleges that the waterline’s location was a differing site condition. 2d Am.
Compl. ¶¶ 156–65. Count 11, however, alleges that connecting the waterline was a constructive
change. 2d Am. Compl. ¶ 168 (“This . . . waterline connection work was not factored into [RMA]’s
proposal and constituted a constructive, if not actual, change to the contract.”). Differing site
conditions and constructive change are different legal claims, therefore, reasons offered to support
34
Count 12 states a claim for constructive change, because “Defendant . . . directed [RMA]
to replace” the installed PVC conduit with metal conduit after RMA installed most of the wiring.
Pl. Resp. at 21–22 (citing 2d Am. Compl. ¶ 172). Therefore, the Army knew or should have known
that RMA was required to change the electrical conduit and wiring for the light fixtures. Pl. Resp.
at 22.
Counts 13 states a claim for constructive change, because the JET verbally approved the
light fixture changes during a February 3, 2010 meeting and, on June 28, 2010, “Defendant finally
approved light fixtures,” thereby effecting a constructive change to the contract. Pl. Resp. at 23
(quoting 2d Am. Compl. ¶ 178).
Count 14 states a claim for constructive change, because the “Defendant requested a
double[-]layer EPDM membrane instead of a single layer” on the roof after RMA planned,
submitted, and substantially completed the single[-]layer roofing and waterproofing system. Pl.
Resp. at 24. RMA argues that “the [CO] or [an] individual acting as the [CO]’s ‘eyes and ears’
cannot stand idly by as a contractor performs additional work[,] accept the benefits of this
additional work[,] and then refuse to pay for it.” Pl. Resp. at 24.
Count 15 states a “cognizable claim under the theory of misrepresentation of fact.” Pl.
Resp. at 25–26 (citing 2d Am. Compl. ¶¶ 190, 192–96, 198). RMA argues that it “provided
valuable design services based on Defendant’s representations or promise that it would pay for
them in a follow-on sole source construction contract[, the Defendant] failed to fulfill this promise
and never paid [RMA] for these design services[, and therefore RMA] is entitled to compensation
under a misrepresentation theory of relief.” Pl. Resp. at 26.
Count 16 also states a claim for misrepresentation, because RMA entered into a contract at
a reduced price for design services. Pl. Resp. at 27. “A government contractor . . . may recover
damages when the contractor reasonabl[y] relies on incorrect representations made by the
Government in entering into a contract.” Manuel Bros., 55 Fed. Cl. at 36, aff’d, 95 F. App’x 344.
Count 17 states a claim for constructive change, because the Second Amended Complaint
alleges the “Defendant” engaged in an unreasonable and burdensome review process. Pl. Resp. at
28. This claim cannot be dismissed under RCFC 12(b)(6), as it “requires a deeper inquiry into the
reasonableness of Defendant’s review of Plaintiff’s submittals.” Pl. Resp. at 28.
Count 18 states a claim for constructive change, although it does not cite specific Contract
safety provisions, since they are part of the Contract. Pl. Resp. at 28–30 (citing Pl. App’x at 85–
86). Therefore, it is premature at this juncture to decide “whether the safety requirements imposed
on the Project exceeded what was agreed to between the parties.” Pl. Resp. at 29. For purposes
of this motion, the United States Court of Federal Claims must assume that RMA’s allegations are
true and the Government imposed unreasonably stringent safety measures causing RMA to incur
additional costs unaccounted for in RMA’s proposal. Pl. Resp. at 29. The Government relies on
regulations cited in the Contract, but the fact that the safety measures imposed on RMA are
why Count 10 states a claim for differing site conditions do not support that Count 11 states a
claim for constructive change.
35
included in Title 29 does not render the Government’s decision to impose those requirements
automatically reasonable. Pl. Resp. 29 (citing 29 C.F.R. §§ 1926.450–54, 1926.501(b)(1),
1926.1051;30 see also CEMS, Inc. v. United States, 59 Fed. Cl. 168, 197–98 (Fed. Cl. 2003)
(“Although the government may insist upon contractor compliance with the terms of the contract,
the government cannot impose a more stringent testing procedure or standard for demonstrating
compliance than is set forth in the contract.”) (internal quotation marks omitted)).
Count 19 states a claim for constructive change, because the Army “failed to assist in
expediting or streamlining security checks for RMA’s personnel, suppliers, and subcontractors,”
and, therefore, violated the Government’s duty to cooperate, not hinder a contractor’s
performance, and Section H.28 of the Contract. Pl. Resp. at 30 (citing 2d Am. Compl. ¶ 70; Pl.
App’x at 38 (requiring RMA and the CO to “develop a mutual understanding relative to the
scheduling of the work . . . so that [RMA]’s proposed construction schedule is coordinated with
the operating and security requirements of the installation”)). Neither Section H nor any other
section of the Contract requires RMA’s workers to update their security badges and vehicle
identifications every fifteen days. Pl. Resp. at 30.
Count 20 states a claim for constructive change, although it does not allege why RMA was
required to redesign the covered training shelter multiple times. Pl. Resp. at 30–31. The only
reasonable inference from the fact that RMA is seeking compensation for the multiple redesigns
is that the Government acted unreasonably in requiring the multiple redesigns. Pl. Resp. at 30–31.
Even if the CO did not expressly approve the additional work, Count 20 sets forth a plausible cause
of action, based on ratification. Pl. Resp. at 31–34 (citing Villars v. United States, 126 Fed. Cl.
626, 633 (Fed. Cl. 2016) (“Individual ratification occurs when a supervisor: (1) possesses the
actual authority to contract; (2) fully knew the material facts surrounding the unauthorized action
of his or her subordinate; and (3) knowingly confirmed, adopted, or acquiesced to the unauthorized
action of the subordinate. . . . In contrast, institutional ratification occurs when the government
‘seeks and receives the benefits from an otherwise unauthorized contract.’” (citations omitted)).
In sum, all of the claims for constructive change allege facts that the court must consider
as true, i.e., the CO effectively allowed Saudi Arabian General Saud to administer the Contract
through the JET. Pl. Resp. at 31–32. Therefore, the CO and the Army knew or should have known
that the additional work was performed by RMA and the Army accepted the benefits, rendering
the Army liable to RMA under ratification. Pl. Resp. at 32.
3. The Government’s Reply.
The Government adds that, as to RMA’s differing site condition claims in Counts 3 and
10, the Differing Site Conditions Clause provides that RMA “cannot seek additional compensation
under [the] provision for subsurface conditions which were not ‘indicated in the contract[.]’”
Gov’t Reply at 7–8 (citing Pl. Resp. at 12).31 The Contract made no statement about subsurface
30
RMA cites to “29 C.F.R. § 126,” that does not exist. The court has replaced that citation
with 29 C.F.R. § 1926.450–54, describing regulations related to scaffolding.
31
In addition, RMA’s history of changing allegations provides good reason for the court
to doubt that the Army told RMA that subsurface conditions were appropriate for construction.
36
conditions except that: (1) they were unknown; (2) a geotechnical survey was required; and (3) the
original foundation plans may need to be modified. Compare H.B. Mac, Inc. v. United States, 153
F.3d 1338, 1345 (Fed. Cir. 1998) (“A contractor cannot be eligible for an equitable adjustment for
a Type I differing site condition unless the contract indicated what that condition would be.”)),
with Gov’t App’x at 11–13 (the Contract requires RMA to conduct a geotechnical investigation,
the purpose of which was to “establish soil bearing capacity”)). Therefore, any assumptions that
RMA made about the subsurface conditions were not warranted. See H.B. Mac, 153 F.3d at 1347
(“[A] reasonably prudent contractor would have realized the relatively limited scope and utility of
the information the government was intending to provide.”).
RMA argues that the subsurface conditions were different from what “Defendant”
represented, but that is insufficient to support a differing site condition claim. Gov’t Reply at 9
(citing Pl. Resp. at 11; see also Manuel Bros., 55 Fed. Cl. at 36–37, aff’d, 95 F. App’x 344 (Fed.
Cir. 2004) (holding that a contractor could not rely on oral statements about subsurface conditions
allegedly made by CO that were not incorporated into a contract)). In addition, RMA’s Response
introduces a new theory that Count 3 is a Type II differing site condition. Gov’t Reply at 12 (citing
Pl. Resp. at 11). Differing site condition claims generally are Type I claims, where subsurface or
latent physical conditions are different from those indicated in the contract. Gov’t Reply at 12
(citing Renda Marine, 509 F.3d at 1376 (“A Type I differing site condition arises when the
conditions encountered differ from what was indicated in the contract documents.”); see also
Comtrol, 294 F.3d at 1362 (“To establish entitlement to an equitable adjustment due to a Type I
differing site condition, a contractor must prove, by preponderant evidence, that: the conditions
indicated in the contract differ materially from those actually encountered during performance; the
conditions actually encountered were reasonably unforeseeable based on all information available
to the contractor at the time of bidding; the contractor reasonably relied upon its interpretation of
the contract and contract-related documents; and the contractor was damaged as a result of the
material variation between expected and encountered conditions.”).
Count 10 (differing site condition) and Count 11 (constructive change) also fail to state
claims upon which relief can be granted. Gov’t Reply at 12–13. Other than alleging that RMA
did not know or have a reason to know where the waterline was located, the Second Amended
Complaint does not allege beyond “speculation” that the difficulties encountered were extra-
contractual. Gov’t Reply at 13 (citing Pl. Resp. at 20).
RMA’s constructive change claims in Counts 4 through 9 and 12 through 14 also fail to
identify any changes to or deviations from the Contract’s requirements and do not allege that the
CO ordered or authorized the changes allegedly made to various materials, methods, and finishes.
Gov’t Reply at 18–22 (citing Gov’t App’x at 27). “Such allegations are insufficient as a matter of
See Bradley v. Chiron Corp., 136 F.3d 1317, 1324–25 (Fed. Cir. 1998) (discussing inconsistencies
between an original and First Amended Complaint, and discrepancies between First and Second
Amended Complaints, and holding that a district court did not abuse its discretion in rejecting the
changes “as sham”). The original Complaint, filed December 15, 2014, alleged that a member of
the SANG told RMA that subsurface conditions were suitable for construction, but RMA’s First
Amended Complaint eliminated that allegation. Compare Compl. ¶ 31, with 1st Am. Compl. (no
allegations that anyone made representations regarding subsurface conditions).
