ARMED SERVICES BOARD OF CONTRACTAPPEALS Appeal of

-- KBJ, Inc.

Under ContractNo. NNC11CA18C

APPEARANCE FORTHE APPELLANT: ) ) ) ) )

APPEARANCES FORTHE GOVERNMENT: ASBCA No. 58512

Joseph R. Spoonster, Esq.

Harpst Ross Ltd. Uniontown, OH

Scott W. Barber, Esq.

NASA ChiefTrial Attorney LauraA. Henry, Esq. Tamika S. Laldee, Esq. MacAllisterA. West, Esq.

Trial Attorneys NASA Glenn Research Center, OH

OPINION BYADMINISTRATIVE JUDGE SCOTT Appellant, KBJ, Inc. (KBJ), appealedpursuantto the Contract Disputes Act (CDA), 41 U.S.C. §§ 7101-7109, from the contracting officer's (CO's) final decision denying its $558,791.33 suspension and delay claim underthe captioned contract to replace two boilers at the National Aeronautics and Space Administration's (NASA's) Glenn Research Center (GRC). The Board conducted a two-dayhearing in Cleveland, Ohio. We decide entitlement and quantum. Forthe reasons set forth below, we sustain the appeal inpart and otherwise deny it.

FINDINGS OF FACT

1. On 16 March 2011 NASA awarded the subject contract, a section 8(a) set-aside, to KBJ inthe firm-fixed-price of$3,621,900 (R4, tab 3 at 42, tab 5 at 59-60; tr. 2/18). Underthe contract, KBJ was to remove andreplace Boilers 3 and 4 at GRC's steamplant, basedupon a design provided by NASA (R4, tab 5, attach. A at 122-102; tr. 2/18). The boilers, whichwere about 18 feet wide, 30 feet long, and 28 feet tall, operated 365 days ofthe yearto provide heat and humidificationto GRC's approximately 350-acre campus. They were critical to GRC's operations, including daily support of significant research projects and experiments. The steam plantwas very old and the boilers needed to be upgradedto make the plant more cost-effective and functional. (Tr. 1/23, 127-29, 174, 2/18-19)2. To facilitate installation ofthe replacement boilers, KBJ was required to demolish
aportion ofthe existing masonry wall on one face ofthe steamplant building and, after installation ofthe new boilers, reconstruct the wall with new energy efficient light panels and an insulated overhead door. KBJ was also required toprovide a new combustion air system for the steam plant; replace two low pressure steam condensate collection and return pumps withnon-electricpressure-powered units with steam pressure equalization tanks; install new conduit and wire for new boiler fans and blowers; install compatible starters for the boiler in the motor control center; and replace low voltage electrical distribution panels and associated feeders. (R4, tab 5, attach. A at 122-007 to -008)

3. On 11 February 2011, priorto contract award, NASA issued solicitation Amendment No. 2, answeringprospective bidders' questions (R4, tab 1 at 7-16). Question 18 asked whetherNASAwould consider a schedule extension "due to the boiler lead time," noting that the replacementboilers would be "delivered atjust about the time NASA wants them to be activated." NASA had responded that its "intention is for the work to be complete perthe solicitation." (Id. at 11)

4. The contract anticipatedthepresence ofasbestos-containing materials during work performance and required KBJ to remove them. Itprovidedthatthe asbestos work included the removal of 1,000 square feet ofboiler insulation material. (R4, tab 5, attach. A at 122-008, -102) Pre-bid QuestionNo. 14 had asked NASAto confirmthat the 1,000 square feet ofboiler asbestos abatement included the ductwork extending from the boilers. NASA responded thatthe "1000 sfshould include abatement ofall asbestos necessary to remove boilers 3 and 4 safely." (R4, tab 1 at 10; tr. 2/89) Kevin Stiles was NASA'sprojectmanager. Atthe time, he was employedby a private contractorthat worked for NASA. Accordingto Mr. Stiles, NASAhad allotted for 1,000 square feet of asbestos for the project and, ifadditional asbestos were discovered, NASA plannedto modify the contract to add abatement ofthat asbestos. (Tr. 2/5-6, 58-59) We find that the contractrequired KBJ to abate only 1,000 square feet ofasbestos-containing boiler insulation material.

5. Contract clause H.12 provided that "[t]he Superintendent is considered essential to the work beingperformed under this contract" and it required that KBJ identify a superintendent who "shall be dedicated solely to this contract and shall be on site full time whenever work is being performed under this contract" (R4, tab 5 at 87).

6. The contract incorporated numerous Federal Acquisition Regulation (FAR) clauses, including FAR 52.233-1, DISPUTES (JUL 2002); FAR52.242-14, SUSPENSION OF WORK (APR 1984); and FAR 52.243-4, CHANGES (JUN 2007) (R4, tab 5 at 67, 103). The Suspension ofWork clause provided in pertinentpart: (a) The [CO] may orderthe Contractor, in writing, to suspend, delay, orinterrupt all or any part ofthe work ofthis



### 2 

# I lcontract for the period oftime that the [CO] determines appropriate for the convenience ofthe Government. (b) Ifthe performance ofall or any part ofthe work is, for an unreasonable period oftime, suspended, delayed, or interrupted (1) by an act ofthe [CO] in the administration of this contract, or (2) by the [CO's] failure to act within the time specified in this contract (or within a reasonable time if not specified), an adjustment shall be made for any increase in the cost ofperformance ofthis contract (excluding profit) necessarily caused by the unreasonable suspension, delay, or interruption, and the contract modified in writing accordingly. However, no adjustment shall be made under this clause for any suspension, delay, or interruption to the extent that performance would have been so suspended, delayed, or interrupted by any other cause, including the fault or negligence ofthe Contractor, or for which an equitable adjustment is provided for or excluded under any otherterm or condition ofthis contract.
7. NASA issued a notice to proceed to KBJ on 12 April 2011, which it received that day (R4, tab 25; compl. 

### ii 12). KBJ was to complete performance within 180 calendar days from the issuance ofthe notice to proceed, i.e., by 9 October 2011 (R4, tab 5 at 67; tr. 1/76). From the pointNASA approved the contractor's submittals for the new boilers, the lead time for boilermanufacture was typically four to six months (tr. 2/29).

8. KBJ submitted its initial construction schedule on 22 April 2011, which NASA did not approve, in partbecause it was difficult to determine the critical path (R4, tab 26; tr. 2/23-24). On 12 May 2011 KBJ resubmitted its schedule, which NASA approved on 13 May 2011 (ex. G-1; tr. 2/24). Underthe approved schedule KBJ plannedto begin boiler asbestos abatement on 19 May 2011 and complete boiler demolition by 18 July 2011. Foundation construction for the replacement boilers was to be complete by 28 July 2011. KBJ plannedto begin boiler assembly on 13 June 2011 and to have replacement Boilers 4 and 3 on site on 12 and 26 August 2011, respectively. Itplannedto begin replacement boiler installation on 15 August 2011 and to complete work on them by 14 October 2011. The contractperformance period, as planned, was to end on 4 November 2011. (Ex. G-1; compl. 

