812 F.2d 1387 (Fed. Cir. 1987), 86-1554, Mingus Constructors, Inc. v. United States

Docket Nº:Appeal No. 86-1554.
Citation:812 F.2d 1387
Party Name:MINGUS CONSTRUCTORS, INC., Appellant, v. The UNITED STATES, Appellee.
Case Date:March 03, 1987
Court:United States Courts of Appeals, Court of Appeals for the Federal Circuit
 
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Page 1387

812 F.2d 1387 (Fed. Cir. 1987)

MINGUS CONSTRUCTORS, INC., Appellant,

v.

The UNITED STATES, Appellee.

Appeal No. 86-1554.

United States Court of Appeals, Federal Circuit

March 3, 1987

Page 1388

        Chad L. Schexnayder, of Jennings, Kepner & Haug, Phoenix, Arizona, argued for appellant. On the brief with him was Robert A. Scheffing, of Jennings, Kepner & Haug, Phoenix, Ariz.

        Thomas W. Petersen, of the Dept. of Justice, Washington, D.C., argued for appellee. With him on the brief were Richard K. Willard, Asst. Atty. Gen., David M. Cohen, Director, and Michael Paul, of the Commercial Litigation Branch, Dept. of Justice, Washington, D.C. Of counsel was Daniel Jackson, Office of Counsel, Bureau of Indian Affairs, Dept. of the Interior.

        Before FRIEDMAN and DAVIS, Circuit Judges, and BENNETT, Senior Circuit Judge.

        BENNETT, Senior Circuit Judge.

        The decision of the United States Claims Court (Claims Court), 10 Cl.Ct. 173 (1986) (Merow, J.), granting summary judgment in favor of the government against Mingus Constructors, Inc. (Mingus), on Mingus's claim for damages arising out of a road construction contract on the Hopi Indian Reservation in Navajo County, Arizona, is affirmed on the basis of the following opinion.

        BACKGROUND

        Mingus entered into a written construction contract with the Department of the Interior (Bureau of Indian Affairs) to construct 8.93 miles of roadway between Lupe and Oraibi, Arizona. Notice to proceed was received by Mingus on August 12, 1981, and work on the project was substantially completed on July 30, 1982.

        On July 14, 1982, Mingus sent a letter to the contracting officer which stated that the conduct of the government's project representative toward Mingus during the job constituted "malicious harassment" and

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advised that Mingus intended to file a claim for the additional cost resulting from the harassment. On August 10, 1982, Mingus sent a second letter which reiterated its intent to file a claim and stated that review of job records indicated that Mingus had suffered losses due to work that was misrepresented by the contract documents or that was constructed outside the scope of the original design. Mingus concluded the August 10 letter by stating that it was in the process of assessing the "impact resulting from these changed conditions" and would submit a finalized cost breakdown within 2 weeks. However, the finalized cost breakdown was not submitted as promised in the letter.

        On October 28, 1982, the government inquired of Mingus as to the status of the Release of Claims form that it had sent to Mingus preliminary to making final payment under the contract and advised that "[y]ou may except any claims against the Government in the space provided [on the form].... Any exceptions you make on the Release of Claims will not hold up the processing of your final payment." The following day, Mingus executed the Release of Claims form which provided, in pertinent part--

Whereas, by the terms of the [contract] entered into by the United States of America ... and the contractor [Mingus Constructors, Inc.] it is provided that after completion of all work, and prior to final payment, the contractor will furnish the United States with a release of all claims;

Now, Therefore, in consideration of the above premises and the payment by the United States to the contractor of the amount now due under the contract, to wit, the sum of [$69,334.27], the contractor hereby remises, releases, and forever discharges the United States, its officers, agents, and employees, of and from all manner of debts, dues, liabilities, obligations, accounts, claims, and demands whatsoever, in law and equity, under or by virtue of the said contract except:

        In the space provided for exceptions, Mingus typed the following statement:

Pursuant to correspondence we do intend to file a claim(s)--the amount(s) of which is undetermined at this time.

        Following receipt of the signed release, the final payment required under the contract was authorized on November 2, 1982. On November 5, 1982, Mingus sent a letter acknowledging its execution of the release form and seeking confirmation of its understanding that by inserting the statement on the release form, Mingus had not waived its rights to claims in the process of being prepared. The contracting officer responded on November 10, 1982, by stating that "[y]ou may except any claims against the Government in the space provided on the release of claims form without waiving your right to submit certified, detailed claim [sic] at a later date."

        Mingus made Freedom of Information Act requests on January 7, 1983, and February 18, 1983, seeking information and documents relating to the contract for use in the preparation of its formal claim. On June 22, 1983, Mingus wrote the contracting officer requesting a time extension on the submission of its formal written claim until July 31, 1983. On July 14, 1983, the contracting officer responded to the letter by denying the request for an extension. The contracting officer noted that, since Mingus's July 14, 1982 letter indicating an intent to file a claim, "nothing in the way of a written cost claim and detailed data in support thereof" had been submitted and concluded--

Time frames for submitting cost claims by the contractor which are set forth in the contract under each pertinent clause, governs [sic].

In view of the time elapsed and the lack of organic documents supporting your intended claim, the Contracting Officer hereby determines that no claim exists under this contract.

        Mingus submitted its certified claim on January 5, 1984. The claim was returned on February 8, 1984, without action by the contracting officer. The reasons given were that it was untimely received, the contract required claims to be made before final payment, and no "claim" as defined in

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the Disputes section of the contract 1 had been submitted by the time of final payment. The contracting officer noted that when no claim had been submitted in the year following the notice of intent to make a claim, a unilateral decision had been made that no claim existed under the contract.

        Mingus filed a petition in the Claims Court on June 19, 1984, pursuant to the Contracts Disputes Act of 1978, 41 U.S.C. Secs. 601-613 (1982), seeking an equitable adjustment to the contract price for changes, constructive changes, differing site conditions, defective specifications, delays, and government interference with the contractor's performance. Damages in the sum of $1,081,273.95 were sought. The government filed a motion for summary judgment asserting that the plaintiff's claims were barred by the release executed on October 29, 1982, by its failure to give notice under the applicable contract provisions, and by its failure to assert a claim prior to final payment. Mingus filed a motion for partial summary judgment 6 days later, arguing that there were no issues of material fact and seeking to foreclose the defenses of lack of notice, untimely submission of the claims, release, and accord and satisfaction.

        The Claims Court held in favor of the government. It observed that the asserted claims were governed by several contract clauses which contained notice provisions and limitations periods which claims brought under the clauses had to meet. The court ruled that none of the claims asserted in Mingus's complaint was submitted to the contracting officer prior to the final payment and that payment to the contractor by the government barred consideration of any subsequent claims for damages under the contract. 10 Cl.Ct. at 177. The Claims Court rejected Mingus's argument that the exception made on the general release was sufficient to put the government on notice as to specific claims. Id. at 178. Finally, the Claims Court held that the defendant had established that the government would be prejudiced to a degree warranting the barring of plaintiff's claims as untimely. Id. Therefore, the Claims Court concluded that no issue of...

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