Court Opinion

ID: 5129964
Source: CourtListenerOpinion
Date Created: 2021-11-30 04:00:13.649401+00
Date Added: 2024-06-11T08:23:14.971164
License: Public Domain

ARMED SERVICES BOARD OF CONTRACT APPEALS
    Appeal of -                                 )
                                                )
    BES Construction, LLC                       )    ASBCA No. 62175
                                                )
    Under Contract No. FA4418-12-C-0023         )

    APPEARANCES FOR THE APPELLANT:                   Todd A. Jones, Esq.
                                                      Raleigh, NC

                                                     Edward P. Kendall, Esq.
                                                      Montgomery, AL

    APPEARANCES FOR THE GOVERNMENT:                  Jeffrey P. Hildebrant, Esq.
                                                      Deputy Chief Trial Attorney
                                                     Lawrence M. Anderson, Esq.
                                                      Trial Attorney

                  OPINION BY ADMINISTRATIVE JUDGE MCILMAIL

       Appellant, BES Construction, LLC, seeks additional compensation related to its
construction of a visitor center at a military base in South Carolina.

                                    FINDINGS OF FACT

        Much of the following is drawn from the parties’ apparent agreement that certain
facts are not in dispute (app. br. at 2-8; gov’t br. at 1-12). On September 28, 2012, the
parties contracted for BES to construct a visitor center at a military base in Goose Creek,
South Carolina (R4, tab 8 at 1-2). The contract provides that “[t]he Notice to Proceed
will be issued within 45 days of award,” and that BES “complete the entire work ready
for use not later than 270 calendar days” (id. at 1). On or around October 2, 2012, the
government received a bid protest from a disappointed bidder (app. br. ¶ 7; gov’t br. ¶ 7).
On October 3, 2012, the government directed BES to “[c]ease all work associated with
the Construct Visitors Center contract” pending the outcome of the protest (see R4,
tab 10). The award protest was resolved on December 6, 2012 (app. br. ¶ 10; gov’t br.
¶ 10). On January 8, 2013 1, the government issued to BES a Notice to Proceed (R4,

1
    The record reflects that the Notice to Proceed was dated January 8, 2012 (R4, tab 1).
         However, based upon the parties’ recitation of the facts and other documents in the
         record, we conclude that the Notice to Proceed was actually issued on
         January 8, 2013.
tab 1). On July 12, 2013, BES requested of the government “a contract time extension
due to excessive rainfall for the Months of February through June” 2013, stating that:

              There was measurable rainfall for 33 days out of 181 calendar
              days for January through June including 22 Days in June with
              a total accumulation that was 7.22 inches (June total) above
              normal as measured at the NOAA site in Goose Creek. We
              are asking for 46 days of calendar days of extension time to
              cover days lost due to weather.

                                            ...

              According to Weather underground.com (NOAA recording
              Data) there was rainfall from January 1st, 2013 through
              June 30, 2013 of 36.75". The normal rainfall for this same
              period is 21.96". Therefore there was a surplus of 14.79" of
              rain since the project started.

(R4, tab 13 at 1-2) On August 8, 2013, the parties entered into Modification No. P0001,
which extended the period of performance “by 70 days due to [the award] protest and a
20 day PoP extension was given due to extreme inclement weather in the months of Mar,
Jun, and July,” from August 8, 2013, to November 6, 2013; the modification states that
“[t]his is a no cost modification,” and that “[a]ll other Terms and Conditions remain
unchanged” (R4, tab 15).

       On August 22, 2013, BES submitted Submittal 48 related to the storefront
windows (app. br. ¶ 27; gov’t br. ¶ 27). Submittal 48 was partially approved on
September 3, 2013; the submittal was disapproved per a handwritten comment stating
“08 41 13, Must provide PE calcs per 1.3.2 structural” (app. br. ¶ 28; gov’t br. ¶ 28). The
government omitted or failed to provide the parameters for the calculation in the
specifications (app. br. ¶ 29; gov’t br. ¶ 29). Fourteen days later, on September 17, 2013,
BES received the design parameter of 1 psi for the storefront windows from the
government (app. br. ¶ 30; gov’t br. ¶ 30). Upon receipt of the design parameter for the
storefront windows, BES resubmitted Submittal 48 as Submittal 48A on September 17,
2013, and final approval was received on September 18, 2013 (app. br. ¶ 31; gov’t br.
¶ 31). Following approval, the subcontractor reapplied to put the storefront windows into
production which took another seven days (app. br. ¶ 31; gov’t br. ¶ 31).

