Precision Standard, Inc.
Docket: ASBCA 59116
Decision date: 2015-07-13

ARMED SERVICES BOARD OF CONTRACT APPEALS 
Appeal of -- ) 
) 
Precision Standard, Inc. ) 
) 
Under Contract No. SPM4A7-08-M-B239 ) 
APPEARANCE FOR THE APPELLANT: 
APPEARANCES FOR THE GOVERNMENT: 
ASBCA No. 59116 
Nancy M. Camardo, Esq. 
Camardo Law Firm, P.C. 
Auburn, NY 
Daniel K. Poling, Esq. 
DLA Chief Trial Attorney 
Robert E. Sebold, Esq. 
Trial Attorney 
DLA Aviation 
Richmond, VA 
OPINION BY ADMINISTRATIVE JUDGE HARTMAN 
ON THE GOVERNMENT'S MOTION FOR SUMMARY JUDGMENT 
The government moves for summary judgment, asserting that its contracting 
officer (CO) appropriately terminated appellant's contract for default because 
Precision Standard, Inc. (PSI) was delinquent in submitting the contractually required 
first article and PSI has provided no evidence of excusable delay. Appellant asserts 
the government's motion should be denied because there are genuine issues of material 
fact regarding: ( 1) why the CO did not exercise her discretion to terminate the 
contract at "no cost" and (2) why its lack of delivery of the first article here was not 
"excusable." According to PSI, it could not schedule the quality assurance 
representative (QAR) inspection necessary for first article delivery due to QAR 
scheduling problems arising from the "sequester" and furlough of government 
employees. 
STATEMENT OF FACTS FOR PURPOSES OF THE MOTION 
In June 2008, the Defense Supply Center, Richmond (which has been renamed 
Defense Logistics Agency Aviation), a field activity of the Defense Logistics Agency 
(DLA), awarded a contract, No. SPM4A 7-08-M-B239, for the supply of 32 aircraft 
"formers" for A-10 aircraft, National Stock Number (NSN) 1560-01-553-7553, 
part 
number 160414007-74, to appellant, PSI (R4, tab 1at1, 3). Aircraft "formers" are a 
"CRITICAL APPLICATION ITEM," where "failure ... could injure personnel or 

jeopardize a vital agency mission" (R4, tab 1 at 5; Federal Acquisition Regulation 
(FAR) 46.203(c)). 
The parties' contract required PSI to submit a first article for testing 
by the 
Engineering Support Activity (ESA) for the A-10 aircraft program at Hill Air Force 
Base in Ogden, Utah 
(R4, tab 1 at 4-5, 10, 13-14). The first article 
was due 9 February 
2009, and ESA had 120 days to evaluate that article. If ESA approved the article, the 
production quantity of 32 was due 200 days after the approval. (R4, tab 1 at 2, 9) 
The parties' contract incorporated by reference various standard clauses, 
including FAR 52.209-4, FIRST ARTICLE APPROVAL - GOVERNMENT TESTING 
(SEP 1989); and FAR 52.249-8, DEFAULT (FIXED-PRICE SUPPLY AND SERVICE) 
(APR 1984). (R4, tab 1at15; FAR 52.252-2, CLAUSES INCORPORATED BY REFERENCE 
(FEB 1998)) The initial clause states: 
(a) The Contractor shall deliver __ unit(s) of 
Lot/Item __ within __ calendar days from the date of 
this contract to the Government at [insert name and 
address of the testing facility] for first article tests .... 
(b) Within __ calendar days after the 
Government receives the first article, the Contracting 
Officer shall 
notify the Contractor, in writing, of the 
conditional approval, approval, or disapproval of the first 
article .... 
( c) If the first article is disapproved, the Contractor, 
upon Government request, shall submit an additional first 
article for testing .... The Contractor shall furnish any 
additional first article to the Government under the terms 
and conditions and within the time specified by the 
Government .... 
( d) If the Contractor fails to deliver any first article 
on time, or the Contracting Officer disapproves any first 
article, the Contractor shall be deemed to have failed to 
make delivery within the meaning of the Default clause of 
this contract. 
The latter clause states: 
(a)(l) The Government may, subject to paragraphs 
(c) and (d) of this clause, by written notice of default to the 
2 

