Opinion ID: 552472
Heading Depth: 2
Heading Rank: 3

Heading: Adjustment Claims

Text: 10 There is a potential for contractors to subvert the certification requirement by artificially fragmenting a single claim into separate claims, each seeking no more than $50,000.00; 3 any greater amount triggers the requirement for certification. Nonetheless, the CDA recognizes that a single government contract may give rise to more than one claim, and that a contractor may pursue his rights by filing two or more suits in either one or more fora. 41 U.S.C. Sec. 609 (1988); see, e.g., Warwick Constr., Inc. v. United States, 225 Ct.Cl. 567, 568-69 (1980). Because, when applicable, certification is a prerequisite to Claims Court jurisdiction over government contract disputes, the issue whether certification was required must always be considered. To determine whether two or more separate claims, or only a fragmented single claim, exists, the court must assess whether or not the claims are based on a common or related set of operative facts. If the court will have to review the same or related evidence to make its decision, then only one claim exists. If that claim seeks more than $50,000.00, then certification is required before there can be jurisdiction in the Claims Court. 41 U.S.C. Sec. 605(c) (1988). On the other hand, if the claims as presented to the CO will necessitate a focus on a different or unrelated set of operative facts as to each claim, then separate claims exist that avoid the certification requirement, provided none of them exceeds $50,000.00.
11 The Claims Court determined that Placeway had originally presented its request for compensation for additional work to the CO as a lump sum request, and concluded that Placeway improperly fragmented the single claim into individual items when it filed its Complaint with the Claims Court. Because the Claims Court decided it had only a single uncertified claim that exceeded $50,000.00 requiring certification, the court dismissed that claim for lack of jurisdiction. Placeway, 18 Cl.Ct. at 166. 12 The Claims Court relied upon Contract Cleaning Maintenance, Inc. v. United States, 811 F.2d 586, 591-92 (Fed.Cir.1987), which it viewed as holding that it is the claim presented to the contracting officer that is determinative of certification requirements, not the format or fragmentation set forth in the complaint to the [Claims Court]. Placeway, 18 Cl.Ct. at 166. This interpretation of Contract Cleaning is perfectly sound but the manner in which it was applied to the instant case was erroneous. Our court did emphasize that in determining whether certification is required, the Claims Court must examine the claims at the time they are submitted to the CO. We neither stated nor implied, however, that it is the form of the submission of claims that determines whether the claim is unitary. See Contract Cleaning, 811 F.2d at 591 ( '[T]he certification requirement applies to submission of claims to the contracting officer; certification at that time, if required, is all-important.'  (quoting Tecom, Inc. v. United States, 732 F.2d 935, 937 (Fed.Cir.1984) (emphasis added-in-part))). In fact, this court de-emphasized the importance of the form in which claims are submitted, stating, We know of no requirement in the Disputes Act that a 'claim' must be submitted in any particular form or use any particular wording. Id. at 592. 13 Because the Claims Court focused on the form in which Placeway's claims were originally submitted to the CO, we must conclude that the court erred. It is not established that only one claim exists merely because Placeway's letter to the CO listed all of the adjustments with a totaled sum requested at the bottom of the page. The court should have determined whether one or more claims existed, regardless of the form in which they were presented to the CO; the court should have decided this question based on whether all claims presented to the CO arose from a common or related set of operative facts. 14 We cannot conclude that the Claims Court's analysis was harmless error. Far from having no legal consequence, the analysis was dispositive of the lawsuit. Placeway demanded payment from the CO based on various grounds: (1) Placeway alleged that the wage schedules in the contract were defective and as a consequence Placeway has been unlawfully deprived of $50,000.00 in contract payments; (2) Placeway sought a $27,366.00 adjustment for a differing site condition; and (3) Placeway sought various adjustments, totaling $140,251.95, for additional costs incurred because of change orders, constructive changes, and defective specifications. See App. at 24-28. We cannot discern from the record any common or related operative facts that would require considering any of these three claims as merely parts of a unitary claim. Nor is it apparent from the record why any of the various adjustments demanded based on change orders and defective specifications, each not more than $50,000.00, should be aggregated as a single claim. For example, there is nothing in the record to show, nor does the government argue, how a $36,566.00 adjustment requested for additional washing-machine piping that had to be installed because of defective specifications and a $20,657.28 adjustment requested for a constructive change order for additional partitions at the second floor stairwells are based on a common or related set of operative facts. 15 Because the Claims Court did not base its analysis on whether the claims presented to the CO arose from a common or related set of operative facts, and the government has not cited support in the record that only a unitary claim exists, we remand for the Claims Court to conduct fact finding consistent with this opinion. Accordingly, we vacate the Claims Court's dismissal of Counts III, IV, and V for lack of certification and remand for further proceedings. 4
16 The Claims Court also concluded that Placeway's Count VI, which seeks various adjustments for extended overhead, is a unitary claim requiring certification because the total adjustment sought is $119,585.91, a sum exceeding $50,000.00. The Claims Court concluded that there was only a single claim because it considered delays in performance of the contract to be a common factual threat contributing to the creation of [Placeway's] claim. Placeway, 18 Cl.Ct. at 168. We disagree. Although there is a common type of fact involved in Placeway's various extended overhead claims, i.e., a cause of delay, that does not necessarily mean that each claim involves proof of a common or related set of operative facts. We conclude that the Claims Court erred in relying on this factual thread as being dispositive of its determination that there is only a unitary extended overhead claim. 5 Accordingly, we vacate the Claims Court's dismissal of Count VI for lack of certification and final decision, and remand for the Claims Court to conduct fact finding consistent with this opinion.