Opinion ID: 215359
Heading Depth: 1
Heading Rank: 2

Heading: DISCUSSION Assignment of Claims

Text: In 1983, Dominion's predecessor, Northeast Utilities, executed three Standard Contracts for the disposal of SNF from its three nuclear power plants at the Millstone Power Station near New London, Connecticut. When Northeast Utilities sold Millstone to Dominion in 2001, it also assigned the three Standard Contracts to Dominion. Dominion, 84 Fed.Cl. at 261. The assignment stated that Northeast transferred to Dominion, along with title to the SNF, all rights of the Sellers . . . under the DOE Standard Contracts (including all rights to any claims of Sellers related to DOE defaults thereunder). J.A. 1613. In the instant suit, Dominion claimed $52.0 million in interim storage costs, including $12.1 million incurred by Northeast prior to Dominion's acquisition of the Millstone facility. Dominion, 84 Fed.Cl. at 263, 285. The Court of Federal Claims determined that approximately $200,000 of the pre-acquisition damages lacked sufficient evidentiary support and another $1 million was not recoverable because Dominion was unable to demonstrate that the costs incurred were caused by the government's breach. Id. at 284-85. After also disallowing some of the claimed post-acquisition damages, the trial court awarded Dominion approximately $42.7 million, of which $10.9 million was incurred prior to Dominion's acquisition of Millstone. Id. at 263; Appellee's Br. 2. At issue here is the pre-acquisition portion of the damages awarded to Dominion. The government does not dispute Dominion's entitlement to the interim storage costs for the SNF which it incurred after it acquired Millstone. The government also does not dispute its responsibility for interim storage costs for the SNF following the breach and up until Dominion's acquisition of Millstone (the $10.9 million). The government's argument on appeal, however, is that Dominion is not entitled to sue the government for the $10.9 million incurred by Northeast Utilities for storing the SNF. Moreover, the government does not dispute that pursuant to the contract in which Northeast Utilities sold Millstone to Dominion, both parties clearly intended for the sale to include the transfer of the claim against the government for the pre-acquisition interim storage fees. Rather the government argues that Northeast Utilities was not permitted to transfer its claim against the government for interim storage fees  that such a transfer is barred by the Assignment of Claims Act, Pub.L. No. 97-258, § 1, 96 Stat. 976 (codified at 31 U.S.C. § 3727) (Claims Act). The Claims Act generally prohibits the assignment of a claim against the government until after [the] claim is allowed, the amount of the claim is decided, and a warrant for payment of the claim has been issued. 31 U.S.C. § 3727. A similar statute, 41 U.S.C. § 15 (Contracts Act), generally prohibits the assignment of contracts. The government may waive these restrictions. Tuftco Corp. v. United States, 614 F.2d 740, 745 (Ct.Cl.1980). At trial, the government argued that the NWPA waives the provisions of the Contracts Act but not those of the Claims Act, thus preventing the transfer of any claim for pre-assignment damages from Northeast Utilities to Dominion. Dominion, 84 Fed. Cl. at 286. The government also argued that pursuant to Ginsberg v. Austin, 968 F.2d 1198, 1199 (Fed.Cir.1992), Congress must, but did not, expressly waive the Claims Act as to existing breach of contract claims. 84 Fed.Cl. at 286. The trial court disagreed, ruling that the NWPA provides a statutory waiver to the Claims Act and that the agreement assigning the Standard Contracts to Dominion specifically included the right to assert an existing breach of contract claim. Id. at 286. We review the CFC's statutory interpretation and legal conclusions de novo and its factual findings for clear error. Heisig v. United States, 719 F.2d 1153, 1158 (Fed.Cir.1983). We begin our interpretation with the statutory language. Consumer Prod. Safety Comm'n v. GTE Sylvania, Inc., 447 U.S. 102, 108, 100 S.Ct. 2051, 64 L.Ed.2d 766 (1980). The relevant portion of the NWPA states: The rights and duties of a party to a contract entered into under this section may be assignable with transfer of title to the spent nuclear fuel or high-level radioactive waste involved. 42 U.S.C. § 10222(b)(3). After notice and comment rulemaking, the DOE adopted similar language in the Standard Contract: The rights and duties of the Purchaser may be assignable with transfer of title to the SNF with 90 days notice to the government. 