ARMED SERVICES BOARD OF CONTRACT APPEALS 
 
Appeals of --  ) 
  ) 
John Shaw LLC d/b/a Shaw Building Maintenance ) ASBCA Nos. 61379, 61585 
  ) 
Under Contract No. AAFES REZ-09-002-10-026 ) 
 
APPEARANCE FOR THE APPELLANT:  Ian Morris, Esq. 
    Morris Law Charlotte 
    Huntersville, NC 
 
APPEARANCES FOR THE GOVERNMENT:  Scott N. Flesch, Esq. 
  Army Chief Trial Attorney 
CPT Richard W. Hagner, JA 
  Robert B. Neill, Esq. 
    Trial Attorneys 
 
OPINION BY ADMINISTRATIVE JUDGE OSTERHOUT 
 
 Appellant John Shaw LLC d/b/a Shaw Building Maintenance (Shaw LLC or 
appellant) claims costs associated with its federal and state tax liability, interest from late 
payment of invoices, the cost of lost equipment, and Mr. Shaw’s hourly rate for phone 
calls placed in pursuit of these costs.  These allegedly result from a 3-year delay in 
payment of 2 of its 36 invoices related to a janitorial services contract with the Army & 
Air Force Exchange Service (Army or government).  For the reasons discussed below, we 
deny these appeals. 
 
FINDINGS OF FACT 
 
 We have previously issued three decisions in these appeals:  John Shaw LLC d/b/a 
Shaw Building Maintenance, ASBCA No. 61379, 18-1 BCA ¶ 37,003; John Shaw LLC 
d/b/a Shaw Building Maintenance, ASBCA No. 61379, 18-1 BCA ¶ 37,026; and 
John Shaw LLC d/b/a Shaw Building Maintenance, ASBCA Nos. 61379, 61585, 19-1 BCA 
¶ 37,216.  Familiarity with those decisions and the facts discussed therein is presumed.  
However, we reiterate several relevant facts here for clarity. 
 
 1.  On May 2, 2010, the Army awarded Contract No. AAFES REZ-09-002-10-026 to 
Shaw LLC, valued at $358,000 (R4, tab 1 at 3).  The contract was to furnish all personnel, 
supervision, equipment, tools, materials, and supplies for janitorial services in the shoppette 
and shopping center at Eielson Air Force Base in Alaska (id. at 7, 36).  The contract 
contained a clause subjecting this contract to the Contract Disputes Act (CDA) of 1978, 
stating “all disputes arising under or relating to this contract shall be resolved under this 

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clause” (id. at 13).  Exhibit C, Section 6.b(2)(a) stated payment was required within 30 days 
“after receipt of a proper invoice” (id at 30).  Section 6.b(10) stated “[a]ny interest penalties 
due to contractors will be computed in accordance with the Prompt Payment Act, 31 U.S.C. 
§§ 3901-3906, as amended” (id. at 31). 
 
 2.  On May 31, 2012, the government issued “Amendment 1,” exercising the first 
option year in the contract to extend services to cover June 1, 2012, through May 31, 2013 
(R4, tab 2 at 1). 
 
 3.  Appellant sent invoice no. 2701 to the government on November 25, 2012.  
Appellant also sent invoice no. 2863 on April 29, 2013.  Each was for $15,913.35.  (R4, 
tabs 15, 27 at 1-2) 
 
 4.  The contract expired on May 31, 2013, and was not renewed by the contracting 
officer (CO) (R4, tab 2 at 1; tr. 73-75).  At this time, invoice nos. 2701 and 2863 were 
still outstanding (R4, tab 25).  
 
 5.  The government issued a check for $31,826.70 for the two outstanding invoices 
on September 30, 2016, and appellant cashed it on October 3, 2016.  The government 
also calculated 47 days of Prompt Payment Act (PPA) interest and issued a check for 
$76.30 for both invoices on October 26, 2016, which appellant cashed on November 3, 
2016.  (R4, tab 25 at 2, 4, tab 37 at 1-3) 
 