### ii 14; gov'thr. at 2; app. hr. at 2, 

### ii 9).
9. On 26 May 2011 Mr. Stiles gave what he described as a direction to KBJ: Regarding the Repair Steam Plant Project, I have been instructed that we are toproceed as follows:

3 

# IWe are free to mobilize atthe Steam Plant toperform work that can be started within a reasonable time frame after installing the barricades and to performworkthat does not render any ofthe boilers non-functional at this point. We cannot make boilers 3 or4 non-functional until wehave the
newboilers onsite (this includes removing the front wall).

We will be allowed to take boilers out for shortperiods (as long as the Steam Plant still remains operational) to replace panels, run new lines, etc[.], and we can do otherwork in the plant such as replace window[s], panels, etc. But we cannot take boilers 3 and 4 out ofservice completely unless we have the newboilers in the Cleveland area.
As your schedule stands now, this direction will require some changes.
(R4, tab 28) The direction (hereafter sometimes the "suspension directive") had not been part ofthe contract (R4, tab 5; tr. 1/65). It suspendedboilerwork for an indefinite period. According to Mr. Stiles, the reason for the suspension directive was: [O]nce we approved the schedule, the NASA facilities management teamtook a step back and looked at the schedule again and said, well, do we really wantto dothis, especially given the age ofthe steam plant..

.. (Tr. 2/28) NASAreevaluated KBJ's construction schedule afterNASAhad approved it because NASA was concerned thatpotential delays due to unforeseen conditions and in the replacement boilers' fabrication wouldpushthe project into the winter. NASAthen would not have enough steamto fulfill its operational needs. (Tr. 2/28-29) The "thought behind suspending the work on the twoboilers until the new ones arrived on site[] was essentially to minimize risk toNASA" (tr. 2/28).

10. On 8 June 2011 KBS submitted a schedule to Mr. Stiles basedupon NASA's direction to delay demolition ofthe existing boilers until the new boilers arrived in Cleveland. KBJ advisedthat materials storage mustbe arranged and inquired whether NASAwould do so orwhether KBJ should, subject to a change order. KBJ asked whetherboiler demolition couldbegin once the newboilers were in fabrication, which would reduce the delay. It also statedthat it would "proceedwiththe window replacement, electrical panel replacement, fire protection installation and water line installation laterthis summerin order not to extend our supervision duration and increase
ourcosts." (R4, tab 29 at427)

411. On 9 June 2011 KBJ resubmitted its schedule, under which boiler demolition would begin on 5 September 2011, replacement boiler installation wouldbegin 12 October 2011 and testing ofthe boilers would be completed by 11 January 2012, with full project completion by 1February 2012. KBJ statedthat it would communicate with Mr. Stiles laterregarding revising the schedule based upon starting demolition when the boilers were released for fabrication. (R4, tab 30)

12. On 13 June 2011 KBJ sent an alternate schedule to Mr. Stiles, based upon starting boiler demolition upon release ofthe replacementboilers, under which KBJ wouldbegin demolition on 25 July 2011 and replacement boiler installation on 15 September2011; complete boilertesting by 30 November 2011; and achieve full project completion by 21December2011. (R4, tab 31)

13. On 16 June 2011 Mr. Stiles responded that KBJ's 13 June 2011 schedule was unacceptable (R4, tab 32 at 440). NASA did not wantto risk entering the winter months without functional boilers (tr. 2/36-37). Mr. Stiles directed KBJ to provide a schedule "detailing any workthat [KBJ] would like to still accomplishthis summerwithin the steam plant" without rendering Boilers 3 and 4 completely inoperable (R4, tab 32 at 440).

14. KBJ responded to Mr. Stiles on 20 June 2011 that:

The activities that we would like to complete this year are as follows: 1) install combustion airplatform 2) install combustion air units, ductwork and piping 3) install new water line 4) install fire protection system 5) window removal and kalwall/louver installation 6) option 3, 4 and 5 electrical panel replacement 7) relocation ofSiemenspanels on eastwall perdrawing ED-101, note 20 8) reroute mechanical and electrical systems on east wall for wall opening 9) remove radiant heaters and gas piping on east and south walls perdrawing MD-102, note 28 & 29
Please review the above list. Ifit is acceptable [KBJ] will finalize a work schedule. (R4, tab 32 at 440)
15. Bilateral contractModification (Mod.) No. 1, effective 27 June 2011, added steam header replacementtothe contract work for an additional $769,344 (R4, tab 6 at



### 5 

# I144-45; tr. 2/40). Although, at the time, the contractperformance period was to end on 4 November 2011, the modification stated that the period "remains at: August 31, 2012," apparently intended as an extension ofthe period (R4, tab 6 at 145). The modification did not address NASA's 26 May 2011 suspension ofboiler work. Itconcluded:

The Parties hereto acknowledge and agree that any and all claims for equitable adjustment ofthe contractprice and time pursuantto the provisions ofthe clause(s) 52.243-04 entitled "CHANGES", and Mutual Agreement are hereby fully satisfied and discharged with respect to this Supplemental Agreement Number One (01). (R4, tab 6 at 145)

16. On 22 August 2011, NASA advised that KBJ was to have "100% dedicated supervision" on the project (R4, tab 34 at 443-44). At this time, only part ofone ofthe activities listed by KBJ on 20 June 2011 had been completed (tr. 2/42). On 24 August 2011, Mr. Stiles inquired whether KBJ was "still planningto do any work inside the SteamPlantbefore Spring, i.e. electrical panels" (R4, tab 34 at 443). KBJ responded on 25 August 2011 that, based upon the overallproject schedule, itwould cease work on the electrical panel relocation shortly and would still install the waterline in September, with
a full-time superintendent in place. It wouldresume work in early 2012 "afterNASA provides a start date for demolition ofboilers 3 and 4." (R4, tab 34 at 443) KBJ did not, however, install the waterline until 2012 (tr. 2/43).

17. On 12 September 2011 Mr. Stiles notified KBJ:

For construction ofthe Steam Plant and Steam Header, the dates below are the official guidance from [Facilities Division]:

March 1, 2012: Boiler 3 demolition can begin April 16, 2012: Begin South HeaderReplacement June 1, 2012 (or upon completion ofS. Header Replacement): Begin North Header and boiler 4 demo Oct 1, 2012: Boiler4 complete, tested, running, etc. (Assuming boiler 4 install will be first based onPhysical location in the Steam Plant) Oct 15, 2012: Boiler 3 complete, tested, running, etc. Oct 15, 2012: Frontwall must be reconstructed



### 6(R4, tab 35 at 445-46) Mr. Stiles reiterated NASA'srequirement thatthe newboilers be in the Cleveland areapriorto demolition ofthe existing boilers. He asked that KBJ submit an updated schedulebasedupon the dates provided. (Id. at 446)

18. Bilateral contract Mod. No. 3, effective 25 January 2012, for $35,731, added work related to the steamheaderreplacement and extended the contract completion date to 31December2012. It statedthat "claims for equitable adjustment ofthe contractprice andtime pursuant to the [Changes clause] and MutualAgreement are hereby fully satisfied and discharged with respectto this Supplemental Agreement." (R4, tab 10)

