Court Opinion

ID: 9925893
Source: CourtListenerOpinion
Date Created: 2024-01-23 15:00:59.169667+00
Date Added: 2024-06-11T09:21:46.238111
License: Public Domain

ARMED SERVICES BOARD OF CONTRACT APPEALS
 Appeal of -                                     )
                                                 )
 Vectrus Systems Corporation                     ) ASBCA No. 63239
                                                 )
 Under Contract No. FA56513-14-D-0008            )

 APPEARANCE FOR THE APPELLANT:                      David Newsome, Esq.
                                                     Counsel

APPEARANCES FOR THE GOVERNMENT: Caryl A. Potter III, Esq.
                                 Air Force Deputy Chief Trial Attorney
                                Josephine R. Farinelli, Esq.
                                Le’Dara Clark, Esq.
                                 Trial Attorneys

                OPINION BY ADMINISTRATIVE JUDGE EYESTER
          ON THE PARTIES’ CROSS-MOTIONS FOR SUMMARY JUDGMENT

       The Department of the Air Force (Air Force or government) awarded Vectrus
Systems Corporation (Vectrus or appellant) a task order against a commercial items
contract which included several contract line item numbers (CLINs) associated with
housing maintenance services. After the task order performance period ended, the
government de-obligated unused funds on several CLINs via a bilateral modification.

        Vectrus seeks summary judgment arguing it is entitled to the total task order
award amount and that the funds should not have been de-obligated. According to
Vectrus, the task order CLINs were fully funded and fixed-priced and therefore it bore
the maximum risk and full responsibility for all costs and resulting profit or loss. The
government cross-moves for summary judgment arguing that Vectrus waived its right
to the claim when it signed the modification de-obligating the funds. The government
further argues that Vectrus has cited nothing supporting its assertion it is entitled to the
full task order amount when it did not perform all the work. In the alternative, the
government argues it constructively terminated the task order for convenience and
Vectrus is only entitled to compensation as set forth in the applicable clause.

        For the reasons set forth below, we grant the appellant’s motion in part and deny
it in part and grant the government’s motion in part and deny it in part.
          STATEMENT OF FACTS FOR PURPOSES OF THE MOTIONS

        On June 25, 2014, the government awarded contract No. FA5613-14-D-0008 to
Exelis Systems Corporation (now Vectrus) to provide maintenance of family housing
for the Kaiserslautern Military Community in accordance with the performance work
statement (PWS), appendices, and technical exhibits (R4, tab 4 at 1, 506, tab 9 at 5). 1
The contract’s period of performance included one phase-in, one base-year, and four
one-year option periods with the last option period ending September 30, 2019 (R4,
tab 4 at 4-430).

        The contract incorporated by reference Federal Acquisition Regulation (FAR)
52.212-4, CONTRACT TERMS AND CONDITIONS--COMMERCIAL ITEMS
(JUL 2013), which states that “[c]hanges in the terms and conditions of this contract
may be made only by written agreement of the parties” (R4, tab 4 at 477; FAR 52.212-
4(c)). Further, the clause explains that the contractor, when submitting an invoice,
shall include the “[d]escription, quantity, unit of measure, unit price and extended
price of the items delivered” and “[p]ayment shall be made for items accepted by the
Government that have been delivered” in accordance with the contract (FAR 52.212-
4(g)(1)(iv)&(i)(1)). The clause includes a paragraph on termination for convenience
which instructs that in the event of such a termination, the contractor shall stop work
immediately, shall be paid a percent of the contract price reflecting the percentage of
the work performed prior to termination but shall not be paid for work performed or
costs incurred which could have been avoided (FAR 52.212-4(l)).

       The contract incorporated in full FAR 52.216-21, REQUIREMENTS
(OCT 1995), which stated that the specified quantities of supplies or services in the
contract were estimates only. In addition, the clause explained that the government
was to issue orders for delivery or performance pursuant to the “Ordering clause.”
(R4, tab 4 at 491-92) The relevant ordering clause, incorporated in full, was Defense
Federal Acquisition Regulation Supplement (DFARS) 252.216-7006, ORDERING
(MAY 2011), which required the government to order the supplies and services via a
task or delivery order. The clause stated that such orders were “subject to the terms
and conditions of the contract” and notified Vectrus that if there were any conflicts
between the two, “the contract shall control.” (Id. at 496)

      The contract included several CLINs outlining the required supplies/services
generally and referencing a specific PWS paragraph, and also included associated sub-
CLINs containing more detail (see e.g., R4, tab 4 at 346-53). 2 Numerous CLINs

1
  The agency issued a modification on January 8, 2015, formally changing the name on
       the contract to Vectrus (R4, tab 5).
2
  The record generally refers to the sub-CLINs as CLINs. We do the same here to
       avoid confusion.

