### ARMED SERVICES BOARD OF CONTRACTAPPEALS Appeal of-- Green Bay Logistic Services Co. Under ContractNo. H92237-16-C-0030 APPEARANCE FORTHE APPELLANT: ) ) ) ) )



### APPEARANCES FORTHE GOVERNMENT: ASBCA No. 61063

Mr. Mohammad Nazar

Vice President E. Michael Chiaparas, Esq.

DCMA ChiefTrial Attorney Michael T. Patterson, Esq.

Trial Attorney Defense Contract Management Agency Chantilly, VA OPINION BYADMINISTRATIVE JUDGE OSTERHOUT This is an appeal from a termination for convenience by the Defense Contract ManagementAgency (DCMA or government) ofcommercial items Contract No. H92237-16-C-0030 (the contract) with Green Bay Logistic Services Co. (Green Bay or appellant) for the lease oftwo stakebed or flatbed trucks for six months at BagramAirfield, Afghanistan, at a total price of$22,440. Green Bay claims it is owed $46,800 for attempting to delivervehicles twice. We deny the appeal. FINDINGS OF FACT 1. On 1June 2016, the government awarded the contractto Green Bay to lease two flatbed or stakebed diesel trucks that were 17 to 19 feet in length, 8 feet 11 inches to 9 feet 7 inches in width, and 7 to 8 feet in height. DCMA further required thatthe vehicles be able to be transported via C-130J and be able to carry up to 20,000 pounds of fuel blivets, fuel, and equipment. (R4, tab 2 at G-32) Green Bay proposed an amount of $22,400, which wasthe amount ofthe awarded contract (R4, tab 3 at G-39). 2. The contractrequired that "[t]he Contractor shall provide vehicles that are less than three (3) years old (based on vehicle model year) and have less than 75,000KM on the odometer" (R4, tab 3 at G-32). This meantthatto be in compliance with the contract terms, the vehicles must have been at least vehicle model years 2014-2016.

### 3. The contract included, by reference, Federal Acquisition Regulation (FAR) 52.212-4, CONTRACT TERMS AND CONDITIONS-COMMERCIAL ITEMS (MAY 2015) (R4, tab 1at G-11), which contains the following relevantportions: (a) 

### Inspection/Acceptance. The Contractor shall only tender for acceptance those items that conform to the requirements ofthis contract. The Government reserves the right to inspect ortest any supplies or services that havebeentendered for acceptance. The Government may require repair orreplacement ofnonconforming services at no increase in contractprice

....

(l) 

### Termination/or the Government's convenience. The Governmentreserves the right to terminate this contract, or any part hereof, for its sole convenience. In the event ofsuch termination, the Contractor shall immediately stop all work hereunder and shall immediately cause any and all ofits suppliers and subcontractors to cease work. Subject to the terms ofthis contract, 

### the Contractorshall bepaidapercentage of the contractprice reflectingthepercentage of the workperformedprior to the notice of termination,plus reasonable charges the Contractor can demonstrate to the satisfaction of the Governmentusing its standard record keeping system, have resulted from the termination. The Contractor shall not be requiredto comply with the cost accounting standards or contract cost principles for this purpose. This paragraph does not give the Government any right to audit the Contractor's records. The Contractor shall not be paid for any work performed or costs incurred which reasonably could have been avoided. [Emphasis added] 4. On 7 June 2016, Green Bay leased two, model year 2000, Mercedes trucks from Ghourband EuropeLogistics Services Company, for which it paid $19,800 for a non-refundable six-month lease (R4, tab 9 at G-58-59). On 8June 2016, Green Bay had stakebeds installed on the trucks for which they paid $7,800 (R4, tab 9 at G-60). 5. On 8June 2016, Green Bay delivered photographs ofthe trucks to the contracting officer's representative (COR). On 30 June 2016, the CORrejected the

2trucks for not complyingwith the contractbecause the vehicles were more thanthree model years old* (R4, tab 12 at G-75).
6. On 1July 2016, Green Bay leased a 1989 Mercedes truck and a 1996 Mercedes truck from Massoud Marzi Seller & Rental Motors Company via another non-refundable six-month lease for $19,200 (R4, tab 9 at G-61-62). 7. On 11 July 2016, Green Bay submitted an invoice for one month's payment in the amount of$3,740, covering the period of 1June 2016 through 30 June 2016 (R4, tab 4 at G-48). The governmentpaidthis invoice without explaining why it paid for non-conforming goods or for goods that were not actually delivered (R4, tab 12 at G-76). 8. On 14 July 2016, the contracting officer issued a stop-work order on the contract (R4, tab 9 at G-50). 9. On 24 July 2016, the contracting officerprovided notice that it was terminating the contract for convenience, effective on 25 July 2016 (R4, tab 9 at G-51-53). 10. On 10 December2016, Green Bay submitted its settlementproposal. 

