A.R. Sales Co. v. United States

51 Fed. Cl. 370, 2002 U.S. Claims LEXIS 10, 2002 WL 62981
CourtUnited States Court of Federal Claims
DecidedJanuary 11, 2002
DocketNo. 00-71C
StatusPublished

This text of 51 Fed. Cl. 370 (A.R. Sales Co. v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
A.R. Sales Co. v. United States, 51 Fed. Cl. 370, 2002 U.S. Claims LEXIS 10, 2002 WL 62981 (uscfc 2002).

Opinion

OPINION

BRUGGINK, Judge.

This case involves a construction contract that was default terminated. In an earlier opinion, we addressed defendant’s Motion for Summary Judgment and alternative Motion for Partial Summary Judgment. We granted defendant’s motion to dismiss Count II. We denied defendant’s motion for summary judgment (along with plaintiffs cross-motion) as to Count I, the only remaining count, and declined to rule on the motion for partial summary judgment. AR Sales Co., Inc. v. United States, 49 Fed.Cl. 621 (2001). Instead, we asked for supplemental briefing on two issues: (1) plaintiffs argument that it was unable to adequately respond to the Army’s November 13, 1998 cure notice; and (2) the applicability and legal effect of Federal Acquisition Regulation (“FAR”) 49.402-3. [371]*371The briefing is complete.1 For the reasons set out below, defendant’s Motion for Summary Judgment is granted.

BACKGROUND

Most of the extensive background facts are set forth in the prior opinion. The additional facts were submitted by defendant in response to our order for supplemental briefing.

On October 14, 1998, plaintiff sent two letters to the Army. At that point, the completion date for the work was June 30, 1998, and the work was well behind schedule. The first letter complained of defective specifications and requested clarification regarding the contract’s requirements in five areas: 1) downspouts, area drains, and sump pumps; 2) whether the concrete trough would require control joints or expansion joints; 3) the requirement for underground lines in the paths of trees or bushes; 4) whether asphalt restoration was still necessary; and 5) a request for written direction concerning point repairs. The second letter expressed confusion concerning two additional items: 6) the end date of the contract; and 7) the Army’s failure to respond to plaintiffs July 23, 1998 letter listing possible contract additions and deletions. The second October 14 letter indicated that the Army, through its actions, was responsible for delaying the work by 140 days because it treated a sub-contractor as if it were the prime contractor.

In a response letter dated November 4, 1998, the Army addressed each of plaintiffs requests for clarification. The letter also directed plaintiff to submit a revised progress schedule and advised it that, when submitting the schedule, the starting date would be the “NTP date,” December 19, 1997, and that plaintiff should reflect in the schedule the “no work” days in September and October 1998. Because of “confusion” about the completion date, the Army extended it to August 31,1998.

In a cure notice dated November 13, 1998, the Army informed plaintiff that its contract would be terminated for default unless it corrected several conditions. These included plaintiffs asserted failures to: complete the contract work in a timely manner; submit a revised progress schedule; diligently prosecute work on the drainage trough; submit payroll reports; submit contractor quality control daily reports; and provide safe working conditions. The notice directed plaintiff to cure these deficiencies within ten days and provide it with a revised schedule reflecting completion of all phases of the work. On November 18 and again on November 25, plaintiff sent letters to the Army complaining of government-induced delays and wrongdoings concerning the contract and the progress of the work. These letters failed to provide the Army with any kind of progress schedule or projected completion date. Other facts relevant to the cure notice and the default termination are found in the earlier opinion.

DISCUSSION

In Danzig v. AEC Corp., 224 F.3d 1333 (Fed.Cir.2000), the Federal Circuit held that, in the face of a validly issued cure notice, the contractor must give reasonable assurances that it will complete performance. In the absence of such assurances, default termination is proper. Defendant argues that plaintiffs performance up to November 13, 1998, supported the sending of the cure notice and that its failure to provide the Army with a revised progress schedule and completion date thereafter legitimated the termination for default.

Plaintiff asserted in prior briefing that it could not adequately respond because there were “outstanding issues that needed to be resolved by the government.” AR Sales, 49 Fed.Cl. at 629. We initially denied defendant’s motion for summary judgment because defendant did not address this defense. Defendant attempts to do so now in its supplemental brief.

In its motion for summary judgment, plaintiff asserted that it could not provide the revised progress schedule because the Army [372]*372never provided it with “written clarification of the actual scope of work, including proper contract change orders and modifications.”2 Pl. Mtn. for Summary Judgment at 25. These charges are presented in its October 14 letters requesting clarification regarding the contract’s requirements in several areas.

The Army’s response to those letters on November 4 was comprehensive. It was followed by the cure notice, which we find to have been reasonable under the circumstances. Plaintiffs opportunity to respond to both the Army’s answers to plaintiffs purported confusion and to the cure notice was in its November 18 or November 25 letters. It did not do so. The first of these letters was a completely missed opportunity to respond point by point to the Army’s answers or assertions. Although an attachment to the November 25 letter summarizes plaintiffs grievances with the Army’s conduct of the contract, it does not directly respond to the cure notice, with one possible exception. That exception is as to the first of the seven issues plaintiff expressed confusion over in October: the lack of direction with respect to the downspouts, area drains, and sump pumps. In an attachment to its November 25 letter, plaintiff merely reiterates its purported confusion, however, but does not respond to the assertions in the Army’s November 4 letter addressing this issue.

The second issue, relating to whether control joints or expansion joints would be required in the concrete trough, we also view as addressed in the Army’s November 4 letter: “[t]he Government has not (WILL NOT?) recommend control joints for the drainage trough.” This response informs plaintiff that, at that time, the Army did not intend to modify the contract to include expansion joints. Although the “(WILL NOT?)” language indicates some uncertainty, it cannot be interpreted as more than the Army’s reservation of its right to make future changes in the specification if necessary. As defendant points out, neither plaintiffs November 18 letter nor its November 25 letter indicate any confusion concerning the trough.

The Army responded to plaintiffs third issue, the requirement for underground lines in the paths of trees or bushes, by stating that “actions required regarding small trees and bushes in the path of the new drainage trough should be discussed in the field between the AR Rep and COE Project Engineer. If a Differing Site Condition exists, a contract modification will be prepared.” Neither of plaintiffs subsequent letters indicate any confusion over this response.

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Related

AR Sales Co. v. United States
49 Fed. Cl. 621 (Federal Claims, 2001)

Cite This Page — Counsel Stack

Bluebook (online)
51 Fed. Cl. 370, 2002 U.S. Claims LEXIS 10, 2002 WL 62981, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ar-sales-co-v-united-states-uscfc-2002.