19. KBJ submitted a revised schedule to Mr. Stiles on 22 February 2012 under which itplannedto conductboiler asbestos abatement from 19 March 2012 to 28 March 2012, replace the south steam header from 16 April 2012 to 11 May 2012, replace the north steam header from 14 May 2012 to 8 June 2012, demolish Boilers 3 and 4 between 4 June 2012 and 6 July 2012, and begin installation ofBoilers4 and 3 on 19 July and 2 August 2012 respectively. KBJ anticipated completing boilertesting by 3 October 2012, with a project completion date of24 October 2012. (R4, tab 36)

20. On 24 February 2012, Mr. Stiles posed several questions and concerns to KBJ regarding its 22 February 2012 schedule. Among other issues, Mr. Stiles asked ifKBJ could starttheproject sooner, subject to proper superintendence. In its 5 March 2012 response, KBJ advised that it hadbeentold thatBoiler 3 demolition could start immediately. Itsought clarification, in view ofMr. Stiles' priorinstructionthat no demolition could take placeuntil the replacementboilers were inthe Cleveland area. (R4, tab 37; tr. 2/51-52)

21. Mr. Stiles replied on 6 March 2012 that KBJ couldbegin Boiler 3 demolition
as soon as possible, withoutthe replacement boilers in the Cleveland area. He also advised that KBJ shouldreplace the north steam headerpriorto replacing the south steam header, due to NASA's desire to leave Boilers 1 and 2 operational during unpredictable April weather, and he asked for an updated schedule. (R4, tab 38 at 451)

22. Joseph Williams became KBJ's project superintendentbetween 13 and 20 March 2012 (see R4, tab 39 at453, tabs 40-41; tr. 1114, 2/55-56).

23. KBJ sent an updated schedule to Mr. Stiles on 23 March 2012 with changes they had discussed. As withthe 22 February 2012 schedule, KBJ projected a project completion date of24 October2012. (R4, tab 42)

24. KBJ plannedto mobilize its asbestos abatement subcontractor, Neumeyer Environmental Services (Neumeyer), during the week of26 March2012 (R4, tab 41 at 457). By mid-April 2012, KBJ hadbegun demolition ofthe existing boilers (tr. 2/60).

725. On 17 April 2012 KBJ submittedto Mr. Stiles Request for Information No. 25 indicating additional asbestos atBoiler 3, attaching a report analyzing a sample, and recommending that a more comprehensive survey be undertaken (R4, tab 43 at 462-69). A 5 May 2011 report shows thatNASA's original survey ofBoiler 3 did not detect any asbestos (id. at471-74). Ultimately NASA confirmedthatthere was additional asbestos at Boiler 3 (tr. 2/60).

26. The replacement boilers were delivered to the Cleveland area on or about 8May 2012 (R4, tab 44; tr. 2/60-61).

27. KBJ submitted a 23 May 2012 proposal to abate the additional asbestos-containing insulation discovered at Boiler 3 for $74,250. KBJ's proposal included $67,500 in subcontractor costs plus five percent markups each for overhead and profit. (R4, tab 47)

28. In response to Mr. Stiles' 24 May 2012 request for.a more detailed cost breakdown, KBJ provided a 4 June 2012 proposal with more costbreakdown, at an increasedprice of$74,568 (R4, tab 48 at 485, 488-92).

29. As the projectprogressed, KBJ continued to discover additional asbestos-containing material in the boilers (tr. 2/63-64). By 5 June 2012, the project was behind schedule due to the unforeseen asbestos (R4, tab 50).

30. On 11 June 2012, KBJ submittedthree proposals for additional asbestos abatement at Boilers 3 and 4. KBJ would abate the asbestos and demolish each boiler in nine weeks, using five eight-hour shifts perweek, for $826,885; or itwould do so in
seven weeks, using five ten-hour shifts and one eight-hour shiftperweek, for $1,000,950;
or it would do so in five and a halfweeks, using tenten-hour shifts perweek, for $1,128,138. (R4, tab 52 at 500-14).

31. KBJ submittedtwo 21 June 2012 proposals to abate additional asbestos found at Boilers 3 and 4 for $25,870 and $136,256, respectively (R4, tab 59). On 12 July 2012, KBJ also submitted a $21,450 proposal to abate additional asbestos found at Boiler 3 (R4, tab 60 at 541-44).

32. Commencing on 27 July 2012, NASA asked KBJ for a proposal to abate even more asbestos (see R4, tab 61at545, tab 64 at 553, 555). The minutes ofa 31July2012 constructionprogress meetingnote a concern, which we infer KBJ raised, that "[a]ll the 'start/stop' is impacting thejob, slowing downprogress'" (R4, tab 62 at 549).

33. Bilateral contractMod. No. 5, effective 2 August 2012, in the amount of $258,937, covered additional work, includingthe abatementworkin KBJ's 23 May, 21 June and 12 July 2012 proposals. The modification statedthat it was entered into

8

### underthe Changes clause and mutual agreement and that it was a "Supplemental Agreement for work within scope" (R4, tab 14 at 280). The contract completion date remained 31December2012. Mod. No. 5 did not refer to the suspension directive or cover any delays relating thereto. It stated that the parties "acknowledge and agree that any and all claims for equitable adjustment ofthe contract price and time pursuant to the [Changes clause] and Mutual Agreement are hereby fully satisfied and discharged with respect to this Supplemental Agreement" (id. 

### at 281).
34. On 3 August 2012 KBJ submitted aproposal for $639,898 to fully contain Boilers 3 and 4 and completely abate the asbestos in the boilers (R4, tab 64).
35. Mr. Stiles warned KBJ on 6 August 2012 that proposed work done prior to NASA'sproposal acceptance would be at KBJ's risk (R4, tab 65). KBJ replied that day:

I think at this pointwe need to stop Neumeyerthen

....we were trying to keep the project going [i]n good faith. We have lost time and money on all ofthis unforeseen asbestos. We have paid for overtime to help get the project back on schedule. I cannot absorb anymore additional cost. Neumeyerwill be on site tomorrow to finish a few things and clean up. Iwill not bringhim back on site until we reach an agreement onthe additional asbestos. At this point, we cannot go any further. (R4, tab 66 at 561)
36. By letter to Mr. Stiles of 10 August 2012, KBJ stated that, at a 31 July 2012 meeting to discuss removal ofadditional asbestos, KBJ was "given a verbal to continue working, to keep the project/schedule moving forward" and was asked to submit its proposal by 3 August 2012; KBJ compliedbut on 6 August 2012 NASA advised that KBJ wouldproceed at its own risk (R4, tab 68 at 565). KBJ stated:

(Id.) 

### As oftoday

...we still have not received direction from NASA expressing their intentions on how to remedy [the asbestos] issue. All this additional, unforeseen asbestos has caused schedule delays, which in turn has pushedthe completion date beyond October 31, 2012. We need to receive a response from NASAtoday. We will need to discuss the schedule extension and additional costs associated with the schedule extension.

937. NASAultimately determinedthat KBJ's 3 August 2012 proposal was too high (tr. 2/71). NASA developed an 8 August 2012 internal estimate thatthe remaining asbestos work should cost $326,364 (R4, tab 73; tr. 2/71-73). NASA also obtained a 13 August 2012 proposal from a different companyto do the work for $183,750 (R4, tab 72 at 575-77; tr. 2/72-73). NASAprovided both figures to KBJ and advised that NASA was willingto agree to its own estimatedprice for the asbestos work (tr. 2/72).

