ORDER DENYING RESPONDENT’S MOTION TO DISMISS:
October 23, 2018
CBCA 6198
EAGLE PEAK ROCK & PAVING, INC.,
Appellant,
v.
DEPARTMENT OF TRANSPORTATION,
Respondent.
Bennett J. Lee, and Stephen L. Pessagno of Varela, Lee, Metz & Guarino, LLP, San
Francisco, CA; and David B. Wonderlick of Varela, Lee, Metz & Guarino, LLP, Tysons
Corner, VA, counsel for Appellant.
Rayann L. Speakman, Western Federal Lands Highway Division, Federal Highway
Administration, Department of Transportation, Vancouver, WA, counsel for Respondent.
Before Board Judges KULLBERG, SULLIVAN, and RUSSELL.
RUSSELL, Board Judge.
Appellant, Eagle Peak Rock and Paving, Inc. (Eagle Peak), filed this appeal of the
Federal Highway Administration’s (FHWA or agency) deemed denial of Eagle Peak’s claim
for termination for convenience costs. FHWA has moved to dismiss this appeal because the
Board has not yet adjudicated the merits of the underlying termination for default. For the
reasons set forth below, we deny FHWA’s motion.
Background
Prior to the filing of this appeal, Eagle Peak filed two other cases with the Board –
CBCA 5692, in which it challenges the FHWA’s termination for default of the parties’


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contract for construction work in Yellowstone National Park, and CBCA 5955, in which it
seeks damages for alleged improper retainage of payments.
In support of its motion to dismiss this appeal, FHWA notes that Eagle Peak’s appeal
of the agency’s termination for default (CBCA 5692) is pending and the relief requested
therein has not been granted (specifically, converting the default termination to one for
convenience). Thus, the agency asserts that any review of the merits of this appeal based on
quantum for a termination for convenience is premature and, for this reason, the appeal
should be dismissed.
Eagle Peak opposes the motion arguing that the Board acquired jurisdiction at the time
of the contracting officer’s deemed denial of Eagle Peak’s claim. The company adds that,
in filing its appeal, it is exercising “its right to pursue the most expeditious reversal” of the
consequences of the termination. Eagle Peak requests that the Board deny FHWA’s motion
or, in the alternative, stay this appeal pending the conclusion of CBCA Nos. 5692 and 5955.
Discussion
FHWA does not argue that, pursuant to Board Rule 8(b), 48 CFR 6101.8(b), the Board
lacks jurisdiction over the appeal nor does it argue that, pursuant to Board Rule 8(e), Eagle
Peak’s complaint fails to state a claim upon which relief may be granted. Instead, FHWA
asserts that dismissal is warranted for the purpose of litigative efficiency, i.e., Eagle Peak’s
termination for default should be decided prior to the start of litigation on quantum. The
agency’s position is not without support.See, e.g., Aerosonic Corporation, ASBCA 42696,
91-3 BCA ¶ 24,212, at 121,117-18.
However, the practice of dismissing as premature convenience claims prior to
resolution of related default claims is not universal among tribunals. Indeed, a predecessor
Board has taken a contrary position–specifically, allowing a challenge to a default
termination (i.e., the entitlement claim) and a claim for termination for convenience
settlement costs (i.e., the quantum claim) to proceed concurrently. Fischer Imaging
Corporation, VABCA No. 6343, et al., 02-2 BCA ¶ 32,048, at 158,384; Delfour, Inc.,
VABCA No. 3900, et al., 94-1 BCA ¶ 26,385, at 131,269. And one court has analogized the
default/convenience termination claims to a traditional breach of contract/damages claim –
concluding that “the [termination for convenience costs remedy] is a substitute for the
damages component of a breach of contract action.”Boeing Company v. United States, 31
Fed. Cl. 289, 296 (1994). Thus, a party may challenge the merits of a default termination
and, at the same time, “plead that damages are presently due and owing” because of the
termination. Id.

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In this appeal, Eagle Peak is seeking relief for monetary damages due and owing (i.e.,
termination for convenience costs) in the event that its separate appeal challenging the
termination for default is decided in its favor. We are inclined to agree with those tribunals
holding that litigative efficiency is not a sufficient basis to dismiss this appeal. Neither the
Board’s Rules nor the Federal Rules of Civil Procedure contemplates dismissal on this basis.
See Board Rule 8; Fed. R. Civ. P. 12(b). Further, any concern regarding potential litigative
inefficiency in proceeding concurrently with entitlement and quantum claims can be readily
addressed through case management of the two appeals.
Decision
For the foregoing reasons, we deny FHWA’s motion to dismiss this appeal.FHWA
must answer the complaint and file any documents pursuant to Board Rule 4 by no later than
Friday, November 23, 2018.1
Beverly M. Russell
BEVERLY M. RUSSELL
Board Judge
We concur:
H. Chuck Kullberg Marian E. Sullivan
H. CHUCK KULLBERG MARIAN E. SULLIVAN
Board Judge Board Judge
1 In its Motion to Extend Deadlinefiled on August 22, 2018 which was granted,
FHWA noted that if the Board denies the Government’s Motion to Dismiss, “the
Government will be able to put together a Rule 4 Appeal File relatively quickly due to the
limited documents.”