                                           2
referenced services for maintenance, cleaning, painting, and other items, indicated the
CLIN was “FFP,” and included estimated quantities, number of units, fixed unit prices,
and estimated amounts (see e.g., id. at 6-52). For example, CLIN 4001 stated it was
for change of occupancy maintenance (COM) services which were to be performed for
the family housing units described in the subsequently priced sub-CLINs and
referenced PWS ¶ 1.3.7.17 (id. at 346). According to that PWS paragraph, Vectrus
was to provide COM services as described in appendix 4, such as cleaning and
painting, when requested by the contracting officer’s representative (COR) (R4, tab 9
at 15, tab 3 at 42). A relevant sub-CLIN, CLIN 4001AA, was for COM services for
two bedroom units/townhouses and set forth an estimated quantity, unit price and
estimated amount which equaled the estimated quantity multiplied by the unit price.
That CLIN also stated it was “FFP.” (R4, tab 4 at 347)

       There were also CLINs designated as “COST” for items such as appliances,
materials and over and above work which contained no fixed unit price but included an
estimated quantity and estimated cost (R4, tab 4 at 53, 55, 88). A relevant example of
these CLINs for appliances for the fourth option year is set forth below:

ITEM NO SUPPLIES/                 EST[.]          UNIT UNIT             ESTIMATED
        SERVICES                  QUANTITY             PRICE            AMOUNT
4010    APPLIANCES                                                      EUR0.00
OPTION  FFP. . . .

ITEM NO SUPPLIES/                 EST.            UNIT UNIT             AMOUNT
        SERVICES                  QUANTITY             PRICE
4010AA  APPLIANCE,                10,000          Lot                   EUR200,000.00
OPTION  FREE                                                            Estimated Cost
        STANDING                                                        EUR200,000.00
        COST. . . .

(Id. at 395-96) CLIN 4010 referenced PWS ¶¶ 1.9.7 and 1.9.8 (id. at 395). According
to those PWS paragraphs, once the government-supplied appliance inventory was
depleted, Vectrus was to purchase, transport, install, and connect new appliances when
requested by the COR. PWS ¶ 1.9.9 explained that the government would reimburse
Vectrus “on actual costs incurred under the respective CLIN” for the replacement of
parts or new appliances and required Vectrus substantiate the actual costs such as by
attaching a supplier invoice (R4, tab 9 at 34).

       A relevant example of the CLIN for materials for the fourth option year is set
forth below:

                                           3
 ITEM NO SUPPLIES/                EST.             UNIT UNIT             AMOUNT
         SERVICES                 QUANTITY              PRICE
 4020    MATERIAL                                                        EUR0.00
 OPTION  COST. . . .
 4020AA       MATERIAL            1,000,000        Lot                   EUR450,000.00
 OPTION       COST. . . .

(R4, tab 4 at 427-28) CLIN 4020 stated that the material would be handled as
described in the subsequently priced sub-CLINs and referenced PWS ¶ 1.4.1 (id.
at 427). According to that PWS paragraph, titled Direct Scheduled Work, Vectrus was
to develop and implement a system responsive to the residents’ emergency and routine
requests (R4, tab 9 at 19). With respect to parts and materials Vectrus supplied for this
work, it was to maintain the original delivery tickets, sales slips and other documents
showing the items purchased under “the cost reimbursement portion of this contract”
(id. at 19-20). Vectrus was to invoice these items monthly (id. at 20).

       And last, a relevant example of the CLIN for the over and above work for the
fourth option year is set forth below:

 ITEM NO       SUPPLIES/            EST.             UNIT UNIT          AMOUNT
               SERVICES             QUANTITY              PRICE
 4021          OVER AND                                                 EUR0.000
 OPTION        ABOVE WORK
               COST. . . .
 4021AA        OVER AND             10,000           Lot                EUR60,000.00
               ABOVE WORK
               COST. . . .

(R4, tab 4 at 429-30) CLIN 4021 referenced PWS ¶ 1.16.8 (id. at 429). That PWS
paragraph stated that Vectrus was to perform other work identified during
performance, which would be subject to DFARS 252.217-7028, Over and Above
Work (R4, tab 9 at 43). That clause explains that such work is discovered during
maintenance efforts, ordered by the contracting officer, negotiated by the parties, and
definitized by a modification. DFARS 252.217-7028.

       With respect to payment procedures, the contractor was required to submit
requests for payment pursuant to DFARS 252.232-7006, WIDE AREA WORKFLOW
[(WAWF)] PAYMENT INSTRUCTIONS (MAY 2013) (R4, tab 4 at 500). All
payment requests were to include the CLIN and sub-CLIN “descriptions of the work
performed or supplies delivered, unit price/cost per unit,” and relevant back-up

                                             4
documents to support the payment request (id. at 502). The contract also stated that
general and administrative (G&A) expenses were allowable for all of the cost
reimbursable CLINs (id. at 430).

