Court Opinion

ID: 2734543
Source: CourtListenerOpinion
Date Created: 2014-09-19 01:29:01.749687+00
Date Added: 2024-06-11T12:58:09.120633
License: Public Domain

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeal of --                                 )
                                             )
DayDanyon Corporation                        )      ASBCA No. 57611
                                             )
Under Contract No. SPM8ED-09-D-0001          )

APPEARANCE FOR THE APPELLANT:                       Mr. Joseph S. Jankowski
                                                     President

APPEARANCES FOR THE GOVERNMENT:                     Daniel K. Poling, Esq.
                                                     DLA Chief Trial Attorney
                                                    Joseph R. Weidenburner, Esq.
                                                     Assistant Counsel
                                                    Kristin K. Bray, Esq.
                                                     Assistant Trial Attorney
                                                     DLA Troop Support
                                                     Philadelphia, PA

                  OPINION BY ADMINISTRATIVE JUDGE JAMES
                ON APPELLANT'S MOTION FOR RECONSIDERATION

        Our 22 January 2014 decision in DayDanyon Corp., ASBCA Nos. 57611, 57681,
57717, 14-1BCA~35,507 at 174,040, granted summary judgment to DLA Troop Support
(DLATS, government or respondent) and denied ASBCA No. 57611, denied summary
judgment to respondent on ASBCA No. 57681, and dismissed ASBCA No. 57717 as
duplicative of No. 57611. On 24 February 2014, DayDanyon (movant) timely moved for
reconsideration "for Appeals 57611 and 57717 only," 1 and submitted further argumentation
for its motion on 28 February 2014. The government responded to the motion on
14 March 2014. Movant replied thereto on 8 April 2014. Familiarity with our 22 January
2014 decision is assumed.

       SOF ~ 5 of our decision stated: "The record contains no evidence that DayDanyon
sought from the CO clarification of the term 'Two Years' in the above-quoted
[FAR 52.216-22(d) and FAR 52.216-18(a)] contract provisions." Movant asserts, citing
its supplemental Rule 4, tabs 38-39, 42-43, 44, 47, 53-54 (including Jankowski
Declaration No. 1 dated 21November2013), that the Board overlooked record evidence

1
    In an 18 March 2014 telephone conference call, in reply to Judge James' question
         whether DayDanyon questioned the dismissal of ASBCA No. 57717 as
         duplicative of ASBCA No. 57611, Mr. Jankowski answered "no." Thus, this
         decision captions only ASBCA No. 57611. (Bd. corr. ltr. dtd. 18 March 2014)
of pre-bid discussions of the parties showing they concurred "that the 'Two Years' term
used on FAR 52.216022(d) [sic] was to describe the same 'Two Years' time period
described in the Ordering Clause ... as the base period of the contract" and failed to
consider the "initial origin inspection procedures for the JMICs." Movant concludes that
these omissions led to the Board's erroneous interpretation of the "Two Years" phrase in
FAR 52.216-22(d). (App. mot. at 1-5)

       Respondent contends that DayDanyon's motion for reconsideration raises no new
evidence and merely reiterates its earlier arguments on the cross-motions for summary
judgment. Specifically, respondent argues that the Jankowski Declaration (app. supp. R4,
tab 43) does not show prior concurrence of the parties on DayDanyon's interpretation of
the FAR 52.216-22(d) clause; the plain and unambiguous terms of the FAR 52.216-18
and 52.516-22 clauses do not support DayDanyon's unreasonable interpretation; and thus
the Board's conclusion of law was not in error. (Gov't resp. at 2-4)

                                            I.

        Mr. Jankowski's 21November2013 Declaration states that prior to award he
discussed the contract solicitation with Mr. Michael Upshaw, the designated point of contact,
contracting officer (CO) Howard Page, and product specialist Mr. Edward Nunan. "I asked
ifthe time period that should be in the blank for 52.216-22(d) was the same as the base
ordering period as shown in FAR 52.216-18. I was told yes." (App. supp. R4, tab 43 at 2-3)

       Assuming, for present purposes, the accuracy of the above conversation, that question
and answer does not address DayDanyon's assertion that DLATS concurred with
Mr. Jankowski's interpretation that "Two Years" meant that DLATS had to order an
additional 500 JMICs by 24 December 2010 in order to obtain their delivery within two
years after contract award, i.e., by 23 April 2011 less 120 days. In deciding the parties'
cross-motions for summary judgment on ASBCA No. 57611, we did not overlook
Mr. Jankowski's Declaration with respect to the interpretation of the phrase "Two Years."
Neither the undated, anonymous notes concerning Solicitation No. SPM8ED-09-R-0011
(app. supp. R4, tab 44) nor appellant's supplemental Rule 4, tabs 38-39, 42, and 53-54,
mention the FAR 52.216-18 or 52.216-22 clauses, or show that Mr. Jankowski and the
CO agreed on DayDanyon's interpretation of the phrase "Two Years" in the two
FAR clauses. Those documents do not support DayDanyon's motion. DayDanyon has not
shown that the Board's decision ignored any material evidence. However, based on the
above, we believe that SOF ~ 5 requires minor correction, see CONCLUSION, infra.

                                           II.

