Prince Const. v. Contract Appeals Bd.

• Decision Date: 09 February 2006
• Docket Number: No. 03-AA-1338.,03-AA-1338.
• Citation: 892 A.2d 380
• Parties: PRINCE CONSTRUCTION COMPANY, INC., Petitioner, v. DISTRICT OF COLUMBIA CONTRACT APPEALS BOARD, Respondent.
• Court: D.C. Court of Appeals

Page 380

892 A.2d 380

PRINCE CONSTRUCTION COMPANY, INC., Petitioner, v. DISTRICT OF COLUMBIA CONTRACT APPEALS BOARD, Respondent.

No. 03-AA-1338.

District of Columbia Court of Appeals.

Argued October 25, 2005.

Decided February 9, 2006.

Christopher M. Kerns for petitioner. Robert A. Klimek, Jr., Washington, filed a brief for petitioner.

William J. Earl, Assistant Attorney General, with whom Robert J. Spagnoletti, Attorney General for the District of Columbia, and Edward E. Schwab, Deputy Attorney General, were on the brief for respondent.

Before WASHINGTON, Chief Judge, KRAMER, Associate Judge, and BELSON, Senior Judge.

BELSON, Senior Judge:

Prince Construction Co., Inc. (Prince), petitions for review of the ruling of the District of Columbia Contract Appeals Board (CAB or Board) that Prince was not entitled to an interest penalty under the Quick Payment Act (QPA), D.C.Code §§ 2-221.01, -221.06 (2001), on its recovery in the Superior Court of the District of Columbia of $2,506,487 against the District of Columbia. Prince challenges here the CAB ruling that, because Prince entered into a Superior Court consent judgment based upon an underlying claim that sounded in equity, Prince could not thereafter disavow its attendant acknowledgment that its claim was equitable in nature and argue instead that its claim was contractual and therefore eligible for a QPA interest penalty. We agree with the CAB and hold that Prince is precluded by the consent judgment it agreed to in Superior Court from seeking QPA interest penalties and, therefore, affirm.

I.

In November 1993, Prince entered into a contract with the District of Columbia Department of Public Works ("DPW") to perform permanent roadway patching work. In October 1994, Prince contracted with DPW to build a facility to store salt to be used on roadways during the winter. In May 1997, after the District failed to pay Prince the amounts due for both completed contracts, Prince filed an appeal before the CAB against the District. In its appeal to the CAB, Prince claimed entitlement to a principal sum of $2,506,487.00 for past due payment for completed work, plus interest penalties under the QPA.

On the same day that Prince filed its CAB appeal, it also filed a complaint in the D.C. Superior Court. The complaint demanded payment in the same amount as sought in the appeal to the CAB, based not only on breach of contract but also on the ground of quantum meruit.¹ Although Prince's complaint sought the principal sum "plus interest and costs" in both the quantum meruit and the contract counts, the Superior Court complaint — unlike the CAB appeal — did not specifically mention interest penalties under the QPA statute. In July 1997, the trial court entered a consent judgment requiring the District to pay Prince the entire principal amount. The District paid it the following month.

The consent judgment extinguished Prince's Superior Court claim, but its CAB claim remained pending. In March 2001, Prince moved the CAB for summary judgment in the amount of $364,904.26 on the QPA interest claim. The District opposed Prince's motion, arguing that because the debt was incurred outside the contracts (i.e. the funding was unauthorized and the work was completed after the term of the contract had expired), any remedy to which Prince would be entitled would be in equity. The District also contended that the Superior Court consent judgment reflected Prince's acknowledgment that the principal debt was not based on valid contractual obligations, because while the CAB has primary jurisdiction to adjudicate valid contract claims, only the Superior Court has jurisdiction to adjudicate equitable quantum meruit claims. The CAB initially found that the District incurred the principal debt while the contracts were still in force, and for that reason entered summary judgment in favor of Prince, thereby ruling that Prince was entitled to QPA interest penalties. It returned the matter to the parties for determination of the QPA interest amount.

The District then moved the CAB to reconsider its grant of summary judgment to Prince. The District first asserted that the claim for QPA interest was barred by res judicata, since the parties had intended to encompass all claims, including any interest claims, in the Superior Court consent judgment. In support of this argument, the District noted, inter alia, that Prince had written a letter to the District offering to accept $2,506,487.00 "as full satisfaction of its claim" in Superior Court if the relatively small salt storage facility claim were determined to be equitable, but added that it would accept that same amount less the price of the salt facility contract if that claim were not to be found equitable in nature. In further support, the District also noted that the joint memorandum supporting the motion for consent judgment set forth the parties' agreement that Prince was entitled to that sum "in full satisfaction of all claims asserted in the Complaint."