Contractor terminate this contract in whole or in part ifthe 
Contractor fails to -
(i) Deliver the supplies ... within the time 
specified in this contract or any extension; 
(c) [Unless] the failure to perform the contract 
arises from causes beyond the control and without the fault 
or negligence of the Contractor. 
PSI did not submit the first article by its due date, 9 February 2009 (R4, tab 8 
at 6). Over three months after the due date, on 21May2009, PSI submitted a first 
article but material certifications, as well as process specifications for the passivate 
and heat treatment, were missing (R4, tab 8 at 
6-21, tab 9 at 1-2). When PSI did not 
respond to requests for the missing materials, ESA disapproved the first article (R4, 
tab 10). By letter dated 17 November 2009, DLA's CO advised PSI that ifit paid 
extra costs incurred for government testing and offered DLA some other consideration 
for its contractor-caused delay, it could re-submit the disapproved first article after it 
had corrected the following discrepancies: 
1. Print requirement is .32 R +/- .03; Actual measurement 
is one side is .28[,] the other is .32. 
2. As per the contract page 4 item numbers 4, and 5 
require that all material certs, and process certs and 
purchase orders; None were sent with the First Article, 
and these certifications were requested again through 
the DLA contracting office. The contractor sent none 
of the requested certifications. 
The CO added that, on resubmission of the first article, a new delivery date would be 
established and memorialized in a contract modification. The CO further advised that 
PSI could alternatively: ( 1) submit a rebuttal letter regarding the first article test for 
review by both DLA and ESA or (2) request a no-cost cancellation/termination of the 
parties' contract and, if the request was acceptable to DLA, the parties' contract would 
be "cancelled or terminated." The CO stated PSI shall respond to her letter within 
ten workdays after receipt of her letter and, if it did not, the "contract may be cancelled 
or terminated without further notification." (R4, tab 10) 
PSI submitted a rebuttal in January 2010 asserting, among other things, that it 
rejected any "no-cost" termination; the disparity in first article dimension could be 
readily corrected in production at minimal cost; and the sole material certification was 
3 

attached to the test report it submitted with the first article. It did not, however, 
furnish a copy of that certification (R4, tabs 13, 16). In June 2011, DLA's CO gave 
PSI the opportunity to submit a second first article and propose a revised delivery 
schedule for the contract (R4, tab 17 at 2). 
By bilateral contract Modification No. POOOOl executed 18 December 2012, the 
parties established a new delivery date of 22 January 2013 for the first article (R4, 
tab 2 at 1-2, tabs 18, 19). PSI, however, did not submit a second first article by the 
specified date (R4, tab 21 ). 
By letter dated 29 July 2013, DLA's CO sent PSI a letter stating she was 
considering terminating the parties' contract 
for default and PSI was being given the 
opportunity to present facts bearing on the question within 
ten days after receipt 
(R4, tab 21). While PSI received the CO's letter, it did not respond within the time 
specified (R4, tabs 22, 23). 
DLA, however, provided PSI a third opportunity to submit a first article. By 
bilateral contract Modification No. P00002, the parties established a new delivery of 
18 October 2013 for the first article. The parties also modified their contract to provide: 
(R4, tab 3) 
[I]fthe First Article re-submission is not delivered by the 
date ... [ due] or ifthe First Article is disapproved, (second 
disapproval), this contract may be terminated in its entirety 
at no cost to the Government. 
PSI again failed to submit a first article by the specified date (R4, tab 23 at 3, 
tab 24). By final decision dated 13 December 2013, DLA's CO notified PSI that its 
contract was "terminated for default effective immediately" based on its "failure to 
perform in accordance with the terms and conditions of the contract, specifically your 
failure to deliver the supplies in accordance with the established delivery schedule" 
(R4, tabs 4, 25). PSI timely appealed the CO's decision to this Board. 
DLA filed a motion for summary judgment in the appeal. PSI filed an 
opposition to DLA's motion asserting, among other things, that it was delayed in 
submitting a first article due to unavailability of an inspector and appending an 
affidavit from its chief operating officer providing in pertinent part: 
The Government, in its Motion, attempts to allege that the 
only effect that the sequester would have on the inspection 
was during the five-day furlough period, occurring 
between October 1 through October 5, 2013. However, 
4 