       During October 2013, the government delayed payment to BES as a result of a
government shutdown (app. br. ¶ 48; gov’t br. ¶ 48). On November 6, 2013, BES
received Modification No. P0002 which extended BES’s contract completion date by
twenty-one days to account for the government shutdown (app. br. ¶ 50; gov’t br. ¶ 50).

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Modification No. P0002 is bilateral, and provides that “[t]his is a no cost modification”
(R4, tab 21 at 1).

       The scope of work under the contract included “electrical systems” (app. br.
¶ 36; gov’t br. ¶ 36). On October 24, 2013, BES submitted Request for Information #43,
requesting clarification of the specifications related to the primary power supply (app.
br. ¶ 37; gov’t br. ¶ 37). On October 29, 2013, the contracting officer responded
indicating that specifications omitted the neutral conductor and incorrectly provided for
a #4 ground wire where it should have been a #2 ground wire (app. br. ¶ 38; gov’t br.
¶ 38). BES provided the neutral conductor and #2 ground wire which were required to
complete the electrical service under the contract (app. br. ¶ 39; gov’t br. ¶ 39). On
November 27, 2013, BES notified the contracting officer that it considered the neutral
conductor and ground wire to constitute a change order (app. br. ¶ 41; gov’t br. ¶ 41).
The November 27, 2013 notice stated the date, circumstances, and source of the change
order (app. br. ¶ 42; gov’t br. ¶ 42). BES incurred actual costs in the amount of $1,867
(including its markups) for the change order (app. br. 43; gov’t br. ¶ 43).

       During performance of the project, BES interpreted specification 2.3.6.1 entitled
“Field Painting” to require BES to provide and install factory primed, field painted doors
(app. br. ¶ 45; gov’t br. ¶ 45). The government questioned BES’s interpretation of this
specification, and extensive discussions ensued pertaining to the required finish for the
wooden doors on the project (app. br. ¶ 46; gov’t br. ¶ 46).

       On February 20, 2014, BES submitted to the government a “request[] [for]
authorization to make the following changes in the project: . . . Color change for stucco”
(R4, tab 12 at 2). On February 28, 2014 2, the contracting officer denied BES’s request
for such a change order (see app. br. ¶ 57; gov’t br. ¶ 57; R4, tab 12 at 1).

       On May 23, 2019, BES presented to the contracting officer a certified claim
seeking $623,205.34 in compensation for alleged changes and delays (see app. br. ¶ 58;
gov’t br. ¶ 58; R4, tab 23 at 1). On June 11, 2019, the contracting officer issued a final
decision granting BES $1,867 in direct costs (for the neutral conductor and changed
ground wire), but denying the remainder of BES’s claim (app. br. ¶ 60; gov’t br. ¶ 60).

     The record includes the affidavit of William Walter Bolton, the sole owner,
member, and operator of BES, who states:

               Available actual cost data (particularly the general conditions
               and certain direct labor costs) divided over the performance
               period for the Contract shows that daily rate of extended

2
    The correspondence from the contracting officer was erroneously dated
         February 28, 2013 (R4, tab 12 at 1).
                                              3
             overhead was $967.61 / day. Attached hereto as Exhibit “A”
             is a true and accurate copy of the calculation of extended
             overhead based on the available cost data.

             This number does not account for all direct labor costs for the
             Project, all supervision costs for the Project, any field office
             overhead for the Project, or any allocation for home office
             overhead.

             Accordingly, BES estimates its daily rate of damages for
             Government caused delay exceeds $1,300.00 / day.

(Bolton aff. ¶¶ 1, 18-20 (emphasis added)) The Exhibit A that Mr. Bolton cites consists
of a “Breakdown of Daily Overhead Rate” that calculates a “daily rate” of $967.61
(Bolton aff. at ¶ 18, ex. A at 1).

       The record also includes the affidavit of John Buziak, BES’s delay expert (app. br.
at 1; Buziak aff.). Mr. Buziak states:

             Had the contract not been protested BES would have started
             demolition and site work in the final quarter of 2012. During
             this period the Charleston area experienced normal rain fall;
             1.06 inches for October, 2.2 inches for November and
             3.56 inches for December. The protest of the award pushes
             this work in to the Spring. This changes the manner in which
             weather is treated in going forward. The delay pushed the
             demolition, site work and shell into a period of exceptionally
             adverse weather. In the spring there were multiple dates
             where rainfall was recorded in a day that matched or
             exceeded a month’s worth of rain in the final quarter of 2012.
             This makes weather impacts compensable, both additional
             effort and extended overhead.