       The government exercised all four option periods, explaining in each
modification that funding would be provided via the individual task orders (R4, tabs 6-
8, 10). After exercise of the fourth option year, the government issued Task Order
No. FA5613-19-FA-063 (TO 63) with a period of performance of March 1, 2019
through September 30, 2019 (R4, tab 11 at 1, 31-45). Block 26 of the task order stated
the “TOTAL AWARD AMOUNT (For Govt. Use Only)” was EUR 1,131,982.53 (id.
at 1). The task order included 50 CLINs, each of which correlated to a CLIN from the
requirements contract (id. at 3-13). For convenience, we will refer to these as “task
order CLINs” or “TO 63 CLINs” within this decision. The following is an example
showing some task order CLINs and setting forth only information relevant to the
appeal:

 Item Supplies/Services         Quantity       Unit Unit Price     Amount
 0023 CLIN 4010AA,              1.0            Lot EUR             Firm Price
      APPLIANCES,                                   65,000.00      EUR 65,000.00
      FREE STANDING. .                              Estimated      Funded Amount
      .                                                            USD 75,739.92
      Firm Fixed Price. . . .
 0039 CLIN 4020AA,              1.0            Lot   EUR           Firm Price
      MATERIAL. . .                                  158,129.19    EUR 158,129.19
      Firm Fixed Price. . . .                        Estimated     Funded Amount
                                                                   USD 184,256.80
 0040 CLIN 4021AA,              1.0            Lot   EUR           Firm Price
      OVER AND                                       35,000.00     EUR 35,000.00
      ABOVE WORK. . .                                Estimated     Funded Amount
      Firm Fixed Price. . . .                                      USD 40,783.03

(Id. at 3, 7, 11)

      The government added funding for certain CLINs via at least two bilateral
modifications to TO 63 CLINs (R4, tabs 14-15). One modification, effective on
September 12, 2019, added “the amount of Euro 48,319.17 ($56,302.96) for CLIN
4021AA, Over and Above” and related to task order Item 0040 (R4, tab 15 at 1-2).
The amount was based on the contractor’s cost estimate for repair work (id. at 2-4).

      In early 2021, almost two years after performance on the task order ended, the
government provided Vectrus with a draft bi-lateral modification to de-obligate
funding on multiple CLINs for TO 63 (see gov’t mot., ex. 15 at 1; R4, tab 23 at 1).
The draft modification stated: “In consideration of this modification agreed to herein,

                                           5
the contractor hereby releases the U.S. Government from any and all liabilities under
the Task Order for those funds which have been de-obligated via this modification”
(app. resp., ex. 3 at 2). Vectrus notified the contracting officer and contract specialist
by email that it was entitled to the fixed-priced amount set forth in the task order and it
was not in Vectrus’ best interest to sign the modification (R4, tab 18 at 5-7).

       Vectrus then notified the government by letter that it would not sign the
modification because the task order was fixed-priced and fully funded, the
government’s decision not to use the established capability and funding was not
Vectrus’ fault, and Vectrus established its workforce, supplies, equipment, and other
items to perform the order. According to Vectrus, there had been no termination for
convenience, and unlike other task orders issued pursuant to requirements contracts
which are estimates, this task order set forth a fully funded, fixed quantity and the
government breached the contract. (Gov’t mot., ex. 15 at 1)

       The government disagreed, arguing that “[a]lthough this is a [fixed-price]
contract these services have estimated quantities that sometimes deviate substantially
from the actual quantities” and therefore the task orders also state estimated quantities
(R4, tab 18 at 1-3). The government told Vectrus that if it did not sign the bilateral
modification, then the government would issue it as unilateral (R4, tab 23 at 2).

       Vectrus then requested the removal of the “Statement of Release” from the
modification and stated its belief that the contract would not be closed out. The
contract specialist obliged, stating that the “Release of Claims is deleted according to
your suggestion.” Vectrus also notified the contract specialist, via email and attaching
the signed modification, of the following:

              • Vectrus reserves the right to submit invoices for all
              fully funded, definite quantity, Firm Fixed Price (FFP) task
              orders (TOs), for payment by the Government, based on
              Vectrus maintaining the labor and materials to perform the
              work ordered and fully funded by the Government, but
              following issuance of the TO the Government determined
              the services are not required;
              • Vectrus reserves the right to submit a claim under the
              contract Disputes clause 52.233-1 for an equitable
              adjustment for any invoice issued under all fully funded
              TOs that are rejected by the Government on the basis the
              service was not required and not performed.