38. By letterto Mr. Stiles of 17 August 2012, KBJ stated:

We have agreed to acceptNASA's offer of $326,364.00 plus KBJ's mark up to fully contain boiler 3 and 4, and remove the remainder ofthe asbestos previously identified. Theprice to complete the subject work is $368,788.... [O]nce we remobilize, we cannot encounter any additional work stoppages. (R4, tab 70 at 568) KBJ's markup includedbond at 2%, overhead and profit at 5% each, andproject superintendent costs of$3,250 (id. at 569).

39. On 20 August 2012, KBJ agreed to acceptNASA's $326,364.00 offer, without the markup KBJ had originally added (R4, tab 71).

40. Bilateral contract Mod. No. 6, effective 29 August 2012, in the amount of $326,364, addedthe remaining asbestos work, including full containment ofthe boilers. It statedthat itwas entered into underthe Changes clause and mutual agreement and that it was a "Supplemental Agreement for workwithin scope" (R4, tab 16 at 315). The contract completion date remained 31 December2012. The modification did not refer to the suspension directive orrelated delays. It statedthat the parties "acknowledge and agree that any and all claims for equitable adjustment ofthe contractprice and time pursuantto the [Changes clause] and Mutual Agreement are hereby fully satisfied and discharged withrespectto this Supplemental Agreement" (R 4, tab 16 at 316). KBJ has not alleged thatthere was any additional asbestos workbeyondthat covered by Mod. No. 5 (finding 33) and Mod. No. 6.

41. By letterto COErickN. Lupson dated 19 September 2012, KBJ stated:

As a recap to ourrecent discussions over [Mod. No. 6], the Project schedule, andtime extension impacts to KBJ

- this letter confirms thatNASA acknowledges that KBJ is not in agreement withthe new December 31, 2012 completion date set forth in [Mod. No. 6]. In fact, KBJ has notified NASA (viathe revised schedule whichwasprovidedbefore [Mod. No. 6] was issued and in ourrecent meetings) that in light of

10(Ex. A-60) the additional asbestos abatement and associated critical path delays, the Project cannotbe completed until February 28, 2013.

KBJ reserves all rights associated with seeking an equitable adjustment in both its contractprice and contracttime due to the asbestos-abatement delays that were outside ofKBJ's scope ofwork and control. KBJ is preparing and will be submitting shortly a request for equitable adjustment for its indirect time extension/delay costs that exceed the direct costs of$326,360 [sic] contained in [Mod. No. 6]. KBJ is asserting its right to further adjustment pursuantto [the Changes clause].

42. By letterto the CO dated 4 October 2012, a Thursday, KBJ submitted a certified claim for $558,791.33 and a time extensionto 28 February 2013, stating that the claim was comprised ofa schedule analysis and damages calculated by its consultant, "Timothy T. Calvey, PE, PSP, CPE" (R4, tab 20 at 388). The manner by which KBJ sent the claim letter and the date the CO received it are not ofrecord. We infer that, even ifsent by regular mail, he wouldhave received it byMonday, 8 October 2012. The claim cited the Changes clause butreferred to NASA's work suspensions. KBJ stated that the claim
was basedupon asbestos-abatement delays thatwere outside its scope ofwork and control, and upon NASA's early project suspension in 2011. KBJ sought, 

### inter alia, to recover its general and administrative (G&A) costs associated withthe "unanticipatedNASA-caused suspension ofthe work" 

### (id. at 390). KBJ reiterated its contention that NASA had acknowledged that KBJ did not agree with Mod. No. 6's 31December2012 completion date. KBJ sought $53,833.33 in additional subcontractor and materials costs for the period it was suspended, measured from 24 October2012, which included its overhead andprofit at 5% each and bond at 2%. It also claimed $371,909 in home office overhead, calculated at a daily rate of$1,047.63, multipliedby 355 days ofalleged delay resulting from NASA'sproject suspension due to "operability concerns with BoilerNos. 3 and 4 during the winter of2011" 

### (id. at 389). KBJ used the

### Eichleay 1 formula in calculating its suspension and delay claim 

### (id.; tr. 1143). Using the same $1,047.63 daily rate, KBJ also sought $133,049 in home office overhead for 127 days ofalleged asbestos-related delays from "thepost-suspension agreed upon completion date ofOctober 24, 2012 through [KBJ'sprojected] completion date ofFebruary 28, 2013" (R4, tab 20 at 393). KBJ included a comparison ofits initial schedule, the schedule following the suspension, and a schedule reflecting the alleged additional asbestos impacts 

### (id. at 392).

1

### See Eichleay Corp., ASBCANo. 5183, 60-2 BCA**~** 2688 at 13,568, 

### ajf'don recon., 61-1 BCA**~** 2894, discussed below.

1143. The CO denied KBJ's claim on 30 November2012, basedprincipally upon alleged releases in the contract modifications although, unlike in the modifications, the release language he quotedreferred to the Disputes clause as well as the Changes clause (R4, tab 22 at 397).2 On 18 January 2013 KBJ appealedto the Board, which docketed the appeal as ASBCA No. 58512. On 16 October 2014 NASA terminated the contract for default and asserted a monetary claim against KBJ (R4, tab 95). KBJ's appeal from that decision, docketed as ASBCA No. 59785, is subjectto separateproceedings.

44. KBJ proffered Mr. Calvey, vicepresident ofCalvey Consulting, LLC, identified in its claim, as an expert witness. He has a Bachelor ofScience degree in engineering, a Master's degree in business administration and, among other credentials, is
aregistered professional engineer, certified professional estimator, and certifiedplanning and schedulingprofessional. He has over 30 years ofpertinent professional experience. He has lectured and published articles on construction claims, schedule analysis and delays and has previously testified as an expert witness. As his expertreport, he relied upon his claim analysis and a MicrosoftPowerPointpresentationthat referred to exhibits. He submittedhis curriculumvitae, his agreement with KBJ, and his invoices. Over NASA's objection, the presidingjudge admitted

### Mr. Calvey as an expert in schedule and damage analysis. (Tr. 1141-52, 97, exs. A-61, -62; Bd. corr., app. witness list) NASA did not proffer an expert and did not engage in any discovery or ask to do so (see tr. 21121).

45. Mr. Calvey opined that the project's critical path consisted ofdemolishing the existing boilers, newpiping installation, new boilers installation, connectingpipingto the boilers, boilers insulation, and starting the boilers, and that delaying removal ofthe existing boilers would impacttheproject's completion date. (Tr. 1/72-74) KBJ's superintendent, 

### Mr. Williams, and NASA's Mr. Stiles, similarly testified thatthe project's critical path consisted ofdemolition ofthe existing boilers and installation of the replacements (tr. 1114-15, 2/89). We find that the project's critical path consisted of the demolition, followed by the replacement, ofBoilers 3 and 4.

