ARMED SERVICES BOARD OF CONTRACT APPEALS Appeals of

-- ) ) CDM Constructors, Inc. ) ) Under ContractNo. W912PL-12-C-0022 )
APPEARANCES FORTHE APPELLANT:

APPEARANCES FORTHE GOVERNMENT: ASBCANos. 60454, 60455, 60669

Bret S. Wacker, Esq. Jeffrey M. Gallant, Esq. Emily J. Baldwin, Esq.

Clark Hill PLC Detroit, MI
Michael P. Goodman, Esq.

Engineer ChiefTrial Attorney John F. Bazan, Esq. Gilbert H. Chong, Esq. Brian M. Choe, Esq.

Engineer Trial Attorneys U.S. Army EngineerDistrict, Los Angeles
OPINION BYADMINISTRATIVE JUDGE SWEET Appellant CDM Constructors, Inc. (CDM) 1 appeals the decision ofthe contracting officer (CO) denying its request for an equitable adjustment (REA), and the deemed denial ofan REA. All three appeals concernthe design and construction ofa watertreatment plant (WTP).2

ASBCANo. 60454 addresses the WTP's evaporationponds (EPs), alleging that CDM is entitledto an equitable adjustment and delay damages. In particular, CDM alleges that the Army Corps ofEngineers (Corps) constructively changedthe contract bycompelling it to include one backup EP, to use a three million gallon perday (mgd) average daily flow (ADF), and to use a 0.8 panevaporation coefficient onlyifthe maximum water depth was three feet orless. (App. br. at 44-53)3 The Corps argues

1CDM Constructors, Inc.'s parent companywas CDM Smith. CDM Smith was responsible for design, and CDM Constructors, Inc. was responsible for construction (tr. 1/38). We referto CDM Constructors, Inc. and CDM Smith collectively as "CDM." 2 This decision only addresses entitlement. 3 The ASBCANo. 60454 complaint also alleges that there was a cardinal change, defective specifications, andbreach ofa covenant ofgood faith and fair dealing 

# Ithat the contractrequired those design elements (gov'tbr. at 22-24). For the reasons discussed below, the Corps is correct about the backup EP, but not the ADF, evaporation coefficient, and water depth. Therefore, CDM is entitled to an equitable adjustment for any increased costs incurred as a result ofhaving to use the Corps' ADF, evaporation coefficient, and water depth, but not as a result ofhaving to provide
a backup EP.
ASBCANos. 60455 and 60669 address the standby generator (generator), alleging that CDM is entitled to an equitable adjustment underthe Changes clause because the contract contained defective specifications.4 In particular, CDM alleges that the Corps improperlyrejected its design, which followed concept drawings in the contract. (App. br. at 53-58) The Corps responds that the contract did notrequire CDM to follow the concept drawings, which, in any event, were trumped by conflicting contractprovisions. Forthe reasons discussedbelow, CDM is correct. Thus, CDM is entitled to an equitable adjustment for any increased costs incurred as a result ofthe defective specifications.
FINDINGS OF FACT
I. Facts Common toAllAppeals

1. On May 24, 2012, the Corps issued Request for Proposal No. W912PL-12-R-0018 (0018 RFP), for the design and construction ofa WTP at FortIrwin, California (R4, tab 9; tr. 1/43, 4/126).
2. Under the 0018 RFP, itwas CDM's responsibility to "design and construct the [WTP] as described in the Request ForProposal (RFP) Documents contained herein" (R4, tab 9 at 1,729). 5 The RFP documents:

(60454, compl. 

## ,r,r 53-66). However, CDM abandoned those allegations by failing to raise them in its post-hearingbrief. UnitedLaunch Services, LLC, ASBCANo. 56850 etal., 16-1 BCA

## ,r 36,483 at 177,765 (failure to address allegations from pleadings inpost-hearingbriefequated to abandonment ofthe issue). 4 The ASBCA Nos. 60455, 60669 complaint also alleges thatthere was a non-disclosure of superiorknowledge, mutual mistake, and breach ofthe covenant ofgood faith and fai,r dealing (60455, 60669, compl. 

## ,r,r 41-63). However, CDM abandoned those allegations byfailing to raise them in its post-hearingbrief. UnitedLaunch, 16-1 BCA

## ,r 36,483 at 177,765. 5 Citations to the Rule 4 files are to the consecutively-numberedpages unless otherwise indicated.

2

# 1

[D]escribe[] the design workthat shall notbe changed, and shall be included in the construction documents. All remaining design work shall be performed bythe Contractorbased on the design criteria as required bythe RFP. No deviations from the criteria will be allowed unless prior approval is obtained from the Contracting Officer's Representative. (Id. at 1,731-32) In particular, "General Design Requirements are contained in [section 01 10 10], with Specific Design Requirements

...identified in" appendix A (id. at 1,729). Section O 1 10 10 described "the requirements for appearance, function, materials, andtypes ofconstruction in sufficient detail to enable engineering and design to be completedbythe Contractor" (id. at 1,731). Appendix A "is intendedto guide the completion ofthe design by establishing existing conditions, and desired character, appearance, and function ofthe newconstruction" (id. at 1,730). Thus, section 01 10 10 and appendix A "shall define the design andperformance criteria" (id. at 1,732).
3. Appendix X contained for information only (FIO) concept drawings from CH2M Hill Constructors, Inc. (CH2M Hill)6 and Southern CaliforniaEdison (SCE)7 (R4, tab 9 at 1,731, 6,679, 7,113), and stated:
Information in appendices below [including appendixX] that are noted for information only (FIO) represent studies, analyses, and designs previously developed for this project. This information is made available to the contractorfor its
use without any warranty ofusefulness or suitability of purpose.... Drawings and designs included inFIO appendices shall NOTbe considered "Drawings ofRecord"
or "ForConstruction". As the designer ofrecord, all design requirements are the responsibility ofthe contractor. (Id. at 1,730) Similarly, appendix A statedthat:
The concept drawings ofAppendix A and this specification section indicate processes required bythe DD1391 as well [as] additional requirements. These concept drawings indicate estimatedrelationships and approximate sizes ofindividual components for the treatment facility. Drawings have beenprovided for

6 CH2M Hill was the privatized water operatorfor Fort Irwin (tr. 1/47). 7 SCE was the electrical utility serving parts ofSouthern California, including Fort Irwin (tr. 2/10).

3information only (FIO) from a 2009 partial design by CH2M HILL Constructors, Inc. ofthe process required that was based on a Design/Build/Operate business process. See Appendix X. The design and FIO drawings provided do not meet the full requirements ofthis solicitation. The actual sizing ofthe tanks, pumps, piping, buildings, etc. shall be determined by the Contractor during his design. (R4, tab 10 at 9,773)
4. Section 01 10 10 stated that "[t]he drawings and details provided by SCE shall be utilized for pricing ofthis effort" (R4, tab 9 at 1,785).
5. Section 01 10 10 also containedthe following Order ofPrecedence clause:
Where the various elements ofthe RFP are inconflict, the following priority shall be used to establish precedence, unless specifically noted otherwise: a. Appendices A - I and Technical Specifications, where furnished. b. Section 01 10 10 DESIGN REQUIREMENTS, GENERAL. c. Drawings. (R4, tab 9 at 1,732)
6. OnAugust 8, 2012, the Corps awarded ContractNo. W912PL-12-C-0022 (0022 contract) to CDM basedupon the 0018 RFP (R4, tab 7).
7. The 0022 contract containedthe Federal Acquisition Regulation (FAR) 52.243-4, CHANGES (JUN 2007), clause under which the Corps hadto provide CDM with an equitable adjustment ifthere was any written or oral direction, instruction, interpretation, or determination from the CO that caused a change (R4, tab 7 at 696).
II. Facts Unique to the EvaporatiorJPondsAppeal (ASBCA No. 60./54)
A. Background
8. A WTP produces wastewater. Because ofFort Irwin's isolated location in the desert, there were limited options available for the disposal ofthat wastewater. (Tr. 4/127) However, due to that desert location, it was advantageous to remove the liquid component ofthe wastewater through natural evaporation in EPs, and then to haul the remaining solid waste to a landfill. Therefore, the Corps decided to use EPs

