# In th e United States Court of Federal Cl aims

No. 05-914C (F iled: F ebruary

26, 2014)

************************************* Posttrial Motions; Recharacteriz ing an K-CON B U I L DI

NG SYSTEMS, I

NC., * RCF C 12(b)(1) Motion to Dismiss as a

* Motion for Summary J udg ment; Ag ency ’s Plaintiff, * Authority to Terminate a Contract for

* Default W hen I ts Order W as Placed Under

v. * a F ederal Supply Schedule Contract;

* Ex cusable Delay ; Counterclaim for THE UNI TED STATES, * L iquidated Damag es; Motion to Amend

* the Complaint; RCF C 15(b)(2); Implied Defendant. * Consent

*************************************

W illiam A. Scott, Charleston
, SC, for plaintiff.

Daniel B . Volk, United States Department of Justice, W ashing ton, DC, for defendant.

OP INION AND ORDER

SWEENEY , J udg e

Plaintiff K-Con B uilding Sy stems, I nc. filed three suits in this court concerning its contracts with the United States Coast Guard (“Coast Guard”) for the desig n and construction of prefabricated metal building s in Eliz abeth City , North Carolina, St. Petersburg , F lorida, and Port Huron, Michig an. After the court issued summary judg ment ruling s in each case and held trial in this case, the parties eng ag e d in settlement discussions. Those discussions revealed several issues that required resolution prior to any settlement. According ly , the parties have filed the relevant motions in all three cases.

I n this case, which concerns the building in Eliz abeth City , plaintiff seeks to invalidate the Coast Guard’s termination of its contract for default. Plaintiff also seeks to amend its complaint to alleg e an affirmative claim for an equitable adjustment. F or the reasons set forth below, the court invalidates the Coast Guard’s default termination, dismisses those claims premised on the default termination for lack of jurisdiction, concludes that it possesses jurisdiction to entertain both parties’ liquidated damag es claims, and g rants plaintiff’s motion to amend its complaint.I. BACK G ROUND

I n April 2001, the United States General Services Administration (“GSA”) awarded plaintiff a F ederal Supply Schedule contract for Prefabricated Structures and Outdoor Smoking Shelters. 1 Subsequently , in September 2003, the Coast Guard solicited proposals for the desig n and construction of a prefabricated building to house a component repair shop at the Coast Guard Support Center in Eliz abeth City . Plaintiff responded to the solicitation and, on September 23, 2003, the Coast Guard placed an order under plaintiff’s GSA contract for the solicited building

. The initial value of the order was $513,520 and the initial completion date was J une 17, 2004.

A. Contract P erf

orm ance
As set forth in the contract, the Coast Guard contemplated that plaintiff would desig n the building based on the contract specifications, submit the desig n to the Coast Guard in two phases (a “100% desig

n” and a “final desig

n ”), and then, upon the Coast Guard’s approval of the final desig n, beg in construction. The desig n and construction of the building were to be completed no more than 262 day s after contract award.
One aspect of the work to be performed by plaintiff was the design and installation of heating , ventilation, and air conditioning (“HVAC”) sy stems “to accommodate all building operations.” Among

the HVAC work required was the provision of air conditioning in the building ’s test labs, including a room to house ex isting , identified hy draulic test equipment (“hydraulic test lab”). I

n addition, plaintiff was required to disconnect an ex isting chiller from hy draulic test equipment situated in another building
, relocate the chiller and the equipment to the new building
, reconnect the chiller to the equipment, and run new distribution piping

.
W o rk on the project did not beg in within the time anticipated in the contract. The Coast Guard postponed the postaward kickoff meeting , which should have occurred between fourteen and twenty -eig ht day s after contract award, to December 4, 2003. I n addition, plaintiff encountered delays in the delivery of the building due to worldwide steel shortag es. Plaintiff also required additional time in which to coordinate the connection of g overnment-owned equipment, some of which was different from the equipment listed in the contract specifications. Plaintiff asserted that this latter problem delay ed its mechanical and electrical desig ns. I n an April 15,

1 Althoug h a trial has been held in this case, for the purposes of ruling on plaintiff’s present motions, the court derives most of the facts in this section from its J anuary 24, 2011 Opinion and Order, K-Con B ldg . Sy s., I n c. v. United States, 97 F ed. Cl. 41 (2011). The balance of the facts are derived from the appendix filed with plaintiff’s motion for partial summary judg ment (“Pl.’s App.”), and the appendix attached to plaintiff’s present motions (“JX”); citations to those documents are set out in footnotes. Only the facts relevant to plaintiff’s present motions are included. A more comprehensive recitation of the factual backg round, with citations to the record, can be found in the court’s prior decision.

-2-2004 bilateral contract modification, the contract completion date was ex tended by 126 day s to October 21, 2004.

On May 6, 2004, one of the contracting officers involved with the contract, 2 Marion E. Hundley , sent plaintiff a cure letter warning that plaintiff’s “failure to submit a proper prog ress schedule and failure to perform any work on site was endang e ring the performance of [ the] contract.” Plaintiff responded to the cure letter on May 16, 2004, describingits prog ress in various aspects of the project. I t ex plained that it was “refining [ its] construction schedule with supplies and subcontractors and would submit the schedule on May 20, 2004.” I t further indicated that it had “completed the lay out of the building ” and was “coordinating ” with the Coast Guard reg ardingthe “the location of ex isting utilities.” I n addition, plaintiff asserted that it “planned to start site work and installation of the building pad on May 18, 2004,” and that, “once the foundation desig n was revised and approved,” it was prepared to install the foundation. F inally , it stated that it was “inspectingthe ex isting equipment to be relocated . . . and . . . holding on site discussions with the base personnel to evaluate the impact of the planned move.”