what the Motion failed to note [was] that the sequester 
affected a time period far beyond those date[ s]. For a 
number of months the QARs were allowed to work only 
four days a week. This made scheduling inspections 
significantly more difficult. This difficulty is exacerbated 
by the fact that each QAR services numerous contractors 
and contract[]s. 
(App. resp., aff. at 3, ii 7) Nowhere in the affidavit, however, does the affiant state that 
he or anyone else from PSI ever actually attempted to schedule an inspection of the first 
article with a QAR (id. at 1-3). DLA appended to its reply an affidavit from a quality 
assurance specialist with the Defense Contract Management Agency in Detroit, 
Michigan, who was assigned to PSI between September and December of 2013 stating: 
During the September through December of 2013 time 
frame I was in Precision Standard's facility for several 
different business matters and had no knowledge that the 
first article test for contract SPM4A7-08-M-B239 was 
ready for inspection. To the best of my knowledge this 
first article test was never presented to the government for 
inspection. 
(Gov't reply, decl. ii 2) 
DECISION 
DLA terminated PSI's contract 
for default based upon a failure to deliver the 
first article by the contractually specified date. It seeks summary judgment that its 
default termination was proper based upon the fact it is undisputed that PSI did not 
deliver the first article by its due date. (Gov't mot. at 2; compl. ii 16(c)) 
The standards set forth in FED. R. C1v. P. 56 guide us in resolving summary 
judgment motions. J W Creech, Inc., ASBCA Nos. 45317, 45454, 94-1 BCA 
ii 26,459 at 131,661; Allied Repair Service, Inc., ASBCA No. 26619, 82-1 BCA 
ii 15,785 at 78,162-63; Board Rule 7(c)(2). We will grant a summary judgment 
motion only if pleadings, depositions, interrogatory answers, and admissions on file, 
together with any affidavits or other evidence, show that there is no genuine issue as to 
any material fact, and the moving party is entitled to judgment as a matter of law. 
DLA, the party here seeking summary judgment, has the burden of demonstrating both 
ofthese elements. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Mingus 
Constructors, Inc. v. United States, 812 F.2d 1387, 1390 (Fed. Cir. 1987); Comptech 
Corp., ASBCA No. 55526, 08-2 BCA ii 33,982 at 168,082. PSI, who is the 
nonmoving party, is entitled to have all reasonable inferences drawn in its favor. 
5 

Celotex Corp., 477 U.S. at 322-24; Elekta Instrument SA. v. 0. UR. Scientific Int'!, 
Inc., 214 F.3d 1302, 1306 (Fed. Cir. 2000). 
It is well established that a default termination is a drastic sanction, which 
should be imposed and sustained only upon "good grounds and on solid evidence." 
E.g., Lisbon Contractors, Inc. v. United States, 828 F.2d 759, 765 (Fed. Cir. 1987); 
J.D. Hedin Constr. Co. v. United States, 408 F.2d 424, 431 (Ct. Cl. 1969). Contract 
provisions authorizing termination for default are a species of "forfeiture" and are to 
be strictly construed. De Vito v. United States, 413 F.2d 1147, 1153 (Ct. Cl. 1969); 
King v. United States, 37 Ct. Cl. 428, 434 (1902). DLA bears the burden of proving 
that a termination for default was justified. Once DLA has established a prima facie 
case in that regard, the burden of production - or of going forward - shifts to PSI. 
DCX, Inc. v. Perry, 79 F.3d 132, 134 (Fed. Cir.), cert. denied, 519 U.S. 992 (1996); 
Lisbon Contractors, Inc., 828 F.2d at 764-65; Hanley Indus., Inc., ASBCA No. 56584, 
14-1BCA~35,699 at 174,812. 
The parties' contract expressly provides that DLA may "by written notice of 
default to [PSI] terminate this contract in whole or in part if [PSI] fails to - (i) Deliver 
the supplies ... within the time specified in this contract or any extension," unless "the 
failure to perform the contract arises from causes beyond the control and without the 
fault or negligence of [PSI]." FAR 52.249-8( a)( 1 ), ( c ). DLA has shown, and it is 
undisputed, that PSI did not deliver the First Article by the contractually specified 
date. DLA, thus, has made a prima facie demonstration that its default termination 
was justified and the burden of production shifts to PSI to show "excusability." 
See DCX, 79 F.3d at 134; Hanley Indus., 14-1 BCA ~ 35,699 at 174,812; Capy Mach. 
Shop, Inc., ASBCA No. 59085, 14-1BCA~35,783 at 175,044. 
PSI contends that its failure to submit the first article by the contractually-agreed 
date was excusable 
because it had the article "test and report ready for QAR 
inspection/approval before the due date of October 18, 2013 ," but "was unable to have the 
inspection performed by the due date, or at anytime shortly thereafter," due to the 
"sequester." According to 
PSI, because its contract had a "C" rating (the lowest in terms of 
priority) and QARs were only working four days a week, the scheduling of its inspection 
was made more difficult. (App. resp. at 10-11) As support for these contentions, PSI 
submitted an affidavit from its chief operating officer providing: 
The Government, in its Motion, attempts to allege that the 
only effect that the sequester would have on the inspection 
was during the five-day furlough period, occurring 
between October 1 through October 5, 2013. However, 
what the Motion failed to note [was] that the sequester 
affected a time period far beyond those date[ s]. For a 
number of months the QARs were allowed to work only 
6 

