Pacific Architects and Engineers Inc. v. United States
| Citation | 491 F.2d 734 |
| Decision Date | 23 January 1974 |
| Docket Number | No. 298-72.,298-72. |
| Parties | PACIFIC ARCHITECTS AND ENGINEERS INCORPORATED and Advanced Maintenance Corporation v. The UNITED STATES. |
| Court | Court of Federal Claims |
COPYRIGHT MATERIAL OMITTED
Loren R. Rothschild, Los Angeles, Cal., attorney of record, for plaintiff.
David R. Schlee, Washington, D. C., with whom was Acting Asst. Atty. Gen. Irving Jaffe, for defendant.
Before KASHIWA, KUNZIG, and BENNETT, Judges.
This case comes before the court on defendant's motion, filed October 2, 1973, requesting that the court adopt, as the basis for its judgment in this case, the recommended decision of Trial Judge Philip R. Miller, filed August 14, 1973, on the parties' cross-motions for summary judgment pursuant to Rule 166(c), plaintiff having failed to file a request for review by the court of said recommended decision within the time provided by the Rules of the court therefor. Upon consideration thereof, it appears that plaintiff has also failed to timely respond to defendant's motion of October 2, 1973, and since the court agrees with the trial judge's recommended decision, without oral argument, it hereby grants defendant's motion and adopts the said decision as the basis for its judgment in this case. Accordingly, plaintiff's motion for summary judgment is denied, defendant's like cross-motion is granted and plaintiff's petition is dismissed.
MILLER, Trial Judge: The petition herein seeks payment of $38,424.52. The claim is derived from a contract with the Air Force for the operation of food service facilities at Vandenberg Air Force Base, California, for an 11-month period commencing November 1, 1968.
Item 1 of the contract provided for preparation of an estimated 1,290,247 meals at facilities on the Base, for service at dining halls, missile sites and remote areas throughout the Base at a unit price of $.30785. Item 2 called for preparation of an estimated 118,959 meals at an in-flight kitchen at a unit price of $.246455. The originally estimated total price was $426,520.58, but the contract was modified to add a special additional mess facility and meals due to a flood in January and February 1969, which increased the estimated contract price to $430,406.13.
Reflecting the fact that costs could vary with increases and decreases from the estimate, the contract contained provisions for adjustment to wit:
To deal with greater variations than those set forth above, Part IV further provided:
c. If the number of meals served in any calendar month (to other than contractor personnel) varies from the estimated requirements for that month by more than 30% of such requirements, the Contractor and the Contracting Officer will negotiate an equitable adjustment in the contract price for that month in the manner provided in the Changes Clause of this contract.
The Changes Clause in the contract provided that if any change caused an increase or decrease in the cost of performance, an equitable adjustment should be made in the contract price. Failure to agree to any adjustment would be a dispute concerning a question of fact within the meaning of the standard Disputes Clause.
In fact the Government's estimate was much too high, for in no one of the 11 months did the number of meals served even approach the estimate. In 7 of the 11 months the number of meals served was less than 70 percent for either Item 1 or Item 2, as shown by the following tabulation:
___________________________________________________________________________
| ITEM 1 | ITEM 2
Month |____________ __________________|_____________________________
| Gov. est. | Actual | Percent| Gov. est. | Actual | Percent
_____________|____________|_________|________|___________|________|________
(1968) | | | | | |
| | | | | |
Nov ________ | 115,890 | 87,026 | 75.09 | 10,685 | 7,492 | 70.12
Dec ________ | 119,753 | 77,256 | *64.50| 11,041 | 6,926 | *62.73
(1969) | | | | | |
Jan ________ | 119,753 | 91,219 | 76.17| 11,041 | 7,746 | 70.16
Feb ________ | 108,164 | 84,018 | 77.68| 9,972 | 8,697 | 87.20
Mar ________ | 119,753 | 88,208 | 73.66| 11,041 | 7,115 | *64.44
Apr ________ | 115,890 | 86,143 | 74.33| 10,685 | 7,695 | 72.02
May ________ | 119,753 | 79,250 | *66.19| 11,041 | 7,526 | *68.16
Jun ________ | 115,890 | 75,633 | *65.26| 10,685 | 7,497 | 70.16
Jul ________ | 119,753 | 73,960 | *61.76| 11,041 | 7,293 | *66.05
Aug ________ | 119,753 | 69,786 | *58.27| 11,041 | 5,837 | *52.87
Sep ________ | 115,890 | 73,641 | *63.54| 10,685 | 6,371 | *59.62
|____________|_________|________|___________|________|________
Total ____| 1,290,247 | 886,140 | 68.73| 118,958 |80,195 | 67.50
_____________|____________|_________|________|___________|________|________
In January 1969, plaintiff requested the contracting officer to make the equitable adjustment required by reason of the fact that the December 1968 meals had fallen below 70 percent of the estimate. In February 1969, plaintiff informed the contracting officer that its own projections showed only 709,102 meals for Item 1 and 60,481 meals for Item 2 over the entire contract period, and it requested a revision of the contract prices to $.6629 and $.4875, respectively, instead of those stated in the contract, so that the contract price of $426,520.58 originally estimated for an aggregate of 1,409,205 meals would be paid for only 769,583 meals. No acceptable agreement could be arrived at, and, by change order to the contract, in May 1969 the contracting officer provided for payment to plaintiff for those months in which meals fell below the 70 percent level, as if 70 percent had been served and at the increased unit price provided therefor in the contract. It was agreed, however, that plaintiff's acceptance of such payments would not prejudice its claim for additional payment.
In January 1970 after completion of the period, plaintiff submitted a claim for equitable adjustment for all of the 7 months in which one or the other of the items had fallen below 70 percent of the estimated meals. The claim was based on the plaintiff's costs for those 7 months plus 6 percent profit. This was rejected by the contracting officer for the reason that plaintiff's bids had been improvidently low so that even if all of the estimated meals had been served, plaintiff could not have made a profit.1 The loss had also been added to by an unanticipated new labor contract increasing labor costs in May 1969. Since these were a part of plaintiff's and not the Government's risks, the adjustment could not be used as a device for converting the contract from a loss to a profit. In October 1970, the contracting officer issued his final decision which based the equitable adjustment on the amount the plaintiff would have received if 100 percent of the estimated meals had been served in the 7 months in which the number of either of the items was less than 70 percent, less an offset for the additional costs plaintiff would have had to incur. This resulted in payment for 286,088 additional meals which plaintiff never served.
As finally made, the Government's adjustment paid to the plaintiff was computed as follows:
7 months estimated meals at 100% _________________ $235,056.24
Less cost savings for curtailed services _________ -5,234.80
___________
$229,821.44
Less payment already made (including offset for
lost equipment not in dispute) _________________ -167,477.60...To continue reading
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