37
law to support a claim for damages under a firm[, ]fixed-price contract which expressly require[s]
authorization [by the CO executing such changes].” Gov’t Reply at 20 (citing Gov’t App’x at 27
(“No changes in or deviation from the scope of work shall be effected without a modification
executed by the [CO] authorizing such changes. . . . The COR is not authorized to make any
commitments or changes that will affect price, quality, quantity, delivery, or any other term or
condition of the contract.”); see also Cath-dr/Balti Joint Venture, 497 F.3d at 1344 (“To
demonstrate entitlement to an equitable adjustment, [a plaintiff] must prove that the contract was
modified by someone with actual authority.”). RMA’s argument that the CO “ratified” additional
work is based on Villars v. United States, 126 Fed. Cl. 626 (Fed. Cl. 2016), but reliance on that
case is misplaced, as it concerned “whether the government may have ratified an unauthorized
contract with plaintiff[,]” not whether alleged changes to the scope of a valid contract may be
ratified. Gov’t Reply at 21.
As to RMA’s misrepresentation claims in Counts 15 and 16, RMA “expressly agreed” that
the Army would not be liable for any “understanding reached or representation made concerning
conditions which can affect the work by any of its officers or agents before the execution of this
[C]ontract, unless that understanding or representation is expressly stated in [the C]ontract.” Gov’t
App’x at 84. A pleading’s “factual contentions [must] have evidentiary support or, if specifically
so identified, [must be] likely [to] have evidentiary support after a reasonable opportunity for
further investigation and discovery[.]” RCFC 11(b)(3). RMA expressly agreed in the Contract to
perform a geotechnical survey to “establish soil bearing capacity and other soil characteristics”
and “verify or modify the foundation design . . . as necessary.” Gov’t App’x at 11–15. Therefore,
RMA agreed to perform the geotechnical survey and all necessary work to construct the office
building and warehouse for a firm, fixed-price, although the Contract stated that the subsurface
conditions were unknown. Gov’t App’x 7–8, 12. As such, “the risk of loss for misjudging what
it takes to perform, or for deliberately underbidding, is on the contractor, not the Government.”
AT&T, 177 F.3d at 1383–84.
Specifically, Count 15 fails to state a claim for misrepresentation, because RMA agreed to
perform the pre-award design work for a firm, fixed-price. Gov’t Reply at 17–18 (citing Gov’t
App’x at 7). Therefore, “RMA is not entitled to additional compensation beyond the agreed upon
amount as a matter of law.” Gov’t Reply at 17 (citing Gov’t App’x at 7). Contractors cannot rely
on oral promises made pre-award. See Manuel Bros., 55 Fed. Cl. at 36–37, aff’d, 95 F. App’x 344.
RMA relies on Kenney Orthopedic, LLC v. United States, 103 Fed. Cl. 455, 462–63 (Fed. Cl. 2012)
and Gregory Lumber Co. v. United States, 9 Cl. Ct. 503, 526 (Cl. Ct. 1986), to support RMA’s
argument that it may recover for pre-award design work, based on “misrepresentation.” Gov’t
Reply at 17–18. Unlike the contracts in those cases, however, the Contract in this case disclaimed
liability for pre-award representations. Gov’t Reply at 18 (citing Gov’t App’x at 84). In addition,
Count 16 fails to state a claim for constructive change, because it does not plead a claim for cost
overruns. Gov’t Reply at 16. Manuel Brothers stands for the proposition that a contractor may
recover damages for misrepresentations in the contract. See 55 Fed. Cl. at 36. Likewise, Count
16 identifies no misrepresentation in the Contract; instead, Count 16 alleges that pre-award
statements were made by unnamed Government representatives, including the COR. Gov’t Reply
at 16–17. The Contract, however, prohibits RMA from relying on oral promises. Gov’t Reply at
17 (citing Gov’t App’x at 84).
38
Count 17 fails to state a claim for constructive change, because the “deeper inquiry” RMA
seeks is allowed “only when a plaintiff plausibly alleges a valid claim for relief under the
applicable law.” Gov’t Reply 13–14 (citing Cary v. United States, 552 F.3d 1373, 1376 (Fed. Cir.
2009) (“The factual allegations must be enough to raise a right to relief above the speculative
level. . . . This does not require the plaintiff to set out in detail the facts upon which the claim is
based, but enough facts to state a claim to relief that is plausible on its face.” (citations omitted))).
RMA’s allegations are conclusory and insufficient to state a plausible claim, as they do not
describe how or why the submittal review process was unreasonable. Gov’t Reply at 14 (citing
Jones, 122 Fed. Cl. at 545–46 (dismissing claim based on “vague assertions against the
government . . . devoid of any factual support”)).
Counts 18 and 19 fail to state claims for constructive change, because RMA did not
identify or describe any changes or deviations from the Contract. Gov’t Reply at 14–15. Dismissal
is appropriate as Counts 18 and 19 do not state plausible allegations. Gov’t Reply at 15 (citing Pl.
Resp. at 29). “Plausible” means that the claim includes “factual allegations [sufficient] to raise a
right to relief above the speculative level.” Cary, 552 F.3d at 1376 (citation omitted). RMA does
not allege that the Army imposed any safety and security measures beyond what the contract
required. Gov’t Reply at 15 (italics omitted) (citing Pl. Resp. at 29).
Count 20 fails to state a claim for constructive change, because it fails to allege that RMA’s
original designs complied with the Contract’s requirements. Gov’t Reply at 15–16 (citing Pl. Resp.
30–31). The Contract required RMA to construct a training shelter in accordance with the terms
and requirements therein. Gov’t Reply at 15 (citing Pl. Resp. at 30–31; Gov’t App’x at 12, 18).
Even if the COR requested that the training shelter be redesigned or the CO approved or ratified
such a directive, the court cannot infer from Count 20 that the redesign of the shelter was outside
the scope of the Contract’s requirements. Gov’t Reply at 15–16.
Count 21 fails to state a claim for post-termination costs, because RMA’s challenge to the
termination was not timely. Gov’t Reply at 25.
4. The Court’s Resolution
a. Standard Of Review For A Motion To Dismiss, Pursuant To
RCFC 12(b)(6).
A challenge to the United States Court of Federal Claims’ “[ability] to exercise its general
power with regard to the facts peculiar to the specific claim . . . is raised by a [Rule] 12(b)(6)
motion[.]” Palmer, 168 F.3d at 1313; see also RCFC 12(b)(6) (“Every defense to a claim for relief
in any pleading must be asserted in the responsive pleading . . . . But a party may assert the
following defenses by motion: . . . (6) failure to state a claim upon which relief can be granted[.]”).
When considering whether to dismiss an action for failure to state a claim, the court must
assess whether “a claim has been stated adequately” and whether “it may be supported by [a]
showing [of] any set of facts consistent with the allegations in the complaint.” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 563 (2007). The plaintiff’s factual allegations also must be
substantial enough to raise the right to relief “above the speculative level.” Id. at 555. In addition,
39
the court must accept all factual allegations in the complaint as true and make all reasonable
inferences in favor of the plaintiff. Id.
The United States Supreme Court also has held that trial courts “must consider the
complaint in its entirety, as well as other sources courts ordinarily examine when ruling on Rule
12(b)(6) motions to dismiss, in particular, documents incorporated into the complaint by reference,
and matters of which a court may take judicial notice.” Tellabs, Inc. v. Makor Issues & Rights,
Ltd., 551 U.S. 308, 322 (2007); see also 5 CHARLES ALAN WRIGHT & ARTHUR R. MILLER,
FEDERAL PRACTICE AND PROCEDURE § 1327 (3d ed. 2018) (“When the plaintiff fails to introduce
a pertinent document as part of [the] pleading, a significant number of cases from throughout the
federal court system make it clear that the defendant may introduce the document as an exhibit to
a motion attacking the sufficiency of the pleading; that certainly will be true if the plaintiff has
referred to the item in the complaint and it is central to the affirmative case.”). RCFC 9(k) requires
that, “[i]n pleading a claim founded on a contract or treaty, a party must identify the substantive
provisions of the contract or treaty on which the party relies. In lieu of a description, [a] party may
annex to the complaint a copy of the contract or treaty, indicating the relevant provisions.” RCFC
9(k).
b. Differing Site Conditions (Counts 3 and 10).
FAR 52.236-2 provides that a contractor may recover for differing site conditions under
two circumstances: first, if the contractor encounters “[s]ubsurface or latent physical conditions at
the site which differ materially from those indicated in th[e] contract;” and second, if there are
“unknown physical conditions at the site, of an unusual nature, which differ materially from those
ordinarily encountered and generally recognized as inhering in work of the character provided for
in the contract.” 48 C.F.R. § 52.236-2(a). But, the contractor is required to provide written notice
to the CO, who is then required to investigate the conditions and, if they differ from that
contemplated by the Contract, provide an equitable adjustment to the contract price. See 48
C.F.R. § 52.236-2(b).
A Type I differing site condition occurs when: (1) a reasonable contractor reading the
contract documents as a whole would interpret them as making a representation as to the site
conditions; (2) the actual site conditions were not reasonably foreseeable to the contractor, based
on information available beyond the contract documents (i.e., that a contractor therefore relied on
the representations in the contract); (3) the contractor relied on the contract’s representations; and
(4) the contractor encountered conditions that differed materially from those represented and
incurred damages as a result. See Renda Marine, 509 F.3d at 1376 (stating the elements for Type
1 differing site conditions claim).
A Type II differing site condition occurs when a condition is encountered of a materially
different nature from what is “known” and usually encountered in performing the work specified
in the contract. Id. at 1376 (citing 48 C.F.R. § 52.236-2); see also Charles T. Parker Constr.
Co. v. United States, 193 Ct. Cl. 320, 333–34 (Ct. Cl. 1970) (“Under [a Type II differing site
condition], the Government has elected not to presurvey and represent the subsurface conditions
with the result that a claimant must demonstrate that he has encountered something materially
different from the ‘known’ and the ‘usual.’ This is necessarily a stiffer test because of the wide
variety of materials ordinarily encountered when excavating in the earth’s crust.”). To state a
40
claim for a “Type II” differing site condition, a complaint must plausibly allege that “the unknown
physical condition must be one that could not be reasonably anticipated by the contractor from his
study of the contract documents, his inspection of the site, and his general experience[,] if any, as
a contractor in the area.” Randa/Madison, 239 F.3d at 1276 (internal quotation marks omitted).
