Steelform, Inc.
Docket: ASBCA 57724
Decision date: 2012-10-17

ARMED SERVICES BOARD OF CONTRACT APPEALS 
Appeal of--
Steelform, Inc. 
Under Contract No. N00406-10-P-B004 
APPEARANCE FOR THE APPELLANT: 
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APPEARANCES FOR THE GOVERNMENT: 
ASBCA No. 57724 
Bryan J. Gottfredson, Esq. 
Sacks Tierney, P .A. 
Scottsdale, AZ 
Ronald J. Borro, Esq. 
Navy Chief Trial Attorney 
Matthew B. Hawkins, Esq. 
Assistant Counsel 
NA VSUP Fleet Logistics Center 
Puget Sound 
Bremerton, WA 
OPINION BY ADMINISTRATIVE JUDGE JAMES 
ON RESPONDENT'S MOTION FOR SUMMARY JUDGMENT 
This appeal arises from the contracting officer's (CO) termination for default of 
three of the six line items of the captioned contract to supply quantities of various sized 
containers to designated Navy activities. The Board has jurisdiction of the appeal under 
the Contract Disputes Act of 1978, 41 U.S.C. §§ 7101-7109. 
On 29 June 2012 respondent moved for summary judgment, submitting a 
30-paragraph Statement of Undisputed Material Facts (SUMF) and a legal analysis. 
Appellant opposed that motion on 9 August 2012, stating that many of respondent's 
alleged facts "are, in fact, disputed or are incomplete" (app. opp'n at 2-3). Appellant 
submitted the affidavit of Mr. Frank Pavlich dated 9 August 2012 in support of the 
opposition. 
Respondent replied to appellant's opposition on 29 August 2012. Respondent 
objected to consideration of Mr. Pavlich's affidavit on the grou'nd that it was untimely. 
The parties initially had elected a Rule 11 proceeding and the Board established a Rule 
· 11 schedule which required that supplements to the record be filed by 31 May 2012 and 
rebuttal evidence by 13 June 2012. When, however, the government subsequently 
elected to move for summary judgment, appellant was entitled to file an affidavit to 
support !ts opposition. Meanwhile the Rule 11 schedule was suspended. The objection is 
overruled. 

STATEMENT OF FACTS (SOF) FOR PURPOSES OF THE MOTION 
1. On 28 September 2010 the U.S. Navy Fleet and Industrial Supply Center, Puget 
Sound (FISC Puget), awarded Contract No. N00406-10-P-:B004 (the contract) to 
Steelform, Inc. The 
contract was a commercial item purchase order to supply various 
sized metal containers for the firm fixed price of$316,799.00. (R4, tab 2 at 2, 9-141) 
2. The contract included the following six contract line items (CLINs): 
ITEM SUPPLIES/SERVICES 
NO 
QUANTITY 
0001 STACKABLE BINS, BOEING TYPE 64 
CONTAINERS FFP 1.48 cubic yard 
0002 BAY ROLL OFF RECYCLING 16 
CONTAINERS FFP 25.7 5 cubic yard 
0003 REAR LOAD CARDBOARD 30 
CONTAINERS FFP 
0004 29 CU YD RECT DROP BOX WITH 5 
LID FFP 
0005 3 CU YD REAR LOAD CONTAINER 125 
FFP 
0006 STACKABLE BINS, BOEING TYPE 16 
CONTAINERS FFP 1.48 cubic yard 
(R4, tab 2 at 
9-14) The CLINs which ultimately were terminated were CLINs 0002, 
0004 and 0005. 
3. As awarded, the contract required the contractor to deliver the six CLINs on or 
before 30 December 2010 (R4, tab 2 at 4). 
4. The 
contract incorporated by reference the FAR 52.212-4, CONTRACT TERMS 
AND CONDITIONS-COMMERCIAL ITEMS (JUN 201 0) clause, which provided in part: 
(f) Excusable delays. The Contractor shall be liable for 
default unless nonperformance is caused by an occurrence 
1 All citations to Rule 4 file page numbers are to Bates numbers. 
2 

beyond the reasonable control of the Contractor and without 
its fault or negligence such as, acts of God or the public 
enemy, acts of the Government in either its sovereign or 
contractual capacity, fires, floods, epidemics, quarantine 
restrictions, strikes, unusually severe weather, and delays of 
common carriers. The Contractor shall notify the Contracting 
Officer in writing as soon as it is reasonably possible after the 
commencement of any excusable delay, setting forth the full 
particulars in connection therewith, shall remedy such 
occurrence with all reasonable dispatch, and shall promptly 
give written notice to the Contracting Officer of the cessation 
of such occurrence. 