46. Mr. Calvey testified that KBJ originally plannedto demolish Boilers 3 and 4 prior to the delivery ofthe new boilers and that NASA's suspension directive that Boilers 3 and 4 mustremain functional until the replacementboilers were in the Cleveland arearesulted in a project delay (tr. 1165, 67; finding 9). He stated that KBJ did not know when it could start work again until NASA's 12 September 2011 notification that it could begin demolition ofBoiler 3 on 1March 2012 (tr. 1/79; finding 17). Mr. Calvey statedthatthe newboilers had been assembled and payment for the assembly had occurred in August 2011, so the boilers could have been installed perKBJ's original

2 The CO statedthat KBJ had reduced its claim from $558,791.53 to $508,000.00 but KBJ characterizedthe latter figure as a counter settlement offer in response to an informal offer from NASA (R4, tab 21).
12schedule but for the NASA-imposed delay in boiler demolition (tr. 1/69, 81-82). Relying upon KBJ's contemporaneous schedules, Mr. Calvey opinedthat the delay in Boilers 3 and 4 demolition pushedthe project completion date from 4 November 2011 to 24 October 2012 (tr. 1/82-83), a total of355 days.

47. Concerningthe alleged delay stemming from NASA's suspension directive, CO Lupsontestified that, from his understanding, there had been other workthat had to beperformedpriorto the boilers' demolition (tr. 11158). However, he mentioned only window work and other workthat "wasn'treally related tothe boilers," stating that he could notbe specific because he lackedthe technical expertise (tr. 11165).

48. Mr. Stiles noted that KBJ had identified nine activities otherthan boiler work that it couldperform during 2011 (tr. 2/36; finding 14). He acknowledged that some of that work could have been impacted by the boiler work, buttestified thatthe majority of it couldhave been completed in 2011 (tr. 2/90).

49. KBJ's superintendent Williams counteredthat the nine activities could not have been accomplished in 2011. Although he arrived in March 2012, he testified that he
was aware ofthe 2011 site conditions and, because the boilerroom work had not been performed, conditions were the same in March 2012 as they wouldhave been in September 2011 (when NASAnotified KBJ ofthe date it could begin boiler demolition). (Tr. 21110-15; finding 17)

50. We find thatNASA's suspension directive to KBJ torefrain from demolishing Boilers 3 and 4 until the replacementboilers were on site delayed the project's critical path workby 109 days as set forth below. We do not acceptMr. Calvey's reliance upon KBJ's contemporaneous schedules to determine the length ofthe delay. The record supports a different calculation. NASA informed KBJ that it could begin demolition of Boiler 3 on 1March2012 (finding 17). KBJ's contemporaneous schedules projected a completion date of24 October 2012 (findings 19, 23). The difference between the 1March 2012 and 24 October 2012 dates is 237 days, longer thatthe original 180-day contractperformance period. Mr. Calvey did not explain how all ofthose extra days
were attributable to NASA's suspension ofboiler activities. We attribute the delay betweenNASA's 26 May 2011 directive to KBJ not to demolish the existing boilers and its 1March 2012 demolition commencement date, a total of280 days, to the government. That delay was indefinite for 109 days, from 26 May 2011 until NASA's 12 September 2011 notice to KBJ that it couldbeginBoiler 3 demolition on 1March 2012. Itwas for a definite periodthereafter. We attribute the delays between 1March 2012 and the start of Boiler 3 demolition to KBJ. KBJ's 5 March 2012 inquiry to NASA about the requirement thatreplacementboilers be inthe Cleveland areabefore demolition of Boilers 3 and 4 couldbegin suggests that the replacement boilers were not yet on site (finding 20). However, Mr. Calvey testified thatthe new boilers had been assembled in August 2011 (finding 46). KBJ gave no explanationwhy they could not have been

13 

# I rbrought to the Cleveland area upon, or at a reasonable time after, NASA's 12 September 2011 notice that KBJ could begin demolition on 1March2012. KBJ has not explained the delay in delivery ofthe replacement boilers until May 2012. Itwas only able to start demolition work soonerbecauseNASArevoked its instruction thatthe replacement boilers first be in the Cleveland area (finding 21).

51. We find KBJ responsible for the delay in the non-boiler work KBJ identified to NASA on 20 June 2011 as workthat could be performed while the boiler work was suspended (finding 14). Although Mr. Williams testified that the work could not have beenperformed in 2011 (finding 49), he was not KBJ's superintendent until March 2012 (finding 22), and we credit KBJ's contemporaneous statement about the work that could be performed in 2011. KBJ has presented no evidencethatthe delay in completingthat workwas caused byNASA. The record is insufficient for us to calculate that delay. Regardless, the project's critical pathwas driven bythe boilerwork (see finding 45). We find that this non-boiler workwas not on the critical path and was insubstantial in comparison to the contractwork as a whole.

52. Mr. Calvey opined thatNASA delayed theprojectby its "lack ofdecision on the asbestos and the added scope ofasbestos thatwas not included in the original contract scope" (tr. 1/96), and thatthis delayed the critical pathworkand extendedthe project's completion date from 24 October2012 to 28 February 2013 (tr. 1189, 95-96), a total of 127 days. He did not apportion this delay between the delay in issuing the contract modifications to add the asbestos work and the time necessary to perform that additional work. The contract required KBJ to abate 1,000 square feet ofasbestos-containingboiler insulation material (finding 4). Because KBJ could not completeboiler demolition, a critical path item, without abating the asbestos, we attribute the delays caused by the additional asbestos encounteredtoNASA. We accept Mr. Calvey's unrebutted testimony that NASA's delay in deciding howto address the additional asbestos and the added abatementtogether delayedtheprojectby 127 days.

53. NASA contends that KBJ could obtainreplacement work during the delay period because, on 7 June 2012 it selected KBJ for an $86,125 project (R4, tab 75 at 584; tr. 2176-77); on 3 August 2012 KBJ bid $525,805.52 on a GRC project, although its bid
was unsuccessful (R4, tab 76; gov'tbr. at 19); and on 19 September 2012, NASA selected KBJ for a $171,574 project (R4, tab 77 at 606). The total $783,504.52 value of these projects, including the largest one for $525,805.52 that KBJ was not awarded, was $783,504.52. This is less than halfthe $3,621,900 value ofthe subject steamplant contract as originally awarded (finding 1).

14Quantum

54. KBJ submittedproposals from its subcontractors seeking additional compensation for being delayed until 2012 (ex. A-56). Mr. Calvey added the subcontractors' requested amounts to arrive at the $53,833.33 subcontractor and materials costs sought by KBJ in its claim (tr. 1/102; finding 42). We find the subcontractor' proposals insufficientto show eitherthattheir labor and material costs actually increased
orthe extent ofany such increase. Because KBJ offered no other evidence onthese points, it has failed to prove any subcontractor cost escalation.

55. KBJ seeks to recover unabsorbed overhead costs pursuantto the Eichleay formula. Mr. Calvey computed a $1,047.63 daily overheadrate (R4, tab 20 at 390; tr. 1/99). NASA does not challengethis calculation or offer an alternate one. We adopt the unchallenged $1,047.63 daily overheadrate and, as we discuss below, conclude that KBJ is entitled to recover 109 days ofunabsorbed overhead costs resulting from NASA's suspension ofdemolition ofBoilers 3 and 4.

