ARMED SERVICES BOARD OF CONTRACTAPPEALS
Appeal of

-- ) ) Relyant, LLC ) ) Under Contract No. W91B4N-08-D-001 l )

APPEARANCE FORTHE APPELLANT:

APPEARANCES FORTHE GOVERNMENT: ASBCA No. 58172

James H. Price, Esq.

Lacy, Price & Wagner, PC Knoxville, TN
Raymond M. Saunders, Esq.

Army ChiefTrial Attorney Kyle E. Chadwick, Esq.

Trial Attorney

OPINION BYADMINISTRATIVE JUDGE PROUTY ONTHE GOVERNMENT'S MOTION FOR SUMMARYJUDGMENT AND APPELLANT'S CROSS-MOTION

The government has filed a motion for summaryjudgment (govt. br.) in ASBCA No. 58172 1 arguing that this matter may be disposed ofbywhat amounts to a straightforward application ofthe terms ofthe contract and its associated delivery orders that are at issue in this matter. In response, appellant filed its own cross-motion for summaryjudgment (app. br.) arguing that the relevant contract terms should be interpreted in its favor because the terms ofthe delivery orders that it agreed to were impermissible. Appellant also filed an opposition to the government's motion (app. opp'n) arguing that, at the very least, ambiguity in the contractterms precludes summary judgment in the government's favor and that other matters also preclude summary judgment for the government. Bothparties filed reply briefs, and we requested additional briefing to clarify the parties' views ofthe amendments to two ofthe delivery orders. For the reasons stated herein, we conclude that the government's interpretation ofthe contract terms shouldprevail, and enterjudgment in favor ofthe government.

1 While ASBCA No. 58172 is consolidated with ASBCA No. 59809, the motion applies only to ASBCA No. 58172.STATEMENT OF FACTS (SOF) FORPURPOSES OF THE MOTIONS

I. Introduction

1. On 22 September 2008, the Army awarded ContractNo. W91B4N-08-D-001 l (contract) to Critical Mission Support Services, thepredecessor-in-interestto Relyant, LLC (hereinafterRelyant or contractor). The contract is an indefinite-delivery/indefinite-quantity (IDIQ) contract for the manufacture, delivery, and installation of"relocatable buildings" (RLBs) for use in Afghanistan, which were to be constructed from retrofitted shipping containers (App. Statement ofGenuine Issues ofMaterial Fact (SGIMF)**~** 1).2 The contract included a Statement ofWork (SOW), providedthat delivery orders (DOs) would be issued and included a schedule setting forth prices for the RLBs and associated installation services (R4, tab 1). The contract also contemplated that multiple vendors possessing similar IDIQ contracts would be submittingbids to the contracting officer (CO) seeking to be awarded the various DOs (SGIMF**~** 1). In fact, two additional vendors were awarded IDIQ contracts to provide RLBs at the same time that Relyant was awarded its contract (id.).

2. As will be seen herein, for four DOs that were awarded to Relyant, the parties agreed to aprice for the RLBs and their installation that was smallerthanthe figure in the price schedule provided in the original IDIQ contract as amended. Although the Army paid Relyant the amount set forth in the DOs (as amended), Relyant now seeks payment at the higherprice set forth in the original IDIQ contract (as amended).

II. The Material Terms ofthe IDIO Contract

3. The contract includes a numbered schedule ofsupplies and services (contract line item numbers (CLINs)) with associated "prices/costs" (R4, tab 1 at 1-2). Section HI ofthe contractprovides that, priorto awarding DOs, the CO will provide to all contractors a notice ofintent to make a purchase (R4, tab 1 at 36). The section also requires that the CO "fairly consider offers" received in response to such notices and that, in makingthe awards, the CO was to "considerprice and any other factors listed in the notice" (id.).

4. The contract also included the IDIQ Ordering clause contained in the Federal Acquisition Regulation (FAR) 52.216-18, ORDERING (OCT 1995), which is required to be in all IDIQ contracts (R4, tab 1 at 44). Included in this provision is paragraph (b), which provides that:

2 Where Relyant concedes, in its "Statement ofGenuine Issues ofMaterial Fact," that

one ofthe proposed findings in the government's "Statement ofUndisputed Material Facts" is accurate, we may note it herein.