4 

# fto deal with the wastewater at Fortltwin. (App. supp. R4, tab 134 at 173; tr. 1/61-62, 86-87)
9. The sizing ofthe EPs must take account ofthe fact that the net evaporation rate-i.e., the rate at which water evaporates from the EPs minus the rate atwhich water enters the EPs as precipitation-mustequal or exceedthe rate at which wastewater flows into the EPs (inflow) overtime (tr. 1/92-93, 2/183, 204, 4/129-30).
10. The measurement ofthe EPs' likely evaporationrate starts with a determination ofthe pan evaporationrate. The pan evaporationrate measures the rate at which water in a standardized test pan evaporates. Thatrate accounts for climatic factors at thatparticular location. However, different bodies ofwater will experience different evaporationrates atthe same climatic location based upon their size, depth, salinity, and watertemperature. To account for those characteristics, the pan evaporationrate is multipliedby an evaporation coefficient. (R4, tab 4 at 32-33; tr. 1/89-91)
11. Onthe other side ofthe equation, two factors-the ADF and the recovery rate-determine the likely inflow. The ADF is the likely average rate per day at which water enters the WTP, which is determinedbyuser demand. ThatADF is multiplied bythe remainder ofthe recovery rate-whichis the percentage ofthe water entering the WTP that leaves the WTP as treated water-to determine the likely inflowrate. (R4, tab 4 at 31; tr. 1/91-92)
12. EPs require very little maintenance (tr. 1/85). While EPs can leak, suchleaks
are rare and usually only take a few days to repair. Moreover, it is highlyunlikelythat the EPs will fail completely during the life ofthe WTP. (Tr. 2/184, 3/30-34) However, ifthe EPs fail orcannotbe used for an extendedperiod oftime, the result would be catastrophic for the WTP and Fort IIWin. Because net evaporation must equal or exceed inflows overtime, the WTP wouldhave to be shut-down in orderto avoid an overflow if the EPs did not adequately function over an extendedperiod oftime. That, inturn, wouldrequire Fort IIWin to close. To compoundthe problem, it wouldbe difficult for the Corps to obtain funding for any majorrepairs. (Tr. 2/204, 4/129-30)
B. The ContractDocuments

1. Evaporation PondSizing anda Standby Evaporation Pond
13. The contract documents required CDMto design and build EPs (R4, tab 9 at 2,107). "Actual plant configuration shall be determinedbythe Contractor" (id. at 2,113).
14. However, the Corps provided concept design requirements. The contract documents stated that

5Table 8 provides the Government's conceptual design unit requirements. The Government's concept may be incomplete and the Contractor shall provide a complete system. Whatis identified in Table 8 is the Government's expected minimum unit operations necessary. The Contractor shall meetthe quantities in Table 8 as a minimum but additional units, ifrequired to meet the criteriaherein, shall be provided. (R4, tab 9 at 2, 113) Table 8 indicated "NUMBEROF PONDS

...2 

### + 1 STANDBY.'' It did notmention standby capacity. (Id. at 2, 116)8

15. The contract documents also indicated that "[a] total ofapproximately 11 acres is allowed for the evaporation ponds as shown in the current layout, withoutprior approval from the [contracting officerrepresentative (COR)]. Anyrequirement above this area will require Government approval and likely revision to the Environmental Assessment (EA) before design approval is granted." (R4, tab 9 at2107)9 Obtaining a revision to an EA was a bureaucratic hurdle that could delay the project (tr. 1/116, 4/139).
16. The CH2M Hill drawings showed three EPs covering a total area of 10.8 acres (R4, tab 9 at 6,681, 6,688, 7,077-80, 9,602; app. supp. R4, tab 175).
17. Reviewing the CH2M Hill drawings in conjunctionwith Table 8-whichwas derived from the CH2MHill drawings-areasonable contractorwouldhave realized that
one ofthe three EPs shown inthe CH2M Hill drawing was notto be used in day-to-day operations. Table 8 showed an overall recoveryrate of99.6 or 99.7 percent. (App. supp. R4, tab 101 at 8-9; tr. 4/116, 141)10 Atthatrecoveryrate, atmost, only two ofthe three

8 TheWTP also generates a sludge oflime, which is siphoned off, and pumpedto lime sludge lagoons. In the lagoons, the water evaporates from the sludge, and the Corps hauls the solids to a landfill (tr. 1/137-38). Wastewater also is pumped from the lime sludge lagoons to the EPs (tr. 3/92). Table 8 required 1

### + 1 standby lagoon. It also required standby units for other items, such as cartridge filters, electro dialysis reversal (EDR) membrane treatments, treated waterpump stations, lime softening contact clarifiers, lime softening filtrations, reverse osmosis (RO) feed water storage andpump stations, RO cartridge filters, RO systems, and concentrate equalizationbasins. (R4, tab 9 at 2,114-17) 9 The EAis state approval to build on a certain area ofland (tr. 1/115, 2/175). 10 To achieve thatrecoveryrate-which was veryhigh (tr. 1/44)-the Corps contemplatedusing several consecutive processes to extractusable water. Table 8 delineated the recovery rate for eachprocess. Table 8 shows thatthe EDRprovided a 92 percent recovery rate. Wastewater then went to RO stage 1, which provided an additional 58.8 percentrecovery rate. Wastewaterthen went

6EPs shown onthe CH2M Hill drawings would be needed to ensure that inflows equaled net evaporation (supp. R4, tab 101 at 8-9; tr. 4/127, 170). 11

18. The 0018 RFP initially required two assessments to evaluate the actual daily demand performance and the maximum daily demand performance. Reflecting the 99.6 or 99.7 percentrecovery rate, the 0018 RFP stated that [T]he Contractor shall demonstrate that the design ofthe WTP material/mass balance achieves a minimum of99.6% recovery efficiency at 6.0 MGD at the given requirements for raw water quality range and treated water quality requirements. Forthe range ofdesign flows (2.0 to 2.5 MGD annual average daily flow; 0.8 MGD minimum daily flow; and 5.4 maximum daily flow), the WTP material/mass balance design shall be designed to exceed a minimum of99%recovery efficiency. (R4, tab 9 at2,082; tr. 4/178)
19. However, the problems arose in this case from the fact that the Corps decided to reduce the recovery rate during the solicitationphase, as reflected in Amendment 8 (tr. 4/159). Amendment 8 amendedthe above paragraphto read that: [T]he Contractor shall demonstrate that the design ofthe WTP material/mass balance achieves a minimum of99-=6% recovery efficiency at 6.0 MGD atthe given requirements for raw water qualityrange andtreated water quality requirements. Forthe raage ofdesign flows (2.0 to 2.5 ~4GD 8:BfH:lal aYerage daily flow; 0.8 ~4GD m-inimam daily flo~;.r; and 5.4 maximam daily flow), the '.VIP

to the RO stage 2, whichprovided an additional 39.5 percentrecovery rate. Wastewaterthen wentto a mechanical evaporator, which provided an additional 85 percentrecoveryrate. Taken together, thatprovided a recovery rateofabout99.7percent. (Supp. R4, tab71 at2,114-16, tab 101 at8-9; tr. 4/176, 181) 11 Dr. Beth Gross-CDM's EP expert-opinedthat the CH2M Hill drawings couldnot be basedupon a 99.6 or 99.7 percentrecovery rate because, at that recovery rate, only one ofthe three EPs would be needed to balance inflows and net evaporation (app. supp. R4, tab 180 at539, tab 187 at 579; tr. 3/18, 72-74). However, thatmerely shows that CH2M Hill may have conservatively designed the EPs with excess capacity.

