Court Opinion

ID: 2734589
Source: CourtListenerOpinion
Date Created: 2014-09-19 01:32:49.178688+00
Date Added: 2024-06-11T13:26:27.740700
License: Public Domain

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeal of--                                   )
                                              )
Thefaf Al-Rafidain Contracting Co.            )      ASBCA No. 59014
                                              )
Under Contract No. W91GFL-08-D-0007           )

APPEARANCE FOR THE APPELLANT:                        Mr. Fawaz M. Aziz
                                                      CEONice Chairman of Directorate Board

APPEARANCES FOR THE GOVERNMENT:                      Raymond M. Saunders, Esq.
                                                      Army Chief Trial Attorney
                                                     LTC Mark A. Ries, JA
                                                      Trial Attorney

                OPINION BY ADMINISTRATIVE JUDGE JAMES ON
            THE GOVERNMENT'S MOTION FOR SUMMARY JUDGMENT

       This appeal arises from the contracting officer's (CO's) denial of the claim of
Thefaf Al-Rafidain Contracting Co. (Thefat) for $1,039,800 for materials, labor hours
and additional rent allegedly incurred to perform under an indefinite delivery, indefinite
quantity (IDIQ) contract. On 18 November 2013, Thefaftimely appealed to this Board
from the CO's decision. The Board has jurisdiction of this appeal under the Contract
Disputes Act of 1978,41 U.S.C. §§ 7101-7109. On 10 January 2014, the government
moved for summary judgment. On 3 March 2014, Thefaf replied to the motion. The
government elected not to respond further.

          STATEMENT OF FACTS (SOF) FOR PURPOSES OF THE MOTION

        1. On 9 June 2008 the Joint Contracting Command-Iraq (JCC-1) issued Solicitation
No. W91GFL-08-R-0018 (the solicitation) for concrete protective barriers, towers, T-walls
and scud bunkers under a commercial items contract (R4, tab 1 at 1-14 of26). The
solicitation provided for a "Firm Fixed Price Indefinite-Delivery Indefinite-Quantity
contract for one base year," 1 and stated that the "solicitation may result in the award of
multiple Firm-Fixed Price IDIQ Contracts" (R4, tab 1 at 3-14 of26).

1
    The base year was 1 July 2008 through 30 June 2009 for all items.
     2. The solicitation stated in "SECTION A, SUPPLEMENTAL
INFORMATION'':

                                   CONTRACT VALUE

               The combined maximum contract value for all orders issued
               against all contracts shall not exceed $30,000,000.00.

                                  MAXIMUM AMOUNT
                                  $30,000,000.00

               The minimum guaranteed amount is $10,000.00 per contract
               award

(R4, tab 1 at 3 of26) The total estimated quantity of barriers under all line items was
117,400 (R4, tab 1 at 3-14 of26).

       3. The solicitation included the FAR 52.216-18, ORDERING (OCT 1995) clause,
which provided in pertinent part: "(a) Any supplies and services to be furnished under
this contract shall be ordered by issuance of [delivery]2 orders or task orders" and the
FAR 52.216-22, INDEFINITE QUANTITY (OCT 1995) clause, which provided in pertinent
part:

                  (a) This is an indefinite-quantity contract for the supplies
               or services specified, and effective for the period stated, in the
               Schedule. The quantities of supplies and services specified in
               the Schedule are estimates only and are not purchased by this
               contract.

                  (b) Delivery or performance shall be made only as
               authorized by orders issued in accordance with the Ordering
               clause. The Contractor shall furnish to the Government,
               when and if ordered, the supplies or services specified in the
               Schedule up to and including the quantity designated in the
               Schedule as the "maximum." The Government shall order at
               least the quantity of supplies or services designated in the
               Schedule as the "minimum."

(R4, tab 1 at 23 of 26)

2
    The claim as printed in the contract includes a transcription error where the word "task"
        is used instead of the correct "delivery." This minor error does not affect the
        decision on this motion.