2(Id.) All delivery orders ortask orders are subject to the terms and conditions ofthis contract. In the event ofa conflictbetween

a delivery order ortask order and this contract, the contract shall control.

III. Orders on and Changes to the Contract

5. Contemporaneously with its award ofthe contractto Relyant on 22 September 2008, the government issued DO No. I (DOI) on the contract directing Relyant to produce, deliver, and install nine two-story RLBs for a total price based upon CLIN prices inthe original contract schedule, $5,38I,750.15 (nine times $55I,I24 for the manufacture ofeach plus nine times $46,848.24 for their installation) (R4, tab 4). 3

6. The parties executedModification No. POOOOI to the contract (POOOOI) on 22 and 23 December2008, which changed the SOW and increased the CLINpricing schedule for the original contract (R4, tab 15 at I-I2). Neither the amended SOW northe amended pricing schedule purported to retroactively apply tothe RLBs ordered in DOI (id.).

7. The Army issued both D02 and D03 on 24 December 2008 to Relyant (R4, tabs 17, 18). D02 was for the manufacture and installation ofone two-story RLB at Bagram Airfield (R4, tab I 7 at 1-2). The price for D02 corresponded to the now-amended CLINprice schedule in the original contract (agreed to in POOOOI), minus a five percent "discount" offered by Relyant (id. at 2). Thus, the order's price underthe amendedprice schedule, of$997,036 ($858,965 for the manufacture ofthe RLB plus $138,07I for its installation), was marked down to $947,184.20 in this DO that was executedby both parties (id.). The executed orderreferenced no contingency for the discount (R4, tab I7).

8. D03 was for manufacturing and installing two more two-story RLBs at Bagram Airfield (R4, tab I8 at I-2). As inD02, the price corresponded to that in the amended price schedule, minus the five percent "discount" offeredby Relyant (id. at 2). Thus, the original price for the manufacture and installation ofthe two RLBs under the amended price schedule of$1,994,072 (twotimes $858,965 for their manufacture plus two times $138,07I for their installation), was marked downto $1,894,368.40 in this DOthat was executed by both parties (id.). The executed orderreferenced no contingency for this discount (R4, tab I8).

9. Three days later, on 27 December 2008, the Army issued D04, which, like D03, was for the manufacture and installation oftwo more two-story RLBs at Bagram Air Field (R4, tab I9 at I-2). The pricing ofD04 was identical to that ofD03: the amended contract's price schedule, subjected to a five percent "discount," leading to a

3 DOI miscalculatedthis price by 1

### ¢.

3price of$I,894,368.40 in this DOthat was executedbybothparties (id.). The executed orderreferenced no contingency for this discount (R4, tab I9).

IO. Subsequenttothe issuance ofDOI, theparties recognized that DOI had failed to make any allowance for the costs ofdelivering the RLBs from BagramAirfield to other Forward Operating Bases (FOBs) in Afghanistan (the contract had a CLIN for delivery that had been left offofthe DO) (R4, tab 9 at 1-4). Apparently, because offunding constraints, the number ofRLBs providedby DO1needed to bereduced in order to accommodate the added delivery costs (R4, tab 6 at 1 (Relyant noting that, absent increased funding, the number ofRLBs would need to be reduced)). Theparties also decided to "incorporate mechanical and window changes into CLIN 0002 unitpricing" (R4, tab 24 at 2). Thus, on 2 and 3 April 2009, the parties executed Modification No. 1to DOI that: (1) reduced the number ofRLBsprovided and installed by Relyant from nine to six; (2) increased the unit price for the manufacture ofthe RLBs to $6I5,55l.06 and left the unit price for installation ofthe RLBs at $46,848.24;4 and (3) added an unpriced CLIN (not to exceed $1,396,704) for transportation ofthe RLBs to the FOBs (id. at 1-3). Afterthis modification, the total price ofDOl changed to $5,371,099.80 (id. at 3), comparedto the DO'spriorprice of $5,381,750.15 (R4, tab 4 at 2).