(m) Termination for cause. The Government may 
terminate this contract, or any part hereof, for cause in the 
event of any default by the Contractor, or if the Contractor 
·fails to comply with any contract terms and conditions, or 
fails to provide the Government, upon request, with adequate 
assurances of future performance. In the event of termination 
for cause, the Government shall not be liable to the 
Contractor for any amount for supplies or services not 
accepted, and the Contractor shall be liable to the 
Government for any and all rights and remedies provided by 
law. If it is determined that the Government improperly 
terminated this contract for default, such termination shall be 
deemed a termination for convenience. 
The contract designated Mr. Bret Wood as FISC Puget's point of contact for contract 
administration and Mr. Danny Lewis as FISC Puget's point of contact for the CO. (R4, tab 2 
at 4, 15) The contract did not require the contractor to submit a first article for any of the six 
CLINs. 
5. It is undisputed that from October 2010 through January 2011 performance of 
the contract was delayed approximately 28 days by FISC Puget's two stop work orders 
and the parties' ensuing discussions about configuration changes to CLINs 0003/0005 
containers, delivery of contractor drawings and revised CLIN delivery dates (R4, tabs 12, 
16, 18 at 61, tabs 26, 27 at 81, tab 28 at 83, tab 29 at 85). 
6. Effective 4 February 2011, bilateral Modification No. P00001 added "strong 
arms" to the CLINs 0003/0005 containers, increased the contract price by $12,400.00 and 
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extended the delivery date for all CLINs from 30 December 2010 to 28 February 2011 
(R4, tab 33 at 103-05, 110-11). 2 
7. It is undisputed that from 28 February to 6 April2011 contract performance 
was delayed by FISC Puget's rejection ofSteelform's CLINs 0003/0005 "first article" 
containers as "too large," its change of those 3-cubic yard containers to 2-cubic yards, its 
9 March 2011 stop-work order for CLINs 0003/0005, its inquiries about delivery status 
updates and 
change price adjustments and its acceptance ofSteelform's CLIN 0002 
drawings (R4, tabs 36-42, 44-45, 47-54, 56-59, 61-63). 
8. Effective 6 April20 11, bilateral Modification No. P00003 amended the CLINs 
0003/0005 specifications to 2 cubic yard capacity, extended CLINs 0002 through 0005 
delivery dates to "on or before 02 May 2011" and did not change the contract price (R4, 
tab 72). On 6 April 2011 FISC Puget lifted the CLINs 0003/0005 stop work order, 
29 days after issuing it (R4, tab 74). 
9. On 2 May 2011 Steelform emailed FISC Puget that all of the CLIN 0005 blue 
containers "should be delivered to you [later] this week" in three truckloads, and the 
green containers ''will be right behind those" blue containers (R4, tab 90). Steelform did 
not provide 
any delivery information or projected time line for CLINs 0002 and 0004. 
There is no government response to that email in the record, and the government did not 
request any information from Steelform as to delivery dates for CLINs 0002 and 0004. 
(SUMF ~ 26 and app. opp'n response thereto). 
10. On 5 May 2011, Steelform delivered four CLIN 0005 containers. It made no 
CLIN 0002 
and 0004 deliveries and no other CLIN 0005 deliveries. FISC Puget's 
11 May 20 11 letter signed by CO Danny Lewis notified Steelform of the termination for 
cause ofCLINs 0002, 0004 and 0005; stated that 4 of 125 containers under CLIN 0005 
had been delivered but that Steelform had not provided notice of any excusable delay; 
concluded that Steelform's "failure to complete delivery on these [CLINs] by May 2, 
2011 constitutes a default of performance"; and stated that this letter was a CO's final 
decision and advised Steelform of its appeal rights (R4, tab 92). 
11. Steelform's 12 May 2011 email requested Mr. Lewis to reconsider his 
termination for cause due to prior FISC Puget delays, changes, a 45% steel price increase 
during the work suspensions, the non-standard nature of the containers, the 11 May 20 11 
payment for CLIN 000 1 containers delivered in February 2011, and the availability of all 
the CLIN 0003/0005 containers for delivery. CO Lewis told Steelform that the 
government could not extend the CLINs delivery date further. (R4, tab 96) Steelform 
2 Unilateral Modification No. P00002, 22 February 2011, made administrative changes 
immaterial to this dispute (R4, tab 35). 
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delivered and the government accepted CLINs 0001, 0003 and 0006 (app. opp'n at 3-5, 
~2). 
12. Mr. Pavlich's affidavit included the following information about the status of 
its efforts on CLINs 0002, 0004 and 0005 at the time of the partial termination for cause 
and thereafter: 
14. To date, the Government still has not provided us 
with the adequate information required for us to provide the 
Government with the product it desires to fill the CLIN 0002 
order. 