                                               2
       4. In response to the solicitation, for each line item Thefaf inserted its unit price
and total price based on the estimated quantity for each line item (R4, tab 2 at 1-14 of
42). Thefafs proposal did not take any exception to the solicited terms and conditions
(R4, tabs 2, 3).

        5. On 8 July 2008, JCC-I, Tikrit Contracting Office, awarded Contract
No. W91GFL-08-D-0007 (Contract 0007) to Thefaf. Contract 0007 contained the
solicitation terms designating the contract type and value, including the $30,000,000
maximum amount for "all contracts" and the $10,000 minimum guaranteed amount "per
contract award"3 as well as the FAR 52.216-18 and 52.216-22 clauses. (R4, tab 1 at 1, 3,
23 of26)

        6. After a week of email exchanges in which Thefaf sought a 25% price increase,
which CO Capt Martin A. Muniz, USAF, refused to agree to, on 28 May 2009 JCC-I
issued Delivery Order No. 0001 (DO 1) to Thefaffor 250, 12-foot T-walls at $350 per
unit, in the total amount of$87,500.00, which Thefafaccepted on 28 May 2009 (R4, tab
4 at 1-6, tab 5 at 1-3).

       7. On 9 July 2009, Thefaf delivered to the government, and the government
accepted, 250 T-walls (R4, tab 5 at 1). Thefafs 9 July 2009 DO 1 invoice for $87,500
was received on 13 July 2009 and was paid by the government on 12 August 2009 (R4,
tabs 6-7).

       8. On 10 October 2013, Thefaf contacted Ms. Joan Wysoske, Chief, Reachback
Closeouts, Army Contracting Command, Rock Island, Illinois, and inquired why it had
not received additional orders and payments from the Army under Contract
No. W91GFL-08-D-0007. According to Thefaf, the contract had a $30,000,000 "big
total amount" and Thefaf had made "big expansions" of a 60-ton silo and 810 barrier
moldings costing $932,650 and $72,000 for 12 men for 3 years of security, and had added
12,000 square meters of"ground to my factory" (R4, tab 8 at 1-3).

       9. Ms. Wysoske's 16 October 2013 reply to Thefafstated that the $87,500
delivery order satisfied the IDIQ contract's guaranteed minimum amount and the
$30,000,000 maximum amount was not a guarantee (R4, tab 9 at 4 ).

      10. On 28 October 2013, Thefafsubmitted a certified claim to the CO requesting
$1,039,800 for three added 60-ton silos, barrier moldings, 3 years for 12-man security
and 12,000 square meters of"ground" to its factory (R4, tab 11 at 1, 4). The CO denied
Thefafs claim by written decision dated 4 November 2013 (R4, tabs 12, 13).

3
    The record does not show whether Army JCC-I awarded a contract(s) to offeror(s)
        other than Thefafunder the multiple award solicitation.

                                              3
       11. On 18 November 2013, Thefaf filed its notice of appeal of the foregoing CO's
decision to the ASBCA, which the Board docketed on 19 November 2013 as ASBCA
No. 59014.

       12. On 6 December 2013, the Board stated that it would consider Thefafs email
dated and received on 4 December 2013 to be its complaint in this appeal.

                                         DECISION

       A tribunal shall grant summary judgment if the movant shows that there is no
genuine issue as to any material fact and the movant is entitled to judgment as a matter of
law. FED. R. CIV. P. 56(a); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986).
Summary judgment properly may be granted to a party when the non-moving party fails
to offer evidence on an element essential to its case and on which it bears the burden of
proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317,322-23 (1986).

                                              I.

        As to whether there is no genuine issue as to any material fact, appellant's reply to
the motion for summary judgment repeats the allegations in its 28 October 2013 claim
and its 6 December 20 13 complaint. Thefaf s documents do not dispute any of the
material facts in the SOF. We conclude that there is no genuine issue as to any material
fact.

                                              II.