One month later, in a J une 18, 2004 letter, Ms. Hundley advised plaintiff that its “mechanical desig

n submittal had sig nificant comments that had to be addressed prior to a resubmittal of the document.” Despite this desig n issue, the Coast Guard permitted plaintiff to proceed with construction after accepting plaintiff’s structural foundation drawing s on J uly 6, 2004. Plaintiff beg an to erect the building ’s steel structure on July 30, 2004.
At around the same time, plaintiff sent its 100% desig n packag e to the Coast Guard. On J uly 23, 2004, a second contracting officer, Victoria W . W o rrell, forwarded the Coast Guard’s comments on the packag e to plaintiff. She indicated that once plaintiff had incorporated the Coast Guard’s comments and submitted its final desig n, it could “proceed with all work other than that related to the HVAC sy stem,” and that once the desig n requirements of the HVAC sy stem were resolved, the mechanical drawing s could be incorporated into the final desig n.
More than one month later, the parties ag reed to a contract modification, effective September 9, 2004, increasing the contract price to $551,155.35 to compensate plaintiff for its installation of sound attenuation blankets above three of the rooms in the building . B ut, as of September 10, 2004, the issues with the hydraulic test lab’s HVAC sy stem had not been resolved.
On September 20, 2004, plaintiff sent a prog ress schedule to the Coast Guard indicating a completion date of December 8, 2004, forty -three day s bey ond the then-contract completion date of October 26, 2004. Ms. Hundley noted the discrepancy

in a September 22, 2004 forbearance letter. Subsequently , in a November 10, 2004 bilateral contract modification, the completion date was ex tended, for the final time, to November 9, 2004, due to a supplier’s shipping delay

.

2 I t appears that three individuals acted as the contracting officer for this project at various times: Marion E. Hundley , Cathy B roussard, and Victoria W . W orrell.

-3-Given that plaintiff had previously anticipated completingthe building on December 8, 2004, it remained unable to meet the contract completion date. Nevertheless, despite noting plaintiff’s “failure to make prog

ress and . . . inability

to complete the contract by the bilaterally

ag reed completion date,” the Coast Guard “determined it was in the best interest of the Government to forbear from terminating

[ plaintiff’s] contract for default . . . .” The Coast Guard permitted plaintiff to continue work on the project, but indicated its intention to assess liquidated damag es at the contract rate of $551 per day for “any delay bey ond the contract completion date . . . .” I ndeed, the Coast Guard beg an to withhold liquidated damag e s from its pay ments to plaintiff in December 2004, and as of F ebruary 28, 2005, the Coast Guard had assessed liquidated damag es for 111 day s of delay

in the amount of $56,721. 3

I n the meantime, by

November 19, 2004, plaintiff had erected the building ’s steel structure. It beg an installing the wall panels and insulation three days later. I t also beg an to hang sprinkler pipe in the building . However, on December 9, 2004, the Coast Guard sent plaintiff a show cause letter, noting

that plaintiff’s “failure to submit the final desig n documents within the time frame allowed and failure to provide adequate manpower for performing the work prevented [ plaintiff] from completing ” the project by the November 9, 2004 completion date. Plaintiff responded to this letter on December 22, 2004, asserting that the Coast Guard contract requirements differed materially from the standard GSA Desig n/B uild requirements and that its subcontractors would resume work on J anuary 3, 2005. Plaintiff then submitted a prog r ess schedule to the Coast Guard on J anuary 5, 2005, reflecting

an anticipated completion date of March 19, 2005. The Coast Guard noted “corrections to three line items” on the schedule that chang ed the anticipated completion date to April 26, 2005, and then, on J a nuary 12, 2005, sent plaintiff another forbearance letter.
Plaintiff finished installing the wall panels and insulation on J anuary 12, 2005, and beg an installing the roof the nex t day . I t then started the electrical, mechanical, and plumbi ng roug h-ins on J anuary

17, 2005. However, on F ebruary 2, 2005, Ms. Hundley

issued a second show cause letter to plaintiff, remarking that plaintiff’s “failure to submit the final desig n documents by J anuary 21, 2005, failure to complete the roofing installation by J anuary 19, 2005, failure to remove the rejected wet insulation, and failure to provide adequate manpower” would prevent plaintiff from meetingits anticipated completion date of April 26, 2005. Plaintiff responded to this show cause letter on F ebruary 7, 2005, 4 describingits reasons for not installing the roof, as well as another reason for the delay in construction:

[ T] he Simple Saver Roofing Sy stem can not be installed in temperatures less than 40 deg rees due to the adhesive and membrane material. . . . [ R] oofing is scheduled to be complete by the end of this week (weather permitting) . All other task[ s] are currently

on schedule with the ex ception of utility tie-ins. . . . The

3 See J X 403; J X 492.

4 See J X 433.

-4-[ site/civil drawing s] must be acknowledg ed or approved [ by the Coast Guard]

prior to ex cavation.
Plaintiff further averred that it would deliver the final desig n documents by

F e bruary 10, 2005.
However, plaintiff did not deliver the desig n documents to the Coast Guard until F ebruary 18, 2005. I n a F ebruary

25, 2005 letter sig ned by Ms. Hundley
, the Coast Guard provided its comments to plaintiff reg ardingits mechanical design. Ms. Hundley informed plaintiff that it could proceed with the work, provided that the comments were addressed and that sealed drawing s were submitted to the Coast Guard.
That same day

–F ebruary

25, 2005–plaintiff sent the Coast Guard four letters. 5 I n the first letter, plaintiff requested a noncompensable time ex tension of thirty

day s due to the Coast Guard’s alleg ed improper review of its desig n drawing s. I n the second letter, plaintiff soug ht a noncompensable time ex tension of thirty day s to account for job site disturbances and its inability to contract with local trades, both purportedly caused by

comments made by

the Coast Guard’s inspector. Then, in its third letter, plaintiff requested a noncompensable time ex tension of twenty -seven day s due to weather delays. The fourth letter provided, in its entirety : “This letter serves as our request for cost modification in the amount of $50,325.00 for ex tended overhead due to delay s outlined in our request for time ex tension letters dated 25 F ebruary 2005.” An

ex h ibit attached to that letter contained a table breaking out the components of the ex tended overhead that plaintiff was requesting . On March 8, 2005, Ms. Hundley denied the three time

ex tension requests. 6 However, a Coast Guard contracting officer never responded to plaintiff’s request for a contract price adjustment.
Ultimately , on March 17, 2005, the Coast Guard issued a Notice of Termination for Default, which was sig

ned by Ms. Hundley

. 7 Ms. Hundley wrote:

