Opinion ID: 786478
Heading Depth: 2
Heading Rank: 2

Heading: Was the solicitation ambiguous?

Text: 22 The threshold question in this appeal is whether the solicitation plainly supports only one reading or supports more than one reading and is ambiguous. To show an ambiguity it is not enough that the parties differ in their respective interpretations of a contract term. Rather, both interpretations must fall within a `zone of reasonableness.' Metric Constructors, Inc. v. NASA, 169 F.3d 747, 751 (Fed.Cir.1999) (citations omitted). Before this court, each party argues that there is no ambiguity because its respective interpretation of the solicitation is plainly supported, and thus reasonable, while the other party's interpretation is unreasonable. 23 Contract interpretation begins with the language of the written agreement. Foley Co. v. United States, 11 F.3d 1032, 1034 (Fed.Cir.1993). When interpreting the contract, the document must be considered as a whole and interpreted so as to harmonize and give reasonable meaning to all of its parts. McAbee Constr., Inc. v. United States, 97 F.3d 1431, 1434-35 (Fed.Cir.1996). An interpretation that gives meaning to all parts of the contract is to be preferred over one that leaves a portion of the contract useless, inexplicable, void, or superfluous. Gould, Inc. v. United States, 935 F.2d 1271, 1274 (Fed.Cir.1991).
24 In preparing its estimate, NVT multiplied the figures in the Number column by the corresponding figures in the Frequency column for all of the hundreds of items in the Solicitation Attachment J C 2(a), including each of the twelve disputed line items in the MISC CERAMIC TILE REPAIR portion. For example, NVT interpreted the first disputed line item, Form, Place & Finish Concrete, to call for 1,428 square feet of concrete, or 119 square feet of concrete poured and finished twelve times per year (119 × 12 = 1428). 25 NVT argues that its interpretation was reasonable. NVT notes that the words monthly, quarterly, or weekly appeared in the Frequency column for most of the hundreds of line items in Attachment J-C 2(a) and that to prepare the estimate for each of these line items, the value in the Number column needed to be multiplied by the number 12, 4, or 52, respectively, representing the number of times in a calendar year that the work was to be performed. NVT used the same approach for the twelve line items in question, using the number in the Frequency column as a multiplier as it had for the numerical equivalent of the words in the Frequency column for all of the other line items. NVT argues that its interpretation, applying the same logic to the line items in question as to the other line items in the schedule, is a harmonious reading of all of the provisions of the contract. NVT further notes that nothing in the specification suggests that a different methodology be used for the line items in dispute. 26 Finally, NVT argues that its price estimate is reasonable. Although NVT calculated a total of 76,209 square feet of tile to be replaced, NVT contends, over the government's objections, that while that figure was large, the total floor space of the Depot is over 3 million square feet. Thus, NVT's figure is only 2% of the total floor space. Moreover, NVT notes that the solicitation emphasized the importance of the appearance of the Depot and the heavy volume of traffic. For these reasons, although NVT's bid of over $6 million for the miscellaneous ceramic tile work alone is a significant portion of the $43 million total bid, NVT contends that there is nothing to indicate or suggest that this was not what was called for in the solicitation. 27 The government argues that NVT's interpretation is incorrect and unreasonable because it is inconsistent with other portions of the solicitation. In particular, the government notes that NVT's construction results in a disproportionate amount of tile, given that the corpus of the solicitation only refers incidentally to ceramic tile. Further, the government asserts that NVT's interpretation is contrary to the terms maintenance and preventative maintenance, as defined in the solicitation. Maintenance is defined as [t]he recurrent day-to-day, periodic or scheduled work required to preserve or restore a facility to such condition that it may be effectively utilized for its designed purpose. Preventative maintenance means [s]ervicing accomplished on a scheduled or recurring basis to lengthen the equipment life. The effort involves visual inspection, operational tests, lubrication, adjustments and the repair or replacement of minor defective component parts. Given these definitions, the government argues that NVT's interpretation, resulting in the installation of 1.3 football fields worth of replacement tile per year, is unreasonable, while the government's estimate, resulting in much less replacement tile, is reasonable. The government further contends that NVT's interpretation is unreasonable given the information available to each bidder in the solicitation in the form of explanatory facility history files, technical library materials, and a software database file. The government argues that this information would have informed NVT's bid and that NVT failed to take advantage of these resources. For these reasons, the government asserts that NVT's interpretation is inconsistent with the corpus of the solicitation and therefore is unreasonable.
