Court Opinion

ID: 6345665
Source: CourtListenerOpinion
Date Created: 2022-06-01 13:00:08.496024+00
Date Added: 2024-06-11T09:14:56.685642
License: Public Domain

ARMED SERVICES BOARD OF CONTRACT APPEALS
 Appeal of -                                  )
                                              )
 ECC International Constructors, LLC          )    ASBCA No. 59586
                                              )
 Under Contract No. W912ER-10-C-0054          )

 APPEARANCES FOR THE APPELLANT:                    R. Dale Holmes, Esq.
                                                   Michael H. Payne, Esq.
                                                    Cohen Seglias Pallas Greenhall & Furman
                                                    Philadelphia, PA

 APPEARANCES FOR THE GOVERNMENT:                   Michael P. Goodman, Esq.
                                                    Engineer Chief Trial Attorney
                                                   Sarah L. Hinkle, Esq.
                                                   Geoffrey A. Mueller, Esq.
                                                   Matthew Tilghman, Esq.
                                                   Kathryn G. Morris, Esq.
                                                    Engineer Trial Attorney
                                                    U.S. Army Engineer District, Middle East
                                                    Winchester, VA

OPINION BY ADMINISTRATIVE JUDGE MCILMAIL ON THE GOVERNMENT’S
                 MOTION FOR RECONSIDERATION

       The government moves for reconsideration of our January 6, 2022 opinion in this
appeal concerning the construction of a military compound in Afghanistan. ECC Int’l
Constructors, LLC (ECCI), ASBCA No. 59586, 22-1 BCA ¶ 38,028 at 184,683. We
assume familiarity with that opinion.

        In deciding a motion for reconsideration, we examine whether the motion is based
upon newly discovered evidence, mistakes in our findings of fact, or errors of law.
Phoenix Data Sols., LLC f/k/a Aetna Gov’t Health Plans, ASBCA No. 60207, 18-1 BCA
¶ 37,165 at 180,930. In addition, we are obligated to assure ourselves that we have
jurisdiction to entertain an appeal. Betance Enters., Inc., ASBCA No. 62819,
21-1 BCA ¶ 37,881 at 183,980.

       In our January 6, 2022 opinion, we dismissed the government’s claim for
liquidated damages for lack of jurisdiction, and dismissed appellant’s claim for liquidated
damages as moot, without prejudice, concluding that “we see no liquidated damages issue
to adjudicate on its merits.” ECCI, ASBCA, 22-1 BCA ¶ 38,028 at 184,683. We
explained:

              The parties each claim $940,274 in liquidated damages
              ostensibly withheld by the government and arising from this
              contract for the design and construction of a military
              compound in Afghanistan. . . . The government has the
              burden of proving that the Board possesses jurisdiction to
              entertain its claim for liquidated damages by demonstrating
              that the assessment of liquidated damages is memorialized in
              a timely final decision by a contracting officer. The
              government does not demonstrate that a contracting officer
              has issued a final decision assessing liquidated damages.
              The government’s post-hearing reply brief references a
              January 18, 2014 contracting officer’s final decision, but that
              decision addresses appellant’s request for a time extension
              and more than $800,000; that decision does not assess
              liquidated damages against appellant. Because the
              government does not satisfy its burden to establish our
              jurisdiction to entertain its claim to liquidated damages, that
              claim is dismissed for lack of jurisdiction. Consequently,
              what the government says is $940,274 in liquidated damages
              is actually, at least at this point, a contract balance
              presumably owed to appellant.

Id. (internal citations omitted).

       The government says that it agrees that there was “no liquidated damages issue to
adjudicate on its merits” (gov’t mot. at 1), but says:

              Where we part ways with the decision is with the premise that
              the government ever bore any burden to establish jurisdiction
              in the first place. The Board opines that in order to retain the
              liquidated damages that the government has collected on this
              contract, the government needed to establish this Board’s
              jurisdiction. Accordingly, after concluding that the
              government did not establish jurisdiction, the Board
              concludes, in dicta, that “what the government says is
              $940,274 in liquidated damages is actually, at least at this
              point, a contract balance presumably owed to appellant.” We
              respectfully disagree that the government owes that balance
              to ECCI, and for that reason submit this motion for
              reconsideration.

                                             2
(Id. ) The government continues:

              the Board erred as a matter of law that the Government had
              the burden of proving jurisdiction over [appellant’s] claim for
              remission of liquidated damages, and erred in holding that,
              with the Board’s dismissal, “what the government says is
              $940,274 in liquidated damages is actually, at least at this
              point, a contract balance presumably owed to appellant.”

Id. at 7 (emphasis added).

        The government also says that “the government has not actually submitted a claim
for liquidated damages to this Board” (id. at 3 (emphasis added)). If it hasn’t, it certainly
sounds like it has. In their post-hearing briefing, both appellant and the government
claimed $940,274 in liquidated damages (see gov’t br. at 40 (“The government is entitled
to $940,274 in liquidated damages, as established above. See, supra, Section entitled
‘Government’s Claim for Liquidated Damages.’”); app. br. at 111-12). In paragraphs 9
through 14 of its post-hearing brief, which the government wholly ignores in requesting
reconsideration, the government explained:

          GOVERNMENT’S CLAIM FOR LIQUIDATED DAMAGES

              9. The Contract established liquidated damages in the
              amount of $2,338.99 for each calendar day of delay after the
              project’s completion date. R4, Tab 5, p. 39, ¶ 52.211-12.