The Site Adapt Design Requirements included in the Contract required that RMA “provide a
complete and independent Geotechnical Investigation and Report of the Project to determine the
existing subsurface conditions and form the basis for foundation design.” Gov’t App’x at 127.
The Contract makes no affirmative representation regarding the subsurface conditions; instead, it
requires RMA to obtain an “independent” Geotechnical Investigation and Report to determine
those conditions. Gov’t App’x at 12–14.
Count 3 of the Second Amended Complaint alleges that the RGF Geotechnical
Investigation Report (“RGF Report”) indicated that “subsurface soils contained backfill materials
consisting of trash, metal pieces, debris and materials, unprocessed stone fragments in excess of
six (6) inches in diameter and unsafe (non-blended) backfilling and material harmful to building
structures.” 2d Am. Compl. ¶ 115. Therefore, the RGF Report recommended that: (1) these
materials be removed and replaced with clean soil; and that (2) the foundation range from 1.5 to
1.8 meters deep. 2d Am. Compl. ¶ 116. Count 3 alleges that this situation was “unforeseeable at
the time of contract award[,]” based on “subsurface conditions to be expected based on natural
conditions in the area.” 2d Am. Compl. ¶ 117. In addition, Count 3 alleges that these conditions
“differed materially from Defendant’s prior representations that the subsurface conditions were
stable and that the foundation would be no more than fifty (50) centimeters deep.” 2d Am.
Compl. ¶ 117. Count 3, however, does not allege that the Contract represented anything regarding
the conditions; instead, it alleges only that “prior representations” were made by the “Defendant.”
2d Am. Compl. ¶ 117.32 Moreover, the Contract warns that the Army did not “assume
responsibility for any understanding reached or representation made concerning conditions which
can affect the work by any of its officers or agents before the execution of this contract, unless that
understanding or representation is expressly stated in this contract.” Gov’t App’x at 84. As a
matter of law, a “contractor cannot be eligible for an equitable adjustment for a Type I differing
site condition unless the contract indicated what that condition would be.” H.B. Mac, 153 F.3d at
1345. Even assuming that a government official represented that the soils were of appropriate
bearing capacity, such a statement was not reflected in the Contract so no misrepresentation was
made. See T. Brown Constrs., Inc. v. Pena, 132 F.3d 724, 728 (Fed. Cir. 1997) (“A contractor can
recover damages under a contract for a misrepresentation by the Government in the contract
documents.”). Accordingly, Count 3 of the Second Amended Complaint fails to state a claim for
a Type I differing site condition.
Count 3 also does not state a claim for a Type II Differing Site Condition. Although it
alleges that the soil contained “debris and manmade materials” and therefore “differed materially
from subsurface conditions to be expected based on natural conditions in the area,” such
32
As the Government pointed out, the December 15, 2014 Complaint alleged that this
representation was made by a specific SANG engineer, i.e., someone who was not a representative
of the United States Government. Compl. ¶ 31.
41
allegations are not sufficient to state that such “natural conditions”33 are the “usual”34 conditions
in the area. 2d Am. Compl. ¶ 117. Count 3’s allegation that “Defendant” represented the
foundation would be no more than 50 centimeters deep also does not establish that a 50-centimeter
foundation depth was sufficient to support the Project buildings, given the ordinary conditions in
the area.
In contrast, Count 10 of the Second Amended Complaint alleges that, after excavating the
Project site, RMA encountered a waterline that “was not located as [the D]efendant had
represented,” i.e., “as a straight line between two manholes.” 2d Am. Compl. ¶ 157. The actual
location allegedly differed from the location “indicated on an as-built drawing provided by
Defendant.” 2d Am. Compl. ¶ 157. Count 10 also alleges that, “[b]y letter dated October 3, 2009,
[RMA] informed Defendant of the differing site condition[ and t]he [COR] visited the Site and
agreed that the waterline had to be relocated.” 2d Am. Compl. ¶ 159. On October 5, 2009, RMA
provided “modified designs as proposed solutions[]” that “covered a plan for the new water line
and structure foundations.” 2d Am. Compl. ¶ 160. Therefore, unlike Count 3, Count 10
sufficiently states a claim for a Type I differing site condition, because it alleges that: (1) a Contract
drawing represented that the waterline was in a specific location; (2) the waterline’s actual location
was not known until excavation; (3) RMA relied on the location represented in the drawing; and
(4) RMA incurred costs to relocate the waterline.
The Government is correct that the Contract required RMA to relocate all utility lines that
interfere with foundation work. Gov’t App’x at 37 (“[The c]ontractor is also responsible for
rerouting of any utility impacted by the new work.”). The Government is also correct that the Site
Investigation and Conditions Affecting the Work Clause provides that RMA “acknowledges that
it has satisfied itself as to the character, quality, and quantity of surface and subsurface materials
or obstacles to be encountered,” but the Government failed to account for the remainder of the
Differing Site Conditions Clause that provides that such an acknowledgement applies “insofar as
this information is reasonably ascertainable from an inspection of the site, including all exploratory
work done by the Government, as well as from the drawings and specifications made a part of this
contract.” Gov’t App’x at 84. In this case, the Contract drawing represented that the waterline
was in a different location than that encountered during excavation. 2d Am. Compl. ¶ 157. The
Differing Site Conditions Clause provides for an equitable adjustment in the Contract price, if it
was based on the conditions represented in the Contract. Gov’t App’x at 83. Therefore, Count 10
sufficiently alleges that the conditions encountered materially differed from those represented in
the Contract and RMA reasonably relied on the Government-furnished drawing that represented
that condition. See Renda Marine, 509 F.3d at 1376.
The Government cites Comtrol, Inc. v. United States, 294 F.3d 1357 (Fed. Cir. 2002) for
the proposition that, if a contract drawing indicates the presence of underground pipes, a contractor
cannot recover on a differing site condition claim. Gov’t Mot. at 25. Comtrol, however, concerned
a contract drawing that “indicated the proposed location for [a utility corridor] as running beneath
“Natural” is defined as “existing in or caused by nature; not made or caused by
33
humankind.” Natural, NEW OXFORD AMERICAN DICTIONARY (3d ed. 2010).
“Usual” is defined as “habitually or typically occurring or done; customary.” Usual,
34
NEW OXFORD AMERICAN DICTIONARY (3d ed. 2010).
42
a portion of the site that was later proposed as the location of [a] tower [to be constructed].”
Comtrol, 294 F.3d at 1365. The drawing depicted a pipeline, but stated that it was to be relocated
to the utility corridor “by others.” Id. The drawing did not specify when the pipeline would be
relocated. Id. Based on those facts, the United States Court of Appeals for the Federal Circuit
held that the drawing was patently ambiguous as to the pipeline’s location, placing the contractor
“on notice that a fuel pipeline might exist at or near the construction site, and . . . had a duty to
seek clarification of this ambiguity.” Id. In this case, however, Count 10 does not allege that the
drawing was ambiguous, but that the drawing represented the waterline was in a specific location
that differed from what was encountered during excavation. Therefore, Comtrol is not relevant to
whether the waterline in this case was a differing site condition.
For these reasons, the court has determined that Count 3 does not allege sufficient facts to
state a claim for either a Type I or Type II differing site condition and is dismissed; however,
Count 10 alleges sufficient facts to state a claim for a Type I differing site condition. See RCFC
12(b)(6).
c. Constructive Changes (Counts 4–9, 11–14, and 17–20).
Counts 4 through 9, 11 through 14, and 17 through 20 appear to allege claims for
constructive change. To state a claim for constructive change, a complaint must plausibly allege
facts sufficient to show: (1) that the contractor “performed work beyond the contract
requirements;” and (2) that the “additional work was ordered, expressly or impliedly, by the
government.” Bell/Heery v. United States, 739 F.3d 1324, 1335 (Fed. Cir. 2014); see also Info.
Sys. & Networks, Corp. v. United States, 81 Fed. Cl. 740, 746 (Fed. Cl. 2008) (“A constructive
change occurs where a contractor performs work beyond the contract requirements without a
formal order, either by an informal order or due to the fault of the Government.”).
As to the first element, the work must exceed the scope of work specified in the contract;
in contrast, where the Government insists on performance in compliance with the contract
specifications, no adjustment in the contract price is warranted. See Flink/Vulcan v. United States,
63 Fed. Cl. 292, 309 (2004), aff’d, 163 F. App’x 890 (Fed. Cir. 2006) (no constructive change
when contractor could have declined extra work or proceeded under protest, but elected to proceed
without reservation, for business reasons). In addition, where the contract requires the contractor
to provide notice to the CO of changes that the contractor believes are constructive changes, notice
must be timely. See K-Con Bldg., 778 F.3d at 1010 (“[T]he notice provision serves an important
purpose in a contract in which some government requests are plainly contemplated under the
contract. Timely written notice differentiates requests the contractor views as outside the contract
from those it deems contemplated by the contract.” (italics in original)).
As to the second element, an informal order or other conduct requiring the contractor to
exceed the scope of the contract must originate from an individual with authority to bind the
Government. See Cath-dr/Balti Joint Venture, 497 F.3d at 1344 (“Where a party contracts with
the government, apparent authority of the government’s agent to modify the contract is not
sufficient; an agent must have actual authority to bind the government.”). Actual authority is
implied when such authority is an “integral part of the duties assigned” to the particular
government agent. See H. Landau & Co. v. United States, 886 F.2d 322, 324 (Fed. Cir. 1989)
(internal quotation marks and citation omitted). No implied authority exists, however, if an action
taken by a government agent contravenes the explicit terms of a contract. See Cath–dr/Balti Joint
43
Venture, 497 F.3d at 1346 (holding that a government agent did not have implied authority to
modify a contract, where that contract “explicitly state[d] that only the [CO] had the authority to
modify the contract”). Where an unauthorized government official directs a contractor to perform
additional or different work, however, a CO may ratify the unauthorized work, provided that the
CO has knowledge of the underlying material facts and approves the work. See United States v.
Beebe, 180 U.S. 343, 354 (1901) (“Where an agent has acted without authority and it is claimed
that the principal has thereafter ratified his act, such ratification can only be based upon a full
knowledge of all the facts upon which the unauthorized action was taken.”); see also Cath-dr/Balti
Joint Venture, 497 F.3d at 1347 (requiring actual authority and “knowledge of material facts
involving the unauthorized act”).