The CAB granted the District's motion for reconsideration. It ruled that, because the joint memorandum of points and authorities which the parties had filed in Superior Court in support of their motion for consent judgment established that Prince's recovery there was equitable in nature, Prince's claim must be denied. Upon examining the language used in the memorandum, the Board determined that the parties had requested the court to exercise its equitable power to direct the District to pay for the value of services received and accepted, rather than seeking the court's enforcement of contract rights. The Board therefore dismissed Prince's claim for QPA interest penalties. Prince filed a motion for reconsideration, which was denied, and this appeal followed.

II.

The first argument Prince presents here is that the CAB was precluded from even considering the District's motion for reconsideration because the District's argument that the Superior Court consent judgment established that Prince's claim was equitable in nature had been made, considered, and rejected by the CAB in connection with Prince's earlier motion for summary judgment. Prince argues that the CAB's own procedural rules now bar it from reconsidering and denying QPA interest penalties.²

Contract Appeals Board Rule 117.1(d) provides that parties may make motions to reconsider the Board's decision, but that "parties shall not present arguments substantially identical to those already considered and rejected by the Board." See Appeal of Volpe Constr. Co., CAB No. D-816, May 17, 1994, 42 D.C.Reg. 4600 (1995) (denying motion for reconsideration because, inter alia, "[a]ppellant ha[d] not presented any information that was not previously considered by the Board").

A comparison of the CAB's first summary judgment ruling with its subsequent grant of reconsideration establishes that the CAB properly considered the District's motion to reconsider. The first summary judgment order analyzed the conduct and actions of the parties and determined that a unified contract existed. It barely made reference to the Superior Court consent judgment. In contrast, when the CAB granted the District's motion to reconsider, it based its decision almost exclusively on the language of the consent judgment and the memorandum of points and authorities the parties submitted with it. Under CAB Rule 117.1(d), whether the party moving for reconsideration has previously presented a given argument is not dispositive; rather, the rule bars only arguments that the CAB "already considered and rejected" (emphasis added). Because the CAB's initial summary judgment order made scant mention of the consent judgment (on which the CAB based its later decision to reconsider), the rule did not bar the CAB from entertaining the District's motion to reconsider.

III.

Prince's substantive claim is that the CAB erred in concluding that Prince's $2,506,487.00 recovery was based on an equitable theory rather than on a theory of contractual entitlement, because the "evidence" did not support such a finding. The consequence of the CAB ruling was that Prince was not entitled to recover QPA interest penalties, because it is only on contract claims that the QPA requires the payment of interest penalties. The QPA by its terms refers to an interest penalty that is incurred by the District when it "does not make payment for . . . service by the required payment date," D.C.Code § 2-221.02(a)(1), specified "under the terms of the contract for the provision of . . . service." D.C.Code § 2-221.02(a)(2)(A)(I). Thus, it is applicable only to contractual obligations of the District.³

The Board has primary jurisdiction to consider claimant's contractual disputes with the District. Lawlor v. District of Columbia, 758 A.2d 964, 973-74 (D.C. 2000); D.C.Code § 2-309.03.⁴ The Superior Court, on the other hand, has jurisdiction over claims that sound in equity. D.C.Code § 11-921(a)(6), see also District of Columbia v. Group Ins. Admin., 633 A.2d 2, 14 (D.C.1993) (as part of its general equity jurisdiction, Superior Court may hear suit for injunctive relief in relation to bid protest, even though underlying protest is still pending before agency review board). Administrative agencies do not have inherent equitable power. See Ramos v. District of Columbia Dep't Consumer & Regulatory Affairs, 601 A.2d 1069, 1073 (D.C.1992) (administrative law tribunals possess only narrowly defined statutory and regulatory powers; they do not have the inherent equity power of courts).

In this case, Prince and the District submitted to the Superior Court a memorandum of points and authorities together with a proposed form of consent judgment which the court adopted and entered on July 23, 1997. The CAB based its order dismissing Prince's appeal seeking a QPA interest penalty on a "plain reading of the recitation of facts contained in the parties' joint memorandum in support of the motion for consent judgment,"...