 6.  On March 20, 2017, Shaw LLC submitted a claim to the Army CO for 
$419,781.01.  This was calculated by attributing $9,045.84 for loss of explosion-proof 
equipment, $2,009.77 in PPA interest, and the rest in punitive damages.  While the claim 
recognized the government “paid good faith amount of $31,826.70 to offset a portion of 
losses,” the claim also alleged that the government had failed to timely pay two of 
appellant’s invoices, resulting in appellant’s use of funds from an unrelated contract.  
Also as a result, appellant was required to pay for storage of its explosion-proof 
equipment in Alaska that it could not ship back to North Carolina, where Shaw LLC was 
based.  Appellant further alleged that its failure to pay those storage fees resulted in the 
storage company selling the equipment to cover those costs.  (R4, tab 13 at 3-4) 
 
 7.  On August 16, 2017, the CO denied the claim in full.  The CO determined that 
appellant was not timely paid these two invoices because it had contacted Exchange 
personnel regarding updating its payment account information, but not the Army CO, as 
required by the contract.  The CO further found no basis in the contract for punitive 
damages for appellant failing to secure future contracts, and thus there was no basis for 
the punitive damages claim.  (R4, tab 14)  Appellant timely appealed this decision, and 
the Board docketed it as ASBCA No. 61379.  
 

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 8.  The Board granted the government’s motion to dismiss the claim for punitive 
damages in an earlier opinion issued in this appeal on March 8, 2018.  Shaw LLC,  
18-1 BCA ¶ 37,026.  On March 27, 2018, Shaw LLC submitted an amended claim to the 
CO for $2,916,323.61.  This included the $31,826.70 for outstanding invoices which it 
previously stated had been paid, and added $2,986.81 for taxes owed to the state of 
Alaska, $14,636.00 for federal taxes owed to the IRS, $4,662 for labor in making 
telephone calls to pursue this claim, $645,154.49 in exemplary damages, and $2,206,002 
for “missed opportunities.”  (R4, tab 23 at 1-2) 
 
 9.  On March 29, 2018, the CO denied the amended claim in full.  The CO cited 
his previous decision for the equipment and PPA interest claims and the ASBCA’s 
decision dismissing the “missed opportunities” claim.  The CO observed that the invoice 
claims were for invoices that had been paid in 2016.  Finally, the claims for federal and 
state taxes, telephone bills, and exemplary damages failed “to provide a basis in the 
contract to support the total losses [appellant has] identified.”  (R4, tab 31)  Appellant 
appealed this denial to the Board on April 9, 2018.  The Board docketed this as ASBCA 
No. 61585. 
 
 10.  The government issued two checks to appellant on April 19, 2018, and May 1, 
2018, for one year of PPA interest for both invoices minus the amount previously paid in 
2016.  The interest for invoice no. 2701 was $486.81, while the amount for invoice no. 2863 
was $486.16.  (R4, tab 37 at 3)  However, the government used the rate of 3.25%, rather than 
what it believes were the correct rates for two different parts of the year, 1.75% and 1.375% 
(R4, tab 37 at 2).  
 
DECISION 
 
 We previously granted the government’s pre-hearing motion to dismiss the claims 
for the unpaid invoices, “missed opportunities,” and exemplary damages.  Shaw LLC,  
19-1 BCA ¶ 37,216.  The remaining requests for relief concern $9,045.84 for loss of 
appellant’s equipment; $2,986.81 for taxes owed to the state of Alaska; $14,636 in 
federal taxes owed to the IRS; $4,662 in the labor costs of making telephone calls; and 
$2,009.77 in PPA interest, totaling $33,340.42.  Appellant argues in its pre-hearing brief
1 
that these losses were due to a breach by the government of the duty of good faith and 
fair dealing implied in every contract.  The Army argues that while many of these costs 
                                              
1 At the hearing, the parties agreed appellant would file a post-hearing brief, the 
government would then respond, and appellant would submit a reply (tr. 100).  
Appellant failed to submit an initial brief or a reply to the government’s 
post-hearing brief.  We thus review appellant’s arguments articulated in its 
pre-hearing brief and during the hearing. 

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amount to consequential damages and thus are not allowed, none are causally connected 
to the alleged breach anyway.   
 