10 C.F.R. § 961.11, Art. XIV. As it did at trial, the government argues on appeal that Congress waived the Contracts Act but not the Claims Act by stating in the NWPA that [t]he rights and duties of a party to a contract are assignable. Relying on Ginsberg, the government argues that the Claims Act requires a specific, express waiver for existing claims, and asserts that the NWPA does not provide one. The government also asserts that Congress' use of the word contract but not claim in the NWPA draws a distinction between the assignment of an existing contract and the assignment of an existing claim for damages, and because the Claims Act and the Contracts Act are separate statutes, assignments of contracts and assignments of claims must be treated differently. Citing Tuftco, 614 F.2d at 744, the government argues that the conceptual difference between the statutes is that the Claims Act pertains to claims for work already done and the Contract Act is more concerned with continuing obligations. Thus, according to the government, the NWPA allows the assignment of continuing rights and duties under the contract, but not assignment of claims that accrued prior to contract assignment. The issue before us is whether the language which permits assignment of the rights and duties of a party to a contract includes the right to assign existing damages stemming from a breach of contract claim. Does this language allow the transfer of the damages claim for breach along with the transfer of the contract? We conclude that it does. The statutory language is broad and allows for transfer of not just the contract, but transfer of the rights and duties of a party to a contract. One of the rights of a party to a contract is the right to bring a claim for damages resulting from breach. The government's reading of the NWPA modifies its plain language in one of two ways: it either reads into the NWPA the word continuing (i.e., only continuing rights and duties may be assigned); or it reads out the rights and duties of a party (i.e., only a contract may be assigned). The rights and duties of a party to a contract encompass not just the party's continuing rights and duties under the contract, but also the party's existing right to enforce the contract for an ongoing breach and to collect damages that have been incurred. See, e.g., Restatement (Second) of Contracts § 346 (The injured party has a right to damages for any breach by a party against whom the contract is enforceable. . . .). Although the Claims Act and the Contracts Act are separate statutes, the Tuftco court recognized that the concerns of the two statutes and the legal concepts involved in their applicability are the same. Tuftco, 614 F.2d at 744 n. 4. The plain language of the NWPA provision states that all rights of a party to a contract are assignable. In this case, it is undisputed that in its transfer of Millstone, Northeast Utilities intended to assign its claim for interim storage fees. We see no reason to read a limitation into the text of the NWPA regarding claims for damages for an existing, ongoing partial breach. While it is certainly true that the bare assignment of a contract does not transfer all accrued claims, here, Congress' intent is manifest in the plain language of the NWPA: a party to the Standard Contract may assign its rights. This includes the party's right to collect damages incurred due to an existing, ongoing breach. Ginsberg, a case decided under state property laws pertaining to real property is not to the contrary. Ginsburg recites no requirement that the transfer of an existing breach of contract cause of action requires a separate, specific, express designation of the claim in the assigning document. On the contrary, Ginsberg states that a contract assignment may specifically or impliedly designate accrued causes of action. 968 F.2d at 1201. We conclude Congress permitted just such a designation in the NWPA. The government further argues that our conclusion subverts the purpose of the Claims Act, which allow[s] the government to deal solely with the original contractor, protects the government's ability to defend itself by ensuring availability of evidence, and reduces the possibility of multiple payments of claims. As an initial matter, these policy arguments do not trump the plain language of the statute. Moreover, these policy concerns are not implicated here. This is not a case where there is any confusion over whether the parties intended to transfer the right to sue for pre-acquisition interim storage fees  it is undisputed that they did. A party to a standard contract cannot transfer its rights and duties to another party without also transferring title to the SNF. Hence, the party who is suing for interim storage fees is suing for all interim storage fees. [1] Moreover, the plaintiff has the burden to prove damages, and indeed, the trial court excluded a portion of Dominion's claimed damages as unsupported. 84 Fed.Cl. at 284. Finally, the government does not assert that it was unable to access any needed information through discovery. The government does not appear to have suffered any harm from the consolidation of the interim storage fee claim with a single party. Northeast Utilities and Dominion complied with the requirements of the Standard Contracts and the NWPA when they executed the purchase agreement, which assigned to Dominion along with title to the SNF, all rights . . . under the DOE Standard Contracts (including all rights to any claims of [Northeast Utilities] related to DOE defaults thereunder). J.A. 1613. Accordingly, Dominion has the right to collect pre-assignment damages for the government's ongoing partial breach of Dominion's Standard Contracts.