       We tum to whether our decision erred in contract interpretation. The contract
schedule provided that "[o]rders may be issued on this contract for a period of TWO YEARS,"
and required delivery of production JMICs within "120 days after the date of the resulting

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[DOs]" (SOF ii 3). The contract's FAR 52.216-18 clause, ii (a), specified the two year
ordering period to start "FROM: DATE OF CONTRACT AWARD," and its FAR 52.216-22
clause, ii (d), provided:

                     Any order issued during the effective period of this
             contract and not completed within that period shall be
             completed by the Contractor within the time specified in the
             order. The contract shall govern the Contractor's and
             Government's rights and obligations with respect to that order
             to the same extent as if the order were completed during the
             contract's effective period; provided, that the Contractor shall
             not be required to make any deliveries under this contract
             after Two Years[.]

(SOF ii 5)

       The contract's E46C06, 52.246-9008, INSPECTION AND ACCEPTANCE AT ORIGIN
(AUG 2007) clause specified that all supplies would be inspected at "DanDanyon
Corporation ... Hartwell, GA" (R4, tab 4 at 14 of21). The contract specified a quality
assurance procedure SQAP-PHST-176A of 20 June 2008 (R4, tab 4 at 4 of 21 ), which
provided in ii 5:

             5. Quality Conformance Inspection Production Lot Sampling
             Testing. Unless otherwise specified in the contract or
             purchase order, prior to delivery, the Government shall
             perform a sample lot inspection of the production containers.
             The DCMA-QAR shall randomly select up to 2% of the total
             production quantity containers. If the total production
             quantity is less than 100, the minimum sample shall be one
             (1) container. Seven days before the production quantities are
             to be tendered for acceptance, the contractor shall arrange to
             have the DCMA-QAR select the sample ....

             5.1 Scheduled Lead Time for Production Lot Testing is as
             follows:

                 ACTION ACTION ACTIVITY *CALENDAR DAYS
             Submission    Contractor      Per Schedule
             of Production
             Sample

             Testing &    Government Test Activity            15
             Evaluation

                                            3
              Approval of DSCP-Contracting Officer               5
              Test Report/
              Notification
              of Failure

(App. supp. R4, tab 47 at 3-4)

        Movant interprets SQAP-PHST-176A to provide that, for production JMICs
inspected and accepted at origin, 7 days before the delivery date the contractor arranges
for the DCMA-QAR to select a lot sample for government testing, evaluation, and
approval; the contractor tenders the lot for acceptance on the delivery date; the
government has up to 20 days after receiving the sample to test, evaluate, and approve it;
and upon government acceptance of the lot, the contractor completes the order by
arranging pick-up with DCMA, preparing and loading the lot for shipment. Movant
concludes:

              [I]f an order is issued late enough in the ordering period,
              though the contractor may have delivered within the base
              period, further actions regarding acceptance and shipment
              may occur after the end of the base period, thus making FAR
              52.216-22(d) meaningful. .. per the Appellant's interpretation.
              Even unforeseen excusable delays would serve to provide
              meaning to this language.

(App. mot. at 3-4)

       Based upon this interpretation of the FAR 52.216-22 clause, movant asserts that
government inspection and acceptance and contractor lot preparation and shipment can
be completed 20 days after the end of the 2-year base/ordering/delivery period, or later
due to excusable delays, and such interpretation renders the FAR 52.216-22(d) provisions
meaningful. Movant cites several decisions applying general rules for contract
interpretation. None ofthem interprets the FAR 52.216-22 clause, if (d), to limit
post-delivery rights and duties to 20 days for government inspection and acceptance, and
contractor lot preparation and shipment.

       DayDanyon's interpretation is unreasonable for the reasons stated in our
January 2014 decision, 14-1 BCA if 35,507 at 174,040 (DayDanyon reduces the ordering
period from the specified "TWO (2) YEARS" to 20 months, and renders meaningless or
superfluous the FAR 52.216-22(d) provisions that orders issued but not completed within
the contract's effective period shall be completed within the time specified by the order;
the contract governs the parties' rights and duties under orders not so completed to the
same extent as if the orders were completed during the contract's effective period; and

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such interpretation violates the rule to seek to harmonize and give reasonable meaning to
all parts of a contract and to render no provision useless, meaningless, inoperative or
superfluous). We conclude that DayDanyon has not shown any error of law in our
decision.

                                    CONCLUSION

       We acknowledge the need to clarify SOF ~ 5 of our decision. Accordingly, we
grant DayDanyon's motion to the extent of clarifying the last sentence of our SOF ~ 5 to
state: "The record contains no evidence that the CO concurred in DayDanyon's
interpretation that the term 'Two Years' in the above-quoted contract provisions meant
that DLATS had to order an additional 500 JMICs by 24 December 2010 in order to
obtain their delivery within two years after contract award, i.e., by 23 April 2011 less
120 days." We deny the remainder of appellant's motion.

      Dated: 28 May 2014

                                                Administrativ:
                                                Armed Servi s

I concur                                        I concur

~4'
Administrative Judge                            Administrative Judge
Acting Chairman                                 Acting Vice Chairman
Armed Services Board                            Armed Services Board
of Contract Appeals                             of Contract Appeals

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     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. 57611, Appeal of
DayDanyon Corporation, rendered in conformance with the Board's Charter.

      Dated:

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

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