Court Opinion

ID: 2824002
Source: CourtListenerOpinion
Date Created: 2015-08-10 21:00:03.868621+00
Date Added: 2024-06-11T12:39:57.342409
License: Public Domain

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeals of --                                 )
                                              )
Al Arrab Contracting Co. Ltd.                 )      ASBCA Nos. 58493, 58877
                                              )
Under Contract No. W90BRJ-06-C-0016           )

APPEARANCES FOR THE APPELLANT:                       Drew A. Harker, Esq.
                                                     Stuart W. Turner, Esq.
                                                     Lauren J. Schlanger, Esq.
                                                      Arnold & Porter LLP
                                                      Washington, DC

APPEARANCES FOR THE GOVERNMENT:                      Raymond M. Saunders, Esq.
                                                      Army Chief Trial Attorney
                                                     Kyle E. Chadwick, Esq.
                                                     MAJ Michael G. Pond, JA
                                                      Trial Attorneys

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

        These appeals involve delays in the performance of a contract for the
construction of schools in Saudi Arabia. The government has filed a motion for partial
summary judgment (motion) regarding appellant's entitlement for delay. Subsequent
filings and briefing related to the motion concluded on 6 July 2015.

           STATEMENT OF FACTS FOR PURPOSES OF THE MOTION

        1. Al Arrab Contracting Co. Ltd. (ACC or appellant), was awarded the
referenced contract on 21January2006 by the United States Army, Office of the
Program Manager (Army or government), in the amount of SR 50,000,400 (Saudi
riyals) for the construction of three school buildings in Riyadh, Saudi Arabia, for the
Saudi Arabian National Guard (R4, tab 1 at 1-2).

      2. As awarded, the contract required completion of the buildings within
730 days by 4 February 2008 (gov't statement of undisputed facts ifif 2, 3).

      3. Construction of the schools was completed on or before 30 June 2012.
Between 5 May 2008 and 23 July 2012, the parties executed ten bilateral modifications
and two unilateral modifications extending the contract completion date to 31 August
2012. None of the bilateral modifications contained an express reservation by
appellant of rights to file claims for delays and impacts resulting from the extended
performance of the contract by in excess of four years. Bilateral Modification
Nos. P00004, P00006, and P00007 increased the contract price by SR 150,000,
SR 84,619 and SR 351,000, respectively. Bilateral Modification No. P00005
decreased the contract price by SR 55,000. The remaining modifications made no
adjustment to the contract price. (R4, tabs 3.4-3.7, 3.18) Each of the pertinent
modifications contained the following "Release" language: "In consideration of the
modification agreed to herein, the Contractor hereby releases the Government from
any and all liability under this contract for further equitable adjustments attributable to
such facts or circumstances giving rise to this modification" (id.).

       4. In a sworn "Declaration" appended to ACC's reply to the motion,
appellant's project manager avers that to the extent that the modifications included
price adjustments they were of "limited scope" and that "on multiple occasions" the
government "assured [its] representatives that the Government would ... consider" a
future delay/impact claim from appellant relating to alleged government-caused delays
(Syed Laique Hashmi (Hashmi) decl. iii! 11, 14, 15).

       5. In particular, the project manager's Declaration avers that he discussed
ACC's pending delay/impact claim with the government's chief construction engineer
(CCE) on 20 July 2011. According to ACC's project manager, the CCE encouraged
appellant to submit the claim and also recommended a claim expert whom ACC
subsequently retained. (Hashmi decl. iii! 17-19)

         6. Appellant's project manager also states that in February 2012, a "senior"
government official inquired about the ACC's intent to submit the claim (Hashmi
decl. il 21 ).

       7. ACC submitted a total cost claim on 1 July 2012 seeking compensation for
the cumulative effect of the government's conduct, including project delay costs (R4,
tab 5 at 2-4).

        8. In early September 2012, ACC's project manager avers that he and the CCE
discussed possible procedures for negotiating a settlement of the claim (Hashmi decl.
ii 23).
       9. The contracting officer (CO) issued an initial final decision on the claim on
25 September 2012 and, following a settlement conference, an amended final decision
on 17 June 2013. Both decisions addressed the merits and substance of ACC's claim.
Neither final decision alleged that ACC had released its rights to file the claim by
virtue of its execution of the bilateral modifications noted above. (R4, tab 4B
at 725-27, tab 6) The amended final decision also evinced the government's

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willingness to revisit the possible settlement of the claim following further
substantiating documentation stating as follows:

              All contract modifications that extended time only with no
              changes to the requirements were issued to allow the
              contractor time to complete corrective actions required due
              to workmanship deficiencies or were in response to the
              contractor's request for additional time to complete
              specified tasks. In the spirit of supporting the contractor
              through project completion, the Saudi customer and
              ultimate bill payer for the 3 school buildings requested that
              no liquidated damages be assessed. Only 662 days of the
              total contract extension were associated with approved
              contract changes.

(R4, tab 6, ~ 5)

        10. Both decisions were timely appealed. Prior to the instant motion, there is
no assertion in the record cited by the Army that appellant released its claim rights as a
result of its execution of the bilateral modifications.

                                       DECISION

        The government contends that appellant's rights to pursue the claims involved
in these appeals were "extinguished" by virtue of its execution without reservation of
the bilateral modifications noted in our findings. We have carefully considered the
Army's allegations and the underlying modifications in question but conclude that
there are genuine issues of material fact that preclude summary judgment. In
particular, these triable issues pertain to the parties' intentions and course of conduct
regarding the scope of the modifications and treatment of delay/impact costs resulting
from the extended performance of the referenced contract for more than four years
after its originally scheduled completion date. That course of conduct culminated in
the issuance of two CO final decisions without mention of the Army's release defense
which was first asserted on appeal.

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      The government's motion for partial summary judgment is denied.

      Dated: 29 July 2015

                                              Administrative Judge
                                              Armed Services Board
                                              of Contract Appeals

I concur                                       I concur

MARK N. STEMPL                                                 CKLEFORD
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 Nos. 58493, 58877, Appeals of
Al Arrab Contracting Co. Ltd., rendered in conformance with the Board's Charter.

      Dated:

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

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