### It claimed $19,200.00 for "PAID in advance for 6 months, Receipt paid in 7/1/2016 with customer ID 145." Green Bay claimed $7,800 to "Repairand fix the Vehicle perUS Government repres[e]ntative changes." Finally, Green Bay claimed $19,800 for "PAID in adv[anJee for 6 months to Ghourband Europe Logistic Services co on Date 6/7/2016." (R4, tab 10 at G-67) 11. On 13 February 2017, the termination contracting officer (TCO) responded to Green Bay's settlementproposal. The TCO noted thatthe government had paid Green Bay $3,740.00 and allowed Green Bayto keep that amount. However, the TCO determined that Green Baywas not entitled to any further compensation because its "percent ofcompletion for this contract is 0%." The TCO further stated, "G[reen Bay] did not comply with the terms and conditions ofthe contract or the Performance Work Statement (PWS). G[reen Bay] failed to meet the requirementthat the leased trucks be no more than three (3) years old." Further, the TCO quoted Page 3, Section E ofthe contract when it informed Green Bay that the contract specified that acceptance would be at

*In its opening brief, the government also stated that the vehicles exceeded the height requirements (gov'tbr. at 3). However, this assertion is not supported by the record, otherthan in the contracting officer's final decision. Based on the blatant non-compliance with the contractbased on the age ofthe vehicles, which is supported in the record, it is unnecessary to analyze the impact that the height ofthe vehicles might have had on the appeal or address the adequacy of the record regarding the height requirements.


### 3destination and thatthe governmentretained "theright to inspect, reject, orterminate any items or services that do not meet required specifications." (R4, tab 11 at G-68) 12. On 15 February 2017, DCMA sent another letterto Green Bay, this time signed bythe director, DCMA Terminations Group. This letter informed Green Bay in more detail why it was not entitled to recovery. DCMA analyzed a "two-pronged formula consisting of'a percentage ofthe contract price reflecting thepercentage of the work performedpriorto the notice oftermination, plus reasonable charges the Contractor can demonstrate

...have resulted from the termination."' (R4, tab 12 at G-72 (citing 48 C.F.R. § 52.212-4(1))) 13. In the 15 February 2017 letter, DCMA outlinedthe events demonstrating that, while Green Bay entered into non-refundable six-month leases, it did so on trucks that were more than three years old which violated the term ofthe contract that required the trucks be less than three years old. Further, the contract called for trucks that were 7to 8 feet in height but the trucks that were delivered were over 11 feet tall. Therefore, DCMA determined that the contractwas Opercent complete. This meant Green Bay was entitled to nothing under the first prong ofthe analysis. (R4, tab 12 at G-75-76) 14. Concerningthe secondprong ofthe analysis, DCMA noted that Green Bay was entitled to "'reasonable charges' resulting from termination" butthat Green Bay only submitted costs for the trucks it attempted to deliver. Green Bay did not propose any settlement expenses. (R4, tab 12 at G-76) 15. Green Baytimely appealed the TCO's decision. This appeal was docketed as ASBCA No. 61063. On 7 July 2017, the governmentrequested to adjudicate the appeal on the written record pursuant to Board Rule 11. Despite several attempts from the Board to discern Green Bay'sposition on how toproceed, Green Bay did not submit a response that addressed the issue. Accordingly, on 10 August 2017, the Board set thebriefing schedule under Board Rule 11. 16. DCMA submitted its opening briefon 9 November 2017, in compliance with the Board's 10 August 2017 order. 17. The Board did not receive an openingbrieffrom Green Bay. On 24 November 2017, the Board allowed Green Bay additional time to submit its openingbrief. The Board warned Green Baythat failure to submit an openingbriefwould mean that the Board would decide the case on the record it had, including the government's brief, and that Green Bay would not have an opportunity to respond to the government's brief. Green Bay still did not respond or file an opening brief. As ofthe date ofthis decision, we have not received any further communication from Green Bay.

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### DECISION This appeal concerns the termination for convenience ofa contract where the contractor failed to comply with the terms ofthe contract prior to the government's notification ofthe termination for convenience. "A contractorbears the burden of proving by apreponderance ofthe evidence that it is entitled to a greatertermination settlement amount than that determined by the TCO." 