7

### materiatrmass ba:10.flee desigt1: sha:11 be desigt1:ed to exeeed a miaimam of99% reeo:very effieieaey. (R4, tab 10 at 10,353) (Strikeout in original) Onthe one hand, reducing the recovery rate benefitted contractors by reducing the risk and cost ofdesigning such an efficient WTP. Onthe otherhand, reducing the recovery rate increased the amount of wastewater flowing into the EPs. Thatmeant that the contractorhad to modify another EP parameter-such as increasing the EP surface area-in order to maintain a balance between inflows and net evaporation. (App. supp. R4, tab 153 at 236, tr. 1/44, 4/178-79, 211)


### 2. Average Daily Flow
20. The contract documents did notrequire CDM to use any particular ADF (R4, tab 9).
21. The contract documents stated that the CH2M Hill drawings were based upon a 3.0 mgd ADF. However, the contract documents stated that "[a]s designer's collect data and develop the actual system, all numerical data used to support the design shall be from the Contractor's inquiries and research." (R4, tab 9 at 2,107)
22. The contract documents stated that the current ADF was 2.44 mgd, and that the ADF in 2010 was 2.26 mgd (R4, tab 9 at 1,727, 4,332). Dr. Beth Gross-CDM's EP expert-opinedthat it was industry standard to use historic flow data to develop the ADF (app. supp. R4, tab 180 at 540, tab 187 at 576; tr. 3/40, 43-44, 67-68). We find this uncontested testimony credible.
23. As noted above, Amendment 8 eliminated one reference to the 2.0 to 2.5 mgd ADF. However, it continued to provide that, in measuring actual daily demand performance, "the flowrates ranges include: Average flow in the range of2.0 to 2.5 MGD for well production rates; minimum flows at 0.8 MGD[;] and maximum flowrates near 5.4 MGD." (R4, tab 10 at 10,354)


### 3. Evaporation Coefficientand WaterDepth
24. The contract documents did notrequire CDM to use any particular evaporation coefficientfor any particular water depth (tr. 4/192).

8C. Performance
25. After award, CDM submitted several EP designs, including a 10 percent design, a 65 percent design, and a 100 percent design (R4, tab 4 at 109). CDM used the CH2M Hill drawings to create its EP design, assuming that none ofthe EPs were backup EPs (tr. 2/168).
26. Dr. Gross opined that it was standard industry practice to constructWTPs without a backup EP. Dr. Gross testified that she was unaware ofany other WTPs that have used a backup EP. (App. supp. R4, tab 180 at 537; tr. 3/25-26) However, Dr. Gross conceded that she "couldnot find any reference in the technical literature to a standby pond" (app. supp. R4, tab 180 at 541). Norhad she ever seen another contract that has used the term standby EP (tr. 3/116). We find that this term as used within the trade does not differ from the standard dictionary definition found in the New Oxford American Dictionary, 1699 (3rd ed. 2010), discussed in greater detail below.
27. The 65 percent and 100 percent designs used a 3.0 mgd ADF, a five-foot maximum water depth, a three-foot average water depth, and a 0.8 evaporation coefficient (R4, tab 4 at 109).
28. On March 6, 2013, CDM submitted a technical memorandum explaining its design. Regarding the evaporation coefficient and water depth, the March 6, 2013 memorandum explained that

In general, a conservative factor of0.7 is typically used to convertpan data to freshwater "lake" evaporationrates, whereas greater coefficients are used for smaller, shallower ponds. This coefficient generally ranges from 0.7to 0.95, depending on the size ofthe pondorlake (see attached [pages] from "Design Characteristics for Evaporation Ponds inWyoming"). Forpurposes ofsizing the evaporationponds, a conservative pan evaporation coefficient of0.8 was applied byCDM Smith to account for the smallerpond size, shallow depths (generally less than 3 feet) and warm water temperatures (including average discharge temperature to the EPs of90 [degrees Fahrenheit]. (R4, tab 47 at 14,891) The Design CharacteristicsforEvaporation Ponds in Wyoming report referenced above indicated that a reasonable coefficientfor EPs in semi-arid conditions was 0.7 to 0.95, depending upon EP size (id. at 14,902). The March 6, 2013

9memorandum proposed using a five-foot maximum water depth and a three-foot average water depth (id. at 14,890-93).
29. The Corps rejected the 10 percent design, the 65 percent design, the 100 percent design, and the March 6, 2013 technical memorandum (supp. R4, tab 105 at 73; tr. 4/123, 133-34). In particular, the Corps rejected the evaporation coefficient. Moreover, the Corps rejected the designs and memorandum because they lacked a backup EP-meaning an EP that was operational, but not in use unless or until there was an emergency. 12 (R4, tab 40; supp. R4, tab 105 at 73, tr. 1/112-13, 118, 2/194)
30. Converting one ofthe three EPs to a backup EP, while maintaining three equally-sized EPs, would have required CDM to increase the surface area to 17.2 acres, which would have exceeded the EA (app. supp. R4, tab 175; tr. 1/113-15).
31. After several discussions, CDM submitted a revised 100 percent design in a May 17, 2013 memorandum (R4, tab 37; tr. 1/117-21).
32. The May 17, 2013 memorandum proposed three EPs-with one being rotated out ofservice every year-on 11 acres. To achieve those parameters, CDM reduced the ADF from 3.0 mgd to 2.25 mgd. Thejustificationthe May 17, 2013 memorandum offered for using the 2.25 mgd ADF was that it was "mid '2.0 to 2.5 MGD' from Appendix A." (R4, tab 36 at 14,503-07; tr. 1/121-24) Dr. Gross opined that it was reasonable for CDM to decrease the ADF from 3.0 mgdto 2.25 mgd because ofthe multiple measures ofconservativismthat the Corps added to the contract (app. supp. R4, tab 180 at 540, tab 187 at 576; tr. 3/40, 43-44, 67-68). The proposed evaporation coefficient was 0.8. While the proposed maximumwater depth was five feet, the May 17, 2013 memorandum indicated that the water depth never actually would exceed three feet (R4, tab 35 at 14,503-07).
33. The Corps responded to the May 17, 2013 memorandum intwo letters dated May 20, 2013, and May 22, 2013. Those letters questioned the lack ofa standby EP, the ADF, and the evaporation coefficientrelative to the water depth. (R4, tabs 33, 35) Regarding the ADF in particular, the letters explained that:

12 CDM often refers to an operational, butnot inuse, EP as a "spare" EP (see, e.g., app. br. at 3). However, as CDM correctlyrecognizes, the term "spare" is interchangeable with the term "backup" (id. at 31, 50; see also ROGET'S INT'L THESAURUS, 822, 1222 (4th ed. 1977) (identifying both the termbackup and spare as being synonymous with the term substitute)). For ease ofreference and consistency, we use the term backup EP-instead ofspare EP-to describe the required EP that is operational, butnot in use except in an emergency.