28 The government interprets the line items in question as not requiring multiplication of the Number and Frequency columns as was done by NVT. Rather the government's interpretation considers only the Number column and does not use the numbers in the Frequency column as multipliers. The government contends that this was reasonable because it was apparent that these line items should be treated differently, based on the presence of numbers rather than words in those line items, as well as the fact that the numbers bear no relationship to the regular and periodic repetitions signaled by the words. The government asserts that its reading is consistent with the rest of the solicitation, because the ceramic tile repair is denoted as Miscellaneous and because if the disputed line items were intended to represent such a large portion of the contract, more information would have been given about these tasks in the specification. 29 NVT contends that the government's interpretation, where the figures in the Frequency column for the disputed line items are simply ignored, violates the contract interpretation canon that a reading that renders terms superfluous is disfavored. NVT argues that for the government's interpretation to be consistent with the remainder of the document, the Frequency column should have read Annually or been left blank, which is not the case. NVT also argues that the government's interpretation renders meaningless the thirteenth line item Cyclic Maint to Repair Ceramic Tile in Messhalls, etc.
30 We conclude that both NVT's and the government's interpretations are within the zone of reasonableness. Metric Constructors, 169 F.3d at 751. NVT's interpretation is reasonable, because it applies the same logic to the thirteen disputed line items as applied to the hundreds of other line items present in the schedule. The schedule nowhere indicated that the data in the Number and Frequency columns were to be treated differently for the thirteen items in question or that the frequency numbers for those items should be ignored. Moreover, although NVT's interpretation resulted in an extensive amount of tile replacement, the amount was not wholly unreasonable: (a) given that the amount only represents a small percentage of the total floor space of the facility; (b) given the extensive use of the facility; and (c) given the mandate in the solicitation that the appearance of the Depot is of great importance. Further, despite the emphasis that the government places on the fact that NVT failed to avail itself of the external resources provided by the Navy, the government points to no particular portion of the external resources that would be inconsistent with NVT's interpretation. 31 We also find the government's interpretation to be reasonable. The government's interpretation is consistent with the notion of incidental repair and maintenance, as noted in the corpus of the solicitation. Moreover, the portion of the price attributable to tile repair and maintenance in the government's estimate is proportional to what would be expected for a small set of line items that received no special treatment in the solicitation. There was no evidence in the record illuminating the government's understanding of the significance of the numbers in the Frequency column for the disputed line items, and in fact, at oral argument, government's counsel admitted that he was unaware of the significance of those numbers; however, the point is not what the numbers in that column meant, but rather whether it was unreasonable for the government to treat them differently from the words used in the Frequency column for all of the other line items. Recognizing that on their face, the numbers in the Frequency column are different from the words used elsewhere in the attachment, and further recognizing that those numbers do not have any apparent correlation to the regular and periodic repetitions signaled by the words used for the other line items, we do not think it was unreasonable for the government not to use them as multipliers, especially because the use of the numbers as multipliers results in such seemingly disproportionate totals and the non-use of the numbers as multipliers yields totals that are entirely consistent with the corpus of the solicitation and the attention given in the solicitation to the line items in dispute. 32 Because both interpretations ... fall within a zone of reasonableness, Metric Constructors, 169 F.3d at 751, we conclude that the solicitation, with respect to these disputed line items, was ambiguous. 33