11. On 27 August 2009 and 2 September 2009, the parties executed Modification No. 2 to D03, changing the type ofRLB from the two-story variety to the three-story type (R4, tab 64). This modification, signedby bothparties, increased the price for the delivery orderby $714,035.80, from $1,894,368.40 to $2,608,404.20 (id. at 2). The $714,035.80 price increase corresponded to the difference inprice ofthe contract's CLINs (as amended by POOOO 1) for the manufacture and installation ofthree-story RLBs comparedto the manufacture and installation oftwo-story RLBs (R4, tab 15 at 2, 4, tab 62 at 2). Because this figure was added to the original D03's discounted price for a two-story RLB, D03's price for the three-story RLB remained less than the amended contract's price for three-story RLBs, although the net discount was proportionally less (approximately 3.7%, compared to the original 5%).

12. At the same time, the parties also issued a materially identical Modification No. 2 to D04, changing the type ofRLB from a two-story model to a three-story type (R4, tab 65). The prices in Modification No. 2 to D04 were identical to those in D03 as amended (R4, tab 64 at 2, tab 65 at 2).

13. Nine days later, on 11 September 2009, the parties executed a bilateral modificationto the original contract (P00007) in which they agreed to incorporate changes into the SOW for the original contract and to amend the prices ofseveral

4 By contrast, the CLINprices for manufacturing and installing two-story RLBs (with their modified SOW) in the original contract, as modified by POOOO 1three months earlier, were $858,965 and $138,071 respectively (SOF 

## iii! 6, 8).

4CLINs (R4, tab 69). Ofmateriality to this motion, CLIN 0002 (forthe manufacture of two-story RLBs) saw its unit price increase by $25,840 and CLIN 0003 (forthe manufacture ofthree-story RLBs) had a unit price increase of$38,760 (id. at 2).

I4. On the same day that the parties executed P00007, they executed related bilateral modifications to DOs 2, 3, and 4 (R4, tabs 70, 7I, 72). For D02, the parties added $25,840 to the price, consistentwith the increased price ofCLIN 0002 as modified by P00007 (R4, tab 70 at 2). For D03, the parties added $77,520 to the price, consistent with the increasedprice ofCLIN 0003 as modified by P00007 and multiplied by two, to account for there being two RLBs ordered by D03 (R4, tab 7I at 2). And, finally, the modification to D04 was materially identical to the modificationto D03, adding $77,520 to its price (R4, tab 72 at 2). 5 DOI remained unchanged.

IV. Payment on the Contract

I5. The Army paid Relyant $662,399.3I ($6I5,551.06 for their manufacture and $46,848.25 for their installation) for each RLB provided underDOI as modified in April 2009 (SGIMF**~** I9). This is the amount that the parties agreed to (exclusive ofdelivery charges) in ModificationNo. I to DOI (id.). The Army also paidRelyantthe amounts set forth in D02, D03, and D04 as amended by their I I September 2009 modifications (SGIMF**~~** 20, 21, 22).

DISCUSSION

The standards for summaryjudgment are well established and need little elaboration here. Summaryjudgment should be granted ifit has been shown that there are no genuine issues ofmaterial fact and the moving party is entitled tojudgment as a matter oflaw. 

### Celotex Corp. v. 

### Catrett, 477 U.S. 3I7, 322 (1986). A non-movant seeking to defeat summaryjudgmentby suggesting conflicting facts "must set forth specific facts showing that there is a genuine issue for trial." 

### Anderson v. 

### LibertyLobby, Inc., 477 U.S. 242, 248 (I986) (quoting 

### FirstNational Bankof Arizona v. 

### Cities Service Co., 39I U.S. 253, 288-89 (1968)).
Here, the primary dispositive issue is whether the price schedule set forth in the original contract (as modified) precludes the parties from negotiating and agreeing to different prices in the DOs. Relyant'sposition is that, regardless ofwhatthe parties mutually agree to in the DOs, they may not differ from the prices set forth in the contract's price schedule because the Ordering clause in the original contractrequires that all differences between the contract and the DOs be resolved in favor ofthe original contract (app. br. at 8). The government argues that the contractpermits the DO prices to be lower than those in the original contract schedule because it explicitly allows the different IDIQ

5 Like the earlier modifications to DOs 3 and 4, the prices-as-modified continued to be lowerthan the prices contained in the original contract (as modified) because the price increases were added to the original "discounted" price.