In this case, the Contract provided that “[a]ll contract administration will be effected by the
[CO.] . . . No changes in or deviation from the scope of work shall be effected without a
modification executed by the [CO] authorizing such changes.” Gov’t App’x at 27. As to changes
for which the contractor believes it is entitled to an adjustment in price, the Contract required RMA
to provide a written notice to the CO within 30 days of receipt of a written change order or 20 days
from the date the Army effected the change. Gov’t App’x at 93. In addition, the Contract provided
that, if a COR were to be appointed, such appointment would be done “in writing by the [CO]”
and would “specify the extent of the COR’s authority to act on behalf of the [CO,]” but expressly
stated that the “COR is not authorized to make any commitments or changes that will affect price,
quality, quantity, delivery, or any other term or condition of the contract.” Gov’t App’x at 27.
With respect to SANG officials, the Contract provided that “[a]ll communication by the Contractor
with all officials, representatives, and/or offices of the Saudi Arabian Government in all matters
pertaining to the design or construction of [the C]ontract, shall be through and in full liaison with
the [CO,]” but that requirement “does not relinquish [RMA’s] responsibility for obtaining routine
items to conduct day-to-day business, such as visas, permits, and custom clearances.” Gov’t App’x
at 37. In short, the CO was the only individual with actual authority to bind the Army and order
changes to the Contract’s scope of work.
Although Counts 4 through 9, 11 through 14, and 17 through 20 allege that RMA incurred
costs for constructive changes, none specify that the CO directed any additional work. Instead,
each of the Counts alleges only that the “Army” or the “JET” or “Defendant” could request that
RMA perform certain work. 2d Am. Compl. ¶ 1 (stating that in the Second Amended Complaint,
“Defendant” refers to the “U.S. Army, Government Joint Engineering Team”). Moreover, none
of these Counts allege that the CO actually authorized any changes post hoc. In addition, none of
these Counts allege sufficient facts to reflect the CO’s knowledge of any change. Instead, these
Counts are conclusory allegations stating, e.g., that “Defendant knew, or should have known”
about the work, or “Defendant accepted the benefits” without compensating RMA. The United
States Supreme Court has held that such allegations fail to state a claim on which the court may
grant relief. See Twombly, 550 U.S. at 549 (“[A] plaintiff’s obligation to provide the ‘grounds’ of
his ‘entitlement to relief’ requires more than labels and conclusions, and a formulaic recitation of
the elements of a cause of action will not do.” (internal alterations omitted)). Nor do these Counts
allege that RMA provided any notice to the CO prior to performing any allegedly additional work,
although the Contract required that RMA provide such notice. Gov’t App’x at 93 (providing that
an equitable adjustment to the contract price can be made for additional work ordered by the CO,
“[p]rovided, that the [c]ontractor gives the [CO] written notice stating . . . [t]he date, circumstances,
and source of the order; and . . . [t]hat the [c]ontractor regards the order as a change order.”); see
44
also Calfon Constr., Inc. v. United States, 18 Cl. Ct. 426, 439 (Cl. Ct. 1989), aff’d, 923 F.2d 872
(Fed. Cir. 1990) (“Contractors are duty bound to inform the [CO] if official direction will result in
claims against the Government.”).
Specifically, Count 4 also alleges that RMA “reasonably assumed that there was adequate
electrical power on site . . . based on representations made by [the] Defendant[,]” but was later
“informed that . . . electrical power . . . would not be available until late in the [P]roject and that
[RMA] would have to supply electrical generators.” 2d Am. Compl. ¶¶ 123–24. In addition,
Count 4 alleges that the “supply of generators was not part of the [C]ontract’s scope of work and
represented a constructive, if not express, change to the [C]ontract.” 2d Am. Compl. ¶ 126.
Section H-14 of the Contract, however, expressly provides that “[e]lectrical service is not available
for use under [the C]ontract, therefore all electric current required by the [c]ontractor shall be the
responsibility of the [c]ontractor, furnished at its own expense.” Gov’t App’x at 36. In addition,
Section I.27 of the Contract provides that the “[c]ontractor acknowledges that it has taken steps
reasonably necessary to ascertain the nature and location of the work, and that it has investigated
and satisfied itself as to the general and local conditions which can affect the work or its cost,
including but not limited to . . . the availability of . . . electric power[.]” Gov’t App’x at 84.
Although RMA implies that “prior representations” were made by an unspecified individual, the
Contract provides that the Army does not “assume responsibility for any understanding reached or
representation made concerning conditions which can affect the work by any of its officers or
agents before the execution of [the C]ontract, unless that understanding or representation is
expressly stated in [the C]ontract.” Gov’t App’x at 84. In addition, the Contract is an integrated
agreement, with respect to conditions affecting the scope of work, so parol evidence would be
allowed only to supplement an agreement “by consistent additional terms.” McAbee Constr.
Inc. v. United States, 97 F.3d 1431, 1434 (Fed. Cir. 1996). No such understanding or
representation was alleged in this case.
Count 5 alleges that the Contract did not require RMA to install telephone or data wiring
in the administrative building or warehouse. 2d Am. Compl. ¶ 129. Even if Count 5 alleged that
the CO directed the work, it still would not state a claim for constructive change, because the scope
of work included these items. RMA was required to construct the administrative building and
warehouse in accordance with approved drawings. Gov’t App’x at 15 (stating that the contractor
“shall construct the facilities in accordance with the technical specifications, contract drawings,
approved site-adapt drawings, and contract requirements”). The Contract also required drawings
to “include the identification of and connection to existing infrastructure and utilities required to
make the new and supporting facilities functional. The infrastructure and utilities of concern
include . . . [the] communications network[.]” Gov’t App’x at 13. The Contract defined “utility
systems” as “all exterior utilities, such as water, sewer, drainage, electricity, telephone, and other
similar systems.” Gov’t App’x at 13. In addition, the Contract stated, that RMA “shall include in
the design of the office building a communication system that includes both telephone and data
service to each work space.” Gov’t App’x at 15. Therefore, the Contract required RMA to provide
telephone and data systems and Count 5 does not identify any additional work that RMA was
required to perform with respect to such systems.
Count 6 alleges that RMA “installed a main circuit breaker at [a] transformer on site[,]”
with “Defendant’s knowledge,” but that work was not required by the Contract nor part of RMA’s
“original cost proposal.” 2d Am. Compl. ¶ 134. The Contract defined “utility systems,” “as all
45
exterior utilities, such as water, sewer, drainage, electricity, telephone, and other similar systems.”
Gov’t App’x at 13. Likewise, the Contract required RMA to “indicate in design drawing
submittals the method of connecting all facilities to electrical power[,]” and provided that electrical
power must “connect to the nearest SEC facility in a manner proposed by the contractor and
approved by the JET.” Gov’t App’x at 15. In addition, Section H.16 of the Contract stated that
RMA was “responsible for tie-in of all required utilities and paying of all connection and testing
fees” that may be required by SEC and other government agencies. Gov’t App’x at 37. Count 6,
however, does not allege any facts that plausibly state how installing a circuit breaker to connect
the constructed facilities to electrical power exceeded the scope of the Contract.
Count 7 alleges that “[i]nspectors acting on behalf of the Defendant[] each had their own
perception of how the toilet plumbing should be constructed and demanded that the work [be]
performed their way[,]” requiring RMA to comply with “at least five . . . changes to the toilet[]
plumbing.” 2d Am. Compl. ¶ 139. As such, RMA was “forced to make changes to the toilet
plumbing at the behest of [the] JET, [that] included performing rework at significant cost to
[RMA].” 2d Am. Compl. ¶ 140. Count 7 alleges this work was performed “at the behest of [the]
JET,” “acting on behalf of the Defendant,” and also “General Saud[’s] . . . engineers [i.e., SANG
personnel].” 2d Am. Compl. ¶ 139. Even assuming that the individuals ordering that work were
JET personnel, Count 7 does not allege that RMA’s original work was in compliance with the
Contract, thereby rendering the rework outside the scope of the Contract. It is true that the JET
was designated with “cognizance over all technical aspects of the contract and [responsibility] for
monitoring [c]ontractor performance.” Gov’t App’x at 27. But, the JET had no authority to change
the scope of the Contract or price. See NavCom Def. Elecs., Inc. v. England, 53 F. App’x 897, 900
(Fed. Cir. 2002) (explaining that a constructive change can occur where an informal order is made
by an authorized Government agent, or by Government fault, but requiring strict compliance with
the contract specifications and correction of nonconforming work does not amount to constructive
change) (citation omitted).
Count 8 alleges that, on October 10, 2009, the JET requested that RMA “redesign[] the
first floor of the administration building to build a pantry instead of a store room[,]” and that this
change required RMA to install “a sink along with plumbing for water supply and drainage.” 2d
Am. Compl. ¶ 146. Count 8 alleges that this work constituted a “constructive, if not actual, change
to the contract.” 2d Am. Compl. ¶ 147. The Contract provided that the administration building
would be an original design by RMA, although a sample floorplan was included. Gov’t App’x at
10. The Contract also required design submission and revision after technical comments were
received from the JET. Gov’t App’x at 7, 11 (discussing three design submissions and at least two
rounds of receiving and incorporating comments and changes). Count 8, however, contains no
factual allegations explaining how replacing a pantry with a storeroom exceeded the scope of the
Contract or was inconsistent with the requirements therein. The Contract states that RMA was
required to design an office building and incorporate comments by the JET on the design. Gov’t
App’x at 7, 9–11.
Count 9 alleges that RMA “originally planned on installing a 15-ton [AHU], which
Defendant had approved[,]” but that unit was “not readily available . . . and would take six weeks
to deliver to the site[,]” so the Army “therefore asked” RMA to install an 18-ton unit that was
available locally. 2d Am. Compl. ¶¶ 151–52. Consequently, RMA “had to perform new
engineering calculations for system, electrical, roof supports, piping, ductwork[,] and other items.”
46
2d Am. Compl. ¶ 152. The Contract, however, required that any change in the size of the AHU
needed to be approved by the CO. Gov’t App’x at 27; see also Cath-dr/Balti Joint Venture, 497
F.3d at 1346 (holding that where a contract and governing regulations are “clear” that “the [CO]
was the only person with authority to make changes to the contract,” changes allegedly directed
by other personnel are not binding on the Government). Count 9 does not allege that the
installation of the 18-ton AHU was directed by the CO, the only individual with authority to make
such a change.