DISCUSSION PreliminaryEvidentiary Issues

I. NASA's Objectionto Admission ofMr. Williams' Disputed Testimony

Atthe hearing, NASA objected to testimony by Mr. Williams regarding whether work KBJ identifiedto NASA on 20 June 2011 could have been accomplished in 2011. BecauseMr. Williams was hired in March 2012, NASA argued that he lacked requisite personal knowledge to give suchtestimony. Thepresidingjudge overruledNASA's objection. (Tr. 2/109-12) In its brief, NASArenews its objection to Mr. Williams' testimony regarding events priorto March 2012 as outside his personal knowledge, citing, inter alia, FED. R. Evm. 70l(a) (gov'tbr. at 62-63).

FED. R. Evm. 701(a) provides that lay opinion testimony must be "rationally based
onthe witness's perception." UnderFED. R. Evm. 602, a "witness may testify to a matter only ifevidence is introduced sufficientto support a finding thatthe witness has personal knowledge ofthe matter," but "[e]videncetoprovepersonal knowledge may consist of the witness's own testimony." Although we may lookto them for guidance, the Federal Rules ofEvidence are notbindingupon the Board. BoardRule 10(c); Laguna Constr. Co., ASBCANo. 58324, 14-1BCAi!35,748 at 174,947-48. In keeping with BoardRule lO(c), in addition to appropriate evidence admissible under the Federal Rules, the Board will consider evidence admissible in the sound discretion ofthe presidingjudge.

15In any event, NASA has not demonstrated any prejudice to itresulting from the Board's admission ofthe disputed testimony. The Board was not persuaded by it and gave weight insteadto KBJ's contemporaneous evaluation ofthe work it could do in 2011(findings14, 51). We deny NASA's objection.

II. NASA's Objection to Board's Admission ofMr. Calvey as an Expert

The Board'spre-hearing orderprovided that ifa party offered expert testimony, it
was to provide a statement setting forth the expert's area ofexpertise; the subject matter ofthe expert's testimony; and a summary ofthe expert's opinion and the basis therefor in the form ofan expert's report. The order referred theparties "generally"to FED. R. C1v. P. 26 and FED. R. EVID. 702-705. KBJ, then proceedingprose, timely submitted its witness list one month beforethe hearing, statingthat: Mr. Calvey would "provide expert testimony on schedule analysis and damage calculations;" the claim contained a summary ofhis opinions; and they were "based on the project schedules, daily logs, project correspondence and company financial records." KBJ provided a summary of Mr. Calvey's credentials and included a copy ofhis curriculum vitae. KBJ also submitted a copy ofits hearing exhibits. Exhibit A-61, "Calvey Consulting Charts," was aprintout ofhis PowerPointpresentation. (See finding 44)

Priortothe hearing NASA objectedto the designation ofMr. Calvey as KBJ's expert witness on the ground that the information in its witness list did not satisfy FED. R. CIV. P. 26's expert reportrequirements. KBJ then submitted a list ofMr. Calvey's publications, cases in which he hadtestified as an expert, and informationregarding his compensationrelated to this appeal (see finding 44). NASArenewed its objection at the hearing (tr. 1/44, 46, 49-51). The presidingjudge overruled it, allowing Mr. Calvey to adoptthe schedule analysis and damages calculation in KBJ's claim and exhibit A-61 as his expertreport under the circumstances ofthis appeal (tr. 1/47-49, 51). NASA renewed its objection in its post-hearing brief(gov'tbr. at 63-67).

Like the Federal Rules ofEvidence, although we may lookto them for guidance, particularly in areas ourrules do not specifically address, the Federal Rules ofCivil Procedure do not apply to the Board. 

### Circle, LLC, ASBCA No. 58575, 15-1 BCA 

### ii 36,025 at 175,965. As noted, under BoardRule lO(a), evidence may be admitted in the presidingjudge's discretion. While Mr. Calvey did notprovide a signed expert report so-designated, we conclude that the materials he submitted satisfiedthe Board's pre-hearing order and thatthe presidingjudgehad ample basis for admitting him as an expert witness. NASA did not engage in discovery or ask to do so regarding Mr. Calvey, who was identified in KBJ's claim. (Finding 44)

16We deny NASA's objectionto the presidingjudge's admission ofMr. Calvey as an expertwitness. 3

KBJ's Entitlement to an Equitable Adjustment

KBJ seeks subcontract escalation costs and unabsorbed overhead for the delay resulting from NASA's suspension directive that Boilers 3 and 4 could not be demolished until replacement boilers were in the Cleveland area, which was not a contract requirement (finding 9). Italso seeks unabsorbed overhead for the delay due to the several occurrences ofadditional asbestos beyond the 1,000 square feet covered by the contract (finding 4).

NASA alleges that: KBJ has failed to establishthat NASA's suspension directive unreasonably delayedproject completion; KBJ caused concurrent delays; NASA fully compensated KBJ underthe clear and unambiguous Mod. Nos. 5 and 6 for asbestos-related impact and delay costs and those claims are barred by the doctrine of accord and satisfaction; KBJ is not entitled to increased subcontractor costs; and KBJ has not established entitlementto Eichleay damages.

KBJ disputes NASA's contentions and asserts that its asbestos-related delay claims were not addressed or resolved bythe contract modifications. Itcontends that the modifications did notput it on notice that NASA intended them to encompass matters other than direct costs ofthe subject changed work.

KBJ has not provedthat its subcontractor costs increased (finding 54) and that unsupported aspect ofits claim fails. Accordingly, we address only KBJ's unabsorbed overhead claims. Mod. Nos. 5 and 6, and the release language they contain, do not refer

3 NASA also makes procedural objections. It objects to the duplication in KBJ's exhibits ofdocuments already contained in NASA's Rule 4 file (gov'thr. at 67-68). KBJ bore the extra duplication costs and, when there has been duplication, we have relied upon the Rule 4 file. NASA also objects to having been required to file its post-hearingbrieffirst, which it agreed to do at the close ofthe hearing at the presidingjudge'srequest. Because KBJ, a small business,
was then appearing

### prose, thejudge determined that having NASA file the first briefwould be most helpful to the Board and serve as briefing guidance to KBJ. KBJ laterretained counsel butthe Board declined NASA's request that it alter its briefing order. NASA argues that this placed it "in an inequitable position regarding the ultimate burden ofproof' (gov'thr. at 69). The order ofbriefing does not alter KBJ's burden ofproof. Moreover, NASA was not prejudiced. It had ample opportunity in its reply briefto respond to KBJ's arguments. NASA's procedural objections are denied.

17to the suspension directive or cover alleged delays relating thereto 

### (see findings 33, 40) and NASA does not so claim. We address those delays first.

In addition to direct costs ofcontractperformance, "agovernment contractor incurs indirect costs which are not attributable to one contract in particular but arise because ofits general operations." 

### West v. 

### AllState Boiler, Inc., 146 F.3d 1368, 1372 (Fed. Cir. 1998). Home office overhead costs are: [T]hose that are expended for the benefit ofthe whole business, which by their nature cannot be attributed or chargedto any particular contract. Incontractingwith the government, a company necessarily includes aportion of home office overhead expenses, which it calculates based on the contract's duration, in its estimate ofcosts to perform the contract. 

