Opinion ID: 691321
Heading Depth: 2
Heading Rank: 2

Heading: Evidence of Pre-Termination Expenses

Text: 56 Related to the disputed issue of the definition of work performed under the contract is the issue of whether Linan-Faye produced any evidence of pre-termination expenses compensable as work performed. The district court determined that Linan-Faye had presented no evidence of expenses that would merit an equitable adjustment to the contract. Id. at 1208 n. 22. Linan-Faye argues that the certification which it submitted in opposition to HACC's third motion for summary judgment provides the requisite evidence. Linan-Faye is correct. 57 The district court, at this early stage of the litigation, improperly concluded that there was no evidence of expenses compensable under the termination for convenience clause. Linan-Faye described 15 types of expenses that Linan-Faye incurred preparing for work on the HACC contract. Certification of Norman Faye (October 21, 1993); App. at 231-33. While many of these expenses may not be compensable, some of the stated expenses, such as time spent with municipal building, plumbing and electrical inspectors regarding job phasing, contract details, code requirements, and problem solving, may be compensable if the parties so intended under the termination for convenience clause of the contract. Cf. ITI Defense Communications Division, Nos. 11858, 13439, 1970 WL 1124, 1970 ASBCA Lexis 29, at  56 (July 29, 1970) (cost of work done by appellant in preparing and submitting configurations that were never used still properly compensable under the termination for convenience clause); Navgas, Inc., No. 9240, 1964 WL 475, 1964 ASBCA Lexis 1139, at  29 (November 18, 1964) (costs of investigating work to be done, and determining the best way to perform the contract, if awarded, are properly compensable under termination for convenience clause). Although, on the whole, the evidence produced by Linan-Faye in this certification appears meager, by granting summary judgment for HACC the district court improvidently prevented the plaintiff from developing the record more fully. There was not a complete lack of evidence. Accordingly, we must reverse the grant of summary judgment on this issue and remand for trial. 58 In remanding for trial on this issue, however, it is important to explain precisely the scope of our holding. We do not hold that Linan-Faye is entitled to pre-termination expenses that accrued as the result of any alleged pre-termination breaches of contract by HACC. As the district court correctly held, cases that have addressed the issue of pre-termination breaches have concluded that claims for such damages are subsumed in the termination for convenience clause. Linan-Faye Construction Co., 847 F.Supp. at 1203, 1204 (citing Nolan Brothers, Inc. v. United States, 405 F.2d 1250, 186 Ct.Cl. 602 (1969)); Descon System Ltd. v. United States, 6 Cl.Ct. 410 (1984)). Pre-termination expenses that accrued as the result of any alleged pre-termination breaches by HACC are not compensable. On remand, the triable issue is limited to a determination of the pre-termination expenses which Linan-Faye incurred that the parties intended to be compensable as work performed under the termination for convenience clause of the contract. 59