Opinion ID: 2263053
Heading Depth: 1
Heading Rank: 4

Heading: other costs

Text: Eagle next contends that the CAB arbitrarily reduced or disallowed its other costs, including direct labor costs and general administrative costs. As to these claims, we uphold the CAB.
Eagle maintains that the five percent reduction applied by the CAB to its costs was non-contractual and arbitrary. In contrast to the CAB's decision regarding commercial value, there was ample evidence and explanation in the record to support the CAB's determination that at least 5 percent of the recyclables processed at the interim facility . . . were generated from Eagle's other recycling and janitorial jobs from commercial haulers. The CAB explained that its conclusion was based on evidentiary hearings it conducted and documents it received. According to the CAB, the evidence showed that Eagle continued to collect recyclables [from Prince George's County, Maryland]. . . using its own trucks and drivers; that Eagle collected recyclables for Dow Chemical Company, the United States Public Health Service, and an entity referred to as The Cluster; and that it may have been collecting materials from the Washington Design Center. Given this information, the CAB also found that the testimony of Eagle's president that only one percent of the recyclables processed at the interim facility came from non-DPW sources was not credible. It is clear from the CAB's detailed analysis that there was substantial evidence to support its finding that the non-DPW jobs processed at the facility exceeded one percent, and that there was a rational connection between this finding and the decision that Eagle's costs actually incurred ought to be reduced by five percent. See Office of People's Counsel, 797 A.2d at 726. Moreover, the CAB was in the best position to evaluate the credibility of witnesses, and this court must give deference to its credibility findings. See, e.g., Washington Metropolitan Transit Authority v. District of Columbia Dep't of Employment Services, 683 A.2d 470, 477 (D.C.1996).
Likewise, the ten percent penalty imposed on certain of Eagle's claimed costs was supported by substantial evidence. The CAB relied on the OIG audit, testimony at the four evidentiary hearings, and supporting documentary evidence to conclude that some of Eagle's claimed costs should be reduced by ten percent because of Eagle's inefficient use of CWI's recycling facility, resulting from inadequacies in Eagle's own facility. This sort of detailed fact-finding is the responsibility of the CAB, and there is no reason for this court to disturb it unless it is unreasonable, which it is not. See Belcon, 826 A.2d at 384. Moreover, the CAB did not apply the ten percent reduction to all of Eagle's claimed costs, but undertook a thorough and careful examination of the record concerning Eagle's hauling and recycling operations. We find no error in the imposition of the ten percent penalty.
Eagle's claims concerning direct costs and general and administrative costs are similarly without merit. Again, it is clear from the CAB's extensive explanations regarding each claimed cost that it based its decision on substantial evidence in the record. The CAB had the benefit of the OIG's report, as well as several days' worth of live testimony and a plethora of documentary evidence. Moreover, the CAB carefully allocated costs based on reasonableness. For example, with regard to general and administrative (G & A) costs, it noted: We could deny all Eagle G & A costs for lack of adequate support, but such a blanket denial may be unfair since clearly there are some allowable G & A costs. We adopt another approach. Eagle proposed in its BAFO [best and final offer] a G & A rate of 11 percent on total costs. We find this rate to be reasonable even considering the problems with Eagle's G & A cost support. This and similar statements show that the CAB was taking into account as much evidence as it could in determining Eagle's actual costs. It is also consistent with the requirement that actual costs be reasonable, allocable to the contract . . . and consistent with any limitations in the contract or regulations with respect to the type or amount of costs. Abadie, 806 A.2d at 1227.
Eagle also contends, in the alternative, that the CAB erred in ruling that it owed the District $959,963 for payment in excess of its costs actually incurred. It argues that under the doctrines of voluntary payment, account stated, and accord and satisfaction, it was entitled to retain all of the $1,071,966 payment from the District. We cannot agree. The common law doctrines cited by Eagle afford it no relief, for they do not apply in the instant case. [20] Accord and satisfaction is an affirmative defense [raised by a debtor] to a breach of contract claim. Pierola v. Moschonas, 687 A.2d 942, 947 (D.C.1997). This is not a breach of contract case; hence the concept of accord and satisfaction is irrelevant. Similarly, the voluntary payment doctrine, aside from being an old common law doctrine rarely cited by courts in modern, complex transactions, Avianca, Inc. v. Corriea, 1992 WL 93128, at , 1992 U.S. Dist. LEXIS 4709, at  (D.D.C.1992), is an affirmative defense to a suit for breach of contract which provides that money voluntarily paid under a claim of right to the payment, and with knowledge of the facts by the person making the payment, cannot be recovered by the payor solely because the claim was illegal. Smith v. Prime Cable of Chicago, 276 Ill.App.3d 843, 847, 213 Ill.Dec. 304, 658 N.E.2d 1325, 1329 (1995). That doctrine is not applicable here, since Eagle is not being sued and, in any event, is not defending against a claim for costs, but is instead claiming additional costs. Moreover, as the District points out, the voluntary payment doctrine does not apply to payments by government officials which are later determined to have been ultra vires. See United States v. Bentley, 107 F.2d 382, 384 (2d Cir.1939); Heidt v. United States, 56 F.2d 559, 560 (5th Cir.), cert. denied, 287 U.S. 601, 53 S.Ct. 8, 77 L.Ed. 523 (1932). The doctrine of account stated is likewise inapplicable. An account stated is a promise by a debtor to pay a stated sum of money which the parties had agreed upon as the amount due. . . . Ally & Gargano, Inc. v. Comprehensive Accounting Corp., 615 F.Supp. 426, 428-429 (S.D.N.Y.1985). The doctrine presupposes an absolute acknowledgment or admission of a certain sum due, or an adjustment of accounts between the parties, the striking of a balance, and an assent, express or implied, to the correctness of the balance. Falcone v. Paradiso, 60 App. D.C. 348, 350, 54 F.2d 715, 717 (1931) (citations omitted). In this case there was certainly no assent . . . to the correctness of the balance because, even after Eagle received the check from DPW, it sought roughly $8 million more in additional costs. Eagle never agreed that the amount sent by DPW was the amount due. Under D.C.Code § 2-302.05(d)(2), Eagle was entitled to recover costs actually incurred. The CAB determined that the payments made to Eagle by the District exceeded the costs Eagle actually incurred in performing the contract, and that the District was therefore entitled to recover the excess amount. This is certainly not an unreasonable interpretation of the statute, to which we owe deference. See Belcon, 826 A.2d at 384. Moreover, if the government overpays a party with whom it has contracted, it is almost always entitled to a refund. See United States v. Wurts, 303 U.S. 414, 415, 58 S.Ct. 637, 82 L.Ed. 932 (1938) (The Government . . . can recover funds which its agents have wrongfully, erroneously, or illegally paid). The District therefore has a right to recover the balance of the payments it made to Eagle in excess of Eagle's actual costs, and the CAB did not err in so concluding.