10 

# 'The contract states thatthe current average daily flow is 2.44 mgd and the average daily flow range ofwell production is 2.0 to 2.5 mgd. This is based onhistorical data for the Water Treatment Plant (WTP) and not listed as the design capacity to support future demands. WTP design manuals andregulatory permits

...indicate that new treatment systems be sized based on future demands. (R4, tab 35 at 14,498-99) Regarding the evaporation coefficient and water depth in particular, the letters explainedthat "[s]ince the 0.8 coefficient is assumedbased on shallow depths (generally less than 3 feet) being maintained [in the] ponds, andthe design actually reaches 5 foot depth withoutprecipitating solids, it is questionable that the 0.8 coefficient would still be appropriate" (R4, tab 33 at 14,494). Dr. Gross opined that CDM's use ofa 0.8 evaporation coefficientfor EPs whose water depth generally
was less than three feet-but occasionally was up to five feet-was appropriate, and that the Corps' directive that an evaporation coefficient of0.8 couldbe used only for water depths ofthree feet orless was not supportedbytechnical data or scientific evidence (app. supp. R4, tab 180 at 539; tr. 3/38-40). We find this testimony credible.
34. On May22, 2013, CDM sentthe Corps a notification ofchange. In the notification ofchange, CDM statedthat:
The essential issues center onthe insistence bythe Governmentthatthe appropriate design parameters are: 3 MGD Average Daily Flow (ADF) and that the Government's definition of"standby" does not allow for
use ofthe "standby" pond during routine maintenance and cleaning ofa pond. This is inconsistent withthe accepted engineering definition of2 

### + I Standby. Also, the Government is not accepting our evaporationrate design factors that are based upon site specific data and literature describing standard industry practices. (R4, tab 34 at 14,496)
35. The Corps responded byletter dated May 29, 2013. The May 29, 2013 letter "constitutes formal direction" to meetthree relevant design elements. First, the Corp directed CDMto include one backup EP. Second, the Corps directed CDMto use a 3 mgd ADF. Third, the Corps directed CMD to use: Evaporationpond factors of0.8 for panevaporation coefficient, ifoperated with smallerpond size and shallow depth of3' or less, and actual calculated salinity correction

11factor (both as stated in 17 MayEvaporation Ponds Design Analysis memo). 

### Ifdesign size or operation varies, please vary factors as necessary. (R4, tab 32 at 14,492)
36. CDM responded by submitting a final design package. CDM reduced the surface arearequired for the EPs from 17.2 acres to 13.5 acres byrevising its design to contain 8 EPs that wouldbe in day-to-day use and one backup EP. Doing so, CDM
was able to meet the Corps' ADF, evaporation coefficient, and water depth requirements. (R4, tabs 172, l75~ tr. 1/129-30) The 13.5 acres did notrequire an EA amendmentbecause CDM moved other equipmentto keep the entire WTP within the EA (tr. 1/133, 4/139-40). 13

37. The Corps accepted the final design package (tr. 1/136).
38. The ADF has decreased over the lastfive years. The yearpriorto the hearing, the ADF was 1.7 mgd. (Tr. 1/142-43)
III. Facts Unique to the GeneratorAppeals (ASBCA Nos. 60455 and60669)
A. The Southern CaliforniaEdisonElectrical Service Requirements
39. In 2006, SCE publishedthe Electrical Service Requirements (ESR). The ESR were "issuedfor the guidance and assistance ofelectrical contractors

...engagedin the installation and design ofelectrical service wiring and service equipment." (R4, tab 51 at 15,022) The ESRwere guidelines with which SCE customers in Southern Californiahadto comply in orderto receive services. However, SCE often waivedthe ESR. (Tr. 2/64-65, 108-10, 4/32)
40. Paragraph 12 ofthe ESR stated that:
When a customerhas a standby generatorto supply all of their load during an Edison system outage, the generator

13 In the final design, there were onlytwo lime sludge lagoons, both ofwhich were in
use. Antonia Ortiz-the Corps' technical design manager and an expertin WTPs-testifiedthat the Corps initially complained about both lagoons being in use, but "thatjustkind offell bythe wayside." Because liquid waste can go from the lagoons to the EP, the lagoons-unlike the EPs-arenot a critical component whose failure will cause the WTP and Fort Irwin to shut down. CDM provided a backup unit for the other items for which Table 8 required a standby unit. (Tr. 1/133, 4/152)

12 

## J 

# Ishall be connectedto the loadby a double-throw switch or automatic relays and switches which will isolate the load from the Edison system before the generator is connected to the load. When the Edison service is re-energized, the generator will then be isolated from the load before the load is reconnected to the Edison system. (R4, tab 51 at 15,023)
B. ContractDocuments
41. The contract documents required a standby generator connected to the normal site powerby an automatic transfer switch (ATS) (R4, tab 9 at 2,161). The generator connection design had to satisfy two potentiallyrelevantrequirements.
42. First, under appendix A, §9.1.3, "[m]ultiple generators and transfer switches will be required whenphysical distances exceed 200 feet to load" (R4, tab 9 at 2,161).
43. Second, section 01 10 10 providedthat "[a]ll work shall be designed and constructed to meet all state and federal codes, standards and law" (R4, tab 9 at 1,732). Similarly, section 01 10 10 statedthat "[t]he applicable building codes and standards shall be used as the minimum criteriato develop the construction documents for areas ofwork not specifically defined" (id.). Regarding the electrical system in particular, appendix A statedthat:

(Id. at 2,159) All electrical equipment shall be installed in accordance with NFPA 70 (National Electrical Code), ANSI C2 (National Electrical Safety Code), California's Energy Efficiency Standards for Residential and Nonresidential Buildings Title 24, Part 6, ofthe California Code of Regulations, all applicable UFC's, ETL's, TM's and other DOD and national standards as applicable to the system under consideration.

44. The RFP initially containedthe CH2M Hill drawings, butnot the SCE drawings (tr. 1/146-47). The CH2M Hill drawings showed a primary 12 kilovolt (kv) network and a secondary 480 volt (v) network (tr. 1/160-61, 236, 2/22). According to the CH2M Hill drawings, electricity would come into the WTP from an SCE substation on the primarynetwork during normal operations. After the electricitypassed through an ATS and traveled along the primary network, transformers would step the voltage down