             Going forward from Notice to Proceed weather ways were
             included in the schedule. Exhibit 3 indicates the state of the
             project at ground breaking. By this point BES had recovered
             27 days on the critical path, primarily by accelerating the
             submittal May 13, 2021 process and completing the
             demolition earlier than in the baseline. The adverse weather
             had started in February. But demolition activities are
             typically less impacted by rain. Exhibit 4 shows the state of
             the project where BES has reached a point where the Critical

                                            4
              Path activities are no longer susceptible to weather delays.
              The negative float at this point compared with state of the
              project at ground breaking indicates the impact of the weather
              on the project was 123 days. The driving factors in the delay
              included the saturated ground preventing the pouring of
              concrete. The contractor took exceptional measures to
              mitigate the effects of the saturated soil including “liming”
              the soil and covering the enclosed area with a heavy duty
              tarp once the trusses were in place. This permitted the
              interior rough in to go forward. In another instance heavy
              rains necessitated the rework of footings in the middle of
              July. A stop work order by a Government representative in
              late June was concurrent with the ongoing weather delay. All
              of the actions taken by BES is reimbursable. In order to
              account for the net affects [sic] of weather and mitigation of
              the delay accomplished by BES we subtract the previously
              identified delay from the total negative float in Exhibit 4.
              This yields a value of 96 days of additional delay attributable
              to the compensable weather impact.

(Buziak aff., ex. B at 3-4) Nowhere in that report does Mr. Buziak identify store front
windows, wooden doors, or neutral conductors and ground wires as delay issues (see
Buziak aff., ex. B).

                                       DECISION

   1. Changes

       a. Electrical scope change

       The parties agree that BES is entitled to $1,897 for an alleged change to the scope
of electrical work, plus interest pursuant to the Contract Disputes Act (CDA), 41 U.S.C.
§§ 7101-7109, from May 23, 2019 (app. br. at 9; gov’t br. at 14, 29). We award that
amount.

       b. Change of color of stucco

       BES requests $6,101.45 in alleged direct costs and $9,100 in alleged delay costs
for an alleged government change to the color of stucco from buff to ivory (app. br. at 10,
15-16). However, the government points (gov’t br. at 27) to a February 20, 2014 request
that BES made of the government for “authorization to make the following changes,”
specifically, “[c]olor change for stucco.” BES does not address that request. We find

                                             5
that BES, not the government, requested the change to the color of stucco. Accordingly,
BES’s request for additional compensation for a change to the color of stucco is denied.

   2. Delays

       a. Delay in issuing Notice to Proceed after protest of contract award

        BES seeks $110,500 for an alleged 85-day project delay caused by the issuance of
the notice to proceed only after the resolution of a protest of the award of the contract to
BES (app. br. at 13). That $1,300 figure appears to consist, at least in part, of extended
overhead. BES states that “[t]he difference between BES’s claimed daily rate of
extended overhead ($1,300.00) and the daily rate calculated using available actual cost
data ($967.61) is $332.39” (app. br. at 11(emphasis in original)). In addition, BES cites
in support of that $1,300 per day figure the affidavit of Mr. Bolton (app. br. ¶ 64), who
states (emphasis added):

               Available actual cost data (particularly the general conditions
               and certain direct labor costs) divided over the performance
               period for the Contract shows that daily rate of extended
               overhead was $967.61 / day. Attached hereto as Exhibit “A”
               is a true and accurate copy of the calculation of extended
               overhead based on the available cost data.

               This number does not account for all direct labor costs for the
               Project, all supervision costs for the Project, any field office
               overhead for the Project, or any allocation for home office
               overhead.

               Accordingly, BES estimates its daily rate of damages for
               Government caused delay exceeds $1,300.00 / day.

(Bolton aff. ¶¶ 18-20) The exhibit A that Mr. Bolton cites consists of a “Breakdown of
Daily Overhead Rate” that calculates a “daily rate” of $967.61. Where the government
delays the issuance of a notice to proceed, one of the things the contractor must prove in
order to recover allegedly unabsorbed overhead is that additional contracts were
unavailable during the delay when payment for the suspended contract activity would
have supported such overhead. See Interstate Gen. Gov’t Contractors, Inc. v. West,
12 F.3d 1053, 1057 (Fed. Cir. 1993). As the government points out (gov’t br. at 18),
despite attempting to recover allegedly unabsorbed overhead caused by government
delay, BES does not address, much less satisfy, that requirement.