              10. The project’s final completion date was February 22,
              2013, established by Modification P00016. R4, Tab 30.

              11. On January 18, 2014, the Contracting Officer found that
              ECCI was entitled to a time extension of 19 days, which was
              not incorporated into the Contract by modification. R4,
              Tab 2. The revised completion date should be March 13,
              2013.

              12. Work substantially completed on April 19, 2014, with
              turnover and acceptance of the JOC and Communications
              buildings. R4, Tab 727.

              13. The difference between the revised contract completion
              and actual substantial completion dates, March 13, 2013, and
              April 19, 2014, is 402 days.

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                14. The amount of liquidated damages for the delay of
                402 days is $940,273.98.

                The government is entitled to the amount of $940,273.98 in
                liquidated damages because ECCI completed the project 402
                days late. As shown below, the government was not
                responsible for any of the delay in completion of the project.

(Gov’t br. at 3) And in its post-hearing sur-reply brief, which the government also
ignores, the government further explained that:

                “The assessment of liquidated damages is a government claim
                and the government has the initial burden of proving that a
                contractor failed to meet the contractual completion date and
                that the period of time for which it assessed liquidated
                damages was correct.” . . . The Government has met this
                burden.

(Gov’t sur-reply br. at 1)

        In view of the government’s representations in its post-hearing briefing, we deny
the government’s motion to reconsider to the extent that the government has, perhaps
inadvertently, asserted the type of liquidated damages claim for which the government
might have the burden to prove jurisdiction. See ASFA Int’l Constr. Indus. & Trade, Inc.,
ASBCA No. 57880, 14-1 BCA ¶ 35,736 at 174,906. But that is not the end of the story.
The briefing on the motion to reconsider persuades us that in arriving at our January 6,
2022 opinion, we overlooked that in May 2021 post-hearing briefing addressing our
jurisdiction to entertain the government’s liquidated damages claim, both parties point to
an April 9, 2014 pay estimate (R4, tab 816) in which the administrative contracting
officer assessed and withheld $940,273.98 in liquidated damages for 402 days of delay
(gov’t May 11, 2021 br. at 2; app. May 11, 2021 br. at 1). 1 That April 9, 2014 action

1
    In its May 11, 2021 brief, the government elaborated upon its claim to liquidated
           damages, requesting “that the Board find that it possesses jurisdiction to hear the
           Government’s claim for liquidated damages to the extent that the Board finds it
           possesses jurisdiction to hear Appellant’s claims for time extensions” (gov’t
           May 11, 2021 br. at 7). And in its May 19, 2021 filing, the government requests
           “that the Board find that it possesses jurisdiction to hear the government claim for
           liquidated damages only to the extent that the Board finds it possesses jurisdiction
           to hear Appellant’s claims for time extensions based on excusable delay” (gov’t
           May 19, 2021 br. at 2). Earlier, in a May 2021 post-hearing brief addressing the
           Board’s jurisdiction to entertain appellant’s claim to the remission of liquidated
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means that the government has actually (not just ostensibly) withheld the $940,274 in
liquidated damages that both parties have claimed in this appeal, and that we erred in
concluding (1) that as a result of our dismissal of the government’s claim for lack of
jurisdiction, there is “no liquidated damages issue to adjudicate on its merits,” and
(2) that “[c]onsequently, what the government says is $940,274 in liquidated damages is
actually, at least at this point, a contract balance presumably owed to appellant.” Because
the government has withheld the liquidated damages, there is still before us appellant’s
claim to the remission of that withholding. 2 See R.R. Gregory Corp., ASBCA
No. 58517, 14-1 BCA ¶ 35,524 at 174,110-11 (contracting officer withheld liquidated
damages before definitizing that assessment in a final decision; contractor appealed, and,
as proponent of the claim, which claim first accrued upon withholding, contractor had the
burden of proving the Board’s jurisdiction).

       For these reasons, the government’s motion for reconsideration is denied in part
and granted in part, and our January 6, 2022 opinion is amended to delete from that
opinion (1) the last sentence of the second paragraph of the opinion, and (2) the last
paragraph of the opinion. In a separate opinion we will address (1) appellant’s claim to
the remission of liquidated damages withheld on April 9, 2014; and (2) the government’s
position regarding its entitlement to keep those liquidated damages.

         Dated: May 2, 2022

                                                      TIMOTHY P. MCILMAIL
                                                      Administrative Judge
                                                      Armed Services Board
                                                      of Contract Appeals
(Signatures continued)

         damages, the government stated that “[w]hile Appellant has described remission
         of liquidated damages in the amount of $940,274.00 as a contractor claim for
         delay damages, ECCI post-hr’g br., at 110-11, it is in fact the Government’s claim
         to assessment of liquidated damages, to which Appellant must present an
         affirmative defense” (gov’t May 7, 2021 br. at 15 (emphasis added)).
2
    We understand that the government asserts entitlement to keep the liquidated damages
        that appellant requests be remitted (see gov’t br. at 3, 40; gov’t sur-reply br. at 1-3;
        app. br. at 111, 117). We also understand that although appellant in at least one
        point in its post-hearing briefing requests the remission of the entire $940,274
        withheld, elsewhere it requests remission of only 400 days’ worth of that 402-day
        amount (app. br. at 111, 117).
                                                5
 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. 59586, Appeal of ECC
International Constructors, LLC, rendered in conformance with the Board’s Charter.

      Dated: May 3, 2022

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

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