13 

# Ito 480v, so that the electricity couldtravel on the secondarynetwork to where it was needed. 

### Ifthe ATS sensedthatthe power from SCE was interrupted, it would send a signal to the 480vgeneratorto start. The generator was connectedto a transformer, which increased the voltage to 12kv. The transformer then connected to the ATS, through which the electricity would flow to the primarynetwork. The ATS ensured that electricity only came from one source at a time, and did notback feed from the generator onto the SCE system. (R4, tabs 136, 145; tr. 1/147-50, 218)
45. There was a pre-bidrequest for information (RFI) regarding the CH2M Hill drawings from another offerorbesides CDM. The RFI indicatedthat appendix A of the RFP "states 'Multiple generators andtransfer switches will be required when physical distance exceed 200 feet to load.' The initial concept drawings by CH2M (90-E-501) indicate one generator which connected into the SCE distribution system. Please confirm thatAppendix A takes precedence overthe CH2M design." The RFI did not indicate thatthere was an actual conflictbecause it did not state thatthe physical distance from the generatorto the load onthe CH2M Hill drawing exceeded 200 feet. The Corps' response did not acknowledge a conflict either. Rather, the Corps merely responded, "[p]lease see Section 01 10 10 paragraph 2.8 Conflicts in RFP Criteria for precedencerequired." (App. supp. R4, tab 148 at 220; tr. 2/54-55)
46. Normayitbe inferredfrom the Corps' response to the RFI that itread the RFI as establishingthatthere was a conflictbecause, the same day that the Corps responded to the RFI, it amended the RFP to add the SCE drawings, which were substantially similarto the CH2M Hill drawings. Byissuing drawings showing a single generatorusing a single ATS andprimarynetwork to distribute electricity after the RFI quoting appendix A,§ 9.1.3, the Corps demonstrated thatit did notreadthe RFI as establishing that such a design conflictedwith appendix A, § 9.1.3. (App. supp. R4, tab 152; tr. 1/146-47, 153-55, 2/16-19)
47. Thatconclusion was correct. The SCE drawings were consistent with appendix A,§ 9.1.3 because the distance to the load was not anissue when using the primarynetwork (tr. 4/47-48). Moreover, while the SCE drawings only showed one generator and one ATS, the distance from the generatorto the ATS-whichwas the load-was only about 100 feet (app. supp. R4, tab 152; tr. 1/153-56, 2/16-20, 89-90).
C. Pe,formance
48. After award, CDM submitted a 10 percent electrical design. The design followed the concept drawings. In particular, the design-likethe drawings-showed
one generator connectedto the primarynetworkby one ATS. (R4, tab 6 at294; app. supp. R4, tab 162; tr. 1/157-58, 2/95) However, the design did not contain any distance measurements. In particular, it did not include any measurement ofthe distance from the generatorto the load (R4, tab 6 at 294; tr. 2/32, 4/54).

1449. The fact that the concept drawings and 10 percent design showed the generator connected to the primaiynetwork did not conflictwith ESR 112because the drawings and the design showed the generator connected to the load with an ATS that isolatedthe load from the SCE systembefore the generator was connected to the load (tr. 1/227-28, 2/30, 71-72, 144, 146). 14 Indeed, it was reasonable to interpretthe ESR in light ofthe SCE drawings because the SCE drawings constituted SCE applying its guidelines to this particular electrical system (tr. 1/232, 2/60, 127, 130).
50. Representatives from CDM, the Corps, and SCE attended a meeting to discuss the 10 percent design. As the Corps subsequently documented, the SCE representative indicated atthe meeting that
The emergency generator will notbe able to be installed as originally shown. Atthe time ofthe original drawing years ago itwas notnecessaiy to submitthe informationthrough the generation group. Per SCE's new standards this installation wouldhave to be submittedto the generation group and this type ofinstallation will notbe accepted.
The Corps did notmention ESR 1 12 or appendix A, § 9.1.3. (R4, tab 6 at 295)
51. 

### In. response, CDM recommended usingthe secondaiynetwork to feed electricity from the generatorto two locations, eachwith an ATS. Using the secondarynetwork raised concerns aboutthe distance to the load. (Tr. 4/47-48) Moreover, the proposed design violated appendix A,§ 9.1.3 because one ofthe two locations at whichthe secondaiynetwork wouldfeed into the load was more than 200 feet from the generator. Nevertheless, the Corps approved the proposed design. (App. supp. R4, tab 166 at 398; tr. 1/162-63, 218, 2/27-29, 4/51)


### JV ProceduralHistory
52. Abe Nejad-CDM's scheduling expert-prepared a time impact analysis on Januaiy 27, 2014, which showedthatthe rejection ofthe EP caused a 51-day delay to the WTP completion date (app. supp. R4, tab 178; tr. 3/144-45) However, Mr. Nejad conceded that, ifthere was a Corps-caused delay and a CDM-caused delay inthe EP design, then that would constitute concurrent delaythat wouldnotbe compensable (tr. 3/199, 4/10).

14 Derrick Collier-the Corps' electrical engineerfor the project-testifiedthat the 10 percent design violated ESR 1 12 because "you can'tutilize the primaiy distribution systemandbe isolated from it" (tr. 4/54). Thattestimony is inconsistent with ESR 112, which acknowledgedthatthe load canbe isolated from the SCE systemby an ATS (R4, tab 51 at 15,023).

1553. CDM subsequently submitted REAs regarding the EPs (R4, tabs 4, 29) and the generator (R4, tab 6).
54. OnJuly 22, 2015, CDM submitted a claim for changes in the EPs and the generator design (R4, tab 3).
55. On May 6, 2016, the CO issued a final decision, rejecting the generator claim (R4, tab 2). The CO did not issue a final decision on the EPs claim, and that claim is deemed denied.
56. These appeals followed.
DECISION
CDM has the burden ofproving thatthere was a constructive change or a defective specificationby a preponderance ofthe evidence. Amos &Andrews Plumbing, Inc., ASBCA No. 29142, 86-2 BCA

## ,r 18,960 at 95,738 (citing Teledyne McCormick-Selph v. UnitedStates, 588 F.2d 808 (Ct. Cl. 1978)). As discussed below, ithas satisfiedthatburden inpart, and hasnot satisfied it inpart.

I. EvaporationPonds (ASBCA No. 60-15-1)

In particular concerning the EPs, CDMhas met its burden ofshowing a constructive change regarding the ADF, evaporation coefficient, and water depth, but has notmet its burdenregarding the backup EP. In orderto establish thatthere was a constructive change, a contractormust show that: (1) an official compelled it to perform work notrequired under the terms ofthe contract; (2) the official directing the change had contractual authority to alter the contractor's duties unilaterally; (3) the official enlarged the contractor's performance requirements; and (4) the added work
was notvolunteered, butresulted from the official's direction. A/fairDev. Co., ASBCA Nos. 53119, 53120, 05-2 BCA

## ,r 32,990 at 163,515. "Where as a result ofthe Government's misinterpretation ofcontractprovisions a contractor is required to perform more or different work, orto higher standards, not calledfor under its terms, the contractoris entitledto equitable adjustments pursuantto the Changes Article, including extensions oftime." Emerson-Sack-Warner Corp., ASBCANo. 6004, 61-2 BCA

## ,r 3248 at 16,827.

In determining whatwork a contract requires, "clear and unambiguous [contract provisions] mustbe given theirplain and ordinarymeaning, and we maynotresort to extrinsic evidence to interpretthem." CoastFed Bank, FSB v. UnitedStates, 323 F.3d 1035, 1040 (Fed. Cir. 2003) (enbane) (citations omitted). "An ambiguity exists when
a contract is susceptible to more than one reasonable interpretation." E.L. Hamm

16 I 

# I&Assocs., Inc. v. England, 379 F.3d 1334, 1341 (Fed. Cir. 2004). "To show an ambiguity it is not enough that the parties differ in their respective interpretations ofa contractterm. Rather, both interpretations must fall within a ·zone of reasonableness."' NVTTechs., Inc. v. UnitedStates, 370 F.3d 1153, 1159 (Fed. Cir. 2004). As we have held: Determining whether

...differing interpretations are reasonable begins with an examination ofthe plain language ofthe contract, construing the contract so as to effectuate its spirit and purpose giving reasonable meaning to all parts ofthe contract. In order to fall within the zone ofreasonableness, a party's interpretation must be logically consistent with the contract and the parties' objectively ascertainable intentions.