W e have determined that it is no long er in the best interest of the Government to forbear termination for default for y our failure to complete within the established completion date. . . . [ Y] our performance in the forbearance period continually fell well behind any

completion schedule you had submitted. Your continued failure to make prog

ress has made it clear that it is no long er in the best interest of the Government to forbear termination for default. I n accordance with contract clause F AR 52.249-10, Termination for Default (F ix e d-Price Construction) (APR

5 See J X 451; J X 452; J X454; J X 455.

6 See J X 470; J X 472; J X473.

7 See J X 481.

-5-1984), 8 y ou are hereby notified that this contract is terminated for default for failure to make prog

ress and failure to prosecute the work with the dilig ence that will insure its completion within the time specified in the contract including any
ex tensions. Therefore, y

our rig ht to proceed with work under this contract is terminated AS OF THI S DATE. The Government may cause the contract to be completed by

others in accordance with the above clause and y ou will be held liable for any

increased costs occasioned thereby . These costs will include liquidated damag e s in the amount specified in the contract that will accrue from the current contract completion date to actual completion of work. The Government reserves all rig hts and remedies provided by law or under the contract in addition to charg ing ex cess costs occasioned by completion of the defaulted contract.

I n closing , Ms. Hundley

indicated that the termination notice was “a final decision of the Contracting Officer” and described plaintiff’s rig ht to appeal. Rather than immediately appealing , plaintiff sent the Coast Guard a letter on March 18, 2005, challeng ing the propriety

of the default termination and requesting that the Coast Guard rescind its notice. 9 I n particular, citing F AR 52.249-10(b), which precludes the termination of a contract for default if the contractor was not responsible for the delay in contract performance, plaintiff enumerated several phases of contract performance where it encountered delay s for which it was not responsible, referring the Coast Guard to its previous correspondence describing those delay s. I n a March 21, 2005 letter, a third contracting officer, Cathy

B roussard, rejected plaintiff’s claims of ex cusable delay and denied plaintiff’s request for the rescission of the default termination. 1 0

B. Reprocurem ent
At the time of the default termination, the Coast Guard had paid $287,551.39 to plaintiff. I n two October 2005 contract modifications reflecting the default termination, both sig ned by Ms. Hundley
, 1 1 the Coast Guard indicated its intent to use the unpaid balance of the contract–$263,603.96–to fund the reprocurement of the project, and reiterated that it reserved its rig ht to claim any

costs incurred in ex cess of the unpaid balance from plaintiff. I t also reiterated that it reserved its rig ht to recover liquidated damag es, which would accrue until the building was substantially complete.

8 “F AR” refers to the F ederal Acquisition Reg u lation.

9 See J X 484.

1 0 See J X 487.

1 1 See Pl.’s App. 139, 142.

-6-On November 7, 2005, almost eight months after it terminated its contract with plaintiff,

the Coast Guard entered into an ag reement with Viteri Construction Manag ement Incorporated (“Viteri”) to complete the building . I n the new contract’s scope of work section, the Coast Guard represented to Viteri that the building desig n was ninety -five percent complete. The initial contract price was $721,431, and the initial completion date was March 19, 2006. Throug h bilateral contract modifications, the contract price was ultimately increased to $814,619 and the completion date was ultimately ex tended to August 26, 2006. The Coast Guard determined that Viteri substantially

completed the building as of September 20, 2006.

C. P rocedural History
Plaintiff filed suit in this court on Aug u st 25, 2005, seekingto convert the default termination into a termination for the g overnment’s convenience and the remission of liquidated damag es. Defendant filed a counterclaim, alleg ing that the Coast Guard had withheld approx imately

$10,220 from pay

ments to plaintiff as liquidated damag es, and seeking the balance of liquidated damag es as measured from the November 9, 2004 contract completion date to the date that the building was completed.
Upon the close of discovery , plaintiff moved for summary judg ment on the issue of liquidated damag e s, arg

uing first that the rate of liquidated damag e s specified in its contract with the Coast Guard constituted an unenforceable penalty , and second, in the alternative, that it was entitled to a remission of liquidated damag es due to ex cusable delay . The court denied plaintiff’s motion in a J anuary

24, 2011 Opinion and Order, concluding that the liquidated damag es rate was not an unenforceable penalty
, and that plaintiff had not established an ex cusable delay that would lead to the remission of some or all of the liquidated damag es. Thus, in December 2011, the court held a two-week trial. Then, after trial, it was necessary for the court to consider and rule on plaintiff’s motion for sanctions. K-Con B ldg . Sy s., I nc. v. United States, 106 F ed. Cl. 652 (2012).
As noted above, this is one of three breach-of-contract cases before the court involving plaintiff and the Coast Guard. The court issued a summary judg ment ruling in the Port Huron case in Aug

ust 2011, K-Con B ldg . Sy s., I nc. v. United States, 100 F ed. Cl. 8 (2011), and a summary judg ment ruling in the St. Petersburg case in November 2012, K-Con B ldg . Sy s., I nc. v. United States, 107 F ed. Cl. 571 (2012). After the court issued the latter decision, the parties eng ag ed in settlement discussions throug h the court’s alternative dispute resolution prog ram. Those discussions revealed several issues that required resolution prior to any settlement, leading the parties to file the relevant motions in each case. I n this case, plaintiff filed a combined motion to dismiss and motion to amend its complaint. The parties have completed briefing on plaintiff’s motions and, finding oral arg ument unnecessary , the court is prepared to rule.