 Appellant, as the proponent of the claim, has the burden of proof.  Horton Constr. 
Co., ASBCA No. 61085, 18-1 BCA ¶ 36,979 at 180,129.  Every contract imposes upon 
each party a covenant of good faith and fair dealing in its performance and enforcement.  
Metcalf Constr. Co. v. United States, 742 F.3d 984, 990 (Fed. Cir. 2014).  “The duty of 
good faith and fair dealing imposes obligations on both contracting parties, including the 
duty not to interfere with the other party’s performance and not to act so as to destroy the 
reasonable expectations of the other party.”  SIA Constr., ASBCA No. 57693, 14-1 BCA 
¶ 35,762 at 174,986 (citing Centex Corp. v. United States, 395 F.3d 1283, 1304 (Fed. Cir. 
2005)).  However, this implicit duty “cannot expand a party’s contractual duties beyond 
those in the express contract or create duties inconsistent with the contract’s provisions.”  
Metcalf, 742 F.3d at 991 (quoting Precision Pine & Timber, Inc. v. United States, 596 F.3d 
817, 831 (Fed. Cir. 2010)).  “A breach of the duty of good faith and fair dealing may be 
shown by proving, inter alia, a lack of diligence, willful or negligent interference, or a 
failure to cooperate.”  Id. (citing Malone v. United States, 849 F.2d 1441, 1445 (Fed. Cir. 
1988)).  “The proper inquiry regarding the duty often boils down to questions of 
‘reasonableness’ of the government’s actions.”  Relyant, LLC, ASBCA No. 59809,  
18-1 BCA ¶37,085 at 180,539. 
 
 Appellant has not pointed to any distinct acts that the government as an 
organization, or any individual representative thereof, has engaged in which would 
indicate a breach of this duty or would be considered unreasonable.  While the 
government admits it paid invoices no. 2701 and no. 2863 three years after the end of the 
contract, in 2016 (findings 4-5), the government has also paid appellant one year of PPA 
interest
2 (finding 10) for each of these invoices, which is the statutory maximum.  
31 U.S.C. § 3907(b)(1).  Appellant has not shown how these late payments were 
unreasonable given the circumstances.  Indeed, the government alleges that it made an 
attempt to pay the invoices earlier, mitigating at least some of the delay, but was 
prevented by appellant switching its banking information without informing the 
government (gov’t br. at 5 ¶ 17).  Appellant’s argument does not address this allegation.   
 
 Appellant’s brief also alleges that the other invoices were routinely paid late, but 
provides only allegations in litigation documents as proof.  See app. br. at 4 ¶ 15 (citing 
appellant’s original complaint) at 10-11 (citing the CDA and certification of claims 
requirements).  These allegations, standing alone, are unpersuasive. 
 
                                              
2 The government argues in its pre- and post-hearing brief it has overpaid the amount of 
interest appellant is owed (gov’t br. at 10-11; finding 10).  Appellant has not 
challenged this contention in its pre-hearing brief or during the hearing.  The 
government states it does not intend to seek repayment (gov’t br. at 12). 

5 
 
 Even if appellant had shown unreasonable governmental conduct, the connection 
of that conduct to many of the damages appellant claims is tenuous, if present at all.  For 
example, appellant’s state tax liability appears to come from five years of interest for not 
paying part of its taxes in 2013, and its federal tax liability covers 2012-2016, despite the 
contract ending in 2013 (tr. 85-86).  The only exception would be the PPA interest, but 
appellant does not explain how it is entitled to interest beyond the statutory maximum for 
these two invoices.  Accordingly, appellant’s theory that it is entitled to the remaining 
costs because the government breached the implied duty of good faith and fair dealing 
must fail. 
 
CONCLUSION 
 
 For the reasons discussed above, the appeals are denied. 
 
 Dated:  April 15, 2021 
 
 
 
 
 
HEIDI L. OSTERHOUT 
Administrative Judge 
Armed Services Board 
of Contract Appeals 
 
I concur 
 
 
 
 
 
 I concur 
 
 
 
RICHARD SHACKLEFORD 
Administrative Judge 
Acting Chairman 
Armed Services Board 
of Contract Appeals 
 OWEN C. WILSON 
Administrative Judge 
Vice Chairman 
Armed Services Board 
of Contract Appeals 
  
  


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 I certify that the foregoing is a true copy of the Opinion and Decision of the 
Armed Services Board of Contract Appeals in ASBCA Nos. 61379, 61585, Appeals of 
John Shaw LLC d/b/a Shaw Building Maintenance, rendered in conformance with the 
Board’s Charter. 
 
 Dated:  April 15, 2021 
 
 
        
PAULLA K. GATES-LEWIS 
Recorder, Armed Services 
Board of Contract Appeals