United States Court of Appeals for the Federal Circuit 

04-1119 

SINGLETON CONTRACTING CORPORATION, 

Appellant, 

v. 

Francis J. Harvey, SECRETARY OF THE ARMY, 

Appellee. 

Harvey K. Hess, Jr., of Kitty Hawk, North Carolina, argued for appellant. Of 

counsel was Arlie O. Pritchard, Jr., of Williamsburg, Virginia. 

Carolyn J. Craig, Trial Attorney, Civil Division, Commercial Litigation Branch, 

United States Department of Justice, of Washington, DC, argued for appellee. With her 

on the brief were Peter D. Keisler, Assistant Attorney General, David M. Cohen, 

Director, and Harold D. Lester, Jr., Assistant Director. Of counsel on the brief was 

Major Anissa Parekh, Trial Attorney, Office of the Judge Advocate General, Department 

of the Army, of Arlington, Virginia. 

Appealed from: Armed Services Board of Contract Appeals 
United States Court of Appeals for the Federal Circuit

04-1119 

SINGLETON CONTRACTING CORPORATION, 

Appellant, 

v. 

Francis J. Harvey, SECRETARY OF THE ARMY, 

Appellee. 

___________________________ 

DECIDED: January 26, 2005 

___________________________ 

Before NEWMAN, CLEVENGER, and BRYSON, Circuit Judges. 

BRYSON, Circuit Judge. 

 In September 1993, Singleton Contracting Corporation entered into a contract 

with the Department of the Army to do construction work at two Army Reserve Centers. 

The contract contained a clause requiring Singleton to buy and maintain specified types 

and amounts of insurance “during the entire period of performance under this contract.” 

The same clause required Singleton to provide the contracting officer with proof of the 

required insurance “prior to commencement of work.” The contract contained another 

clause requiring Singleton to furnish a certificate of insurance at the preconstruction 

conference. 

 The preconstruction conference was held on November 2, 1993. During the 

conference, it became apparent that the government’s plans were flawed and that 
04-1119 2 

construction could not begin until the government provided Singleton with new 

construction drawings. In addition, Singleton failed to provide a certificate of insurance 

at the conference. Singleton’s representative stated that Singleton would submit proof 

of insurance “within the next few days,” but Singleton never did so. On February 15, 

1994, the contracting officer informed Singleton that the government would not allow 

Singleton to begin work at either Reserve Center until Singleton submitted the required 

certificate of insurance. Singleton responded that it was not obligated to furnish proof of 

insurance until ten days after the government allowed work to begin. 

 In the meantime, Singleton began submitting invoices requesting payment for 

material and bonds purchased for the contract. The contracting officer refused to pay 

the invoices on the ground that no proof of insurance had been submitted. Finally, on 

August 8, 1994, the contracting officer terminated the contract for the convenience of 

the government. At that point, the government had not provided Singleton with the 

revised drawings and specification changes, Singleton had not provided proof of 

insurance, and none of the contract work had been performed. 

 Singleton submitted proposals for settlement of the termination. Singleton 

sought settlement costs, the costs of material and bonds it procured for the contract, 

and overhead costs. The Defense Contract Audit Agency conducted an audit and 

issued a report on Singleton’s claims. The audit focused on the amount that Singleton 

claimed it was owed for unabsorbed overhead, but it did not make a determination as to 

whether Singleton was entitled to the overhead. The auditor first found that Singleton’s 

total amount of overhead during the period of the contract should be reduced from 

$108,125 to $88,343. More importantly, the auditor found that the contract accounted 
04-1119 3 

for only 13 percent of Singleton’s revenue in 1993 and 1994. Applying that fraction to 

Singleton’s total overhead, the auditor determined that only $11,485 of overhead should 

be allocated to the government contract. Singleton subsequently demanded that the 

contracting officer make a decision with respect to the audit report. When the 

contracting officer did not make a timely decision, Singleton appealed to the Armed 

Services Board of Contract Appeals from the deemed denial of its claims. 