-7-II. P LAINTIF F ’S MOTION TO DISMISS

A. Recharacterization of P laintif f ’s Motion as a Motion f or Sum m ary Judgm ent

Plaintiff first “moves to dismiss the Government’s claim for termination for default for lack of subject matter jurisdiction” pursuant to Rule 12(b)(1) of the Rules of the United States Court of F ederal Claims (“RCF C”). Mot. 1. However, an RCF C 12(b)(1) motion to dismiss is not the proper vehicle for plaintiff to obtain the result it seeks. A party filing a motion under RCF C 12(b) must assert a “defense to a claim for relief in [ a ] pleading
, ” but defendant in this case did not assert a claim for default termination in its sole pleading , its answer and counterclaim.

F ortunately

for plaintiff, the court is not constrained by the label that plaintiff attached to its motion. I nstead, the court is guided by the motion’s substance. Plaintiff contends in its motion that contractually , the Coast Guard could not terminate its contract with plaintiff without first referring

plaintiff’s alleg ations of ex cusable delay to the GSA. B ecause the Coast Guard did not make such a referral, plaintiff asserts, the Coast Guard’s default termination was invalid, depriving the court of jurisdiction to consider any claims arising from the default termination. 1 2 I n support of its contentions, plaintiff relies on the provisions of the two contracts at issue–its F ederal Supply

Schedule contract with the GSA and its contract with the Coast Guard–and the contents of several letters it ex chang ed with the Coast Guard. Defendant does not dispute the contents of the letters relied upon by plaintiff; rather, it contends that the letters were insufficient under the relevant contractual provisions to require a referral to the GSA.
Given the substance of plaintiff’s motion and defendant’s response, it is clear that plaintiff’s request can be considered under the summary judg ment rubric. Plaintiff is challeng ing the validity

of a contracting

officer decision as a matter of law on the basis of undisputed facts, and defendant has fully

responded to plaintiff’s contentions. See RCF C 56(a) (notingthat summary judg ment is appropriate if the material facts are undispu ted and “the movant is entitled to judg ment as a matter of law”). Moreover, because plaintiff filed its motion after trial, the parties had the opportunity to support their positions using the complete universe of documents and testimony

admitted at trial. As neither party would be prejudiced, the court recharacteriz es plaintiff’s motion as a motion for summary judg ment under RCF C 56. See RCF C 56(f)(3) (noting that the court may “consider summary judg ment on its own after identify ing for the parties material facts that may not be g enuinely

in dispute”); Celotex Corp. v. Catrett, 477 U.S. 317, 326 (1986) (agreeing that trial courts “possess the power to enter summary judg ments sua

1 2 I t is unclear why

plaintiff did not raise this issue until after trial. F or its part, the court was unable to raise the issue sua sponte before trial because the relevant portions of the GSA contract had not been provided to the court. Nevertheless, because the issue implicates the court’s jurisdiction, the court must address it at this time. See Arbaug h v. Y & H Corp., 546 U.S. 500, 506 (2006) (reflecting that the parties or the court sua sponte may challeng e the court’s subject matter jurisdiction at any time).

-8-sponte, so long as the losing party was on notice that [ it] had to come forward with all of [ its]

evidence”); Rothe Dev. Corp. v. Dep’t of Def., 413 F .3d 1327, 1336 (F ed. Cir. 2005) (ex tending the notice requirement to the prevailing party ); see also RCF C 1 (stating that the court’s procedural rules “should be construed and administered to secure the just, speedy , and inex pensive determination of every action and proceeding ”).

B. The Coast G uard’s Def ault Term ination
Havingdetermined that plaintiff’s motion should be treated as a motion for summary judg ment, the court turns to the merits of that motion. As previously noted, plaintiff contends that contractually , the Coast Guard had no authority to terminate its contract with plaintiff prior to referring

plaintiff’s ex cusable delay alleg ations to the GSA. Thus, the court must ex amine the relevant contractual provisions.
The GSA awarded plaintiff a F ederal Supply Schedule contract in April 2001, and the Coast Guard placed an order with plaintiff under that contract on September 23, 2003. Plaintiff’s F ederal Supply

Schedule contract contained the following clause: F AR 52.212-4, Contract Terms and Conditions–Commercial I tems (May 1999). Paragraph (m) of that clause provided:
Termination for cause. The Government may terminate this contract, or any part hereof, for cause in the event of any default by

the Contractor, or if the Contractor fails to comply with any contract terms and conditions, or fails to provide the Government, upon request, with adequate assurances of future performance. I

n the event of termination for cause, the Government shall not be liable to the Contractor for any amount for supplies or services not accepted, and the Contractor shall be liable to the Government for any and all rig h ts and remedies provided by

law. I f it is determined that the Government improperly terminated this contract for default, such termination shall be deemed a termination for convenience.

I n addition, parag raph (h) of that clause incorporated by reference clause I

- F SS-249-B , Default (May 2000), which provided:

I n addition to any

other clause contained herein related to termination, the following is applicable to orders placed under F ederal Supply Schedule contracts.

Any orderingoffice may , with respect to any one or more orders placed by it under the contract, ex ercise the same rig ht of termination, acceptance of inferior articles or services, and assessment of ex cess costs as mig ht the Contracting Officer, ex c ept that when failure to deliver articles or services is alleg e d by the Contractor to be ex cusable, the determination of whether the failure is ex cusable shall be made only

by the ContractingOfficer of the General Services Administration, to whom such alleg ation shall be referred by the ordering office

-9-and from whose determination appeal may be taken as provided in the clause of this contract entitled “Disputes.”
Similarly , the portion of the F AR pertainingto the F ederal Supply Schedule in effect at the time plaintiff was awarded its F ederal Supply Schedule contract included the following provision reg ardingtermination of an order for default:

(1) An ordering

office may

terminate any

one or more orders for default in accordance with Part 49, Termination of Contracts. The schedule contracting office shall be notified of all cases where an ordering office has declared a F ederal Supply

Schedule contractor in default or fraud is suspected.
(2) Should the contractor claim that the failure was ex c usable, the orderingoffice shall promptly refer the matter to the schedule contracting office. I n the absence of a decision by the schedule contracting

office (or by the head of the schedule contracting ag ency , on appeal) ex cusing the failure, the ordering office may

charg e the contractor with ex c ess costs resulting from repurchase.