Count 11 alleges that RMA “expended significant funds to connect [the] waterline to the
building[,] pursuant to [the] JET[’s] requirements[,]” but that work “was not factored into SMN’s
proposal and constituted a constructive, if not actual, change to the contract.” 35 2d Am.
Compl. ¶¶ 167–68. The Contract, however, provided that the “contractor is responsible for tie-in
of all required utilities and paying of all connection and testing fees[,]” and that the “contractor is
also responsible for rerouting of any utility impacted by the new work.” Gov’t App’x at 37. In
short, the Contract required RMA to perform the work that Count 11 alleges was beyond the scope
of the Contract.
Count 12 alleges that, during construction, the Army “changed the electrical wiring
[required] for light fixtures[,] . . . after [RMA] had already installed most of the wiring.” 2d Am.
Compl. ¶ 171. In addition, the Army “directed [RMA] to replace all PVC conduit . . . with EMT
conduit (metal cladding).” 2d Am. Compl. ¶ 172. Further, the Army “knew, or should have
known, that [RMA] was directed to change the electrical conduit and wiring for the light fixtures[,
such that the] work constituted a constructive, if not express, change to the contract.” 2d Am.
Compl. ¶ 174. The Contract, however, provided that the “contractor is responsible for tie-in of all
required utilities and paying of all connection and testing fees[,]” and that the “contractor is also
responsible for rerouting of any utility impacted by the new work.” Gov’t App’x at 37.
Count 13 alleges that the “JET verbally approved the light fixtures shown in a supplier
catalog,” but during a site visit after the fixtures were installed, “a JET inspector rejected the light
fixtures and restarted the light fixture approval process.” 2d Am. Compl. ¶¶ 177–78. After
additional meetings with the JET and the lighting supplier, the Army “finally approved [the] light
fixtures[,]” and RMA replaced the rejected fixtures with the newly approved fixtures. 2d Am.
Compl. ¶¶ 178–79. As previously discussed, the JET had “cognizance over all technical aspects
of the contract and [responsibility] for monitoring [c]ontractor performance.” Gov’t App’x at 27.
In addition, the JET’s input was an integral part of the design approval process as reflected in the
Contract. Gov’t App’x at 7, 11 (discussing three design submissions and at least two rounds of
receiving and incorporating comments and changes). Count 13, however, does not allege that the
initial verbal approval of the light fixtures from a supplier catalog was a part of this design approval
process. 2d Am. Compl. ¶ 178. Even assuming this work was within the scope of the work to be
performed, Count 13 does not allege that the installation of the light fixtures complied with the
approved design. Therefore, the JET could insist on performance in strict compliance with the
contract specifications, without adjusting the contract price. See NavCom Def. Elecs., Inc., 53 F.
App’x at 900 (“The government generally has the right to insist on performance in strict
35
It is not clear who or what “SMN” is. The court assumes the reference to SMN is a
clerical error and that Count 11 intended to refer to RMA’s proposal.
47
compliance with the contract specifications and may require a contractor to correct nonconforming
work.” (citation omitted)). Moreover, no factual allegations state whether the work performed was
in conformity with the Contract or the changes requested were for rework or additional work.
Count 14 alleges that RMA “originally planned on installing a waterproof roof system
consisting of a single layer EPDM rubber membrane[,]” but “[a]fter the site work was substantially
complete[d], [the] Defendant requested a double layer EPDM membrane instead of a single layer.”
2d Am. Compl. ¶¶ 183–85. Count 14 does not allege what the Contract required nor does it allege
any facts to plausibly establish that a double layer membrane exceeded the contract requirements;
it only alleges what RMA initially planned to do.
Count 17 alleges that at a pre-construction meeting the parties agreed that two Government
employees would be responsible for approving submittals, but that the JET requested a “major
change” by requiring all submittals to be approved by JET engineers. 2d Am. Compl. ¶¶ 205–06;
see also 2d Am. Compl. ¶ 207 (“As a result of this change, [RMA] submitted over 200 submittals
for Defendant’s formal review and incurred additional costs totaling $71,545.”). The Contract,
however, provides that the S-1, S-2, and S-3 design submittals were to be made to the JET, for
review and approval. Gov’t App’x at 7, 11. Each of these submittals was to include “AutoCAD
design drawings,” “Existing Site Layouts,” “Proposed Site Layouts,” and technical reports
prepared, pursuant to the Contract. Gov’t App’x at 11. Count 17, however, does not allege how,
if at all, the “changed” process differs from that required by the Contract.
Count 18 alleges that the “JET engineers imposed unreasonably stringent safety measures,
including safety handrails, temporary stairs[,] and wood platforms[ that] hindered [RMA’s]
performance and caused it to incur additional costs . . . of $30,360.00[,]” including overhead and
profit. 2d Am. Compl. ¶¶ 210–11. The Contract states that RMA was required to “comply with
the standards issued by the Secretary of Labor at [29 C.F.R. Part 1926 and 29 C.F.R. Part 1920]”
and implement any “additional [safety] measures the [CO] determines to be reasonably
necessary[.]” Gov’t App’x at 88. The regulations cited in the Contract concern the use of a
guardrail system, temporary stairs, and platforms. See 29 C.F.R. §§ 1920.1–1926.1442. For
example, construction employees must be protected by a guardrail system. See 29 C.F.R. §
1926.501(b)(1) (“Each employee on a walking/working surface . . . with an unprotected side or
edge which is 6 feet . . . or more above a lower level shall be protected from falling by the use of
guardrail systems, safety net systems, or personal fall arrest systems.”). Other safety provisions
concern temporary stairways. See 29 C.F.R. §§ 1926.1052(a)(1) (“Stairways that will not be a
permanent part of the structure on which construction work is being performed shall have landings
of not less than 30 inches[.]”), 1926.1052(b)(3) (“Treads for temporary service shall be made of
wood or other solid material, and shall be installed the full width and depth of the stair.”). Safety
regulations require the use of platforms. See 29 C.F.R. § 1926.1052(a)(4) (“Where doors or gates
open directly on a stairway, a platform shall be provided[.]”), 29 C.F.R. § 1926.801(c) (“Whenever
a shaft is used, it shall be provided, where space permits, with a safe, proper, and suitable staircase
for its entire length, including landing platforms, not more than 20 feet apart. Where this is
impracticable, suitable ladders shall be installed with landing platforms located about 20 feet apart
to break the climb.”). Although 29 C.F.R. Part 1926 allows for variances from the safety standards,
under certain circumstances, employers must apply for a variance from the Assistant Secretary of
Labor for Occupational Safety and Health. See 29 C.F.R. § 1926.2(a); see also 29 C.F.R. § 1905.1.
48
Count 18 alleges that the use of “safety handrails, temporary stairs, and wood platforms”
was “unreasonably stringent,” and RMA incurred substantial costs as a result. 2d Am. Compl. ¶
68. These safety measures, however, were required by Department of Labor regulations and RMA
also was required to comply with any “additional [safety] measures the [CO] determine[d] to be
reasonably necessary[.]” Gov’t App’x at 88. Therefore, Count 18 does not plausibly allege that
compliance with safety requirements exceeded the Contract’s scope of work nor allege facts to
support why the use of safety rails, stairways, and platforms was unreasonable.
Count 19 alleges that RMA incurred additional expenses for “obtaining security badges,
vehicle identifications, and updates to [the] same every fifteen days.” 2d Am. Compl. ¶ 213. The
Contract provided that “[t]he [c]ontractor shall provide within five (5) calendar days after contract
award, a complete list of personnel who are to work on the [P]roject[]” and “be ready as directed
by SANG security to present original passport and igama for verification.” Gov’t App’x at 33–
34. In addition, “[e]ach request for personnel pass . . . [must] include worker’s name, nationality,
copy of passport and igama [sic], and . . . photographs[.]” Gov’t App’x at 33. The Contract also
required RMA to coordinate passes “at least ten (10) calendar days prior to required access” and
obtain all necessary “authorizations, permits, and licenses necessary [for] quarry operations, batch
plant operations, and haul routes.” Gov’t App’x at 33–35. In addition, RMA was required to
comply with Saudi Arabia Laws and Customs and advise “the [COR] of the names of personnel,
type, and amounts of equipment, dates and length of time required at the site, and purpose of
entering Saudi Arabia . . . [for] proper clearance . . . from the Saudi Arabian Government.” Gov’t
App’x at 38. RMA “agree[d] that it and all of its personnel who [] perform work under this contract
within Saudi Arabia . . . are subject to all applicable Saudi Arabian Government laws and
regulations.” Gov’t App’x at 38. The Contract’s Safety Clause also required RMA to “provide
and maintain . . . environments and procedures” that will “safeguard the public and Government
personnel, property, materials, supplies, and equipment” throughout the Project site, and to
“[s]ubmit a written proposed plan for implementing this [Safety C]lause” before commencing
work. Gov’t App’x at 88. The CO, however, was authorized to “notify the contractor . . . and
request immediate initiation of corrective action,” if he became aware of noncompliance with the
Safety Clause. Gov’t App’x at 88. The Contract, however, prohibited RMA from obtaining an
“equitable adjustment of the contract price or extension of the performance schedule on any stop
work order issued under [the Safety C]lause.” Gov’t App’x at 88. Therefore, Count 19 does not
allege sufficient facts to support that obtaining “security badges, vehicle identifications, and
updates to [the] same every fifteen days[]” was outside of the scope of the Contract nor that other
safety requirements were unreasonable; nevertheless RMA seeks reimbursement for the costs
incurred for compliance. 2d Am. Compl. ¶ 213.
Count 20 alleges that RMA “redesigned the Covered Training Shelter portion of the Project
multiple times,” and incurred additional costs as a result. 2d Am. Compl. ¶ 215. The Contract,
however, provided that the Covered Training Shelter would be a “site adapted design,” based on
drawing SANG 020, such that RMA was required to “modify the . . . drawing[] to fit the specified
site.” Gov’t App’x at 9–10. The Contract also stated that the design submission and revision
would be based on technical comments received from the JET. Gov’t App’x at 7, 11 (discussing
three design submissions and at least two rounds of receiving and incorporating comments and
changes). Count 20, however, does not explain how any redesigns exceeded the scope of the work
set forth in the Contract; instead, it alleges only that RMA redesigned the Covered Training Shelter
“multiple times.” 2d Am. Compl. ¶ 215.