### Altmayer v. 

### Johnson, 79 F.3d 1129, 1132 (Fed. Cir. 1996) (citations omitted). A contractorrecovers these costs by allocating them on a proportionate basis among all its contracts. 

### AllState Boiler, 146 F.3d at 1372; 

### B. V. 

### Construction, Inc., ASBCA No. 47766 

### etal., 04-1 BCA

### ii 32,604 at 161,358. Suspension or delay ofcontractperformance results in an interruption in payment for direct costs, which in tum causes an interruption in payment for overhead; however, overhead costs continue to accrue regardless ofdirect contract activity. This interruption in the stream ofpayments causes a portion ofhome office overhead costs to be unabsorbed. 

### Nicon, Inc. v. 

### UnitedStates, 331F.3d878, 882 (Fed. Cir. 2003); 

### Wickham Contracting Co. v. 

### Fischer, 12 F.3d 1574, 1577 (Fed. Cir. 1994). The 

### Eichleay formula estimates "proportionatehome office overhead that may be unabsorbed due to suspension." 

### B. V. 

### Construction, 04-1 BCA

### ii 32,604 at 161,358. It approximates unabsorbed home office overhead costs "by calculating a daily overhead dollar amount for the contract in question and multiplying that figure by the number of days ofdelay." 

### Altmayer, 79 F.3d at 1132-33. Recovery ofunabsorbed overhead under

### Eichleay, however, is an extraordinary remedy. 

### Charles G. Williams Constr., Inc. v. 

### White, 271 F.3d 1055, 1058 (Fed. Cir. 2001). The contractormust meetthree prerequisites. Itmust show that (1) there was a government-caused delay to contractperformance ofuncertain duration that was not concurrent with a delay caused bythe contractor or some otherreason; (2) the delay extendedthe performance time, or the contractor completedthe work ontime but incurred additional costs because it hadplanned to finish earlier; and (3) the contractor was required to be on standby during the delay. Concerning concurrent delay, "[t]he contractor generally cannotrecover for concurrent delays for the simple reason that no causal link can be shown: A government act that delays part ofthe contractperformance does not delay the general progress ofthe

18work when the prosecution ofthe work as a whole would have been delayed regardless of the government's act." EssexElectro Eng'rs, Inc. v. Danzig, 224 F.3d 1283, 1295 (Fed. Cir. 2000) (citation and internal quotation marks omitted). Moreover, only work on the criticalpath can delay contract completion. Webb Electric Co. of Florida, Inc., ASBCA No. 54293, 07-2 BCA**~** 33,717 at 166,940, ajf'd, Webb Electric Co. of Florida v. Griffin, 299 F. App'x 958 (Fed. Cir. 2008). In evaluating a contractor's entitlementto recover for government-caused delays, the contractor is not charged for its concurrent delays that do not affect work on the critical path. Fischbach & Moore International Corp., ASBCA No. 18146,**77-1BCA~12,300** at 59,224, ajf'd, Fischbach & Moore International Corp.
v. UnitedStates, 617 F.2d 223 (Ct. Cl. 1980).

As to standby, "[t]heproper standby test focuses on the delay or suspension of contractperformance for an uncertain duration, during which a contractor is required to remain ready to perform." Interstate General Government Contractors, Inc. v. West, 12 F.3d 1053, 1058 (Fed. Cir. 1993). When the period ofdelay is uncertain "andthe contractor is required by the governmentto remain ready to resume performance on short notice, the contractor is effectivelyprohibited from mitigating such overhead costs by making reductions in home office staffor facilities." Id. at 1057-58. A contractor meets the standby requirement when the CO "has issued a written orderthat suspends all the workon the contract for an uncertain duration and requires the contractorto remain ready to resume work immediately or on short notice." P.J. Dick, 324 F.3d at 1371. Alternatively, a contractor can establish standby by indirect evidence, which requires a showingthat: (1) the government-caused delay was substantial and ofindefinite duration; (2) during the delay, the contractorhad to be ready to resume work on the contract immediately, at full speed; and (3) there was an effective suspension ofmuch, if not all, ofthe contract work. Id.
When a contractorhas establishedthe prerequisites to applying Eichleay, it has made aprima facie case ofentitlement. The burden ofproductionthen shifts to the government to showthat it was not impracticable for the contractorto take on replacement work and mitigate its damages. The contractor, however, retains the ultimate burden ofpersuasionthat itwas impracticable for it to obtain replacement work. Nicon, 331 F.3d at 883; P.J DickInc. v. Principi, 324 F.3d 1364, 1370 (Fed. Cir. 2003); Melka Marine, Inc. v. UnitedStates, 187 F.3d 1370, 1376 (Fed. Cir. 1999). We address whether KBJ is entitledto unabsorbed overhead for the alleged NASA-caused delays.

I. Suspension ofBoilerDemolition
The project's critical pathbeganwiththe demolition ofBoilers 3 and 4 (finding 45). Under KBJ's original approved schedule, it planned to complete demolition ofthose boilerspriorto the delivery ofthe replacement boilers (finding 8). On 26 May 2011, less thantwo weeks afterNASA approved KBJ's schedule, it instructed KBJ not to demolish the boilers until the replacementboilers were inthe Cleveland area. The directive

19suspended the boiler work for an indefinite period. (Finding 9) NASA did not allow KBJ to begin demolition ofBoiler 3 until 1March 2012 (finding 17). This extended the contract'sperformanceperiod past the original 4 November 2011 project completion date. NASA's directive delayed contract performance substantially, by 280 days (finding 50), 100 days longer than the 180-dayperiod in which KBJ was initially required to complete the contract work (finding 7).

NASA concedes that its directive was an exercise ofits authority under the Suspension ofWork clause (gov'tbr. at 22; gov'treply br. at 3), but it argues that it did not suspend all work and KBJ's failure to perform other available work in 2011 (findingl4) concurrently delayed the project. We found KBJ responsible for the delay in completing the non-boiler work it had identified as possible to perform in 2011, but that this work was not onthe criticalpath (finding 51). Because the non-boiler work was not
on the critical path, KBJ's delay in performing that work did not concurrently delay the prosecution ofthe project as a whole. Accordingly, KBJ has metthe first two prerequisites for recovery underEichleay: there was a government-caused delay ofuncertain duration, not concurrent with a relevant contractor-caused delay, that extended the contract's performance time. Because there was no written suspension order by the CO, KBJ must establish the third prerequisite, standby, through indirect evidence. Regarding the first standby factor, as we have stated, NASA's suspension directive delayed contractperformance substantially, for an indefiniteperiod. However,
on 12 September2011 NASAprovided a date certain for the resumption ofboiler work (finding 17), suchthatthe delay was only indefinite for the 109 days precedingNASA's notice (finding 50). Afterthe notice, KBJ could not be on standby because the delay then
was for a definite duration. P.J Dick, 324 F.3d at 1371 ("where the government suspends all work onthe contract, buttells the contractor work will begin again on a date certain, the contractor cannot be on standby").