ECCI-CMetag, fl~ ASBCA No. 59031, 15-1 BCA

## ,r 36,145 at 176,418 (citations and quotations omitted). "[T]he language ofa contract must be given that meaning that would be derived from the contractby a reasonably intelligentperson acquainted with the contemporaneous circumstances." Hol-GarMfg. Corp. v. UnitedStates, 351 F.2d 972, 975 (Ct. Cl. 1965). Thus:
We must seek to put ourselves in the position ofappellant atthe time he bid on the contract, i.e., we must seek the meaning that would be attached to the language by a reasonably intelligentbidder in the position ofappellant, who wouldbe expected to have the technical and trade knowledge ofhis industry and to know how to read and interpret technical engineering specifications and perform construction work in accordance with such specifications.
AdrianL. Roberson, db a Roberson Constn1ction Co., ASBCA No. 6248, 61-1 BCA 

## ,r 2857 at 14,915.
""Trade practice and custom illuminate the context for the parties' contract negotiations and agreements." Metric Constn,ctors, Inc. v. NASA, 169 F.3d 747, 752 (Fed. Cir. 1999). Before we can conclusively declare a contract ambiguous or unambiguous, we must consult the context-includingtrade practice and custom-in which the parties exchanged promises. However, a contracting party cannot invoke trade practice and customto create an ambiguity where a contract was notreasonably susceptible to differing interpretations at the time ofcontracting. "Trade practice

17evidence is not an avenue for a party to avoid its contractual obligations by later invoking a conflicting trade practice." Id.
As discussed below, the contract unambiguously required a backup pond, but did not require a particular ADF or evaporation coefficient for a particular water depth. Thus, there was no constructive change regarding the backup EP, but there was a constructive change regarding the ADF, evaporation coefficient, and water depth.
A. Backup Evaporation Pond
There was not a constructive change when the Corps compelled CDM to provide a backup EP that was operational, butnot in use exceptin an emergency because the plain language ofthe contract documents required CDM to provide at least
one backup EP. Table 8 required at least one "STANDBY'' EP (finding 14). The dictionary definition ofthe word "standby" is "readiness for duty or immediate deployment.

...a person or thing ready to be deployed immediately, especially ifneeded
as a backup in an emergency." NEWOXFORD AM. DICTIONARY, 1699 (3rd ed. 2010). Thus, by using the word standby to modify the word pond, Table 8plainlyrequired a backup EP that was operationally ready for duty, butnotyetdeployed unless oruntil needed for an emergency.
CDM correctly argues that context and the parties' intentions may be more importantthan dictionary definitions in determining plain meaning (app. br. at 43); Metric ConstnJctors, 169 F.3d at 752. However, the context in which the parties used the term standby-namelythe CH2M Hill drawings and Table S'srecovery ratesconfirms that they intended the term standby to have its usual meaning as a backup. The CH2M Hill drawings showedthree EPs, covering a total area of 10.8 acres (finding 16). When read in the context ofthe 99.6 or 99.7percentrecoverrate provided for in Table 8-whichwas based upon the CH2M Hill drawings-a reasonably intelligent contractor would understand that at least one ofthe CH2M Hill drawings' three EPs was a backup EP (finding 17).
As context, CDM points to the fact thatthree EPs capable ofbalancing inflows and net evaporation would not fit within the 11 acres for which there was an EA ifone ofthe EPs was a backup EP (app. br. at 28-29; app. reply br. at 8-9). That argument incorrectly assumes that the contract documents limited CDM to three EPs. While Table 8 indicated that the number ofEPs was "2 

### + 1STANDBY," the contract documents also stated that "[w]hat is identified in Table 8 is the Government's expected minimum unit operations necessary
.... [A]dditional units, ifrequired to meet the criteriaherein, shall be provided." (Finding 14) Thus, nothing in the contract documents prohibited CDM from including more than three EPs in its design. And indeed, CDM ultimately was able to accommodate a backup EP within the EA by

18using nine EPs (finding 36). As a result, the area available within the EA was consistent with a backup EP.
Nor did the term standby have a customary meaning within the trade that differs from the dictionary definition. Onthe contrary, CDM's EP expert testified that she was unaware ofany reference to the term standby EP inthe technical literature or its
use in any other contracts. Rather, she opined that it was not standard industry practice to construct EPs with a backup EP. (Finding 26) However, "evidence that
some practitioners customarily accomplish tasks differently from the manner called for by the contract will not overcome the clear language ofthe contract." Metric Constructors, 169 F.3d at 752. 15
CDM also argues that Table 8 merely required standby capacity in the EPs (app. br. at 45). Thatreading ofTable 8 does not fall within the zone of reasonableness. Table 8 does not even mention capacity. Rather, the word standby modifies the word pond. (Finding 14) Thus, by its plain language, Table 8required
one standby EP; not any particular standby capacity.
CDM also relies upon the Environmental Protection Agency's (EPA's) definition ofthe word standby as "the period oftime that an impoundment is not accepting uranium byproductmaterial ortailings buthas notyet entered final closure'' (app. br. at46; 40 C.F.R. 

### § 61.251(k)). However, that definition is consistent with the dictionary definition ofthe word standby, albeit applied to modify a period oftime instead ofa physical structure (id.). The EPA definition indicates thatthe standby period-i.e., the period oftime that an impound is ready for duty, butnotyet deployed unless or until needed for an emergency-is when it is not accepting uranium by-product ortailings buthas notyet enteredfinal closure under EPAregulations. Because the word standby modifies a physical structure (i.e., an EP) instead ofa period oftime here, the plainmeaning ofthe contract documents required CDM to provide a backup EP that was operationally ready for duty, butnotyet deployed unless
oruntil needed for an emergency. Thus, there was no constructive change when the Corps compelled CDM to provide a backup EP. 16

15 

### It is not ourplace to second-guess the soundness ofthe Corps' decision to require a backup EP. Savantage Fin. Servs., Inc. v. UnitedStates, 595 F.3d 1282, 1286 (Fed. Cir. 2010). In any event, we note that, while the probability ofan EP failure might be low, the impact ofany such failure likely would be catastrophic, leading to the closure ofFort Irwin (finding 12). 16 CDM also points to the fact that it didnotprovide a backup lime sludge lagoon, despite the fact that Table 8 calledfor a standby lagoon (app. br. at 50). However, as the Corps explains, it objected to the lack ofa backup lagoon, but did not insist upon strict compliance with the contract requirements in that case because, unlike the EPs, the lagoons were not a critical component whose

19B. Average Daily Flow
There was a constructive change when the Corps compelled CDM to utilize a 3.0 mgd ADF. The contract documents stated that the CH2M Hill drawings were based upon a 3.0 mgd ADF, but it did not require CDM to use that-or any particular-ADF (finding 21). On the contrary, the contract documents stated that the CH2M Hill drawings were FIO, and it was up to the contractor to determine sizing (finding 3). Because the contract documents did notrequire the use ofany particular ADF, the Corps constructively changed the contract documents when it compelled CDM to use a 3.0 mgd ADF. Indeed, because the contract documents required CDM to use an ADF inthe range of2.0 to 2.5 mgd to measure actual daily demand, it was reasonable for CDM to conclude that it could use an ADF within that range-namely a 2.25 mgd ADF (finding 23).
The Corps argues that CDM's constructive change claimregarding the ADF must fail because it was CDM-notthe Corps-thatchanged the ADF from the 3.0 mgd that CDMhadproposed in its 65 percent and 100 percent designs to the 2.25 mgd that CDM proposed in its revised 100 percent design (gov'tbr. at 26; gov't reply br. at 7). That is beside the point. A constructive change occurs when the government compels a contractor to perform work notrequired under the terms of the contract. AffairDev., 05-2 BCA