5contractors to submitbids on delivery orders with differentprices (gov'tbr. at 8-9). We conclude that only the government position harmonizes all ofthe provisions ofthe contract and, not coincidentally, is consistent with the parties' pre-conflict actions, which reflect their intent. Appellant's interpretation, on the otherhand, is unreasonable. We further conclude that the other defenses against summaryjudgment articulated by Relyant do notpresent disputed facts that precludejudgment in favor ofthe government.

I. The Proper Interpretation ofthe Contract Allows the Parties the Rightto Mutually Agree to LowerPrices for the DOs than Those in the Original Contract's Price Schedule

Under basic principles ofthe law, a contract is interpreted "interms ofthe parties' intent, as revealed by language and circumstance." UnitedStates v. Winstar Corp., 518 U.S. 839, 911 (1996) (citations omitted). Generally, this process begins and ends withthe language ofthe contract. TEG-Paradigm Environmental, Inc. v. UnitedStates, 465 F.3d 1329, 1338 (Fed. Cir. 2006). And in reviewingthis language, the Board should read the contract "as a whole and [interpret it] to harmonize and give reasonable meaning to all its parts," ifpossible, leaving no words "useless, inexplicable, inoperative, insignificant, void, meaningless or superfluous." Precision Dynamics, Inc., ASBCA No. 50519, 05-2 BCA

### il 33,071at163,922; see also Hercules, Inc. v. UnitedStates, 292 F.3d 1378, 1381 (Fed. Cir. 2002) ("contract must be construed to effectuate its spirit and purpose giving reasonable meaning to all parts ofthe contract"); Hunkin Conkey Constr. Co. v. UnitedStates, 461F.2d1270 (Ct. Cl. 1972) (rejecting contract interpretation that wouldrender a clause in the contract meaningless). Interpreting the contract as a whole requires the Boardto interpret all documents that are part ofthe same transaction together. See RESTATEMENT (SECOND) OF CONTRACTS§ 202(2).

With these foundational tenets in mind, we tumto the contract at hand. To be sure, the price schedule inthe original contract, read by itself, could lead the casual reviewer to believe that it sets the only prices that may be paidbythe government for the CLINs covered bythe contract. This is Relyant's favored interpretation. But this interpretation wouldbe in tension with Section H 1 ofthe contract, which allows the contractors to make competitive bids for DOs and for the CO to considerthe price when deciding to which contractor it would award each DO (see SOF 

### il 3). Ifthe price schedule in the contract were not subjectto change by mutual agreement ofthe parties in the DOs, there wouldbe little point in the competitive bidding contemplated by clause Hl.6 Moreover, this interpretation would also be in direct conflict withthe DOs that

6 Indeed, one ofthe significantbenefits ofa multiple award IDIQ contract, like the one here, is that the continuing competition for the award ofDOs allows the government the opportunity to control the prices ofindividual DOs. See JOHN CIBINIC, JR. & RALPH 

## c. NASH, JR., FORMATION OF GOVERNMENT CONTRACTS 1243 (3d ed. 1998), see also id. at 1249, 1251 (referencing competitive pricing ofindividual delivery orders).

6were negotiated and executed by both ofthe parties, which set forth lowerprices than the original contract's price schedule and (being a part ofthe contract), mustbe considered in harmonizingthe meaning ofthe contract. Under Relyant's interpretation, the prices that the parties agreed to in the DOs would have been utterly meaningless. This is a disfavored interpretation and cannot constitute an accurate reflection ofthe parties' intentions: justwhat were the parties doing when they were executing their DOs ifthe reduced pricing was unallowable? Tellingly, in none ofits four filings related to this motion, does Relyantprovide any explanation ofhow, under its interpretation ofthe contract, clause H 1 or the DOs' terms would not be superfluous, nor does it offer any
means to harmonize them with the original contract'sprice schedule.

The government must, ofcourse, provide a reasonable explanation for the existence ofthe pricing schedule in the original contract and why 

### its terms are not superfluous ifthey are subject to alteration by the DOs. The government has suggested that this pricing schedule reflects a maximum price permissibleby the contract (gov't reply at 4). Although no terms ofthe contract use this express language, we believe it to be a reasonable interpretation ofthe contract, which has the virtue ofharmonizing all of the terms ofthe contract and being consistent with the intent ofthe parties as evidenced by the DOs. 