Asto the second standby element, NASA's suspension directive anticipated that KBJ would remain on site, performing othertasks, until the boilers arrived (finding 9). NASA acknowledges that "NASA'sProject Manager expressly directed Appellant to proceed with all other workthat could be performed" (gov'treply br. at 34). Thus, in effect, KBJ hadto keep workers on site during the delay andbe ready to resume boiler work immediately. As we found, the delay originating with NASA's 26 May 2011 directive delayed the project's critical path work by 109 days (finding 50). Regarding the third standby element, NASA alleges that KBJ was not on standby because it could perform otherwork, referring to the work identified by KBJ on 20 June 2011 (finding 14), which we found could have beenperformed during the delay in boiler work (finding 51). However, a contractor's work force need not be completely idle to be

20on standby. 

### Altmayer, 79 F.3d at 1134; 

### see also P.J. Dick, 324 F.3d at 1371. A contractor canbe on standby when it was only able to continue performance ofinsubstantial work on the contract. 

### Id. at 1372-73. We found that the non-boiler work KBJ could have performed was insubstantial in comparisonto the contract as a whole (finding 51). The contract was for the replacement ofBoilers 3 and 4 (finding 1), and that work could not commence during the suspension ofboiler demolition. KBJ has thus met the third standby element.

The burden therefore shifts to NASA "to showthat it was not impractical for the contractorto take on replacement work." 

### P.J. Dick, 324 F.3d at 1370. NASA points to three projects, two ofwhich KBJ was awarded and one on which KBJ bid unsuccessfully 

### (see finding 53). Itis insufficient merely to showthat a contractor could take on some other work during the delay period. 

### See Melka, 187 F.3d at 1377 (court improperly focused upon contractor's "abilityto take on 

### any other work during the delay period"). The critical factor is not whether a contractor can obtain additional work, but rather a contractor's "ability to obtain a 

### replacement contract to absorb the indirect costs that would otherwise be unabsorbed solely as a result ofa government suspension on one contract." 

### AllState Boiler, 146 F.3d at 1377. We conclude that the projects NASA identified do not amountto replacement work. The two projects awarded to KBJ were for $86,125 and $171,574, far less that the $3.6 million value ofthe subject steam plant contract as awarded. Even including KBJ's $525,805.52 bid for the project it was not awarded, the three projects' valuetotaled $783,504.52, less than halfthe value ofthe steamplant contract. (Finding 53)
NASA has notmet its burden. Accordingly, we find KBJ entitledto recover for 109 days ofunabsorbed overhead under

### Eichleay.

IL Additional Asbestos

We found that issues surrounding the additional asbestos encountered in the boilers delayed the project for 127 days (finding 52). However, we must first address NASA's dispositive contentionthat KBJ's claim, with regard to those delays, is barred by the doctrine ofaccord and satisfaction.
Modification Nos. 5 and 6, which added the additional asbestos work to the contract, each concludedwiththe same acknowledgment that "claims for equitable adjustment ofthe contractprice and timepursuantto the [Changes clause] and Mutual Agreement are hereby fully satisfied and discharged with respect to this Supplemental Agreement" (findings 33, 40). NASA urges that this language unambiguously discharged any KBJ claim for asbestos delay costs. KBJ has not alleged that there was any additional asbestos workbeyondthat covered by Mod. No. 5 and Mod. No. 6 (finding 40).

21As we have stated:

Release and accord and satisfaction are separate affirmative defenses. ..A release is a contract whereby a party abandons a claim or relinquishes a right that could be asserted against another.'' An accord and satisfaction
occurs when "a claim is discharged because some perfonnance other than that \vhich was claimed to be due is accepted as full satisfaction ofthe claim." Although the defenses are distinct. "an agreement may constitute both a release and an accord and satisfaction. either ofwhich may bar future claims." OptexSystems, Inc., ASBCANo. 58220, 14-1BCAii35,801 at 175,097 (citations omitted).

In this case, we conclude that the term "release" is the more apt. A release "is interpreted in the same manner as any other contractterm orprovision,"BellBC!Co. v. UnitedStates, 570 F.3d 1337, 1341 (Fed. Cir. 2009), which is to say that it is interpreted
as a whole, to harmonize and give a reasonable meaning to all ofits parts. See NVT Technologies, Inc. v. UnitedStates, 370 F.3d 1153. 1159 (Fed. Cir. 2004). Ifarelease's terms are clear and unambiguous, we are to give them theirplain and ordinary meaning, withoutresort to extrinsic evidence. BellBC!, 570 F.3d at 1341. Ifa "release is ambiguous as to its scope ofcoverage, we construe its language to effectthe parties' intent atthe time they executedthe release." Dureiko v. UnitedStates, 209 F.3d 1345, 1356 (Fed. Cir. 2000); see also OptexSystems, 14-1BCAii35,801at175,097 ("[I]fthe words defining the scope ofthe release are ambiguous in their application to a contractor's claim, courts and boards will ascertain the parties' intent by examining the parties' conduct leading up to the modification.").
Here, Mod. Nos. 5 and 6 each added additional asbestos abatement to the contract work. Priorto its execution ofMod. No. 5, apparently in connection with asbestos abatement, KBJ had expressed a concern to NASA about "start/stop" impacting thejob and slowingprogress (finding 32), but ifit was not satisfiedthat Mod. No. 5 had compensated it adequately for delays, it did not add any exception to the modification's release language. Both Mod. Nos. 5 and 6 clearly provide, without exception, that the parties "acknowledge and agree that any and all claims for equitable adjustment ofthe contractprice and time pursuantto the [Changes clause] and Mutual Agreement are hereby fully satisfied and discharged with respect to this Supplemental Agreement." (Findings 33, 40) IfKBJhad intendedto except asbestos-related delays and to contest the modifications' 31December2012 contract completion date, as indicated in its 19 September 2012 letterto the CO (finding 41), it did not do so.



### 22Accordingly, KBJ's claim for compensation and time due to delays occasionedby additional asbestos encountered in the boilers is barred by release. Quantum

KBJ is entitled to recover 109 days ofunabsorbed overhead costs resulting from NASA's 26 May 2011 directive suspending demolition ofBoilers 3 and 4. We have accepted KBJ's unchallenged calculation ofa $1,047.63 daily overhead rate under the first two steps ofthe Eichleay formula (finding 55). Multiplyingthat rate by the 109 days ofentitlement, the third step ofthe Eichleay formula, we find KBJ entitled to an equitable adjustment of$114,191.67

DECISION
The appeal is sustained in part and denied in part. We award KBJ $114,191.67 plus interestpursuantto the CDA, 41 U.S.C. § 7109, running from 8 October 2012, the date we infer the CO received KBJ's claim (finding 42), until paid.

Dated: 3 March 2016

I concur dministrative Judge Armed Services Board ofContractAppeals

# ff~:'**1ff4--~-----'--------=-----** MARKN. STEMPLER RICHARD SHACKLEFORD Administrative Judge Acting Chairman Armed Services Board ofContractAppeals

23 Administrative Judge Vice Chairman Armed Services Board ofContractAppealsI certify that the foregoing is a true copy ofthe Opinion and Decision ofthe Armed Services Board ofContractAppeals in ASBCANo. 58512, Appeal ofKBJ, Inc., rendered in conformance with the Board's Charter.

Dated:

24 JEFFREYD. GARDIN Recorder, Armed Services Board ofContract Appeals