F AR 8.405-5(a). Taken tog ether, these provisions indicate that the Coast Guard was entitled to terminate its contract with plaintiff for default unless plaintiff had alleg ed that its failure to complete work under the contract was ex cusable. I n those circumstances, the Coast Guard was required to refer plaintiff’s alleg ation to the GSA for a determination of whether plaintiff’s failure was ex cusable.
Neither party disputes that the Coast Guard was required to refer any alleg ations of

ex c usable delay

to the GSA prior to terminating its contract with plaintiff for default. I n stead, the parties disag ree as to whether plaintiff alleg e d ex c usable delay . Plaintiff contends that its letters to the Coast Guard dated December 22, 2004, and F ebruary 7, 2005, both sent in response to letters requestingthat plaintiff show cause why its contract should not be terminated, contained alleg ations of ex cusable delay . Plaintiff further contends that the three letters it sent to the Coast Guard on F ebruary 25, 2005, to request time ex tensions also included alleg ations of

ex c usable delay . These alleg ations of ex cusable delay
, plaintiff argues, should have been referred to the GSA prior to the Coast Guard’s termination of its contract with plaintiff for default. The court ag

rees.
The pertinent provision of the F ederal Supply Schedule contract indicates that referral to the GSA is required “when failure to deliver articles or services is alleg ed by the Contractor to be

ex c usable . . . .” I

n other words, a mere alleg ation by the contractor is a sufficient trig g er. I n its December 22, 2004 letter, plaintiff claimed that its failure to submit the final desig n documents was due to the conflict between the Coast Guard’s specifications and standard GSA Desig n/B uild requirements. I

n its F e bruary

7, 2005 letter, plaintiff asserted that the cold weather prevented it from installing the roof and that it was unable to complete the utility tie-ins due to the Coast Guard’s failure to acknowledg e or approve the relevant drawing s. And, in its F ebruary 25, 2005

- 10-letters, plaintiff soug ht time ex tensions to compensate for the Coast Guard’s alleg ed improper

review of its desig n

drawing s, the purported neg ative effects of comments made by the Coast Guard’s inspector, and weather-related delay s. All of these letters contained alleg ations of

ex c usable delay ; 1 3 thus, the Coast Guard should not have terminated its contract with plaintiff for default prior to referring these alleg ations to the GSA.
Defendant’s arg

uments to the contrary

are not persuasive. I

ts first argument is based on the decision of the United States Court of Appeals for the F ederal Circuit (“F e deral Circuit”) in M. Maropakis Carpentry , I nc. v. United States (“Maropakis”), 609 F .3d 1323 (F ed. Cir. 2010). I n that case, the F ederal Circuit held that when facing a g o vernment counterclaim for liquidated damag es, a contractor cannot assert an affirmative defense that would result in the modification of contract terms (e.g ., an increase in the contract price or an ex tension of the time for contract performance) unless that contractor had filed a claim with the contracting officer pursuant to the Contract Disputes Act of 1978 (“CDA”). I d. at 1331. Applying that holding to the facts of this case, defendant contends that because plaintiff never filed a claim for ex cusable delay

with a contracting

officer pursuant to the CDA, it has not properly alleg ed ex cusable delay under clause I -F SS-249-B of plaintiff’s F ederal Supply Schedule contract.
Defendant’s attempt to apply the holding of Maropakis to the facts in this case cannot be sustained. I n Maropakis, the F ederal Circuit held that a CDA claim alleg ing ex cusable delay was a jurisdictional prerequisite to asserting an affirmative defense of ex cusable delay ag ainst a g overnment counterclaim for liquidated damag es in a suit before the United States Court of F ederal Claims (“Court of F ederal Claims”). The F e deral Circuit’s holdinghas no bearing on what qualifies as an alleg ation of ex cusable delay for the purpose of a procuring ag ency ’s referral of such an alleg ation to the GSA under a F ederal Supply Schedule contract. F or one, a dispute between a procuring

ag ency and a contractor concerning whether a contract should be terminated for default occurs prior to litig ation. Thus, unlike in Maropakis, the jurisdiction of the Court of F ederal Claims would not be at issue. Moreover, there is nothing in the plain lang uag e of clause I -F SS-249-B requiring an alleg ation of ex cusable delay to be in the form of a CDA claim. I ndeed, the clause does not use the word “claim”; rather, it merely requires the contractor to “alleg e[ ] ” an ex cusable delay

.

1 3 Defendant’s sug g e stion that plaintiff was merely ex plaining the reasons for the delays, and was not asserting

that those delay s were ex cusable, is nonsensical, and therefore does not raise a g enuine issue of material fact. See Anderson v. L iberty L obby , I nc., 477 U.S. 242, 250 (1986) (indicating

that an issue is g enuine if it “may reasonably

be resolved in favor of either party ”). In this correspondence, plaintiff ex plained that the reasons for the delay s were not its own actions, but the actions or inaction of the Coast Guard, or the weather. B y disclaiming responsibility

for these delay s, it is log ical to infer that plaintiff felt that these delay s were
ex c usable. See also F AR 52.249-10(b)(1) (indicating that delay

is ex cusable if it “arises from unforeseeable causes,” such as acts of the g overnment or delay s of subcontractors or suppliers, that are “bey

ond the control and without the fault or neg lig ence of the Contractor”).