49
For these reasons, the court has determined that Counts 4 through 9, 11 through 14, and 17
through 20 fail to state claims for constructive change and are dismissed. See RCFC 12(b)(6).
d. Misrepresentation Or Unjust Enrichment (Counts 15 and 16).
Count 15 of the Second Amended Complaint alleges that prior to award, the Army
requested that RMA “design a building for the [SANG] for administrative and training purposes.”
2d Am. Compl. ¶ 190. Count 15 also alleges that RMA completed several designs between
December 2008 and February 2009, and at a meeting on or about April 7, 2009, the Army
“promised [RMA] that it would be compensated for this pre-award design as part of [a] sole source
contract for construction of the building[]” and that “Defendant’s representations induced [RMA]
to enter into the contract.” 2d Am. Compl. ¶¶ 190–95. Count 15 further alleges that RMA was
not compensated for “pre-award design efforts” so the “Defendant . . . is liable . . . in the amount
of $95,800 under the parties’ agreement, or alternatively, under the theory of unjust enrichment or
misrepresentations of fact.” 2d Am. Compl. ¶ 198.
Count 16 of the Second Amended Complaint alleges that when RMA agreed to the terms
of the Contract, “representatives of the Defendant, including the [COR], represented to [RMA]
that it would receive other contracts.” 2d Am. Compl. ¶ 200. These representations allegedly
“induce[d RMA] to provide design services at arbitrary pricing dictated by the Defendant in the
total amount of $94,000 for 35%, 90% and 100% design submissions.” 2d Am. Compl. ¶ 200.
Count 16, however, alleges that RMA did not receive other contract awards. 2d Am. Compl. ¶
201. On that basis, Count 16 requests that RMA be reimbursed for “cost overrun in design services
for the contract design work totaling $118,910.00, which includes overhead and profit.” 2d Am.
Compl. ¶ 203.
Counts 15 and 16 do not allege that any individual with authority to bind the Government
agreed to award any other contracts to RMA. In fact, the Contract expressly states that the COR
has no authority to bind the Army. Gov’t App’x at 27 (the COR was not “authorized to make any
commitments or changes that [would] affect price, quality, quantity, delivery, or any other term or
condition of the contract.”). The Contract also provided that all design work would be performed
for the firm, fixed-price of 352,500 Saudi Riyals. Gov’t App’x at 7 (subtotal for CLINs 0001
through 0003). A firm, fixed-price contract is one that “is not subject to any adjustment on the
basis of the contractor’s cost experience in performing the contract.” 48 C.F.R. § 16.202-1. For
this reason, the United States Court of Appeals for the Federal Circuit has held that “full payment
under a valid fixed price-type contract is all to which a contracting party is entitled,” and the “risk
of loss for misjudging what it takes to perform, or for deliberately underbidding, is on the
contractor, not the Government.” AT&T, 177 F.3d at 1383–84. Moreover, “oral explanations or
instructions given before the award of a contract [are not] binding” and contractors “cannot rely
on . . . statements [that] were never incorporated into the contract.” Manuel Bros., 55 Fed. Cl. at
37, aff’d, 95 F. App’x 344. Assuming that the COR promised RMA that it would receive any
future contract award, any such statement is not enforceable, because the COR could not promise
to award future contracts in contravention of the competition requirements in the FAR. See 48
C.F.R. § 6.101(b) (“[CO]s shall provide for full and open competition through use of the
competitive procedures contained in this subpart that are best suited to the circumstances of the
contract action and consistent with the need to fulfill the Government’s requirements
efficiently[.]”).
50
For these reasons, the court has determined that Counts 15 and 16 do not allege sufficient
facts to state a claim for misrepresentation or unjust enrichment and are dismissed. See RCFC
12(b)(6).
e. Post-Termination Costs (Count 21).
Count 21 of the Second Amended Complaint alleges that, following contract termination,
RMA incurred costs for demobilization, preparation of updated as-built drawings, preparation of
the Project’s Critical Path Method graph, and “additional management costs that would not have
been incurred but for the wrongful termination.” 2d Am. Compl. ¶ 217. The court has determined
that it does not have jurisdiction to adjudicate the wrongful termination claim alleged in Count 1
of the Second Amended Complaint and therefore cannot convert the termination for default into
one for convenience. For this reason, a default termination precludes a contractor’s recovery for
post termination costs, absent extraordinary circumstances. See Mega Constr. Co. v. United States,
29 Fed. Cl. 396, 437 (Fed. Cl. 1993) (“[O]nce plaintiff’s contract was terminated for default, its
only responsibility, as it was instructed, was to vacate the job-site immediately. The default
termination can be analogized to the final payment to a contractor in that it marks the end of the
contract. . . . However, post-termination for default costs are not recoverable in the absence of
extraordinary circumstances . . . or judicial conversion of the default termination to a termination
for the convenience of the [G]overnment[.]” (citations omitted)). Count 21, however, does not
allege any extraordinary circumstances that would entitle RMA to state a claim for post-
termination costs.
For these reasons, the court has determined that Count 21 does not allege sufficient facts
to state a claim for post-termination costs and is dismissed. See RCFC 12(b)(6).
E. RMA Engineering S.A.R.L.’s March 22, 2018 Cross-Motion For Leave To
File A Third Amended Complaint.
1. RMA Engineering S.A.R.L.’s Argument.
Pursuant to RCFC 15(a), “a party may amend the party’s pleading only by leave of court
or by written consent of the adverse party.” RCFC 15(a). RMA argues that, if the court determines
that any of the Counts in the Second Amended Complaint fails to state a claim, RMA requests
leave to file a Third Amended Complaint to provide additional facts, grounds for relief, and
supporting exhibits. Pl. Resp. at 37–38. RMA represents that the proposed Third Amended
Complaint includes “much more particularized claims than the original Complaint” that “better
describe[] who provided direction for change order work and plead[ing] facts sufficient to show
that the [CO] approved these changes either expressly or by ratification.” Pl. Resp. at 38.
2. The Government’s Response.
The Government responds that the court should deny RMA’s Request To File Another
Amended Complaint. Gov’t Reply at 2–7. Leave to amend pleadings typically should be granted
freely “when justice so requires.” RCFC 15(a)(2). But, the court also must consider the possibility
of prejudice to the adverse party and the passage of time so as to “not impose endlessly upon the
defendant and the court ‘by the presentation of theories seriatim.’” Gov’t Reply at 3 (citing
Cencast Servs., L.P. v. United States, 729 F.3d 1352, 1363 (Fed. Cir. 2013)). “If [an] issue lurks
51
in the case, vacillation can cause the other party irreparable injury.” Gov’t Reply at 5 (quoting
Tenneco Resins Inc. v. Reeves Bros., 752 F.2d 630, 634 (Fed. Cir. 1985)). “Delay alone, even
without a demonstration of prejudice, has [] been sufficient grounds to deny amendment of
pleadings.” Cencast, 729 F.3d at 1364; see also Bradley, 136 F.3d at 132536 (holding that the trial
court was not required to accept as true amended allegations that were “self-serving” and
inconsistent with prior factual allegations). RMA’s proposed Third Amended Complaint is “both
unduly delayed and prejudicial to the Government.” Gov’t Reply at 3. RMA requests to amend
for the third time “more than three years after this lawsuit was filed, almost two years after RMA’s
[F]irst [A]mended [C]omplaint was filed, and more than [fifteen] months after the Government
completed written discovery.” Gov’t Reply at 5.
In addition, the Government filed an Answer to the original Complaint, served extensive
discovery requests, and agreed to allow RMA to depose Jean Yves Rousseau, in Saudi Arabia, and
spent substantial time researching and preparing diplomatic documents for permission to conduct
that deposition. Gov’t Reply at 4. Although the United States Embassy issued necessary papers
in September 2016 for that deposition, RMA failed to respond to the Government’s discovery
requests that were more than three months overdue at the time. Gov’t Reply at 4. More than two
years ago, the diplomatic note requesting permission to conduct the deposition was prepared and
likely will need to be reissued; in addition, at least two key witnesses for the Government, the CO
and the technical representative, have retired from federal service. Gov’t Reply at 6; see also
Tenneco Resins, 752 F.2d at 634 (“[A]fter several opportunities foregone by [plaintiff], [the
Government’s] burden of demonstrating prejudice is light.”).
Another Complaint also will allow Plaintiff “to introduce [a new] theory [that] would . . .
prejudice[] the [G]overnment, which had already devoted significant resources to litigating the
issues long recognized as raised by the case.” Gov’t Reply at 6 (quoting Cencast, 729 F.3d at 1364
(internal corrections omitted)). The Second Amended Complaint failed to allege that the
“additional” work was not required by the Contract or authorized by the CO. Gov’t Reply 5. The
Third Amended Complaint does not cure these deficiencies, and therefore would be futile. See
Gov’t Reply at 5. In addition, the Third Amended Complaint greatly expands the theories of relief,
but Plaintiff fails to explain why such theories were not addressed in any of the prior complaints.
Gov’t Reply at 5–6.
3. RMA Engineering S.A.R.L.’s Reply.
RMA replies that the Third Amended Complaint will not prejudice the Government,
because: (1) the Government did not allege that the Second Amended Complaint would create
prejudice, and nothing has changed; (2) RMA has not delayed adjudication of the case since the
Second Amended Complaint was filed; and (3) the Third Amended Complaint contains no new
claims. Pl. Reply at 6. In addition, the Government’s resources have not been wasted, because
the Third Amended Complaint arises from the same facts as the original Complaint, and
depositions have not been completed. Pl. Reply at 7. In addition, the fact that some witnesses
have retired does not affect either party’s ability to call them to testify at trial. Pl. Reply at 7. The
36
The Government did not provide a pinpoint citation; the court has done so.
52
Government has proffered no evidence that fading memories and lost documents will prejudice
the Government.
The Third Amended Complaint also will not be futile, because it contains additional
information in support of prior allegations. Pl. Reply at 8. Nor will it alter the theories of relief
presented in the Second Amended Complaint, but elaborates on the claims. Pl. Reply at 8–9. In
addition, the Government’s attack on the credibility of allegations regarding the relocation and
connection of a new water line (Counts 10 and 11) and design submittal and approval (Count 17)
is premature, because credibility is an issue for the court to consider at trial. Pl. Reply at 10. In
addition, the Third Amended Complaint contains more detailed allegations about: “unreasonable”
safety and security measures (Counts 18 and 19); design services for the covered training shelter
rendered beyond the scope of the contract (Count 20); pre-award design work (Count 15); cost
overrun for the base contract design (Count 16); and RMA’s claims for payment for additional
work. Pl. Reply at 11–13.