       In addition, after awarding the contract on September 28, 2012, the government
received a bid protest on October 2, 2012, and, the next day, issued to BES a suspension

                                              6
of work notice. The award protest was resolved on December 6, 2012, and on January 8,
2013, the government issued to BES the Notice to Proceed. On August 8, 2013, the
parties entered into Modification No. P0001, which, among other things, extended the
period of performance “by 70 days due to [the award] protest,” and recited that the
modification was “a no-cost modification.” Because Modification No. P0001 is a no cost
modification, BES is not entitled to any additional compensation for the delay in issuance
of the Notice to Proceed. See Jimenez, Inc., ASBCA No. 52825, 01-1 BCA ¶ 31,294
at 154,502 (citing cases); Loral Corp., Def. Sys. Div.-Akron, ASBCA No. 37627, 92-1
BCA ¶ 24,661 at 123,025.

      For these reasons, BES’s request for $110,500 for an alleged 85-day project delay
caused by the timing of the issuance of the notice to proceed is denied.

       b. Weather

      BES requests $124,800 for an alleged 96-day, weather related, project delay in the
Spring of 2013 also allegedly caused by the award protest (app. br. at 13-15). BES states:

              Through no fault of BES, as a result of the Award protest,
              BES was required to start demolition and site work in the
              Spring of 2013 instead of the fall of 2012. The rainfall in
              Charleston for the Fall of 2012 (October, November, and
              December) was a total of 6.82 inches. By contrast, in the
              Spring of 2013 there were multiple days where recorded daily
              rainfall exceeded the rainfall for the entire month in the Fall
              of 2012. In fact, the rainfall in the Spring was so heavy it
              saturated the ground such that it was impossible for work to
              proceed even on days when there was no rainfall. For
              instance, because of the sheer magnitude of rain, the ground
              was not dry enough for BES to obtain sufficient compaction
              to pour the concrete slab. This required BES to take
              extraordinary measures to mitigate the effect of the weather,
              particularly the saturated soil, leading to a ninety-six (96)-day
              delay in the Project schedule. The delays would not have
              occurred if the demolition, site work, and the building shell
              would have started in the Fall of 2012 during which the
              weather was more favorable and drier. Because the Award
              Protest, which was the fault of the Government, pushed the
              Project start unto a period of unfavorable weather, the
              weather delay is compensable.

(App. br. at 13 (emphasis added, internal citations omitted))

                                             7
       Although BES points to the award protest as the reason it is due additional
compensation because of rain, the parties signed a bilateral modification, Modification
No. P0001, which extends the contract completion date by 70 days “for the Award
Protest,” and recites that Modification No. P0001 is “a no-cost modification” (R4, tab 15
at 1). Because Modification No. P0001 is a no cost modification, BES is not entitled to
any additional compensation for having to begin work in Spring 2013, as opposed to Fall
2012, even if the former turned out to be rainier than the latter. See Jimenez, 01-1 BCA
¶ 31,294 at 154,502; Loral, 92-1 BCA ¶ 24,661 at 123,025.

      Apparently anticipating that conclusion, BES argues in the alternative that “the
weather encountered by BES is compensable because it was unusually severe”:

              [A]ccording to the [National Oceanic and Atmospheric
              Administration], normal rainfall for Charleston between
              January 1 and June 30, is 21.96 inches. However, between
              January 1 and June 30 of 2013, Charleston received 36.75
              inches of rain. This represents a surplus of 14.79 inches.
              Therefore, the weather in Charleston during BES’s
              performance was unusually severe when compared to prior
              years. Because the weather in Charleston during BES’s
              performance was unusually severe, the weather delay is
              compensable.