- 11-Defendant nex t argues that the three referenced F ebruary 25, 2005 letters are insufficient to constitute alleg ations of ex c usable delay because the cumulative time ex tension plaintiff requested in these letters–eig hty -seven day s–is not enoug h to ex c use the entire 128-day delay between the date contract performance was due, November 9, 2004, and the date of the default termination, March 17, 2005. This arg ument also fails. F irst, plaintiff’s alleg ations of ex cusable delay were not limited to the circumstances alleg ed in the F ebruary 25, 2005 letters. In its December 22, 2004 letter, plaintiff contended that it was delay ed in submitting its final desig n documents for an unspecified leng th of time due to the Coast Guard’s purported deviation from the standard GSA Design/B uild requirements. And, plaintiff’s F ebruary 7, 2005 letter described a delay of an unspecified duration due to poor weather conditions. Thus, the ex cusable delay alleg ed by

plaintiff likely

amounted to more than eighty -seven day s. More importantly , even if the alleg ed delay

was less than 128 day s and thus could not cover the entire time between the contract completion date and the contract termination date, the leng th of the alleg ed delay

is irrelevant to whether plaintiff alleg ed ex cusable delay in the first instance. Clause I -F SS-249-B does not condition the referral of an ex cusable delay alleg ation to the GSA on whether the contractor has alleg ed delay sufficient to ex tend the deadline for contract performance to the date of the show cause letter, the date of contract termination, or any other date. I

nstead, under the plain lang uag e of the clause, the procuring ag ency is merely required to refer an alleg ation of

ex c usable delay

to the GSA upon receiving it.
Defendant’s final arg

ument is that because the Coast Guard denied plaintiff’s F ebruary 25, 2005 requests for time ex tensions on March 8, 2005, there was no reason for the Coast Guard to believe that there were any outstanding , unresolved alleg ations of ex c usable delay when it terminated its contract with plaintiff for default on March 17, 2005. This arg ument, like the first two, lacks merit. As clause I -F SS-249-B clearly provides, if a procuring ag ency is contemplating the termination of a contract for default, any alleg ation of ex cusable delay must be referred to the GSA for a determination on the merits of the ex cusable delay alleg ation. I n other words, only the GSA possessed the authority to reject plaintiff’s alleg ations of ex cusable delay . Thus, the Coast Guard’s March 8, 2005 letters are irrelevant.

I n sum, under the terms of plaintiff’s F ederal Supply Schedule contract, the Coast Guard lacked the authority to terminate its contract with plaintiff for default because it did not refer plaintiff’s alleg ations of ex cusable delay to the GSA. According ly , the Coast Guard’s termination of its contract with plaintiff for default is invalid, and the court therefore lacks jurisdiction to entertain any claims premised solely

on the default termination. Accord B e aring Point, I nc. v. United States, 77 F ed. Cl. 189 (2007). Plaintiff is entitled to summary judg ment on this issue. However, because plaintiff’s complaint contains alleg ations reg arding the Coast Guard’s assessment of liquidated damag e s that are not premised on the default termination, the court’s grant of summary judg ment does not dispose of plaintiff’s entire complaint.

- 12-C. The P arties’ Liquidated Dam ages Claim s

Althoug h the Coast Guard lacked the authority to terminate its contract with plaintiff for default, plaintiff contends that the Coast Guard’s assessment of liquidated damag es within the default termination notice is a valid g overnment claim, and that the court can therefore entertain its claim for the remission of liquidated damag e s due to the ex cusable delay s it alleg ed in its F ebruary 25 and March 18, 2005 letters to the Coast Guard, as well as defendant’s counterclaim for liquidated damag es. Defendant ag rees with plaintiff that the Coast Guard’s notice contained a valid claim for liquidated damag es and that the court therefore possesses jurisdiction over its counterclaim. However, defendant contends that under the holding of Maropakis, the court cannot entertain plaintiff’s alleg ations of ex cusable delay because plaintiff did not first file a proper CDA claim with the contracting officer seeking

an equitable adjustment for ex cusable delay

. As an initial matter, the court ag rees with the parties that the Coast Guard’s default termination notice contained a valid g overnment claim for liquidated damag es. Pursuant to the disputes clause incorporated into the Coast Guard’s contract with plaintiff, the Coast Guard’s contracting

officer was required to issue a written decision on any claim by the Coast Guard ag ainst plaintiff. F AR 52.233-1(d)(1). And, in that clause, “claim” was defined as “a written demand or written assertion by one of the contracting

parties seeking , as a matter of rig ht, the pay ment of money

in a sum certain, the adjustment or interpretation of contract terms, or other relief arising

under or relating

to the contract.” F AR 52.233-1(c). Although Ms. Hundley did not indicate the precise amount of liquidated damag e s that the Coast Guard was assessing ag ainst plaintiff in the default termination notice, she did indicate that liquidated damag es, at the rate set forth in the contract, would “accrue from the current contract completion date to actual completion of work.” Thus, even thoug h work had not y et been completed, plaintiff had sufficient information by

which to calculate the sum certain claimed by the Coast Guard. See Metric Constr. Co. v. United States, 14 Cl. Ct. 177, 179 (1988) (“[ A] claim in which the amount in dispute can be easily

determined by

a simple mathematical calculation . . . is sufficient for purposes of the Act.”); accord N. Star Alaska Hous. Corp. v. United States, 76 F ed. Cl. 158, 184 (2007), appeal dismissed, 226 F

. App’x 1004 (F ed. Cir. 2007) (unpublished order); CPS Mech. Contractors, Inc. v. United States, 59 F ed. Cl. 760, 764 (2004); Ex ec. Court Reporters, I nc. v. United States, 29 F ed. Cl. 769, 775 (1993), appeal dismissed, 22 F .3d 1106 (F ed. Cir. 1994) (unpublished table order). I ndeed, Ms. Hundley

subsequently

advised plaintiff in writingthat as of F ebruary

28, 2005, the Coast Guard had assessed liquidated damag es for 111 day s of delay , in the amount of $56,721. F urthermore, the fact that liquidated damag es continued to accrue thereafter does not invalidate the Coast Guard’s claim. Cf. Placeway Constr. Corp. v. United States, 920 F .2d 903, 906-07 (F ed. Cir. 1990) (holdingthat althoug h the contracting officer had not determined the precise amount of the g overnment’s set off ag ainst the contract price, the finality of the contracting

officer’s decision was not affected). 1 4

1 4 The Court of F ederal Claims Technical and Procedural I mprovements Act of 1992 superseded a portion of the decision in Placeway Construction Corp. not relevant to this case.