## ,r 32,990 at 163,515. Thus, the relevant change was when the Corps required CDM to use a 3.0 mgd ADF that was not called for bythe contract documents (findings 20, 35). It was notwhen CDM changed the ADF from
an earlier design. The earlier ADFs proposed by CDM were not contract requirements. On the contrary, the Corps hadrejected those earlier designs (finding 29). Absent a contractrequirement or an approved design to the contrary, CDM was free to select an ADF, so long as itwas sound and supported, which was the
case here. 17

failure likely would lead to the closure ofFort Irwin. Moreover, for all the other design elements requiring a standbyunit, CDMprovided a backup unit. (Finding 36) CDM argues that those elements are different from EPs because they are mechanical and thus prone to failure (app. br. at 50). However, nothing inthe language ofthe contract documents evidences a mutual intentto draw such a distinction. 17 The Corps does not-and could not-argue that the 2.25 mgd ADF was unsupported orunsound. Onthe contrary, Dr. Gross testified that the 2.25 mgd ADF was reasonable, and the evidence shows that the ADF actually has been lower than 2.25 mgd (findings 33, 38). Moreover, the contract documents contained historical data showing that the ADF was below 3.0 mgd ADF. Dr. Gross testified that historical data is an industry-accepted basis for determining ADF. (Finding 22) Further, the contract documents themselves supported a 2.25 mgd

20

### C. Evaporation Coefficient andthe Water Depth
There also was a constructive change whenthe Corps compelled CDM to use a 0.8 evaporation coefficient only ifthe maximum water depth was three feet or less. 18 The contract documents did not require CDM to use any particular evaporation coefficient for any particular water depth (finding 24). Therefore, the Corps constructively changed the contract documents when it compelled CDM to use a 0.8 evaporation coefficient only ifthe maximum water depth was three feet orless. 19

As with the ADF, the Corps argues that itwas CDM-notthe Corps-that changed the evaporation coefficientrelative to the water depth from that proposed by CDM in its March 6, 2013 memorandum (gov'tbr. at 32). That argument is even weaker than the Corps' argument regarding the ADF. First, it suffers from the same defect discussed above regarding the ADF. Namely, it fails to recognize that the relevant change for purposes ofestablishing a constructive change was when the Corps compelled CDM to perform work notrequired by the contract documents; not when CDM purportedly changedthe coefficientrelative to the water depth from that CDM proposed inthe rejected March 6, 2013 memorandum.

ADF by requiring CDM to use an ADF inthe range of2.0 to 2.5 mgd to measure actual daily demand (finding 23). That CDM had proposed a more conservative 3.0 mgd ADF earlier does not establish that the subsequent 2.25 mgdADF was unsound because the revised 100 percent design increased conservativism elsewhere (findings 27, 32). 18 The Corps improperly seeks to segregate CDM's evaporation coefficient claim from its water depth claim in an attempt to argue that CDM voluntarily used a 0.8 evaporation coefficient (gov'treply br. at2-3, 8). The March 6, 2013 memorandum voluntarily proposed using a 0.8 evaporation coefficientfor a maximumwater depth offive feet (finding 28). The Corps rejected that proposal, directing CDM to use a 0.8 evaporation coefficient only ifthe maximum water depth was three feet orless (findings 29, 33, 35). Thus, it was not the evaporation coefficient alone that was compelled, butrather the evaporation coefficient relative to the ·waterdepth. 19 The Corps does not-and could not-argue that the use ofa 0.8 evaporation coefficient for EPs with a maximum water depth offive feet was unsound or unsupported. Onthe contrary, Dr. Gross testified that a 0.8 evaporation coefficientfor EPs with a maximum water depth offive feet was reasonable (finding 33). Moreover, CDM supported its evaporation coefficientby citing the Design CharacteristicsforEvaporation Ponds in Wyoming, which indicated that a reasonable evaporation coefficient was inthe range of0.7 and 0.95 (finding 28).

21Moreover, the Corps' argument regarding the evaporation coefficient and water depth is even weaker than its argument regarding the ADF because it was the Corpsnot CDM-that sought to change the evaporation coefficientrelative to the water depth from that proposed in CDM'srejected proposal. 

### In the March 6, 2013 memorandum, CDM proposed using a 0.8 evaporation coefficient for EPs that had a maximum water depth of five feet and a usual water depth ofthree feet or less (finding 28). 

### It was the Corps-not CDM-thatchanged that criteriaby compelling CDM to use a 0.8 evaporation coefficient only for EPs that had a maximum water depth ofthree feet or less (findings 29, 33, 35). The Corpsjustifiedthatrequirement by stating that, "[s]ince the 0.8 coefficient is assumed based on shallow depths (generally less than 3 feet) being maintained [inthe] ponds, and the design actually reaches 5 foot depth without precipitating solids, it is questionable thatthe 0.8 coefficient would still be appropriate" (finding 33). However, inthat statement, the Corps improperly compared apples (i.e., the March 6, 2013 memorandum's proposed five foot ma.ximum water depth) with oranges (i.e., the March 6, 2013 memorandum's proposed three feet orless general or usual water depth) to callinto question the March 6, 2013 memorandum's evaporation coefficient by creating an illusory inconsistency. Because the Corps was compelling CDM to use an evaporation coefficientrelative to the water depth that was not called for bythe contract documents-oreven by CDM's rejected March 6, 2013 design memorandum-there
was a constructive change.
The Corps also argues that CDM failed to provide adequate notice (gov'tbr. at 29-32). Thatis incorrect. While the May 22, 2013 notice ofchange focused upon the standby EP and ADF issues, it stated, "[a]lso, the Government is not accepting our evaporationrate design factors" (finding 34). Thatprovided adequate notice that CDM consideredthe evaporation coefficientrelative to the water depth requirementto be a constructive change that CDM did not voluntarily perform. Similarly, the Corps' argument that CDM voluntarily changed the evaporation coefficientrelative to the water depth because the Corps merely provided feedback instead ofdirection is incorrect (gov'treply br. at 18). After the notice ofchange, the Corps issuedthe May 29, 2013 letter, which-byits own terms-"constitutes formal direction" to use a 0.8 evaporation coefficient onlyfor water depths ofthree feet or less (finding 35) (emphasis added). Therefore, CDM did not voluntarily use a 0.8 coefficient only for water depths ofthree feet or less.20

20 There was no compensable delay because there was concurrent contractor-caused delay (i.e., failing to include a backup EP) that was intertwined with the government-caused delays (i.e., changes to the ADF, coefficient, and water depth requirements) (finding 52). Sauer, Inc. v. Danzig, 224 F.3d 1340, 1348 (Fed. Cir. 2000}; Celesco Indus., Inc., ASBCA No. 21928, 81-2 BCA

## ,r 15,260 at 75,556. Whether CDM will be able to segregate any increased costs it

2211. The Standby Generator (ASBCA Nos. 60-1-55 and60669)
CDM is entitled to an equitable adjustment under the Changes clause because the Corps provided defective specifications regarding the generator. "When the governmentprovides a contractor with defective specifications, the government is deemed to have breached the implied warranty that satisfactory contractperformance will result from adherence to the specifications." Alliance Gen. Contractors, LLC, ASBCA No. 54979, 09-1 BCA

## ,r 34,030 at 168,327 (quoting Essex Electro Engineering, Inc. v. Danzig, 224 F.3d 1283, 1289 (Fed. Cir. 2000)). Here, by providing the concept drawings, the Corps warranted that satisfactory performance would result from adherence to those drawings (findings 44, 46). The Corps breached that warranty when it subsequently rejected a design that followed the concept drawings (finding 50).
The Corps argues that the concept drawings were not specifications because the contract documents did notrequire CDM to comply with those drawings (gov'tbr. at 38). However, we rejected that argument inMA. Mortenson Company, ASBCA No. 39978, 93-3 BCA

## ,r 26,189 at 130,367 (holding that concept drawings create a warranty, even ifthe contract does not require a contractor to follow the drawings). Indeed, the conclusion that the concept drawings created a warranty is even stronger here than it was inMortenson because, unlike in that case, the contract documents required the contractorto use the drawings to price its proposal (finding 4). 21