### SWR, Inc., ASBCA No. 56708, 15-1 BCA,35,832 at 175,225 (citing 

### GeneralDynamicsLandSys., ASBCA No. 52283, 02-1 BCA,31,659 at 156,411; 

### UnifiedEng'g, Inc., ASBCA No. 21565, 81-1 BCA, 14,940 at 73,936). Upon atermination for convenience, FAR 52.212-4(1) directs the governmentto pay contractors: (1) "apercentage ofthe contract price reflectingthe percentage ofthe workperformedprior to the notice oftermination"; and (2) "reasonable charges the Contractor can demonstrate to the satisfaction ofthe Government using its standard record keeping system, have resulted from the termination." 

### SWR, 15-1 BCA,35,832 at 175,221. Here, Green Bay failed to prove that it is entitled to any amount it presented to the government in its termination settlement proposal. Forthe first prong ofthe analysis, Green Bay would have been entitled to "a

- percentage ofthe contract price reflecting the percentage oftheworkperformed prior to the notice oftermination" had it performed any percentage ofthe work. Green Bay is not entitled to recover any monetary amount, however, because it did not complete any percentage ofthe contract. The vehicles Green Bay delivered or attempted to deliver did not comply with the contract and were rejected by the government. (Findings 4-6) The contract clearly required vehicles that were "less than three (3) years old (based on vehicle model year)" which would require the vehicles to be model year 2014 or newer (finding 2). Yet, Green Bay first delivered photographs ofvehicles that were model year 2000, 14 model years olderthan required by the contract (findings 4-5). In an attempt to correct this problem, Green Bay leased different non-compliant trucks, this time even older. Instead ofleasing newer model yearvehicles, Green Bay leased vehicles with the model years 1989 and 1996. (Finding 6) The government properly declined acceptance ofboth attempts to deliver non-compliant vehicles (findings 5, 8). Green Bay never attempted to deliver compliant vehicles. The government's determination that Green Bay completed zero percent ofthe contract was accurate. Thus, Green Bay is not entitled to recovery under the first prong ofthe analysis. Forthe second prong ofthe analysis, Green Bay did not present any "reasonable

. charges the Contractor can demonstrate to the satisfaction ofthe Government using its

standardrecord keeping system, have resulted from the termination." We have



### 5previously held that this secondprong "refers tothe recovery ofthose charges incurred that do not relate to work completedbut shouldbe reimbursed to fairly compensate the contractorwhose contracthas been terminated." 

### SWR, 15-1BCA135,832 at 175,223 (original quotations omitted). Green Bay solely provided costs for leasing the vehicles it intended to use toperformthe contract. Because Green Bay did not submit any amounts notrelated to the workcompleted, it cannotrecover any charges underthe second prong. Had Green Bay submitted an opening brief, it might have argued that the payments it made for the various leased vehicles should be analyzed under the second prong ofthe analysis. Even ifwereview the claimed amount under the second prong, we cannot agree that entering multiple non-reimbursc::tble lease agreements for non-compliant vehicles were reasonable charges that imposedupon the government a requirement to pay. As stated above, Green Baypresented invoices to the government that demonstratedpayment for two separate non-reimbursable leases, arguing that because it made payments for the leases that it was entitledto recoverthose amounts (finding 10). Even ifGreen Baypaid for the two separate non-reimbursable leases, the vehicles never complied with the contract and, therefore, are notreasonable charges. Indeed, the leases that Green Bayprovided to the TCO demonstrate thatthe vehicles did not comply with the contractbecause the vehicles were more than three years old (findings 4, 6). Thus, Green Bay still cannotrecoverunderthe secondprong. Accordingly, Green Bay failed to meet its burden ofprovingby a preponderance ofthe evidence that it is entitled to a greatertermination settlement amountthan that determined by the TCO.

We deny the appeal. Dated: 12 April 2018

(Signatures continued) CONCLUSION

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HEIDILSTERHOUT Administrative Judge Armed Services Board ofContractAppeals

### I concur

RICHARD SHACKLEFORD Administrative Judge Acting Chairman Armed Services Board ofContract Appeals I concur

OWEN C. WILSON Administrative Judge Vice Chairman Armed Services Board ofContractAppeals

I certify thatthe foregoing is a true copy ofthe Opinion and Decision ofthe Armed Services Board ofContract Appeals in ASBCA No. 61063, Appeal ofGreen Bay Logistic Services Co., rendered in conformance with the Board's Charter. Dated:

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### JEFFREY D. GARDIN Recorder, Armed Services Board ofContract Appeals