- 13-Havingdetermined that the Coast Guard asserted a valid claim for liquidated damag es, the court must nex t determine whether plaintiff asserted a valid claim for ex cusable delay

. Plaintiff avers that three of its F ebruary 25, 2005 letters–those that soug ht a contract

ex tension–and its March 18, 2005 letter challeng ing the default termination satisfy the requirements of a valid claim under the CDA. The court need not address whether plaintiff’s March 18, 2005 letter constituted a valid claim because it has concluded that the action plaintiff soug h t to overturn in that letter–the Coast Guard’s purported default termination–was unauthoriz ed. The invalidityof the default termination renders plaintiff’s subsequent meritsbased challeng e to it a nullity

. On the other hand, the three F ebruary 25, 2005 letters identified by plaintiff were valid CDA claims. I n

each letter, plaintiff described the nature of the delay , ex plained that it was not the cause of the delay , specified the length of the delay , and requested an equitable adjustment of the contract–a time ex tension–to compensate for the delay . These letters clearly were written demands seeking , as a matter of rig h t, the adjustment of contract terms, see F A R 52.233-1(c), that g ave the contracting

officer adequate notice of the basis of plaintiff’s claim and the relief plaintiff soug ht, see Contract Cleaning Maint., I n c. v. United States, 811 F .2d 586, 592 (F ed. Cir. 1987) (“All that is required is that the contractor submit in writing to the contracting officer a clear and unequivocal statement that g ives the contracting officer adequate notice of the basis . . . of the claim.”). I

ndeed, the March 8, 2005 letters containing the Coast Guard’s rejections of plaintiff’s time ex tension requests reflect that the contracting officer understood the basis of plaintiff’s claims and the relief plaintiff soug ht.

I n sum, the court possesses jurisdiction to entertain plaintiff’s claim for the remission of liquidated damag e s to the ex tent that the claim is premised on the ex cusable delay s alleg ed in the three identified F ebruary

25, 2005 letters, but not to the ex tent that it is premised on the

ex c usable delay s alleg e d in plaintiff’s March 18, 2005 letter. The court also possesses jurisdiction to entertain defendant’s counterclaim for liquidated damages. According ly , the court g rants in part and denies in part plaintiff’s motion for summary judg ment on this issue.

III. P LAINTIF F ’S MOTION TO AMEND ITS COMP LAINT

I n addition to challeng ing the validity of the Coast Guard’s termination of its contract for default, plaintiff seeks to amend its complaint to alleg e a claim based on its F ebruary 25, 2005 letter to the Coast Guard requesting a $50,325 price increase resulting from the ex cusable delay s it alleg ed in its other F e bruary 25, 2005 letters. Under RCF C 15(b), 1 5 the court may permit the posttrial amendment of pleading s if the proposed amendment is based on an objection at trial or

See Pub. L . No. 102-572, § 907(b), 106 Stat. 4506, 4519 (permittingthe Court of F ederal Claims to render judg ment in nonmonetary disputes arising under the CDA).

1 5 Plaintiff erroneously

bases its motion on RCF C 15(a), which g overns pretrial amendment to pleading s.

- 14-on an issue tried by consent. The latter basis for amendment, the only one relevant here, provides:

W h en an issue not raised by the pleading s is tried by the parties’ exp ress or implied consent, it must be treated in all respects as if raised in the pleading s. A party may move–at any

time, even after judgment–to amend the pleading s to conform them to the evidence and to raise an unpleaded issue. But failure to amend does not affect the result of the trial of that issue.

RCF C 15(b)(2). F rom the plain languag e of the rule, it is apparent that an amendment is not necessary for the court to try

and rule on an unpleaded issue; so long as an issue is tried by

the consent of the parties, the court must treat the issue as if it were pleaded. Accord 3 J ames W m. Moore et al., Moore’s F ederal Practice ¶ 15.18[ 1] (3d ed. 2012). Nevertheless, it is g enerally accepted that trial courts should be liberal in allowing posttrial amendments under Rule 15(b)(2) so long as the requisite consent was demonstrated. I d. Thus, to determine whether plaintiff should be permitted to amend its complaint to add a claim for a $50,325 price increase, the court must ex amine whether defendant consented to the trial of that issue.
As noted above, the letter containing plaintiff’s request for a price increase provided, in its entirety : “This letter serves as our request for cost modification in the amount of $50,325.00 for ex tended overhead due to delay s outlined in our request for time ex tension letters dated 25 F ebruary 2005.” And, the requests for time ex tensions referenced in this letter concerned the Coast Guard’s review of plaintiff’s desig n drawing s, the consequences of comments made by the Coast Guard’s inspector, and the weather. Plaintiff asserts that one of the issues at trial was whether some of the delays that it encountered were the result of the Coast Guard’s instructions pertainingto the HVAC desig n and the Coast Guard preventing plaintiff from beg inning construction without an approved desig n. According ly , plaintiff argues, its proposed amendment would conform its complaint to the evidence admitted at trial. Defendant disag rees, averring

that plaintiff never sug g ested at trial that it was entitled to ex tended overhead, and that no evidence was offered at trial on the issue.
After reviewing

the parties’ submissions, the court concludes that defendant’s consent to try the issue of plaintiff’s entitlement to ex tended overhead should be implied. As defendant correctly sug g ests, for the court to decide whether plaintiff is entitled to ex tended overhead, evidence must have been presented at trial on that issue (such as how plaintiff calculated the amount of ex tended overhead owed by the Coast Guard or the components of the ex tended overhead it requested). Such evidence was admitted at trial. Joint Ex hibit 455.2, the attachment to plaintiff’s F e bruary

25, 2005 letter, contains a table breaking out all of the elements of the

ex tended overhead claimed b y plaintiff. And, for each item of ex tended overhead, the table identifies the unit, unit cost, and total cost. The court admitted this joint ex hibit into evidence on the first day

of trial, with no objection from defendant; indeed, the fact that it was a joint ex hibit indicates that defendant was jointly responsible for proposing its admission into the trial record. W h en a party

“knowing ly

acquiesces in the introduction of evidence relating to issues that are

- 15-bey o nd the pleading s,” either by failing to object to its introduction or by “actually produc[ ing ] evidence bearing

on the new issue,” it “is in no position to contest a motion to conform.” 6A Charles Alan W rig ht et al., F ederal Practice and Procedure § 1493 (3d ed. 2013). According ly
, the court g rants plaintiff’s motion to amend its complaint.

