Triax-Pacific v. Stone
| Decision Date | 10 March 1992 |
| Docket Number | TRIAX-PACIFIC |
| Parties | 37 Cont.Cas.Fed. (CCH) P 76,275 , a Joint Venture, Appellant, v. Michael P.W. STONE, Secretary of the Army, Appellee. 91-1311. |
| Court | U.S. Court of Appeals — Federal Circuit |
Timothy Miguel Willardson, Alpine, Utah, argued for appellant.
Joan M. Bernott, Sp. Litigation Counsel, Commercial Litigation Branch, Dept. of Justice, Washington, D.C., argued for appellee. With her on the brief were Stuart M. Gerson, Asst. Atty. Gen., and David M. Cohen, Director. Also on the brief was John McC. Trainor, Engineer Attorney, Army Corps of Engineers, Norfolk, Va., of counsel.
Before MICHEL, LOURIE, and CLEVENGER, Circuit Judges.
Triax-Pacific appeals from the January 9, 1991, decision of the Armed Services Board of Contract Appeals, ASBCA No. 36353, 91-2 B.C.A. (CCH) p 23,724, 1991 WL 8533, denying Triax's claim for delay and additional costs associated with a contract to renovate family housing quarters. Because the Board correctly found that the contract delay was the fault of Triax, we affirm.
On March 31, 1986, Triax was awarded a contract to perform improvements to family housing quarters at Fort Lee, Virginia. The work under the contract was divided into three phases, designated as Phase I, Phase II, and Phase III. Triax was required to commence work within 10 calendar days after receiving a notice to proceed; that requirement existed for each phase. The notice to proceed on Phase II was to be issued within 60 days after the notice to proceed on Phase I.
Earlier, Triax had been awarded another contract to perform substantially the same improvements on other units of the family housing quarters. Triax was 60 days late in completing performance on this earlier contract and was assessed $33,335 in liquidated damages. Triax's late performance on this earlier contract, as described by the Board, had "the effect of reducing the number of housing units available for occupancy" during Triax's performance on the second contract.
Shortly after Triax received notice to proceed on Phase I, the government told Triax that its late performance on the earlier contract might result in delaying the notice to proceed on Phase II of the second contract. Consequently, the notice to proceed on Phase II was not issued until 53 days after the August 8, 1986 deadline.
Triax submitted a certified claim for additional costs due to the delay. Upon denial of its claim by the contracting officer, Triax sought review by the Board. The Board found that the government's delay in issuing the notice to proceed on Phase II of the second contract was due to Triax's late performance on the earlier contract. Consequently, the Board determined that Triax's additional costs could not be recovered under the provisions of the second contract, specifically the Changes and Suspension of Work clauses, and that Triax's claim was not remediable under a breach of contract claim.
The Changes clause states that
The Contracting Officer may ... make changes in the work within the general scope of the contract. If any change under this clause causes an increase or decrease in the Contractor's cost of, or the time required for, the performance of any part of the work under this contract ... the Contracting Officer shall make an equitable adjustment.
48 C.F.R. § 52.243-4 (1990).
The Suspension of Work clause provides that
If the performance of all or any part of the work is, for an unreasonable period of time ... delayed ... by the Contracting Officer's failure to act within the time specified in this contract ..., an adjustment shall be made for any increase in the cost of performance of this contract. However, no adjustment shall be made under this clause for any ... delay ... to the extent that performance would have been so ... delayed ... by any other cause, including the fault or negligence of the Contractor.
48 C.F.R. § 52.212-12 (1990) (Emphasis added).
Whether the Board erred in denying Triax's claim for the additional costs it incurred when Phase II of the contract was delayed?
Our standard of review is set forth in 41 U.S.C. § 609(b) (1988), as follows:
the decision of the [Board] on any question of law shall not be final or conclusive, but the decision on any question of fact shall be final and conclusive and shall not be set aside unless the decision is fraudulent, or arbitrary, or capricious or so grossly erroneous as to necessarily imply bad faith, or if such decision is not supported by substantial evidence.
The Board's interpretation of a contract is a legal conclusion which we review de novo. George Hyman Constr. Co. v. United States, 832 F.2d 574, 579 (Fed.Cir.1987). However, the Board's interpretation is given careful consideration, as it has considerable experience and expertise in interpreting government contracts. Alvin Ltd. v. United States Postal Serv., 816 F.2d 1562, 1564 (Fed.Cir.1987). In this case, the Board's interpretation of the contract was not erroneous.
Triax argues that the Board's determination that Triax was not entitled to recover under a breach of contract claim misconstrued the intent of the Contract Disputes Act and the holding of the court in Johnson & Sons Erectors Co. v. United States, 231 Ct.Cl. 753, cert. denied, 459 U.S. 971, 103 S.Ct. 303, 74 L.Ed.2d 283 (1982). Triax states that since the Board held that it cannot recover under the contract, it should be entitled to seek recovery under a breach of contract claim. We do not agree.
In Johnson & Sons, one of our predecessor courts stated that contract clauses providing for equitable adjustments remove the contractor's obligation to declare the contract at an end and cease performance in order to avoid a waiver and save its rights. Id. at 757. As a result, claims for breach of contract are claims for equitable adjustment. Id. at 758. Therefore Triax also argues that its additional costs should be recoverable under the Changes clause. Triax states that the...
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Alappat, In re, 92-1381
...fact finding be reviewed under the deferential "substantial evidence" standard. See 41 U.S.C. Sec. 609(b) (1988); Triax-Pacific v. Stone, 958 F.2d 351, 353 (Fed.Cir.1992). If the court is correct that the patent appeals board is less "independent" and makes policy-based decisions, then argu......
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