4. The Court’s Resolution.
a. Governing Precedent.
RCFC 15(a)(2) provides that a party may amend pleadings with the court’s leave, and leave
should be freely given “when justice so requires.” RCFC 15(a)(2). This Rule is applied liberally,
because “the purpose of pleading is to facilitate a proper decision on the merits.” Conley v. Gibson,
355 U.S. 41, 48 (1957). Nevertheless, the court should not grant leave when an amended pleading
would unfairly prejudice the opposing party, impose undue delay, be futile, or is made in bad faith.
See Foman v. Davis, 371 U.S. 178, 182 (1962). Because RCFC 15 is “designed to facilitate the
amendment of pleadings[,] except where prejudice to the opposing party would result,” prejudice
is a critical factor in determining whether to grant leave to amend. United States v. Hougham, 364
U.S. 310, 316 (1960); see also Pressure Prods. Med. Supplies, Inc. v. Greatbatch Ltd., 599 F.3d
1308, 1320 (Fed. Cir. 2010) (“Prejudice is the ‘touchstone of the inquiry under rule 15(a).’”
(citation omitted)). Prejudice has been found where an amendment results in unfair surprise, a
broadening or fundamental change in the issues litigated, or prompting further discovery or a need
for significant new preparation. See Cencast, 729 F.3d at 1363–64. In addition, “[a] litigant’s
failure to assert a claim as soon as he could have is properly a factor to be considered in deciding
whether to grant leave to amend.” Tenneco Resins, 752 F.2d at 634 (internal quotation marks and
citation omitted). Therefore, the United States Court of Appeals for the Federal Circuit has held
that “[d]elay alone, even without a demonstration of prejudice, [is] sufficient grounds to deny
amendment of pleadings.” Te-Moak Bands of W. Shoshone Indians of Nev. v. United States, 948
F.2d 1258, 1262 (Fed. Cir. 1991).
Futility is also a sufficient ground to deny a motion to amend. See Cultor Corp. v. A.E.
Staley Mfg. Co., 224 F.3d 1328, 1333 (Fed. Cir. 2000). An amendment is futile when the
proponent cannot provide a colorable argument that the original or the amended claim will not
survive a dispositive motion. Id. When the non-moving party argues that the amendments are
futile, the moving party must provide sufficient facts to demonstrate that the amended pleading
can survive a dispositive pretrial motion. See Kemin Foods, L.C. v. Pigmentos Vegetales Del
Centro S.A. de C.V., 464 F.3d 1339, 1355 (Fed. Cir. 2006) (“When a party faces the possibility of
being denied leave to amend on the ground of futility, that party must demonstrate that [the
53
complaint] states a claim on which relief [can] be granted, and it must proffer sufficient facts
supporting the amended pleading that the claim could survive a dispositive pretrial motion.”).
b. Whether The Third Amended Complaint Is Unduly Delayed Or
Prejudicial To The Government.
Prejudice has been found where an amendment results in unfair surprise, a broadening or
fundamental change in the issues litigated, or the prompting of further discovery or a need for
significant new preparation. See Cencast, 729 F.3d at 1363. In addition to prejudice, if an “issue
lurks in the case, vacillation can cause the other party irreparable injury.” Tenneco Resins, 752
F.2d at 634 (internal corrections omitted).
The original Complaint in this case that was filed on December 15, 2014 alleged two
claims: (1) breach of contract, due to wrongful termination; and (2) breach of the duty of good
faith and fair dealing. Thereafter, the Government filed an Answer and the parties proceeded with
discovery. On February 18, 2016, RMA requested leave to amend the December 15, 2014
Complaint and filed a First Amended Complaint that did not claim a breach of the duty of good
faith and fair dealing. Compare Compl. ¶¶ 48–55, with 1st Am. Compl. ¶¶ 1–42 (alleging no claim
for a breach of the duty of good faith and fair dealing).
On January 11, 2017, RMA’s first counsel sought leave to withdraw as counsel; thereafter,
RMA retained a second counsel, but did not seek leave to file a Second Amended Complaint for
several months. When the Second Amended Complaint was filed on September 6, 2017, twenty-
two new counts were added. See generally 2d Am. Compl. The Government did not oppose the
Second Amended Complaint, but reserved the right to file a motion to dismiss. ECF No. 34 at 1
(“Counsel for [the Government] does not oppose this motion with reservation of rights to file a
motion to dismiss, if appropriate.”).
RMA now seeks the opportunity to add “more detail” to cure deficiencies in the Second
Amended Complaint. As the Government points out, “RMA does not explain why its new
allegations were not asserted when the lawsuit was first filed, or when RMA first amended its
complaint, or after the Government responded to RMA’s written discovery requests.” Gov’t Reply
at 5. It is true that depositions of RMA’s principal and the Government employees who were
involved in the award and administration of the Contract have not taken place, but this appears to
be a situation of RMA’s making, since RMA elected not to comply with written discovery requests
from the Government that were required prior to conducting the deposition. Gov’t Reply at 4–5.
Although “RMA finally responded to the Government’s written discovery requests on December
31, 2016, more than eight months after [they] were served, . . . RMA’s responses were facially
deficient.” Gov’t Reply at 4–5. Therefore, allowing a Third Amended Complaint to be filed would
require additional discovery and another round of motions under RCFC 12(b). This situation
strikes the court as analogous to one where the United States Court of Appeals for the Federal
Circuit observed: “[W]ith the passage of time and acceptance of multiple earlier amendments, a
point is reached when the party seeking to amend must justify that request by more than invocation
of the concept of the rule’s liberality.” Te-Moak Bands of W. Shoshone Indians of Nev., 948 F.2d
at 1263.
54
For these reasons, the court has determined that, based on this record, RMA’s Motion For
Leave To File A Third Amended Complaint should be denied, as it would prejudice the
Government.
c. Whether The Third Amended Complaint Is Futile.
The court has determined that it does not have jurisdiction to adjudicate the claims alleged
in Counts 1, 2, 22, and 23 of the Second Amended Complaint, because they were not presented to
the CO in a timely manner, but the court has determined that it has jurisdiction to adjudicate the
allegations in Count 10 regarding RMA’s claim for a Type I differing site condition. Therefore,
the court considers here whether the remaining claims alleged in the proposed Third Amended
Complaint, would survive a RCFC 12(b)(6) Motion.
i. Differing Site Conditions (Counts 3 and 10).
The only new allegations in the Third Amended Complaint are found in Paragraph 146,
that recites some of the elements for a Type II differing site condition claim. Compare 2d Am.
Compl. ¶¶ 117, 120, with 3d Am. Compl. ¶¶ 138–48. These allegations, however, are conclusory
and do not remedy the deficiencies previously identified in Count 3 of the Second Amended
Complaint. Likewise, Count 10 of the Third Amended Complaint adds no new information, but
instead repeats or reformats the allegations in the Second Amended Complaint that the court has
determined plausibly alleges a Type I differing site condition claim.
ii. Constructive Change (Counts 4–9, 11–14, and 17–20).
Count 4 of the Third Amended Complaint concerns the availability of electrical power
during construction and adds only that the Contract represented that electrical power would be
available, because it stated that the “contractor shall furnish all instruments and personnel required
for the tests and Owner will furnish the necessary electrical power.” 3d Am. Compl. ¶ 151
(underline omitted). As with the Second Amended Complaint, these allegations conflate electrical
power used for testing electrical systems post-installation with electrical power used for
construction, that the Contract expressly stated was not available. Gov’t App’x at 36 (“Electrical
service is not available for use under this contract, therefore all electrical current required by the
[c]ontractor shall be the responsibility of the [c]ontractor, furnished at its own expense.”). In
addition, the Contract disclaimed pre-award representations, unless any such representations were
incorporated therein. Gov’t App’x at 84 (“The Government assumes no responsibility for any
conclusions or interpretations made by the [c]ontractor based on the information made available
by the Government. Nor does the Government assume responsibility for any understanding
reached or representation made concerning conditions which can affect the work by any of its
officers or agents before the execution of this contract, unless that understanding or representation
is expressly stated in this contract.”). Therefore, Count 4 alleges no new facts that state a claim
for constructive change.
Count 5 of the Third Amended Complaint concerns whether telephone and data wiring
were required by the Contract and adds that the COR made a pre-award representation that the
wiring would be installed by a “special JET installation communication team.” 3d Am. Compl. ¶¶
159–60. As the court previously determined, however, the Contract expressly required RMA to
55
install telephone and data wiring. Gov’t App’x at 10, 13, 130–31. Therefore, Count 5 alleges no
new facts that state a claim for constructive change.
Count 6 of the Third Amended Complaint is largely the same as that alleged in the Second
Amended Complaint, but adds that RMA notified the CO, by a June 2, 2010 letter, of the “need to
install a main circuit breaker was not part of the [C]ontract.” 3d Am. Compl. ¶ 169. On June 19,
2010, the CO responded that the main circuit breaker installation was required under the Contract.
Pl. App’x Ex. 29. The Contract required RMA to propose the method of connection for, and to
connect, all utilities required to render the buildings operational. Gov’t App’x at 15, 33, 37.
Therefore, Count 6 alleges no new facts that state a claim for constructive change.
Count 7 of the Third Amended Complaint alleges that several changes were made to the
toilet plumbing that amounted to a constructive change. 3d Am. Compl. ¶ 176. Toilet plumbing
work was completed between January 24, 2010 and March 3, 2010. 3d Am. Compl. ¶ 44. RMA,
however, did not provide notice to the CO that it considered this work to be additional until May
31, 2010, i.e., nearly three months after it was completed. 3d Am. Compl. ¶ 177. That notice,
however, did not comply with the notice requirements set forth in the Contract. Gov’t App’x at
93 (FAR 52.243-4 Changes Clause requiring post hoc notice within 20 days of a change).
Therefore, Count 7 alleges no new facts that state a claim for constructive change.
Count 8 of the Third Amended Complaint alleges that, on October 10, 2009, a JET engineer
requested that RMA redesign the first floor of the administrative building to include a pantry,
instead of a store room, and this resulted in additional construction costs to install a sink and
plumbing. 3d Am. Compl. ¶¶ 184, 188. Count 8 alleges that RMA notified the CO of this change
during a meeting held on December 21, 2009, and again in a letter dated May 31, 2010. 3d Am.