      As to whether the government is entitled to judgment on its motion, the legal
precedents with respect to the government's duty to order supplies or services exceeding
the minimum guaranteed quantity in an IDIQ contract are well established. In Travel
Centre v. Barram, 236 F .3d 1316, 1319 (Fed. Cir. 2001 ), the Court held:

              [U]nder an IDIQ contract, the government is required to
              purchase the minimum quantity stated in the contract, but
              when the government makes that purchase its legal obligation
              under the contract is satisfied.... [B]ased on the language of
              the solicitation for the IDIQ contract, Travel Centre could not
              have had a reasonable expectation that any of the
              government's needs beyond the minimum contract price
              would necessarily be satisfied under this contract.

Similarly, in Transtar Metals, Inc., ASBCA No. 55039, 07-1 BCA ~ 33,482 at 165,959,
we held that the government ordered amounts which exceeded the guaranteed minimum
for each contract period, thus fulfilling its obligations to appellant under the contract, and

                                              4
the government was entitled to summary judgment on the contractor's claim that it had
incurred substantial costs for purchasing and maintaining inventories as a result of the
substantial disparity between the government's actual purchases and the estimated
quantities in the solicitation.

       The government argues that it ordered 250 T-walls for $87,500, exceeding the
$10,000 guaranteed minimum order, and therefore it had no obligation to order additional
barriers under IDIQ contract 0007 (gov't mot., at 4, 6-8).

        In the contract 0007 provision that said, "[t]he combined maximum contract value
for all orders issued against all contracts shall not exceed $30,000,000.00," Thefaf
emphasizes the "s" in the phrase "all orders" and interprets that provision to state that
"this note is for contractor to prepare himself to cover this amount." Thefaf asserts that
the "big space" between $10,000 and $30,000,000 is indicative of the government's
intent to order the $30,000,000 amount: "they [apparently JCC-1] intend to order for all
the barriers in the contract (117400 pes)." (Compl. at 1)

       Thefafs foregoing interpretations are untenable. Thefafs proposal in response to
the solicitation does not contain any such interpretations (SOF ~ 4). The appeal record
contains no evidence that before contract award Thefaf told the government of such
interpretations. A party's uncommunicated interpretation of a contract provision does not
bind the other contracting party. See Lora! Corporation, Defense Systems Division-
Akron, ASBCA No. 37627, 92-1 BCA ~ 24,661 at 123,025, aff'd, 979 F.2d 215 (Fed. Cir.
1992) (table).

       Thefaf identifies no legal precedent compelling the Board to construe the phrase "all
orders" in the "CONTRACT VALUE" provision of the contract, or the plural "orders" in
FAR 52.216-18 and 52.216-22, to require the government to issue one or more orders
exceeding $10,000 per contract or to purchase at or near the maximum value of
$30,000,000. The term "all orders" in the "CONTRACT VALUE" provision does not
require the government to purchase 117,400 barriers for $30,000,000 but rather limits the
government orders to $30,000,000, not to Contract 0007 alone, but to "all contracts"
awarded under the multiple award solicitation (SOF ~~ 1-2) With respect to the "big
space" between $10,000 and $30,000,000, as we stated in Crown Laundry & Dry Cleaners,
Inc., ASBCA No. 39982, 90-3 BCA ~ 22,993 at 115,481, aff'd, 935 F.2d 281 (Fed. Cir.
1991) (table):

                    Appellant argues that the contract's minimum of
             $85,000 and maximum of$991,644 in orders creates such a
             disparity ... as to make the minimum meaningless. We do not
             agree. To the extent that appellant relied on the
             Government's estimates and assumed that the Government
             would order the maximum, its reliance and assumption were

                                            5
               both misplaced. Under the contract, the Government was
               obligated only to order the minimum quantity stated, and it
               more than met that obligation.

        Based on the foregoing analysis and legal authorities, we hold that the government
is entitled to judgment as a matter oflaw. We grant the motion and deny the appeal.

      Dated: 4 April 20 14

I concur

                                                 ruCHARDSHACKLEFORD
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. 59014, Appeal of Thefaf
Al-Rafidain Contracting Co., rendered in conformance with the Board's Charter.

      Dated:

                                                 JEFFREY D. GARDIN
                                                 Recorder, Armed Services
                                                 Board of Contract Appeals

                                             6