(App. resp., ex. 1 at 1)

                                             6
       By July of 2021, both parties had signed Modification No. P00005 to TO 63
pursuant to FAR 52.212-4(c), reducing quantities and de-obligating fiscal year 2019
funding by EUR 204,308.40; the modification was effective January 15, 2021 (R4,
tab 16 at 1-2). The modification specifically stated the following:

                The purpose of this modification is to reduce the quantities
                and de-obligate FY 2019 excess funding for the period 01
                Mar 2019 to 30 Sep 2019. Changes are described in the
                summary of changes identified on the attached
                continuation pages.
                Information for DFAS only:
                the Contracting Officer asserts that actions are closed with
                no residual balance, regardless of entitlement system
                residual balance.

(Id. at 1) The modification identified the total quantity and/or amount reduced for
several CLINs for TO 63 (id. at 3-8).

       After the parties signed the modification, Vectrus submitted final invoices
seeking: EUR 155,219.94 for multiple task order/contract CLINs; 3 EUR 2704.34 for
task order CLIN 23/contract CLIN 4010AA (appliances, free standing); EUR
42,551.81 for task order CLIN 39/contract CLIN 4020AA (material); and EUR
3828.43 for task order CLIN 40/contract CLIN 4021AA (over and above work) (gov’t
mot., exs. 16a-16d (DD 250 tab)). In response, the government stated that all invoices
for received services and materials for TO 63 “cost reimbursable contract have been
paid” (gov’t mot., ex. 17 at 1).

       On October 26, 2021, Vectrus submitted a certified claim seeking Euro
204,308.40 for TO 63 (R4, tab 19, tab 20 at 1). The government acknowledges that
this was the same amount de-obligated from TO 63 via the modification at issue (gov’t
mot. at 15). As before, Vectrus argued that the task order was fixed-priced and
contained a definite quantity, the government breached the task order, and Vectrus was
therefore owed the total amount (R4, tab 20 at 2-3). In its claim, Vectrus identified the

3
    The invoice listed the task order/contract CLINs as follows: 1/4001AA; 3/4001AC;
         41/4001AD; 43/4001AF; 4/4002AA; 6/4002AC; 44/4002AD; 46/4002AF; 7-
         9/4003AA through 4003AC; 10/4004AB; 11-13/4005AA, 4005 AB, 4005AD;
         47/4005AE; 14-17/4005AK through 4005AN; 18/4006AA; 19/4007AB; 20-
         21/4008AA through 4008AB; 25-26/4012AA through 4012AB; 27/4012AD;
         28/4013AA; 29/4014AA; 30/4014AC; 31-34/4015AA through 4015AD;
         36/4016AA; 37/4017AA; and 50/4018AA (gov’t mot., ex. 16c (DD 250 tab)).
         All of these contract CLINs were identified as fixed unit-priced (see R4, tab 4
         at 345-422).

                                             7
total funded amount, total unpaid amount, and total amount for “Multiple” CLINs,
CLIN 4010AA, CLIN 4020AA, 4 and CLIN 4021AA. 5 Vectrus sought payment of the
unpaid, but funded, amount. (R4, tab 20 at 1)

        On January 19, 2022, the government denied the claim (R4, tab 23). According
to the contracting officer, Vectrus was not entitled to the total funded amount in the
task order for CLINs 4010AA and 4021AA because Vectrus did not show any
unreimbursed costs associated with the material and appliances CLINs. In addition,
the contracting officer stated that Vectrus failed to provide supporting documents
showing unreimbursed costs associated with the line item for “Multiple” CLINs as
there was no attached Exhibit 2 (id. at 2). The contracting officer’s final decision did
not specifically address the request for CLIN 4020AA (see id.).

       On April 4, 2022, Vectrus filed its notice of appeal and later its complaint. In
its complaint, Vectrus stated it established its workforce, supplies and equipment once
awarded TO 63 and the government breached the task order when it failed to pay
Vectrus for all quantities ordered under the task order (compl. at 3-4). In its answer,
the government denied all allegations and asserted the affirmative defense that the
claim is without merit pursuant to the terms of the contract, and in the alternative, the
government constructively terminated the contract thereby eliminating or limiting
compensation owed to Vectrus (answer at 4-5).

                                      DECISION

       Vectrus moved for summary judgment. The government opposed the motion
and cross-moved for summary judgment. Summary judgment is proper when there is
no genuine dispute as to any material fact and the moving party is entitled to judgment
as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). With
respect to cross-motions, we “must evaluate each party’s motion on its own merits,
taking care in each instance to draw all reasonable inferences against the party whose
motion is under consideration.” Mingus Constructors v. United States, 812 F.2d 1387,
1391 (Fed. Cir. 1987) (citation omitted).