15. On May 11, 20 11, the date of the government's 
partial "Termination for Cause," Steelform had a truck en 
route from Arizona to Washington to deliver a load pursuant 
to order CLIN 0005. Additionally, Steelform had ordered 
two trucks (to deliver CLIN 0005), but those trucks had been 
delayed due to the sudden rise in the cost of diesel fuel. The 
Government had already implicitly agreed that certain 
deliveries relating to CLIN 0002 would be acceptable if 
delivered by the end ofMay 2011 (R4 File, tab 90 and no 
response from the government). As it relates to CLIN 0005, 
four 
first article units had already been delivered to the 
Government on May 5, 2011. Having not heard from the 
Government that any additional modifications of CLIN 0005 
were required, we were prepared to ship the remaining 121 
units to the Government. 
18. We had complied with CLIN 0003 and had 
produced four ... articles ofCLIN 0005 and had the remaining 
shipment ready to be delivered. The next and last orders to be 
delivered were the containers in CLIN 0002 and 0004. 
Steelform had already purchased the material to complete the 
CLIN 0002 containers and the process was nearly complete. 
19. Just as in every instance with this project, 
Steelform would need to confrrm with the Government that 
the CLIN 0002 and 0004 containers were built exactly to the 
· Government's specifications prior to Steelform incurring the 
expense of shipping the containers to Everett, Washington. 
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20. Given the Government's conduct over the course 
of this project, it would have been imprudent and 
unreasonable to spend thousands of dollars in shipping costs 
to build and deliver all of the CLIN 0002 and 0004 containers 
only for the Government to then explain that it was rejecting 
the containers because they did not work for the 
Government's specific purpose even though that specific 
purpose was never communicated to Steelform. 
Mr. Pavlich's affidavit did not identify any specific information it lacked to build the 
CLIN 0002 and 0004 containers. (App. opp'n, Pavlich aff.) 
13. The 26 July 20 11 letter of contracting officer Virginia Dashiell reissued the 
11 May 2011 decision for partial termination for cause of contract CLINs 0002, 0004 and 
0005, because the previous notice "was issued outside the extent of delegated authority" 
and again advised Steelform of its appeal rights (R4, tab 102). Mr. Pavlich's affidavit 
states that if Steelform had known the partial termination for cause was unauthorized, it · 
would have completed the orders in a reasonable manner and delivered the containers by 
26 July 2011 (app. opp'n, Pavlich aff. ~~ 16-17). 
14. On 28 July 2011 contract specialist Bret Wood sent to Steelform unilateral 
Contract Modification No. P00005, issued by NA VSUP FLC Puget Sound and signed by 
CO Virginia A. Dashiell, to deobligate CLINs 0002, 0004 and 0005 funding due to the 
termination for cause (R4, tabs 103, 104). 
15. On 2 August 2011 Steelform timely appealed respondent's 11 May 2011 fmal 
decision, which the Board docketed as ASBCA No. 57724. 
DECISION 
I. 
A tribunal shall grant summary judgment if the movant shows that there is no 
genuine issue as to any material fact and the movant is entitled to judgment as a matter of 
law. FED. R. CIV."P. 56( a). A material fact is one that may have an impact on the 
outcome of the appeal. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 
(1986). A movant has the burden to show the absenc~ of any genuinely disputed issue of 
material fact. See Celotex Corp. v. Catrett, 477 U.S. 317,323 (1986). The government 
has the burden of proof that its partial default termination was justified. See Nuclear 
Research Corp. v. United States, 814 F.2d 647, 650 (Fed. Cir. 1987). 
Steelform does not dispute that it failed to deliver the 16 CLIN 0002 containers, the 5 
CLIN 0004 containers, and the 125 CLIN 0005 containers to the designated Navy 
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activities by 2 May 20 11, the extended delivery date established by bilateral Modification 
No. P00003 effective 6 April 2011 (SOF ~~ 8, 11 ). While it appears that the 11 May 2011 
termination was outside CO Lewis' delegated authority, the decision was subsequently 
reissued by CO Dashiell on 26 July 2011 (SOF ~ 13). 
II. 
Steelform asserts that there are genuine issues of disputed material fact with respect to 
whether, in light of the government's numerous delays, starts and stops and its failure to 
provide adequate information to Steelform to comply with the contract requirements, 
Steelform's late contract performance was excusable as a matter oflaw (app. opp'n at 15). 
As explained hereafter, such disputed facts are irrelevant and immaterial to the government's 
affirmative defense of accord and satisfaction based on the bilateral modifications. 
Steelhead contends, and respondent does not dispute, that from October 2010 through 
6 April2011 respondent issued stop work orders with respect to some or all six of the CLINs, 
changed the configuration of the CLINs 0003/0005 containers and stopped work, which 
delayed contract performance (app. opp'n at 15). Such government actions and inactions do 
not provide Steelform a defense to the default termination because in bilateral contract 
Modification Nos. POOOO 1 and P00003 the parties agreed to increase the contract price for 
CLINs 0003/0005 by $12,400.00 and to extend the contract delivery date for CLINs 0002 
through 0005 by 123 calendar days from 30 December 2010 to 2 May 2011 (SOF ~~ 6, 8). 
