Broad Ave. Laundry and Tailoring v. U.S.
| Decision Date | 29 November 1982 |
| Docket Number | No. 28-81,28-81 |
| Citation | 693 F.2d 1387 |
| Parties | 25 Wage & Hour Cas. (BN 1048, 30 Cont.Cas.Fed. (CCH) 70,546 BROAD AVENUE LAUNDRY AND TAILORING, Petitioner, v. The UNITED STATES, Respondent. |
| Court | U.S. Court of Appeals — Federal Circuit |
Charles M. Reifel, Washington, D.C., argued for petitioner. Dempsey & Bastianelli, Washington, D.C., was on the brief.
Gerald L. Elston, Washington, D.C., argued for respondent. With him on the brief were Asst. Atty. Gen. J. Paul McGrath, and Timothy J. Greszko, Dept. of the Army, Washington, D.C.
Before FRIEDMAN, RICH, BENNETT, MILLER and SMITH, Circuit Judges.
This is an application under the Equal Access to Justice Act, 28 U.S.C. Sec. 2412 (Supp.IV 1980) (the Act), for attorney's fees and expenses incurred in the petitioner's successful appeal to the United States Court of Claims from a decision of the Armed Services Board of Contract Appeals (the Board), denying an upward price adjustment in a government contract. We deny the application for attorney's fees and expenses.
The dispute that gave rise to the present application grew out of a fixed price contract under which the applicant agreed to operate for one year a government-owned laundry at a military post. Labor costs were such a major item of the contract that the petitioner's cost of performance varied almost directly with the wages paid. The wage rates were set through collective bargaining and were required to equal the prevailing wage rates in the area determined by the Department of Labor under 41 U.S.C. Secs. 351-358 (1976). When the petitioner took over the operation of the laundry, there was an existing collective bargaining agreement.
Shortly after the petitioner began to perform the contract, its employees shifted their union affiliation. Following collective bargaining between the petitioner and the new union, the parties agreed upon higher wages. They further agreed that those higher wages would not be effected unless the government agreed to incorporate them in the contract as an additional cost of performance.
The parties consulted the contracting officer, who said that if the Labor Department would issue a new prevailing wage determination reflecting the higher wages, she would incorporate them in the contract and that the petitioner then could request a contract price adjustment. She acted in reliance upon a Department of Labor regulation, 29 C.F.R. Secs. 4.143-4.145, 4.161, which provided that the wage rates in a contract could be changed by "[a] change in the Fair Labor Standards Act minimum by operation of law." 29 C.F.R. at Sec. 4.161. The contracting officer, who was not a lawyer, assumed that a new Labor Department prevailing wage determination would constitute a change "by operation of law." She was unaware of another provision of the regulation that indicated that new prevailing wage determinations would be effective only for contracts not yet awarded, but not for contracts already in effect. Id.
The Labor Department issued a new prevailing wage determination embodying the higher wages. The contracting officer incorporated those higher wages into a modification of the contract that required the petitioner to pay the higher rate for the life of the contract. The petitioner then requested a contract price adjustment to reflect the higher wages.
Extensive discussion ensued within the government regarding the legality of the contracting officer's modification of the contract to require the higher wages. Two weeks before the expiration of the contract, a successor contracting officer disallowed the price adjustment.
The petitioner, appearing pro se, appealed to the Board, which held that the petitioner was not entitled to a price adjustment. The Board ruled that the contracting officer had no "authority to bind the Government either in promising to amend the contract if a wage revision" were issued or The Board held that the petitioner could not invoke equitable estoppel against the government, which was the theory upon which its case primarily was based, because for that doctrine to apply "the Government representative whose acts form the basis for the estoppel must have been acting within the scope of his/her authority."
The petitioner (represented by counsel) filed an appeal from the Board to the Court of Claims. The court reversed the Board's determination that the petitioner was not entitled to recover and remanded the case to the Board to determine damages. Broad Avenue Laundry and Tailoring v. United States, 681 F.2d 746 (Ct.Cl.1982). The court held that the act of the contracting officer "though erroneous, was within the scope of her authority." Id. at 747. It ruled that the contracting officer had "actual authority to embody mistakes of law in her decisions and the government is estopped, having endowed her with the powers it has, to assert otherwise." Id. at 749.
The provisions of the Equal Access to Justice Act involved in this case authorize a court to "award reasonable fees and expenses of attorneys ... to the prevailing party in any civil action brought by or against the United States ... in any court having jurisdiction of such action." 28 U.S.C. Sec. 2412(b) (Supp.IV 1980). The Act further provides that "a court shall award to a prevailing party other than the United States fees and other expenses ... incurred by that party in any civil action ... in any court having jurisdiction of that action, unless the court finds that the position of the United States was substantially justified." Id. Sec. 2412(d)(1)(A).
In this case we need decide only two questions: (1) whether "the position of the United States," the justification for which must be evaluated, is the position it took in the court litigation for which the fees and expenses are sought, or also includes the position it took before the tribunal below (here the Board); and (2) whether the position of the United States in this case was substantially justified. We hold that the position of the United States refers to the government's position in court and not before the Board, and that the government's position here was substantially justified.
A. The Act provides for the awarding against the United States of attorney's fees "incurred by [the prevailing] party in any civil action ... in any court having jurisdiction of that action, unless the court finds that the position of the United States was substantially justified." A fair and reasonable reading of those words is that the position referred to is that taken by the United States in the "civil action" in which the attorney's fees were "incurred." The provision addresses the award of attorney's fees in a civil action in court, and it is in that particular action in which the government takes a position. See Operating Engineers Local Union No. 3 v. Bohn, 541 F.Supp. 486, 493-96 (D.Utah 1982); Alspach v. District Director of Internal Revenue, 527 F.Supp. 225, 228-29 (D.Md.1981). Contra Citizens for Block Grant Compliance v. City of Euclid, 537 F.Supp. 422, 426 (D.Ohio 1982); Photo Data, Inc. v. Sawyer, 533 F.Supp. 348, 352 (D.D.C.1982).
It would strain the normal meaning of language to construe the statutory words to cover the position the United States took in the administrative proceedings that led to the civil action in which the attorney's fees were incurred. The petitioner here seeks attorney's fees and expenses only for services rendered in the proceedings before the Court of Claims, and it would be inappropriate to look at the position the United States took in other forums to determine whether to award fees for those services.
The legislative history of the Act sheds no light on the issue of just which "position" is to be evaluated. The ordinary meaning of the words Congress used, however, limits our review to the justification for the position of the United States in the proceedings before the Court of Claims. If Congress had intended the words to mean something else, presumably it would have so indicated.
Another provision of the Act--28 U.S.C. Sec. 2412(d)(3)--supports this conclusion. That section provides that in awarding fees to a...
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