four days a week. This made scheduling inspections 
significantly more difficult. This difficulty is exacerbated 
by the fact that each QAR services numerous contractors 
and contract[]s. 
(App. resp., aff. at 3) Nowhere in the affidavit however does the affiant state that he 
or anyone else from PSI ever actually attempted to schedule 
an inspection of the First 
Article with a QAR (id. at 1-3 ). 
DLA asserts there is no evidence of the government delaying PSI in obtaining 
an inspection of a First Article during fall 2013. It notes that PSI does not offer any 
evidence in the form of an email or other correspondence that it attempted to schedule 
an inspection. DLA also appends to its reply a declaration from the quality assurance 
specialist with the Defense Contract Management Agency in Detroit, Michigan, who 
was assigned to PSI between September and December of 2013, stating: 
During the September through December of 2013 time 
frame I was in Precision Standard's facility for several 
different business matters and had no knowledge that the 
first article test for contract SPM4A7-08-M-B239 was 
ready for inspection. To the best of my knowledge this 
first article test was never presented to the government for 
inspection. 
(Gov't reply, decl. ii 2) 
PSI may not rest upon vague, unsupported allegations of a delay in government 
inspection of the First Article to defeat DLA's summary judgment motion. "The very 
mission of the summary judgment procedure is to pierce the pleadings and to assess 
the proof in order to see whether there is a genuine issue for trial." Penn Screw and 
Machine Works, Inc., ASBCA No. 32382, 89-3 BCA ii 22,205 at 111,694. Based on 
our examination of the evidence presented and cited in response to DLA's motion, and 
drawing all reasonable inferences in favor of PSI, the nonmovant, we conclude PSI has 
failed to show that a reasonable fact finder could decide PSI was delayed in obtaining 
a First Article inspection as a result of the sequester when there is no evidence PSI 
requested such an inspection prior to its contractually-required delivery date. See 
DCX, Inc., 79 F.3d at 134 (no evidence actual contractor inspection delayed to meet 
requirements of higher priority contracts; contractor thus failed to meet burden to show 
excusable delay in inspection); Mingus Constructors, 812 F.2d at 1390-91 (party 
opposing summary judgment must show an evidentiary conflict on record; mere 
denials or conclusory statements are insufficient). 
7 

PSI further contends in opposition to DLA's motion that, by entering into 
bilateral Modification No. P00002 extending the First Article 
delivery date, DLA 
represented a no-cost termination could be issued if PSI failed to timely deliver and 
PSI consented to a "no-cost termination" (app. resp. at 9-10). PSI argues that there are 
"[m]aterial questions of fact" in this appeal "whether the Government even considered 
a 
no-cost termination for convenience as promised in the agreed-upon Modification 
P00002," which require the factual record be more fully developed concerning the 
reasonableness of the COs' action and which preclude grant of summary judgment to 
DLA (id.). 
DLA argues that the CO's actions were wholly consistent with the language of 
contract Modification No. P00002 and that there are no genuine issues of material fact 
regarding compliance with that modification because the question of whether the 
language in the modification precluded the CO from terminating the contract for default 
is a question of "law," not a question of "fact." According to DLA, contract Modification 
No. P00002 simply authorizes the parties' contract to be terminated in its entirety "at no 
cost to the Government," not at no cost to PSI. (Gov't reply hr. at 3-5) 
DLA is correct that contract interpretation is a question of law and therefore 
amenable to resolution by motion for summary judgment. E.g., Sevenson 
Environmental Servs., Inc. v. Shaw Environmental, Inc., 477 F.3d 1361, 1364 (Fed. 
Cir. 2007); P.J Maffei Building Wrecking Corp. v. United States, 732 F.2d 913, 916 
(Fed. Cir. 1984). We interpret a contract in accordance with its express terms and 
begin with the plain language of that agreement. E.g., C. Sanchez & Son, Inc. v. 
United States, 6 F.3d 1539, 1543 (Fed. Cir. 1993); Gould, Inc. v. United States, 935 
F.2d 1271, 1274 (Fed. Cir. 1991). If the "provisions are clear and unambiguous, they 
must be given their plain and ordinary meaning." E.g., United Int'! Investigative 
Servs. v. United States, 109 F .3d 734, 73 7 (Fed. Cir. 1997); Alaska Lumber & Pulp 
Co. v. Madigan, 2 F.3d 389, 392 (Fed. Cir. 1993). 
Modification No. P00002 to the parties' contract expressly provides that, "ifthe 
First Article re-submission is not delivered by the date [due] ... , this contract may be 
terminated in its entirety at no cost to the Government" (emphasis added). While PSI 
appears to desire a 
termination of the contract for the convenience of the government 
that would result in no cost to PSI, the modification does not require a termination at 
no cost to PSI if PSI fails to deliver by the due date. Nor does it mention a termination 
for the convenience of the government. By its plain language, it simply authorizes a 
termination which results in no cost to DLA. A termination for default is such a 
termination and clearly within the express terms of the contract modification. See 
Lockheed Martin IR Imaging Sys., Inc. v. West, 108 F.3d 319, 322 (Fed. Cir. 1997) 
(words of a contract are deemed to have their ordinary meaning); Churchill Chemical 
Corp. v. United States, 602 F.2d 358, 362 (Ct. Cl. 1979) (it is well established that a 
contract may be terminated for default pursuant to default clause if contractor fails to 
8 