Before the Board, Singleton sought to recover overhead costs, the costs of 

material purchased for the contract, and post-termination settlement costs. Singleton 

Contracting Corp., ASBCA No. 51692 (Aug. 8, 2003). Regarding the claim for overhead 

for the period during which performance of the contract was delayed, the Board found 

that Singleton was responsible for the delay. The Board ruled that the government’s 

failure to provide new drawings was merely a concurrent cause of the delay and that 

Singleton therefore was not entitled to unabsorbed overhead under Nicon, Inc. v. United 

States, 331 F.3d 878 (Fed. Cir. 2003). The Board further found that Singleton had not 

presented sufficient evidence to justify an award of overhead on any other theory of 

recovery. The Board failed to specifically address Singleton’s claims for the costs of 

materials purchased for the contract and the post-termination settlement costs. 

I 

 In pressing its case for unabsorbed overhead resulting from the contract delay, 

Singleton essentially asks that we find that the government was solely responsible for 

the delay. Singleton bases its argument on two alternative theories. First, it claims that 

it was not required to provide proof of insurance before beginning work. Therefore, it 

asserts, the lack of insurance cannot form the basis for attributing the delay to the 
04-1119 4 

company. Second, Singleton contends that if it was required to provide proof of 

insurance before beginning work, it was required to do so only at the preconstruction 

conference. Because the conference was suspended and never rescheduled, Singleton 

argues that its obligation to produce proof of insurance never matured. 

 Singleton’s first theory relies on a clause entitled “Insurance—Work on a 

Government Installation,” which states that Singleton must offer proof of insurance 

“before commencing work under this contract.” The contract also specifies that 

Singleton must begin work within ten days of receiving the government’s notice to 

proceed. Singleton therefore claims that it was required to provide insurance only after 

the government directed it to begin work. 

The problem with this argument is that the contract also contains a clause that 

explicitly required Singleton to furnish a certificate of insurance during the 

preconstruction conference. The two provisions are easily reconciled: the first specifies 

that the contractor must submit a certificate of insurance before beginning work, while 

the second specifies exactly when proof of insurance must be provided during that prework period, i.e., at the preconstruction conference. Accordingly, we agree with the 

Board that Singleton was required to present proof of insurance at the preconstruction 

conference. 

 Alternatively, Singleton asserts that it did not fail to furnish proof of insurance at 

the preconstruction conference because the business at the conference was never 

concluded. Singleton argues that the government’s construction drawings were so 

defective that it was necessary to schedule another conference before construction 

could begin. For support, Singleton points to the notes made by the government during 
04-1119 5 

the meeting, which state that another preconstruction conference would be scheduled. 

Singleton contends that it could be held accountable for the delay only if it did not 

produce proof of insurance by the conclusion of that second meeting, because only then 

would it have failed to meet its obligation to furnish proof of insurance at the 

preconstruction conference. 

 Singleton’s argument is based on a strained reading of the contract. The 

contract provided that the contracting officer would schedule a preconstruction 

conference and that Singleton would be required to produce proof of insurance at that 

time. The government was required to produce adequate construction drawings at the 

same conference. The preconstruction conference was held, but Singleton did not 

produce the required certificate of insurance and the government did not produce the 

required drawings. The fact that neither party complied with its obligations as of the 

time of that conference does not mean that either one should be excused for its default. 

If Singleton’s obligations did not mature on account of the need to schedule a new 

conference, then neither did the government’s. The better interpretation of the contract 

is that both the government and Singleton were required to comply with their obligations 

at the original preconstruction conference and their failure to do so jointly caused delay 

in the project. The fact that it became necessary to schedule another conference does 

not mean that Singleton was freed from the requirement that it produce a certificate of 

insurance at the initially scheduled conference. We therefore agree with the Board’s 

conclusion that Singleton’s delay “began on the date of the pre-construction conference 

when submittal of such proof [of insurance] was required.” 
04-1119 6 

Singleton’s agreement at the preconstruction conference that it would provide 

proof of insurance “in the next few days” suggests that Singleton was aware that the 

company was not in full compliance with its obligations. Yet Singleton never cured its 

failure in that regard, even after subsequent requests by the government for the proof of 

insurance. If Singleton had provided that proof, it would have placed responsibility for 

the delay entirely on the shoulders of the government. Instead, Singleton failed to do so 

and therefore was properly held jointly accountable with the government for the delay. 