Compl. ¶ 185. Count 8, however, states that RMA provided the CO with verbal notice more than
two months after the work was requested and did not provide the written notice required under the
Changes Clause until seven and a half months after the work was requested. 3d Am. Compl. ¶¶
184–85. These allegations do not state a claim that the requested design change qualified as
“additional” work, because the office building was to be an original design by RMA that
incorporated the JET’s changes to the design at periodic intervals. Gov’t App’x at 7, 9, 11.
Therefore, Count 8 alleges no new facts that state a claim for constructive change.
Count 9 of the Third Amended Complaint alleges that: (1) RMA was requested to provide
an 18-ton AHU during a meeting on February 2, 2010 (3d Am. Compl. ¶ 191); (2) the CO “was
well aware of this acceleration plan and approved it” (3d Am. Compl. ¶ 191); (3) the work was
performed from March 2–7, 2010 (3d Am. Compl. ¶ 192); and (4) the required notice was provided
on May 31, 2010 (3d Am. Compl. ¶ 193). Count 9 does not allege facts that state the CO was
aware of the larger AHU and approved it. In addition, RMA’s notice to the CO that it proceeded
under protest was not provided until nearly three months after work was complete. Gov’t App’x
at 93 (FAR 52.243-4 Changes Clause requiring RMA to provide a written notice to the CO within
30 days of receipt of a written change order or 20 days from the date the Government effected the
change). Cf. Calfon Constr. Inc., 18 Cl. Ct. at 439 (“If the contracting officials have knowledge
of the facts or problems that form the basis of a claim and are able to perform necessary fact-
finding and decisionmaking, the Government is not prejudiced by the contractor’s failure to submit
a precise claim at the time a constructive change occurs. . . . On other facts[, however,] lack of
immediate notice seriously can prejudice government interests. Where contractor silence would
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foreclose less costly alternative solutions or the ability of the Government to avoid contractor
claims, timely notice is required.”). Therefore, Count 9 alleges no new facts that state a claim for
constructive change.
Count 11 of the Third Amended Complaint alleges that the Contract was constructively
changed when RMA was required to install a 2.5-inch waterline, after it installed a 2-inch
waterline. 3d Am. Compl. ¶¶ 65–66, 208. Count 11 also alleges that RMA “advised [the] JET in
several meetings that it was useless or an economic waste to change the waterline” but “Defendant”
nevertheless “insisted that the waterline be changed to 2.5 inches.” 3d Am. Compl. ¶ 67. Count
11, however, does not allege sufficient facts to support that this work exceeded that required by
the Contract; only that this work “was not factored into [RMA’s] proposal.” 3d Am. Compl. ¶
209. Nor does Count 11 allege that the work was required by an individual with authority to bind
the Government in contract or any facts that would support the conclusory allegation that the CO
ratified any alleged change. Therefore, Count 11 alleges no new facts that state a claim for
constructive change.
Count 12 of the Third Amended Complaint alleges that, after RMA installed most of the
electrical wiring, a JET inspector “changed the electrical wiring for light fixtures” and directed
RMA to “replace all PVC conduit . . . with EMT conduit (metal cladding).” 3d Am. Compl. ¶¶
214–15. Count 12 adds the name of the “JET OPM Representative” who directed the work and
alleges that this additional work was done from March 28, 2010 to April 24, 2010. 3d Am.
Compl. ¶¶ 47, 216. In addition, Count 12 adds that on February 22, 2010, RMA provided notice
to the COR that it performed the required electrical work. 3d Am. Compl. ¶¶ 49, 217. But, written
notice to the CO was sent in a letter dated May 31, 2010, i.e., five weeks after the work was
completed. 3d Am. Compl. ¶ 217. No factual allegations support that the JET OPM
Representative had actual authority to bind the Government or that the CO ratified any allegedly
additional work. Therefore, Count 12 alleges no new facts that state a claim for constructive
change.
Count 13 of the Third Amended Complaint alleges that a JET inspector also approved light
fixtures in February of 2010, that were delivered from April 1 to 3, 2010, but a JET inspector
subsequently disapproved of the light fixtures and required RMA to order new ones. 3d Am.
Compl. ¶¶ 222–24. RMA informed the CO of this change on May 31, 2010, and from June to July
replaced the light fixtures. 3d Am. Compl. ¶¶ 223–24. These allegations imply that RMA
proceeded to replace the light fixtures, but under protest. Count 13, however, does not allege that
the CO approved or disapproved of this work or whether the original light fixtures complied with
the specifications provided in the Contract.37 Therefore, Count 13 alleges no new facts that state
a claim for constructive change.
Count 14 of the Third Amended Complaint alleges that RMA submitted a single-layer
roofing system to “Defendant” on January 20, 2010, but that after Project site work was
substantially completed, the “JET/General Saud[]” directed RMA to install a double-layer roofing
system and RMA completed this work from April 3 to 8, 2010. 3d Am. Compl. ¶¶ 230–32. Again,
37
Neither RMA nor the Government provided a copy of the technical specifications listed
in Section J of the Contract.
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no allegations represent that General Saud had actual authority to bind the Government in contract
or that the work was “additional.” Nor does Count 14 provide any factual allegations to support
the conclusory allegations that the CO “knew, or should have known, that [the] JET/General Saud
directed [RMA] to install a double layer EPDM roof,” “knew, or should have known, that this
additional work was being performed[,]” and “approved or ratified the directive[.]” 3d Am.
Compl. ¶¶ 232–34. Therefore, Count 14 alleges no new facts that state a claim for constructive
change.
Count 17 of the Third Amended Complaint alleges that the design approval process used
during contract performance required RMA to submit “over 200 submittals for Defendant’s formal
review,” and thereby exceeded the scope of the Contract. 3d Am. Compl. ¶¶ 255, 257. Therefore,
Count 17 alleges no new facts that state a claim for constructive change.
Count 18 of the Third Amended Complaint alleges that RMA was subjected to increased,
“unreasonably stringent safety measures[.]” 3d Am. Compl. ¶ 262. Count 18 adds that RMA
provided notice to the CO regarding about its concern on December 21, 2009. 3d Am. Compl. ¶
263. Count 18, however, does not explain how safety measures required by the Contract amounted
to additional work. Therefore, Count 18 alleges no new facts that state a claim for constructive
change.
Count 19 of the Third Amended Complaint alleges that RMA was subjected to increased
security measures, in part, because the CO and COR “failed to . . . assist in expediting or
streamlining security checks for [RMA’s] personnel, suppliers, and subcontractors” and RMA had
to pay costs for “obtaining security badges, vehicle identifications, and updates to same every
fifteen days.” 3d Am. Compl. ¶¶ 268, 270. The Contract required RMA to provide all information
required to secure Project site access for contractor and subcontractor personnel. Gov’t App’x at
37 (providing that RMA had “responsibility for obtaining routine items to conduct day-to-day
business, such as visas, permits, and custom clearances”), 38 (“The [c]ontractor shall be
responsible for advising the [COR] of the names of personnel, type, and amounts of equipment,
date and length of time required at the site, and purpose of entering Saudi Arabia, so that proper
clearances may be obtained from the Saudi Arabian Government.”). Therefore, Count 19 alleges
no new facts that state a claim for constructive change.
Count 20 of the Third Amended Complaint alleges that RMA incurred additional costs for
redesigning the Covered Training Shelter “multiple times.” 3d Am. Compl. ¶ 275. The Third
Amended Complaint alleges that this “went beyond the design services required for the Covered
Training Shelter under . . . the Contract[,]” but provides no information to support this conclusory
allegation. 3d Am. Compl. ¶ 275. Although RMA notified the CO of this work on June 2, 2010
(3d Am. Compl. ¶ 277), no new factual allegations support that this notice was timely since the
initial contract completion date was February 6, 2010. Therefore, Count 20 alleges no new facts
that state a claim for constructive change.
iii. Uncompensated Pre-Award Design Work (Counts 15–
16).
Count 15 of the Third Amended Complaint includes two new, but inconsistent allegations:
first, that the CO, together with the COR, promised RMA that it would be compensated for design
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work; and second, that the CO “knew or should have known that the [COR] had promised to
compensate [RMA] for pre-award design services.” 3d Am. Compl. ¶¶ 238, 245. These
allegations, however, do not overcome the fact that RMA agreed to a firm, fixed-price for all
design services for the buildings required by the Contract. See AT&T, 177 F.3d at 1383 (“[F]ull
payment under a valid fixed price-type contract is all to which a contractor is entitled.”).
Therefore, Count 16 alleges no facts that state a claim for constructive change, unjust enrichment,
or misrepresentation of fact.
Count 16 of the Third Amended Complaint alleges breach of an implied-in-fact contract
and unjust enrichment to support imposing liability on the Government for the failure to award
additional contracts. 3d Am. Compl. ¶¶ 248, 250–52. To state a claim for implied-in-fact contract,
RMA must allege sufficient facts to establish: “(1) mutuality of intent, (2) consideration, (3) an
unambiguous offer and acceptance, and (4) ‘actual authority’ on the part of the [G]overnment’s
representative to bind the [G]overnment in contract.” Hanlin v. United States, 316 F.3d 1325,
1328 (Fed. Cir. 2003). In other words, the “requirements for an implied-in-fact contract are the
same as for an express contract; only the nature of the evidence differs.” Id. In addition, as with
the Second Amended Complaint, the Third Amended Complaint fails to allege that the CO made
any promise or representation regarding additional contracts. 3d Am. Compl. ¶ 248
(“[R]epresentatives of the Defendant, including the [COR] . . . and . . . OPM Chief [of] Technical
Affairs, represented to [RMA] that it would receive other contracts.”). Therefore, Count 16 alleges
no facts that state a claim for breach of an implied-in-fact contract or unjust enrichment.
For the foregoing reasons, the court denies RMA’s March 22, 2018 Cross-Motion to file a
Third Amended Complaint as it would be futile. See RCFC 15(a)(2).
IV. CONCLUSION.
The Government’s November 22, 2017 Motion To Dismiss is granted as to Counts 1
through 9 and 11 through 23 of the Second Amended Complaint, but denied as to Count 10.
RMA’s March 22, 2018 Cross-Motion For Leave To Amend is denied. The court will convene a
telephone status conference in early September 2018 to discuss further proceedings.
IT IS SO ORDERED.
s/ Susan G. Braden
SUSAN G. BRADEN
Senior Judge
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