4
  The claim refers to CLIN 4022AA for materials, however it should have referenced
       CLIN 4020AA (see gov’t mot., ex. 16b (tab DD 250 Mat) and R4, tab 4 at 428).
       We cite to CLIN 4020AA in the decision.
5
  The claim cited an Exhibit 2 when discussing the multiple CLINs for which Vectrus
       sought compensation. Although there was no such exhibit attached, the claim
       referenced the four task order invoices Vectrus submitted to the government,
       which identified the specific task order CLIN and contract CLIN it sought to
       have paid. (R4, tab 20 at 1)

                                            8
Did Vectrus waive this claim in bilateral Modification P00005?

        The government first argues that Vectrus waived its claim via bilateral
Modification P00005 (gov’t mot. at 13-14, 18). Specifically, the government contends
that it did not agree to reserve Vectrus’ future claim in the modification. Further, the
government contends the bilateral modification shows that Vectrus itself agreed to
waive any claim against the government for payment of these de-obligated funds
because the contract included the commercial items changes clause stating that
changes to the contract must be agreed upon by both parties. In other words,
according to the government Vectrus agreed (implicitly) to the change set forth in the
modification--the de-obligation of funds--and therefore waived its claim to those
funds. (Gov’t reply at 8)

        Vectrus states, and provides an email as support, that the contracting officer had
initially presented a modification containing explicit waiver language, which Vectrus
refused to sign (app. resp. at 8-9). Vectrus, therefore contends there is no explicit
release provision in the modification and the conduct of the parties supports that there
was no waiver or release (id. at 6, 8-9).

        We have explained before that “[t]he effect of the bilateral exercise is a
question of law that does not preclude summary judgment.” Alutiiq Commercial
Enters., LLC, ASBCA No. 61503, 20-1 BCA ¶ 37,506 at 182,198. Further, a waiver is
“an intentional relinquishment or abandonment of a known right or privilege.” Id.
(quoting Johnson v. Zerbst, 304 U.S. 458, 464 (1938)). “An intent to waive a
contractual right must be manifest in a party’s failure to object.” United Techs. Corp.,
Pratt & Whitney Grp., ASBCA No. 46880 et al., 95-1 BCA ¶ 27,592 at 137,482
(citations omitted). We give the parties’ contemporaneous actions “great weight” and
refer to the surrounding circumstances to determine what they intended when they
executed the bilateral modification at issue. Range Tech. Corp., ASBCA No. 51943,
04-1 BCA ¶ 32,456 at 160,546 (citations omitted); see also Maint. Eng’rs, ASBCA
No. 23131, 81-2 BCA ¶ 15,168 at 75,073 (“[r]elease or waiver of claims is basically a
matter of intention”).

       Because a waiver must be an intentional relinquishment, the government’s
argument here fails as there is no specific waiver or release language in the bilateral
modification. See CTA Inc., ASBCA No. 47062, 00-2 BCA ¶ 30,947 at 152,754
(modification did not contain any release of claims and therefore the claim was not
barred by release or waiver). Further, Vectrus notified the government of its concerns
before signing the modification and refused to sign any modification if it contained
waiver language. Vectrus did not waive its claim in the modification.

       We note that the government cited no case law to support its position and
appellant cited some appeals discussing accord and satisfaction, which constitutes a

                                            9
different legal theory than waiver and release. See Coastal Gov. Services, Inc.,
ASBCA No. 50283, 01-1 BCA ¶ 31,353 at 154,832. Accord and satisfaction occurs
“when some performance different from that which was claimed as due is rendered
and such substituted performance is accepted by the claimant as full satisfaction of his
claim.” Bell BCI Co. v. United States, 570 F.3d 1337, 1340-41 (Fed. Cir.
2009) (quoting Cmty. Heating & Plumbing Co. v. Kelso, 987 F.2d 1575, 1581 (Fed.
Cir. 1993)). There is a four part test to prove accord and satisfaction, with one part
being “a meeting of the minds of the parties.” Id. at 1341 (quoting O’Connor v.
United States, 308 F.3d 1233, 1240 (Fed. Cir. 2002)).

         To the extent the government was arguing there was an accord and satisfaction
as a result of the bilateral modification, it failed to meet its burden of proof. There is
no specific language in the bilateral modification indicating a meeting of the minds,
i.e., that Vectrus’ claim for the fixed-priced amount was satisfied. In this regard, the
government knew of Vectrus’ position and failed to resolve the issue before the
modification was signed or even indicate to Vectrus that by signing the modification
Vectrus was accepting the government’s position. The government’s argument here
fails.

Is Vectrus entitled to the full amount set forth in the task order?