comply with the delivery schedule); Artisan Electronics Corp. v. United States, 499 
F .2d 606, 611 (Ct. Cl. 197 4) (default may lie even where an incremental delivery date 
is missed); Environmental Devices, Inc., ASBCA No. 37430 et al., 93-3 BCA ii 26,138 
at 129,934 (if parties execute modification establishing new delivery date, contractor 
must deliver by new date unless delayed by excusable causes arising after contract 
modification execution). 
PSI asserts additionally that FAR 49.101 (b) mandates the CO effect a no-cost 
settlement instead of a termination for default where it is known the contractor will 
accept one, no government property was furnished the contractor, and there are no 
outstanding payments or debts that the contractor owes the government, as PSI asserts 
is the case here, and there are "[ m ]aterial questions of fact" in this appeal whether 
DLA "considered a no-cost termination for convenience." We have held, however, 
that the government, i.e., DLA, "owes no duty to contractors" 
to terminate contracts in 
default for the "convenience of the government," which generally results in the 
government having to pay monies to the contractor for the costs that the contractor has 
incurred. Contact Int'! Corp., ASBCA No. 44636, 95-2 BCA ii 27,887 at 139,119, 
aff'd, 106 F.3d 426 (Fed. Cir. 1996) (table); Rotair Indus., Inc., ASBCA No. 27571, 
84-2 BCA ii 17,417 at 86,749-51; see generally FAR 49.20l(a).* 
Moreover, it is well established a fact is "material" only if it may affect the 
outcome, i.e., the finding of that fact is relevant and necessary to the proceeding. A 
genuine dispute arises regarding that material fact if sufficient evidence is presented 
that a reasonable fact finder could decide that fact in favor of the nonmoving party. 
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-50 (1986); Opryland USA Inc. v. 
Great American Music Show, Inc., 970 F.2d 847, 849-50 (Fed. Cir. 1992). In sum, as 
the nonmoving party here, PSI must present sufficient evidence showing that a specific 
conflict exists regarding a "material fact." Opryland USA, 970 F.2d at 850; Lemelson 
v. TRW, Inc., 760 F.2d 1254, 1261 (Fed. Cir. 1985). PSI, however, has failed to show 
that there is any genuinely disputed question of material fact which precludes grant of 
summary judgment to DLA here. 
* We note that, while PSI asserts FAR 49.101 (b) requires a CO to consider a "no-cost" 
settlement instead of a default termination when it is known that the contractor 
will accept one and certain other factors exist (app. opp'n at 8), even if we were 
to assume PSI's interpretation of FAR 49.lOl(b) was correct, there is no reason 
to believe here that the CO thought PSI would accept such a settlement since 
PSI expressly rejected such a "no-cost" termination for convenience when it 
was previously offered by the CO. 
9 

CONCLUSION 
We grant the government's motion for summary judgment. The appeal is 
denied. 
Dated: 13 July 2015 
I concur 
//;;?;/ / L ,/ /' 
/~~~~~··· 
Administrative Judge 
Acting Chairman 
Armed Services Board 
of Contract Appeals 
TERRENCES.HARTMAN 
Administrative Judge 
Armed Services Board 
of Contract Appeals 
I concur 
RICHARD SHACKLEFORD 
Administrative 
Judge 
Vice Chairman 
Armed Services Board 
of Contract Appeals 
I certify that the foregoing is a true copy of the Opinion and Decision of the 
Armed Services Board of Contract Appeals in ASBCA No. 59116, Appeal of 
Precision Standard, Inc., rendered in conformance with the Board's Charter. 
Dated: 
10 
JEFFREY D. GARDIN 
Recorder, Armed Services 
Board of Contract Appeals