The Corps also argues that itwas unreasonable for CDM to follow the concept drawings because appendix A, 

### § 9.1.3 trumped the concept drawings underthe Order ofPrecedence clause (gov'tbr. at 36-37). Underthe Order ofPrecedence clause, appendix A took priority overthe concept drawings only ifthere was an inconsistency (finding 5). That clause is not applicable here because the concept drawings are consistentwith appendix A, 

### § 9. 1.3. Appendix A, 

### § 9.1.3 stated that "[ m]ultiple generators and transfer switches will be required whenphysical distances exceed

incurred as a result ofthe ADF, evaporation coefficient, and water depth changes from any increased costs it incurred as a result ofits failure to include a backup EP is an issue ofdamages that is not addressed in this opinion. 21 It is true that the contract documents indicated that the concept drawings were FIO, and were made available to CDM for its use without any warranty ofusefulness
or suitability ofpurpose (finding 3). However, "[g]overnmental disclaimers of responsibility for the accuracy ofspecifications which it authors are viewed with disdain bythe courts." Edsall Constr. Co., ASBCANo. 51787, 01-2 BCA 

## ,r 31,425 at 155,181 (quoting Bromley Contracting Co., ASBCANo. 14884 et al., 72-1 BCA

## ,r 9252 at 42,902); see alsoMetcalf Constr. Co. v. UnitedStates, 742 F.3d 984, 995-96 (Fed. Cir. 2014).

23200 feet to load" (finding 42). The concept drawings' use ofa single generator and ATS was consistent with appendix A, 

### § 9.1.3 because the distance from the generator to the load was less than 200 feet (finding 47). Moreover, the Corps' reliance upon appendix A, § 9.1.3 is unavailing in light ofthe facts that the rejected 10 percent design did not even show distances, the Corps did not cite appendix A, § 9.1.3 as a basis for rejecting the 10 percent design, and the design the Corps ultimately approved violated appendix A, § 9.1.3 because itonly had one generator that was over 200 feet from the load (findings 48, 50-51). Similarly, the Corps argues that ESR

## ,r 12 trumped the concept drawings under the Order ofPrecedence clause (gov'tbr. at 36-37). That argument is even weaker than its argument regarding appendix A, § 9.1.3. First, it suffers from the same defect discussed above regarding appendix A, § 9.1.3. Namely, the Order ofPrecedence clause does not applybecause ESR

## ,r 12 was consistent with the concept drawings. The Corps is unclearpreciselyhowit claims the concept drawings conflicted with ESR

## ,r 12 (id.). To the extent that it is claiming thatthe concept drawings' use ofa single ATS orthe primarynetwork to distribute electricity was inconsistent with ESR 

## ,r 12, that argumentwould fail because ESR

## ,r 12 did notrequire the use ofmultiple ATSs orthe secondarynetwork. ESR

## ,r 12 providedthat
When a customerhas a standby generatorto supply all of their load during an Edison system outage, the generator shall be connectedto the load bya double-throw switch or automatic relays and switches which will isolate the load from the Edison system before the generator is connected to the load. Whenthe Edison service is re-energized, the generator will thenbe isolated from the loadbefore the load is reconnected to the Edison system. (Finding 40) (Emphasis added) That language expresslyrecognizedthat a single double-throw switch was acceptable. Nor did that language prohibit CDM from connecting the generatorto the primarynetwork. (Id.) Further, SCE sometimes waived the ESR'sprovisions (finding 39). Therefore, the SCE drawings can be read consistently with ESR

## ,r 12 as eitherthe SCE applying ESR

## ,r 12 to this project, or waiving any inconsistentprovisions ofESR

## ,r 12 (finding 49). Indeed, in its contemporaneous communications with CDM, the Corps did not cite ESR

## ,r 12 as the basis for rejecting the 10 percent design (finding 50).
Moreover, even ifESR

## ,r 12 were inconsistent withthe concept drawings, it would not trump the concept drawings underthe Order ofPrecedence clause. Under the Order ofPrecedence clause, appendix A and section O1 10 10 took priority over the concept drawings ifthere was a conflict (finding 5). However, unlike with appendix A,§ 9.1.3, appendix A and section 01 10 10 did notrequire compliance with ESR

24

## ,r 12. Appendix A and section 01 10 10 required compliance with "all state and federal codes, standards and law,'' "applicable building codes and standards," and "DOD and national standards" (finding 43). Building codes are "[l]aws, ordinances, or governmentregulations." BLACK'S LAW DICTIONARY, 195 (6TH ed. 1990). The ESR
was not a state or a federal code, standard or law; applicable law ordinance, or government regulation; or a DoD standardbecause itwas issuedby a utility-not a government. Nor was it a national standard because it only applied to SCE's customers in Southern California. (Findings 3, 39) Further, the Corps does not even attemptto define a "building standard," or showthatthe ESRwas a building standard (gov'tbr. at 37; gov'treplybr. at 19-21). Therefore, appendix A and section 01 10 10 did notrequire compliance with ESR

## ,r 12.
The Corps finally argues that its response to the RFI put CDM on notice ofthe Corps' beliefthat there was a conflictbetweenthe CH2M Hill drawings and appendix A, 

### § 9.1.3 (gov'tbr. at 2, 38). However, the Corps' response to that RFI did not indicate a beliefthatthere was a conflict. Onthe contrary, a reasonable contractor could inferthat the Corps believedthatthe electrical design shown in the CH2M Hill drawings was consistent with appendix A, 

### § 9.1.3 from the fact thatthe Corps respondedto the RFI-whichpurportedly establishedthatthe CH2M Hill electrical design was inconsistent with appendix A, § 9.1.3-by amending the RFP to add the SCE drawings, which showed an electrical design that was substantially similarto that shown inthe CH2M Hill drawings. (Findings 45-46) Ifthe Corps hadbelievedthat the RFI had established that such a design was inconsistent with appendix A, 

### § 9.1.3, a reasonable contractor couldhave expected that the Corps would have responded to the RFI by amending the RFP to remove the inconsistent drawings and/orto add a consistent drawing-instead ofto add drawings that continued to show a purportedly inconsistent design. Any subjective understanding ofa conflictthat was so unclearly communicated is insufficientto establish an actual conflict. Because the concept drawings were nottrumpedby inconsistentrequirements in appendix A or section O 1 10 10, those drawings created an implied warrantythat adherence to the drawings wouldresult in satisfactory contractperformance, which the Corps breached.
CONCLUSION
On entitlementunder ASBCANo. 60454, the appeal is sustained as to the constructive change claimrelative to the average daily flow, pan evaporation coefficient, and water depth. Otherwise, the appeal in ASBCANo. 60454 is denied. On entitlementunder ASBCA Nos. 60455 and 60669, the appeals are sustained onthe

25defective specification claim. Otherwise, the appeals in AS_BCA Nos. 60455 and 60669 are denied. Accordingly, the appeals are returned to the parties for a determination ofquantum consistent with this decision.
Dated: October 24, 2018

I concur



### ~HACKLEFORD Administrative Judge Acting Chairman Armed Services Board ofContract Appeals Administrative Judge Armed Services Board ofContractAppeals

I concur

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

I certifythat the foregoing is a true copy ofthe Opinion and Decision ofthe Armed Services Board ofContract Appeals in ASBCANos. 60454, 60455, 60669, Appeals of CDM Constructors, Inc., rendered in conformance with the Board's Charter.
Dated:



### 26 JEFFREY D. GARDIN Recorder, Armed Services Board ofContractAppeals