       As noted, Vectrus argues that it is entitled to the full amount set forth in TO 63
because it was fully funded, fixed-priced and set forth a definite and not estimated
quantity and amount (app. mot. at 1; app. resp. at 7-8). Vectrus contends that the task
order is different from the other task orders issued and therefore unique and stands on
its own (app. resp. at 8). According to Vectrus, as the task order and each CLIN was
fixed-priced, pursuant to the principles of FAR 16.202-1 it placed full responsibility on
Vectrus and was not subject to any adjustment on the basis of Vectrus’ cost experience
in performing on the task order (app. mot. at 5). Vectrus contends that when the
government failed to order all stated quantities, it breached the contract (id. at 6, citing
C1², Inc., ASBCA No. 56257, 14-1 BCA ¶ 35,698, recon denied, CI², Inc., ASBCA
No. 56257, 15-1 BCA ¶ 35,829).

       The government argues the contract language takes precedence over any
language in the task order (gov’t mot. at 17). The government states the WAWF
payment instructions required Vectrus use a combination invoice and receiving report
to identify the work performed or supplies delivered for payment (gov’t reply at 6).
Further, the government states that Vectrus has failed to identify any statute or
regulation authorizing the government to always pay for services never performed
simply because the contract was a requirements contract and the underlying task order
was fully funded (gov’t mot. at 17; gov’t reply at 5). And finally, the government
wants us to look at extrinsic evidence when it contends that Vectrus’ conduct prior to
signing Modification P0005, in which it signed without issue other similar

                                            10
modifications de-obligating unused funds, shows Vectrus never interpreted the task
order the way it does now (gov’t mot. at 18; gov’t reply at 5-7).

       Contract interpretation is a matter of law. See e.g., ThinkQ, Inc., ASBCA
No. 57732, 13-1 BCA ¶ 35,221 at 172,825 (citing Muniz v. United States, 972 F.2d
1304, 1309 (Fed. Cir. 1992)). The rules of contract interpretation require that we first
look to the plain language of the contract. Langkamp v. United States, 943 F.3d 1346,
1349 (Fed. Cir. 2019).

Task Order/Contract CLINs 0023/4010AA, 0039/4020AA

        These CLINs for TO 63 specifically state “Firm Fixed Priced” and refer to a
specific CLIN in the contract. The task order CLINs also set forth a specific quantity,
unit, unit price identified as “Estimated,” and amount stating “Firm Price” in Euros
and “Funded Amount” in US dollars. (R4, tab 11 at 3-13) While Vectrus would like
us to read the task order in isolation and fixate only on the words “Firm Fixed Price”
and “Firm Price,” we must “examine the contract as a whole, harmonizing and giving
meaning, if possible, to all provisions. See ThinkQ, Inc., 13 BCA ¶ 35,221 at 172,825
(citing NVT Tech., Inc. v. United States, 370 F.3d 1153, 1159 (Fed. Cir. 2004)). In
other words, the language of a particular contractual provision must be read in the
context of the entire agreement. Speegle Constr., Inc., ASBCA No. 54236, 05-1 BCA
¶ 32,866 at 162,863 (citing United States v. Johnson Controls, Inc., 713 F.2d 1541,
1555 (Fed. Cir. 1983)).

       As the task order was issued pursuant to Vectrus’ requirements contract, we
must review that contract and its attachments. See Relyant, LLC, ASBCA No. 58172,
16-1 BCA ¶ 36,226 at 176,748 (“Interpreting the contract as a whole requires the
Board to interpret all documents that are part of the same transaction together.”).
Therefore, we reviewed the contract CLINs referenced in the task order.

       Task order CLIN 0023 referenced contract CLIN 4010AA for appliance
services, which in turn referenced PWS ¶¶ 1.9.7 and 1.9.8 requiring Vectrus purchase,
transport, install and connect new appliances when requested by the COR. PWS
¶ 1.9.9 explained the government would only reimburse Vectrus “on actual costs
incurred under the respective CLIN” for the replacement of parts or new appliances
and required Vectrus substantiate the cost such as by attaching a supplier invoice. (R4,
tab 4 at 395, tab 9 at 34) Likewise, task order CLIN 0039 referenced contract CLIN
4020AA for material, which also stated (in the referenced PWS paragraph) that this
was for items purchased under “the cost reimbursement portion of this contract” and
Vectrus was therefore to invoice these items monthly (R4, tab 4 at 427, tab 9 at 20).

       Both contract CLINs were designated as “COST” CLINs, contained no fixed
unit price, but set forth an estimated quantity and estimated cost (R4, tab 4 at 53, 55,

                                            11
88, 427-28). This language indicates the CLINs are cost reimbursable and not fixed-
priced. In fact, the contract itself recognized some of the CLINs were cost
reimbursable when it stated G&A expenses were allowable for the cost reimbursable
CLINs (id. at 430).