I n g ranting plaintiff’s motion, the court rejects defendant’s contention that the court lacks jurisdiction over plaintiff’s proposed claim. Specifically , defendant arg ues that plaintiff’s F ebruary 25, 2005 request for a price adjustment cannot constitute a valid claim under the CDA because plaintiff did not, in its letter, make a demand or indicate that it was seeking a final decision from the contracting officer. Defendant’s interpretation of the CDA’s requirements is too narrow. According

to binding F ederal Circuit precedent, there is “no requirement in the [ CDA] that a ‘claim’ must be submitted in any particular form or use any particular wording

. ” Contract CleaningMaint., I nc., 811 F .2d at 592; see also Transam. I n s. Corp. v. United States, 973 F .2d 1572, 1578 (F ed. Cir. 1992) (notingthat “certain ‘mag ic words’ need not be used and that the intent of the ‘claim’ g overns”). “All that is required is that the contractor submit in writing to the contracting officer a clear and unequivocal statement that g ives the contracting officer adequate notice of the basis and amount of the claim.” Contract Cleaning Maint., I nc., 811 F .2d at 592. Thus, the contractor’s request for a decision from the contracting officer need not be ex p licit; it may

be implied. J ames M. Ellett Constr. Co. v. United States, 93 F .3d 1537, 1543 (F ed. Cir. 1996); see also Transam. I ns. Corp., 973 F .2d at 1576 (“The statute’s broad lang uag e demonstrates that as long as what the contractor desires by its submissions is a final decision, that prong of the CDA claim test is met.”). Althoug hplaintiff’s F ebruary 25, 2005 letter is terse, plaintiff clearly indicates that it is a “request” for extended overhead based on the delay s it alleg ed in its other three F e bruary 25, 2005 letters. Not only is plaintiff’s “request” tantamount to a demand, but any reasonable contracting

officer receiving

plaintiff’s letter would have interpreted it as a request for a decision reg ardingplaintiff’s entitlement to ex tended overhead. I

n fact, it bears noting

that Ms. Hundley

rendered decisions in response to plaintiff’s other three F e bruary

25, 2005 letters, all of which contained lang uag e similar to the letter at issue (each of the three letters beg an, “[ t] his letter serves as our request for time ex tension,” and each concluded, “[ t] herefore [ p laintiff is] requestinga non-compensable time ex tension” ).
Plaintiff has also satisfied the CDA’s remaining jurisdictional requirements. F irst, the requirement of a contracting officer’s decision is satisfied despite the failure of a Coast Guard contracting

officer to issue a decision on plaintiff’s claim because under the CDA, such a failure results in the deemed denial of a claim. See 41 U.S.C. § 605(c); Paragon Energ y Corp. v. United States, 645 F .2d 966, 971 (Ct. Cl. 1981) (“[ T] o invoke the jurisdiction of this court . . . there must first be a ‘decision’ (or failure to decide) by the contracting

officer.”). And, the requirement of a timely

appeal of the contracting officer’s decision or deemed denial is satisfied because plaintiff filed its complaint on Aug ust 22, 2005, well within the y ear allowed for appeals, see 41 U.S.C. § 609(a); J ames M. Ellett Constr. Co., 93 F .3d at 1541 (“The CDA g rants the court jurisdiction over actions broug ht on claims within twelve months of a contracting officer’s final decision.”), and under RCF C 15(c)(1)(B ), plaintiff’s amendment to its complaint relates back to the filing of the orig inal complaint.

- 16-I n sum, because plaintiff’s F ebruary 25, 2005 request for a $50,325 price increase constitutes a valid CDA claim, because the contracting officer is deemed to have denied plaintiff’s claim due to her failure to issue a decision, and because plaintiff timely appealed the contracting

officer’s deemed denial of its claim, the court possesses jurisdiction to entertain plaintiff’s proposed claim.

IV. CONCLUSION

As set forth above, the court recharacteriz es plaintiff’s motion to dismiss as a motion for summary judg ment. B ecause the Coast Guard lacked the authority to terminate its contract with plaintiff for default, its default termination is invalid, and the court G RANTS plaintiff’s motion for summary

judg ment on that issue. F urther, the court concludes that it possesses jurisdiction to entertain plaintiff’s claim for the remission of liquidated damag es, but only to the ex tent that the claim is premised on the ex cusable delay s alleg e d in the three pertinent F ebruary 25, 2005 letters. I t also possesses jurisdiction to consider defendant’s counterclaim for liquidated damages. Thus, the court G RANTS IN P ART and D ENIES IN P A RT the remainder of plaintiff’s motion for summary judg ment. F inally
, the court G RANTS plaintiff’s motion to amend its complaint.

B y no later than F riday, March 14, 2014 , plaintiff shall file an amended complaint setting forth its new claim as described above. Defendant shall file its responsive pleading no later than F riday, March 28, 2014 , and plaintiff shall file a response to any counterclaim asserted by

defendant no later than F riday, April 4, 2014 . Then, by no later than F riday, April 11, 2014 , the parties shall file a joint status report sug g e sting a schedule for further proceeding s.

IT IS SO ORDERED.
s/ Marg aret M. Sweeney MARGARET M. SW EENEY J udg e

- 17-