### See Blinderman Constr. Co. v. UnitedStates, 695 F.2d 552, 558 (Fed. Cir. 1982) (contemporaneous construction ofan agreementpriorto dispute is entitled to great weight). Itis also consistent with the public policy interest offostering price competition in the original award ofthe multiple IDIQ contracts (by requiring the parties to bid a ceilingprice) while continuing to allow for price competition in the DOs.
Relyant argues that the order ofprecedence portion ofthe Ordering clause would be superfluous under the government's preferred interpretation ofthe contract (app. opp'n at 10-11), butthat is not so. The clause is simply not applicable when there is no conflict in the contract and DO terms, and there is no such conflict here. There are many other potential contingencies in which the terms ofa DO could conflict withthe contract as we interpret it here (e.g., iftheDO'sprices exceeded the ceiling prices in the original schedule), making the order ofprecedence clause a necessary provision. Put another way, application ofthe order of precedence clause is only necessary ifthere is a conflict in the contract's terms; the proper interpretation ofthis contract (which permits the parties to mutually agree to lowerprices in the DOs than in the original schedule) avoids such a conflict.

The government also argues, in the alternative, that, ifits view ofthe contract is incorrect, then the contract's terms would havepresented a patent ambiguity, which would have required Relyant to make an inquiry about their meaning (gov'treply br. at 5). Because we find that our interpretation ofthe terms ofthe contract is internally-consistent and removes any ambiguity, the doctrine ofpatent ambiguity does not apply.

7II. Relyant'sAdditional Arguments Do Not Challenge the Viability ofthe DOs
Relyant makes a number ofadditional undeveloped arguments that the DOs, as amended, shouldbe invalid. One ofthese arguments is made explicitly in the "Argument" section ofits opposition to the government's motion; the others are sprinkled throughout the "Factual and Procedural Background" section ofits oppositionbrief. All but one ofthese arguments are contained in a single legally-conclusory paragraph ofthe declaration ofits Vice President ofBusiness Development, Kenneth Biles. None are persuasive.
Relyant's only additional argument that is fully developed and included in its "Argument" section is that the government should notbe entitled to the five percent discounts reflected in the pricing for DOs 2, 3, and 4 because the government's modification ofRLB requirements after First Article Testing ofthe RLB's deprived it of the economies ofscale necessary to supportthe "discount" (app. opp'n at 12-14; Biles decl. 

## iii! 14-15). As the governmentrightly points out, the final DOs, as amended by their change orders, made noreference to any discount (R4, tabs 70, 71, 72), and even the original DOs' discounts were not contingentupon such economies ofscale (SOF

## iii! 7-9). Thus, whatever contingencies may have been considered when Relyant first proposed the five percent discount to the government were overtakenby the DOs andtheir amendments, which made no mention ofsuch considerations and did not make the DOs contingent upon any factors involving economy ofscale.
Relyant alleges in a single paragraph ofthe "Factual and Procedural Background" ofits opposition briefthat the terms ofthe first modification to DO1 shouldbe void because they were entered under duress7 (app. opp'n at 4). Thetotal factual support for this legal conclusion in Relyant's filing consists ofthe following language in Mr. Biles's declaration:

Modification #01 to DO #0001 also included an additional line item making shipping costs part ofthe Government's order, which both Relyant andthe Government agreed should have been included in the original delivery order. Because Relyant neededto bereimbursed bythe Government for shipping as had originally been contemplated, Relyant agreed to Modification #01 to DO #0001 even though it contained inconsistentpricingterms and eventhough it contained a release ofclaims clause. Based on the circumstances and the Government's constantly changing demands with regard to

7 This allegation was notpresented in Relyant's complaint or claim, and Relyant does not extend it to the terms ofDOs 2, 3, or4.

8RLB specifications and other issues, Relyant agreed to Modification#01 to DO#0001 under economic duress.
(Biles decl. 

### ii 7) Like the singleparagraph in Relyant's response briefraising this defense, this declaration names a defense (a defense raised here for the first time in this litigation) and makes generalized references to some ofits elements, but is nowhere near sufficient to preclude summaryjudgment.