       Second, in reviewing further the task order, the same CLINs also indicate they
are cost reimbursable despite the “Firm Fixed Price” language. In this regard, the
relevant CLINs identify a quantity of one and unit of a “Lot” (R4, tab 11 at 3, 7, 11).
Vectrus argues the government here was required to, but “failed to order all of the
definite quantities” (app. mot. at 5). Vectrus, however, does not explain how the
government failed to order one lot of materials, for example. Nor could it, as the
contract explained that these were items that would be ordered during performance, as
needed, on a cost reimbursable basis. (See e.g., R4, tab 9 at 34)

        Accordingly, Vectrus’ reliance on C1², Inc. is misplaced. In that appeal, the
Board ruled the appellant was entitled to the mutually agreed upon fixed-priced
amount for the quantities of registrars ordered pursuant to a modification issued to the
contract. C1², Inc., ASBCA No. 56257, 14-1 BCA ¶ 35,698 at 174,782, recon denied,
CI², ASBCA No. 56257, 15-1 BCA ¶ 35,829. The Board explained in a decision on
reconsideration that the government had ordered these registrars via the modification
but failed to “assign” them to the various work sites consistent with its contract
obligations. CI², ASBCA No. 56257, 15-1 BCA ¶ 35,829 at 175,195. In comparison,
the government here did not order one lot of appliances or materials because as noted,
these were ordered as needed and reimbursed for cost.

        Therefore, when the entire contract and task order are read together, the only
reasonable reading is that these are not fixed-priced or fixed unit-priced CLINs. See
Pac. Coast Cmty. Servs., Inc. v. United States, 147 Fed. Cl. 811, 816 (2020), aff’d, 858
F. App’x 346 (Fed. Cir. 2021) (denomination of contract as fixed-priced does not
trump substance of or control over actual terms of contract). Further, the contract
instructs that if there were any conflicts between an order and contract, “the contract
shall control” (R4, tab 4 at 496). Based on this instruction, these are cost
reimbursement CLINs and any total amount shown for these CLINs are not-to-exceed
amounts. See FAR 16.301-1 (cost reimbursement contracts “establish an estimate of
total cost for the purpose of obligating funds and establishing a ceiling that the
contractor may not exceed (except at its own risk) without the approval of the
contracting officer.”). For these reasons, we deny Vectrus’ motion for summary
judgment that it is entitled to the full amount set forth in these CLINs and grant the
government’s motion.6

6
    While we find no ambiguity here, even if one were to find an ambiguity it would be a
        patent ambiguity that would place a reasonable contractor on notice to seek
        clarification. See Interstate Gen. Gov’t Contractors, Inc. v. Stone, 980 F.2d

                                            12
Task Order/Contract CLIN 0040/4021AA

        Task order CLIN 0040 referenced contract CLIN 4021AA for over and above
work. As discussed, over and above work included services not in the baseline but
discovered during maintenance efforts, ordered by the contracting officer, negotiated
by the parties, and definitized by a modification per DFARS 252.217-7028 (R4, tab 9
at 43 citing DFARS 252.217-7028). Here, the government modified the task order to
add funds for task order CLIN 0040, contract CLIN 4021AA, for over and above work
(R4, tab 15 at 1-2). According to the modification, it added task order CLINs on over
and above work for repair of heating systems in different buildings “based on the
contractor cost estimate dated 25 Jul 2019” and the repair of a balcony “based on
contractor cost estimate dated 05 Sep 2019” (id. at 2-6). The government has failed to
explain why Vectrus is not owed the amount set forth in the task order, as modified per
DFARS 252.217-7028, and we therefore grant Vectrus’ summary judgment motion on
this issue.

Remaining CLINs

       The remaining task order CLINs reference fixed unit-priced contract CLINs.
For example, task order CLIN 01 referenced contract CLIN 4001AA, which was for
maintenance services on two bedroom units/townhouses (R4, tab 4 at 347). According
to the PWS, Vectrus was to provide these maintenance services as described in
appendix 4 when requested by the COR (R4, tab 9 at 15). However, the task order
here was issued by the contracting officer and the CLINs set forth fixed quantities, the
fixed unit price set forth in the requirements contract, and the total firm price amount.
We therefore agree with Vectrus that these were fixed-priced CLINs.

      The government argues that despite this, Vectrus is still not owed the total
amount for these fixed-priced CLINs. In its answer and reply brief, the government
argued that FAR 52.212-4(l) precludes recovery for breach of contract and therefore

       1433, 1434-45 (Fed. Cir. 1992). “As an exception to the rule of contra
       proferentem, under which a contract is construed against the drafter, the patent
       ambiguity doctrine applies to bar appellant’s recovery even though the
       government was responsible for the poorly-drafted contract.” Dawkins Gen.
       Contractors & Supply, Inc., ASBCA No. 48535, 03-2 BCA ¶ 32,305 at
       159,846. Thus, Vectrus was required to seek clarification from the government,
       and since it failed to do so, we cannot accept its interpretation here.

