my chambers and i suppose a year is a short time do you work as my clerk i've time again have been impressed by your work ethic and you know legal activ can thank you very much good morning american auto source was unable to meet its obligations initial obligation to have a minimum in the area of bottled water in place by the contract date of august first two thousand and eight primarily because of the breach was was was later they did at the inception of the contract there were no specifications in the contract for how much land was available there was a site visit but only two of the nineteen offers attended that site  news or a breach well here's what happened then because no one attended the site visit the army put out what they call their conceptual plan which was a sketch that you would find in the joint appendix on  j eighty eight the sketch can complete compliance price of two different areas a truck loading area and a building plant that was about eleven acres that my client had been involved in six other plants up to that point all of which range from eight to fourteen acres in addition the two distinct areas on the sketch comprised coordinated with the requirements under the contract that you have both a bottling plant and a water storage yard so the assumption was they were providing the sketch to be relied on there was no other any indication of any other dimensions and if you see in joint appendix one forty five the design that american officers use was based on that eleven acres none of the other nineteen offers that for any other clarification as well so in order to make this is it your position is that  and when it was going to be established and the obligation to your client to provide water by august first that's true it had nothing to do with the construct struction in fact the contract anticipated that it would not be what's the basis of the argument be purchasing from outside centers and bring it in but you had to have the land and when the initial dimensions came down and there were only six acres it took an entire redesign the water that it takes in order to meet that million cases in mn tory takes a large amount of land and they had an initially planned on it being pallets on the ground and the redesign meant that they had to put pallet handled in the inventory requirements according to the contract so there was never an ability to you know the board kept talking about purchasing you could purchase the water but you couldn't take delivery and have the minimum quantities of million cases on hand and still you had the land and the land security because i'm in the tory requirements require security from tampering and people in place so the whole  disagreement or concern over whether there was six acres or eleven a person and the ability for america not with source to actually do this plan with six acres didn't get resolved until after the aug first delivery date had passed  subsequent i don't know what with the call of representation yes of an amount of lands that man led you to design the in way number one and when that became clear it was representation that turned out to lead you down a bad well i believe that it created and acuity and the contracts that should be construed against the army because what happened was this was put out there to rely on an all night scene of the offerers took that in account and there was never any other discussion as to the amount of land there wasn't there were no no representations that this drawing and the dimensions that were bided were not to be relied on in fact as there is no you have to have of assume that they are going to be providing it for some purpose and the purpose  was because no one could get to the site does it and so you were supposed to know what your area where they never at any point although the army does say that they measured the land at no point in time did they ever put out a need to mention other then this redesign which put us past the date that the initial imagery would have been in place my clients all the way up until the terminate contract was working with the army to work through not only the land but the issue on housing at every point in time all the way up until this terminated until the termination occurred my client thought they were working through this and going to have a new plan and a new agreement well after my client had redesigned it and accepted the land they were proceeding diligently through the contract it was only after the housing disputes came up which is a whole different area that the army asked for a release of all claims and a no cost settlement as a part of a part of the renegotiation and then terminated this but it all started with the issue of of the land and then once we've gotten past that then it became clear that they did not have housing available whether it be six acres or eleven acres the land had to be agreed upon and delivered to my client so that they could take delivery of the the land they were in the water they were going t purchased the water because they had already passed that time period the at the time and all of these things were a part of the on going to go see a chanst the army had an outside contract they were purchasing water from another source that was going through october so there was never this whole discussion in fact my client was under the impression the army had waived that initial delivery date until it already went back to that point because of these ongoing issues but it all started with the fact that the army had provided  my client with a basis to reasonably believe there was an eleven acre tract and so once that had occurred and that that was the issue it was after the date had already pas before it became clear that six acres was all they were going to get and my client redesigned but he still would have had to have the land in place to take delivery of the minimum bottled water that he would have had to purchase from an outside source never a question as to whether or not they could purchase from an outside source only once you purchased it what were you going to do with it and the only thing that you can do with it was put it on the land and they had not  until after that delivery date had already passed and then we came to the issue of whether or not there were housing and i think that everyone is agreed that the housing dispute was was clearly that big u a t and the army then offered to modify the contract for that but it additionally was a problem it pleases the court in addition to building new water bottles the contract provided that american august source was to have a plant water storage or that is a storage laydown area to quarantine water for forty eight hour period required