(App. br. at 14 (emphasis added, internal citations and footnote omitted)) Again,
however, BES ignores that in their no-cost, August 2013, Modification No. P0001, the
parties agreed to a 20-day extension of the contract completion date “due to extreme
inclement weather in the months of Mar, Jun, and July,” and that Modification No. P0001
is a no cost modification. Because Modification No. P0001 is a no cost modification,
BES is not entitled to any additional compensation for inclement weather (including rain)
in March or June 2103. See Jimenez, 01-1 BCA ¶ 31,294 at 154,502; Loral, 92-1 BCA
¶ 24,661 at 123,025. And in its briefing, BES makes no effort to identify any of the
76 allegedly severe weather days “between January 1 and June 30 of 2013” that are not
covered by the 20-day, weather-related time extension in Modification No. P0001
(specifically, presumably, days in January, February, April, and May 2013), and for
which BES currently seeks additional compensation. Consequently, we find that BES
fails to prove its case with regard to any additional compensation due to unusually severe
weather in Spring 2013. Cf. GSC Constr., Inc., ASBCA Nos. 59402, 59601, 21-1 BCA
¶ 37,751 at 183,220 (finding that contractor had not proven that damage to panels for
which the government was responsible delayed the completion date of the project where
“it is not clear from the testimony if these are the same damaged panels to which
[contractor] is referring and the record and briefing is inadequate for the Board to sort out
which panels were damaged by which contractor or event.”); appealed Mar. 23, 2021.

                                             8
      For these reasons, BES’s request for $124,800 for an alleged 96-day project delay
caused by rain in the Spring of 2013 is denied.

       c. Government shutdown

        BES requests $27,300 for an alleged 21-day project delay caused by the
government’s delay in payment to BES arising from the October 2013 shutdown in
government operations (app. br. at 15). The parties agree that “[d]uring October 2013,
the Government delayed payment to BES as a result of a Government shutdown,” and
that “[o]n November 6, 2013, BES received Modification No. P0002 which extended
BES’s contract completion date by twenty-one (21) days to account for a Government
shutdown.” However, Modification No. P0002, which is bilateral, provides that “[t]his is
a no cost modification.” Because Modification No. P0002 is a no cost modification, BES
is not entitled to any additional compensation for the delay in payment caused by the
2013 shutdown in government operations. See Jimenez, 01-1 BCA ¶ 31,294 at 154,502;
Loral, 92-1 BCA ¶ 24,661 at 123,025.

       d. Storefront window, wooden door, and neutral conductor and ground wire

        BES requests (1) $27,300 for an alleged 21-day project delay caused by
specifications governing storefront windows; (2) $27,300 for an alleged 21-day project
delay caused by specifications governing wooden doors; and (3) $9,100 for an alleged
7-day project delay caused by specifications regarding a neutral conductor and a ground
wire (app. br. at 16-18). BES has the burden here: to prevail on its claims for additional
costs allegedly incurred because of the late completion of a fixed-price government
construction contract, a contractor must show that the government’s actions affected
activities on the critical path, and where the delays of the government and the contractor
are concurrent, the contractor must establish its delay apart from that attributable to the
government. BES Constr., LLC, ASBCA No. 60608, 19-1 BCA ¶ 37,455 at 181,989.
BES cites the affidavits of Mr. Bolton and Carol Denise Bradley in support of its
allegations of such delay to the contract work (app. br. at 5-7, 16-18). However, BES has
not demonstrated that either of those individuals is a delay expert. In addition, as the
government points out (gov’t br. at 28-29), nowhere in the report of BES’s delay expert
are the issues of store front windows, wooden doors, or neutral conductors and ground
wires identified as delay issues. For these reasons, BES does not demonstrate its
entitlement to delay damages for these issues. Consequently, its request for
compensation for those issues is denied.

                                             9
                                     CONCLUSION

       We find it unnecessary to address the parties’ other arguments. The appeal is
sustained with regard to the electrical scope change in the amount of $1,897, plus interest
pursuant to 41 U.S.C. § 7109 for the period beginning May 23, 2019, until the date of
payment. The appeal is otherwise denied.

       Dated: November 9, 2021

                                                   TIMOTHY P. MCILMAIL
                                                   Administrative Judge
                                                   Armed Services Board
                                                   of Contract Appeals

 I concur                                           I concur

 RICHARD SHACKLEFORD                                OWEN C. WILSON
 Administrative Judge                               Administrative Judge
 Acting Chairman                                    Vice Chairman
 Armed Services Board                               Armed Services Board
 of Contract Appeals                                of Contract Appeals

      I certify that the foregoing is a true copy of the Opinion and Decision of the
Armed Services Board of Contract Appeals in ASBCA No. 62175, Appeal of BES
Construction, LLC, rendered in conformance with the Board’s Charter.

       Dated: November 10, 2021

                                                 PAULLA K. GATES-LEWIS
                                                 Recorder, Armed Services
                                                 Board of Contract Appeals

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