See Nicon, 331 F.3d at 887. For that reason, Singleton is not entitled to reimbursement 

for its unabsorbed overhead during the contract period. 

II 

 Singleton argues that it was entitled to overhead on its direct costs under the 

contract solely by reason of the termination for convenience. 

The government acknowledges that a contractor may receive overhead on its 

direct costs following a termination for convenience. The government also points out, 

however, that whenever the calculation of overhead is made under this method, very 

specific information is required from the contractor. As the government auditor testified 

before the Board, this calculation starts with the contractor’s total indirect costs for each 

fiscal year of the contract’s performance and divides that amount by the contractor’s 

total direct costs for that year to yield an “overhead rate.” The overhead rate is then 

multiplied by the total direct costs of the contract in question to arrive at the indirect 

costs that are allocable to that contract for that fiscal year. The problem is that 

Singleton never submitted evidence to the Board of the company’s total direct costs for 
04-1119 7 

1993 and 1994. Thus, it was impossible for the Board to apply this formula and 

determine the amount of Singleton’s overhead that was allocable to the contract. 

 Singleton admits that it never supplied the Board with the information needed to 

make the allocation calculation but contends that it is nonetheless entitled to relief 

because of the unusual circumstances of this case. Singleton bases its claim on the 

fact that during the pendency of the contract, it had no other business. Singleton 

argues that it is therefore entitled to have all of its overhead for the contract period paid 

by the government. This line of reasoning, however, ignores the possibility that 

Singleton had other contracts in 1993 and 1994, outside of the contract period. Indeed, 

the audit report states that Singleton had other contract revenue in both 1993 and 1994. 

Singleton’s argument also overlooks the fact that the calculation of the company’s 

overhead costs was based on Singleton’s total overhead for 1993 and 1994, which was 

then multiplied by the fraction consisting of the proportion of the days in those years in 

which the contract was in effect. It would be unfair to let Singleton base its calculation 

of indirect costs on the overhead for the entire year, but to limit the direct costs to those 

experienced during a specific time period chosen by the contractor. Simply because the 

parties stipulated to the “total fixed overhead expenses for the contract period” does not 

entitle Singleton to the entirety of this “total fixed overhead,” as Singleton suggests. To 

support that claim, Singleton relies on the auditor’s statement before the Board that if a 

contractor has only one contract, the overhead expenses during the contract period 

would be allocable to that contract. However, the auditor immediately clarified that if 

other contracts were under way during the contractor’s fiscal year, they would bear their 

share of the overhead. Singleton never presented evidence establishing either that it 
04-1119 8 

had no other contracts during the years in question or the amount of direct costs 

attributable to those other contracts. Thus, the Board was never given the evidence it 

needed to address Singleton’s claims. Singleton admitted as much during oral 

argument and suggested that we remand to the Board for further proceedings. We see 

no reason to give Singleton a second opportunity to prove its case when it failed to take 

advantage of the first. We therefore affirm the Board’s decision to deny overhead 

based on the termination for convenience. 

III 

 Singleton also appeals with regard to its claims for settlement costs and the costs 

of materials procured for the contract, plus profit. Specifically, Singleton asks for $4,706 

for settlement costs and $1,441 for the cost and profit on materials bought for the 

contract. Although the Board failed to rule on those claims, the government concedes 

that Singleton is owed that money. Accordingly, we reverse in part and direct that 

Singleton recover those expenses. 

AFFIRMED IN PART and REVERSED IN PART.