for testing before being released that land was approximately to hold one hundred fifty to three hundred cases of bottled water there was however no requirement to contract that they maintain a class one yard storage yard for bottled water so to the extent they assert here today that they could not receive delivery of the water because they did not have land or an adequate amount plan that's contrary to the contract that's contrary and inconsistent with the design of the stores laid down already as provided in the contract and it's also contrary to the conference call notes which were attached to solicitation in which an offer ask land that was adequate to say to store a million cases no i'm saying that the contract requirement for storage was only one hundred fifty to three hundred thousand cases you would choir's a million cases the available a million cases were to hundred fifty to three hundred cases so it's a different the contract doesn't provide for them storing the water other than the quality of our quarantine period when the water would come out of the plant the initial delivery was coming from a separate source so instead of going on the land that they were provided it would go straight into the classroom storage or because it's going straight into storage it's not being produced at the plant we don't need to test it because it's not water that is it's come out from another centcom approves the water do recent phones to arrange to lease land t six acres and so if they say had begun construction they've done something else with the land during that time period they would have absolutely been fine we don't know whether or not you know they would store when they talk about redesign we haven't seen a board we never saw any redesign on of their facility to accommodate water we don't know it's as they redesigned it they designed it destroy a million cases or more their initial design and call for actually  seven hundred fifty nine cases of one thousand cases of water being stored on land which was again different from the contract requirements but that was never produced to the government it was produced at the armed services contractor feel in any event it's the government's position that the failure to deliver the water was a was a prima fascia cause for terminations for cause of the contract  that there were issues of housing there was some issues about names for clear rooms yes i mean they failed to submit any names for clearance and the armed services board of contract appeals found that the proximate cause of the failure to or of their failure to deliver or of the failure to have been the main provided there was a dispute over housing exactly what was to be provided the contract provides that we provide  housing as a vamp for certain services as available there's a question of what is available does it matter who that contract employee was the government had offered to modify the contract and in fact the only individuals who are looking at coming out the government actually scrambled over one day period after getting notice that they were planning on having some individuals come out and managed to find ten thousand space for them out on contractors row so the government did try to find hous g for those that were planning on coming out we never got their names and they never showed up so but we do agree that there was a definite ambiguity in the contract them with regards to these regards to exactly what sort of housing i thank you as for that last one story chart i just want to make a couple of points clear that there is a requirement in the actual contract for the for the contractor to have not only the area that is the quarantine but the handling of the inventory and all of the contract materials say that in addition to everyone is agreed that the american aqua source was supposed to take possession of a million cases of water and handle that all through the contract it talks about that the conference call notes that mr mayor is referring to were notes not with the offer or this was february of two thousand and eight prior to even putting out the bid where they talked about will they have a storage article they not almost everything in that conference call changed in addition to the fact that during that conference call they had provided for the army to pay in advance and three month increments and at once and the contract eventually got changed so that all the burden of additional costs were on the actual contractor so nothing that happened in that conference call went forward so in addition to the storage yard you had to have  inventory handling and that's where this whole dispute comes about so in the actual statement of work it says that the contractor is going to produce stage store and issue the palletized cases of the purified water  i am reading from one point four on j a forty four the general information on the water plants additionally when it goes into the storage are the three hundred cases is purely for quarantine but it always contemplate that the contractor would have to be handling it and then tori on the issue of housing although mr mayor has said that the you know the board found that the proximate cause of the issue workers but the reason is that they had not vetted their workers was because there was no timeline in place for where there would be any kind of housing and it was a a pool of potential workers that we couldn't know who the actual workers were going to be from the local iraqi workers and so we had a timeframe we worked through a contractor was putting together the workers so no names had been vetted and philip timeline was put in place for housing and there was never a timeline for housing was very clear that the army did not contemplate having local workers although a part of the contract with the contractor was required to set up hiring practices for local workers so in addition to this whole issue of land american auto source was never able to bring in the contractors or even bring in people to do the handling of the inventory  position on all of this is that the army should have continued to work with american arc with source rather than terminating this for a default of something that occurred and everyone had proceeded a month and a half beyond that point and because of that because of the different disputes that arose and the the army insistence that a part of the renegotiating was for american aqua source to sign a no cause  settlement agreement where they waived any potential claims even though all of these things cost and time and money and the government was not on any kind of payment schedule that this contract should have been is that this default should be turned into a term