As discussed above, a non-movant seeking to defeat summaryjudgmentby suggesting conflicting facts "must set forth specific facts showing that there is a genuine issue for trial." LibertyLobby, 477 U.S. at 248 (quoting FirstNationalBankof Arizona, 391 U.S. at 288-89). In orderto prevail on an economic duress defense, a party must allege and prove that it (1) involuntarily accepted the other party's terms; that (2) circumstances permitted no other alternative; and (3) such circumstances were the results ofthe other party's coercive acts. Rumsfeldv. FreedomNY, Inc., 329 F.3d 1320, 1329 (Fed. Cir. 2003). Mr. Biles's declaration does not set forth facts supporting a single element ofthe defense, even though it would need facts supporting all three in orderto be effective: nowhere, exceptperhaps by implication, does he allege that Relyant's agreementto the terms ofthe modification to DO1was involuntary; nowhere does he present any facts explaining why the circumstances presented no alternative to agreeing to the modification that he now alleges was improper; and nowhere does he allege any coercive acts by the government. Thus, there are no facts supporting the defense of economic coercionthat preclude summaryjudgment.

The next argument advanced by Relyant in its "Factual and Procedural Background" section is that the amendments to DO1 are invalid becausethey lowered its price and thus lacked consideration (app. opp'n at 4; Biles decl. 

### ii 7). This is not a serious argument: as the governmentpoints out, the amendment to DO1 lowered the overall price ofthe DO because it reduced the number ofRLBs ordered (SOF 

### ii 10). It also increasedthe unitprice ofthe RLBs that it was obtaining (id.). This easily passes the (low) bar for consideration, which can be met by a bargained-for mutual exchange of promises. See RESTATEMENT (SECOND) OF CONTRACTS§§ 71, 72 (1981).
Relyant's next argument in this section is that it should be excused from the terms ofDO1because the government allegedly did not perform its end ofthe deal by making payment for shipping costs (app. opp'n at 4; Biles decl. 

### ii 7). A claim for unpaid transportation costs is not presently before the Board. In any event, this alleged breach of the contract would not change the terms ofthe contract that are before us here: what Relyant is due for its manufacture and installation ofthe subject RLBs.

The last argument raised by Relyant in this section that we address is Relyant's contention thatthe amendments to the original contract's pricing schedule that were effected by P00007 should have been applied to DO1,justas these changes were applied

9(through amendment) to DOs 2, 3, and 4 (app. opp'n at 5). But since, as discussed above, theprice schedule in the original contract does notprecludethe parties from agreeing to a lowernumber in DOs onthat contract, there is no reason that P00007 should have necessarily applied to DO1. Indeed, the fact that the parties amended DOs 2, 3, and 4 concurrently with their adoption ofP00007 indicates that they recognized that changing the price schedule in the original contract was not enough to change the prices in the DOs (thus, lending even more supportto the interpretation ofthe contractthat we set forth above), while their decision notto amend the pricing in DO1 indicates that they had agreedthat DO1need not have its prices changed. There was, moreover, a sensible

reason for theparties to have leftDOl'sprices unchanged, which was that its SOW appears to have been unchanged, unlike the change to the SOW for DOs 2, 3, and 4.

III. The Army Paid Relyantthe Amount Specifiedby the DOs as Amended
Relyant does not dispute the fact thatthe Armypaid it the amount to which it was entitled underthe prices memorialized in the final amended versions ofthe DOs executed by bothparties. Thus, there is no breach in this case, and the government is entitled to judgmentin its favor.

CONCLUSION

Forthe reasons stated herein, we grant summaryjudgment in favor ofthe government. ASBCANo. 58172 is denied.

Dated: 12 January 2016

I concur 

# ;;&

# ~**~~** / MARKN.

# STEMPLE~i4 Administrative Judge Acting Chairman Armed Services Board ofContractAppeals

10 J. REID PROUTY Administrative Judge Armed Services Board ofContractAppeals

I concur

RICHARD SHACKLEFORD Administrative Judge Vice Chairman Armed Services Board ofContractAppealsI certify that the foregoing is a true copy ofthe Opinion and Decision ofthe Armed Services Board ofContract Appeals in ASBCANo. 58172, Appeal ofRelyant, LLC, rendered in conformance with the Board's Charter.

Dated:

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