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Vectrus, at most, can only seek recovery under a partial constructive termination for
convenience (gov’t reply at 9-10). 7

       A constructive termination for convenience is a “legal fiction” as it imposes
such a termination on a contractor even when it was never specifically ordered by the
contracting officer. Catherine Kurkjian, ASBCA No. 61154, 20-1 BCA ¶ 37,594
at 182,538, aff’d sub nom, Kurkjian v. Sec’y of the Army, 2021 WL 3520624 (Fed. Cir.
Aug. 11, 2021), cert denied, 142 S.Ct. 1428 (2022). Pursuant to a constructive
termination for convenience, Vectrus would only be entitled to be paid according to
the terms set forth in FAR 52.212-4(l), which addresses terminations of convenience
for commercial items and services.

        FAR 52.212-4(l) states that “the contractor shall stop work immediately” and be
paid a percent of the contract price reflecting the percentage of the work performed
prior to termination but shall not be paid for work performed or costs incurred which
could have been avoided. Here, there was no stoppage of work, rather, the
government did not order all of the work. Regardless, the government still could have
invoked the clause for these CLINs when it became clear that all of the services were
not needed. 8 Heartland Energy Partners LLC, ASBCA No. 62979, 22-1 BCA
¶ 38,200 at 185,519-20 (discussing constructive partial termination for convenience
pursuant to FAR 52.212-4(l), of fixed-priced task order CLINs for commercial
services); see also Praecomm, Inc. v. United States, 78 Fed. Cl. 5, 11-13 (2007)
(government constructively terminated fixed-priced contract for convenience when it
did not require contractor to install the delivered radios). Accordingly, we conclude
the deletion of work was a constructive termination for convenience and grant the
government’s motion on this issue.

7
  In its motion, Vectrus also moved to strike the government’s affirmative defense that
         the contract could be deemed constructively terminated arguing it was
         insufficiently pled by the government (app. mot. at 6-7). According to Vectrus,
         the government failed to identify supporting facts or evidence in the Rule 4 file
         (id. at 7). The argument concerning constructive termination is a legal
         argument and therefore it is not clear what facts are missing.
8
  We note that the government did not argue constructive termination in C1², Inc., the
         appeal relied on by Vectrus. We also note that in the C1², Inc. quantum
         decision, the appellant did not actually pay the wages of those registrars the
         government failed to assign, and which were on stand-by, and the Board held
         appellant’s damage calculations based upon the full, gross contract revenue for
         those registrars and temporary registrars was improper. C1², Inc., ASBCA No.
         59948, 16-1 BCA ¶ 36,410 at 177,534. Specifically, the Board stated it was
         contrary to well-settled law to place “appellant in a better position than if the
         government had fully performed and made all the required assignments.” Id.

                                            14
                                    CONCLUSION

        For the reasons stated above, we grant Vectrus’ motion for summary judgment
in part and deny it in part, and grant the government’s motion in part and deny it in
part. Specifically, we deny the government’s motion that Vectrus waived its claim via
bilateral Modification P00005; deny Vectrus’ motion that it is entitled to the full
amount set forth in for Task Order/Contract CLINs 0023/4010AA and 0039/4020AA
and grant the government’s motion that these CLINs are cost reimbursable; grant
Vectrus’ motion that it is entitled to the full amount set forth in Task Order/Contract
CLIN 0040/4021AA and deny the government’s motion; grant Vectrus’ motion that
the remaining multiple CLINs are fixed-priced but also grant the government’s motion
that there was a constructive termination for convenience of these CLINs (although a
constructive termination for convenience in a commercial items contract/task order
still requires the calculation of proper termination costs). Thus, this decision does not
resolve the appeal as Vectrus’ entitlement to further compensation, if any, will be
addressed in further proceedings.

       Dated: January 4, 2024

                                                  LAURA EYESTER
                                                  Administrative Judge
                                                  Armed Services Board
                                                  of Contract Appeals

 I concur                                         I concur

 OWEN C. WILSON                                   J. REID PROUTY
 Administrative Judge                             Administrative Judge
 Acting Chairman                                  Vice Chairman
 Armed Services Board                             Armed Services Board
 of Contract Appeals                              of Contract Appeals

                                           15
      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. 63239, Appeal of Vectrus
Systems Corporation, rendered in conformance with the Board’s Charter.

      Dated: January 4, 2024

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

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