By virtue of those two modifications, all causes of delay arising before 6 April 2011, when 
Modification No. P00003 was agreed to, cannot excuse Steelform's failure to complete 
deliveries ofCLINs 0002, 0004 and 0005 by 2 May 2011. See Precision Dynamics, Inc., 
ASBCA No. 42955, 97-1 BCA ~ 28,846 at 143,892 (citing RFI Shield-Rooms, ASBCA No. 
17374, 77-2 BCA ~ 12,714 at 61,731) (The "action of the parties in agreeing upon a new 
delivery schedule eliminates from consideration the causes of delay occurring prior to such 
agreement."). 
III. 
Steelform argues that the default termination of CLIN 0005 was invalid because 
the government "implicitly agreed that. .. deliveries [ofJ CLIN 0005 [containers] would be 
acceptable if delivered by the end of May 2011 (See [Steelform's 2 May 2011 email to 
the government] and no response from the Government)," Steelform was prepared to ship 
the remaining 121 containers, had a truck with 34 additional units "headed toward 
Washington" and "was prepared to ship the remaining containers in the ensuing days" 
(app. opp'n at 15-16, Pavlich aff. ~ 15). For support, Steelform cites RESTATEMENT 
(SECOND) OF CONTRACTS§ 69 (1981): "Where an offeree fails to reply to an offer, his 
silence and inaction operate as an acceptance in the following cases only:. . . (c) Where 
because of previous dealings or othelivise, it is reasonable that the offeree should notify 
the offeror if he does not intend to accept." Steelform adds that if the government had a 
7 

problem with Steelform 2 May 2012 email, "it should have responded the same day," 
pointing to the parties' course of dealing when respondent replied within 24 hours on 
configuration details and stop work orders (app. opp'n at 17-18; R4, tabs 7, 11, 45). 
RESTATEMENT (SECOND) OF CONTRACTS§ 69 comments a and d state: 
a. Acceptance by silence is exceptional. Ordinarily an 
offeror does not have power to cause the silence of the offeree 
to operate as acceptance... . The exceptional cases where 
silence is acceptance [are] where the offeree silently takes 
offered benefits, and those where one party relies on the other 
party's manifestation of intention that silence may operate as 
acceptance .... 
d .... Prior conduct of the offeree .... a course of 
dealing between the parties may give the offeror reason to 
understand that silence will constitute acceptance ... regardless 
of [the offeree's] actual intent, unless both parties understand 
that no acceptance is intended. [Italics in original] 
The parties' relevant course of dealing on requests for delivery date extensions 
shows periods of(a) 18 days from 14 January 2011, when Steelforni proposed "the end of 
February" 2011, and 4 February 2011, when the parties agreed to Modification No. P00001 
(SOF ~~5-6; R4, tab 31 at 98-99) and (b) 20 days from 17 March 2011, when Steelform 
proposed to deliver CLINs 0002 and 0004 by the end of April2011, to 6 Apri12011, the 
effective date of Modification No. P00003 (SOF ~~ 7-8; R4, tabs 56, 72). Such course of 
dealings on delivery date extensions does not support Stee1form's argument that respondent 
had to notify Stee1form in one day whether it accepted the 2 May 2011 extension date it 
offered. Rather, it manifested the parties' mutual intent to accept Steelform's proposals 
by 
written contract modifications, not by governnient silence. Therefore, Steelform's implicit 
agreement argument is unsound. See also Precision Dynamics, 97-1 BCA ~ 28,846 at 
143,894 (government silence and inaction, by themselves, are not sufficient to constitute an 
election to permit continued performance). 
Steelform also asserts that it lacked information to fulfill CLIN 0002 and 0004 
requirements, but does not identify what that information was (SOF ~ 10). This 
unsupported assertion is inadequate to defeat summary judgment. 
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CONCLUSION 
Accordingly, based on the foregoing analyses, we grant respondent's motion for 
summary judgment and deny the appeal. 
Dated: 17 October 2012 
I concur 
Administrative Judge 
Acting Chairman 
Armed Services Board 
of Contract Appeals 
Administrative ...... ~j::, .. . 
Armed Services IIIL£>oO ... rt 
of Contract Appeals 
I concur 
EUNICE W. THOMAS 
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. 57724, Appeal of Steelform, 
Inc., rendered in conformance with the Board's Charter. 
Dated: 
9 
CATHERINEA. STANTON 
Recorder, Armed Services 
Board of Contract Appeals