CEMS, Inc. v. United States

59 Fed. Cl. 168, 2003 U.S. Claims LEXIS 324, 2003 WL 22533158
CourtUnited States Court of Federal Claims
DecidedNovember 5, 2003
DocketNos. 99-951C, 00-437C, 00-438C, 00-439C
StatusPublished
Cited by13 cases

This text of 59 Fed. Cl. 168 (CEMS, Inc. 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
CEMS, Inc. v. United States, 59 Fed. Cl. 168, 2003 U.S. Claims LEXIS 324, 2003 WL 22533158 (uscfc 2003).

Opinion

OPINION

HORN, Judge.

The plaintiff, CEMS, Inc. (CEMS), filed a complaint in this court arising out of contract no. DTFH70-98-C-00011 for the construction of a bicycle path on a portion of the Historic Columbia River Highway in Cascade Locks, Oregon. On April 6, 1998, the Department of Transportation, Federal Highway Administration (FHA), Western Federal Lands Highway Division awarded the contract to CEMS for the construction of the bicycle path on a 3.888 kilometer portion of the Historic Columbia River Highway between the Columbia Fish Hatchery and the Bridge of the Gods, in the amount of $1,676,154.00. The plaintiffs complaint alleges “changes, delays and other compensa-ble acts or omissions of the FHA,” and requests an equitable adjustment under the terms of the contract, and such further relief as is appropriate.

The plaintiff originally filed three separate appeals before the Department of Transportation Board of Contract Appeals (DOTBCA) arising under CEMS’ first certified claim to the contracting officer (CO). During the pendency of the plaintiffs appeals before the DOTBCA, the plaintiff submitted a second, certified, comprehensive claim to the CO, including sixty-two separate claims. Following the denial of many of plaintiffs claims by the CO,1 CEMS filed its complaint in this [173]*173court. The plaintiff subsequently filed a motion to consolidate the DOTBCA appeals with this case. The court granted the plaintiffs motion and consolidated the plaintiffs DOTBCA appeals with the above captioned case. Following the plaintiffs voluntary dismissal of certain claims, and the settlement of additional claims preceding trial in this case, the plaintiff seeks $1,241,203.70 in compensation for numerous claims under the contract. Although listed separately by the parties, many of the plaintiffs claims are related in subject matter, but occurred’ at different intervals on the bicycle path. Based on the presentation of the evidence at trial by the parties, the court’s opinion has grouped the plaintiffs claims involving similar subject matter to avoid repetition.

FINDINGS OF FACT

I. Claim Al — Government Delayed the Notice to Proceed

The FHA awarded the contract at issue to CEMS on April 6, 1998. The contract specified performance was to begin within ten calendar days after receipt of the notice to proceed. The contract was to be completed on or before September 30, 1998, “subject to such extensions as may be authorized by the terms of the contract and the specifications made a part thereof.” The contract specified that the completion date of September 30, 1998 was based on the assumption that CEMS would receive the notice to proceed by April 1, 1998. The contract further provided that:

The completion date will be extended by the number of calendar days after the above date that the contractor receives the notice to proceed, except to the extent that the delay in issuance of the notice to proceed results from the failure of the contractor to execute the contract and give the required performance and payment bonds within the time specified in the offer.

CO Parsons, by letter dated April 6, 1998, notified CEMS of the award of the contract and stated that the plaintiffs “offer of $1,674,154.00 for construction of the above project is accepted.” The April 6,1998 letter by CO Parsons indicating the bid amount was type-written in the amount of $1,674,154.00. On April 14, 1998, CEMS transmitted to the FHA performance and payment bonds in the FHA requested amounts of $1,674,154.00 and $689,661.60, respectively. The April 14, 1998 transmittal indicated that the FHA received the performance and payment bonds, notes that the bonds were in the incorrect amounts, and that the incorrect performance and payment bonds were returned on April 16, 1998 to CEMS. CEMS submitted corrected performance and payment bonds in the amount of $1,676,154.00 and $670,461.60, respectively, on April 16, 1998, with the FHA indicating receipt of the corrected bonds on that same date.

On April 16, 1998, the FHA provided the plaintiff with the notice to proceed on the bicycle path contract. The April 16, 1998 notice to proceed indicated that as a result of the government’s delay, the contract was not awarded until April 6,1998, and although the government was prepared to issue the notice to proceed on April 13,1998, the FHA stated that as a result of the plaintiffs failure to provide correct performance and payment bonds, the issuance of the notice to proceed was delayed. The April 16, 1998 FHA letter stated, “the Fixed Completion Date is extended by 12 calendar days, to October 12, 1998.” On April 23,1998, CEMS notified the defendant that due to the delay in the issuance of the notice to proceed, the plaintiff was requesting an extension of the contract completion date of fifteen days, until October 15,1988.

On June 12, 1998, the parties executed a negotiation memorandum for contract modification no. 1. The negotiation memorandum and contract modification no. 1, although not explicitly addressing the delay in the issuance of the notice to proceed, noted the following, “On the 20th of April 1998, CEMS, Inc. receives [sic] the Notice to Proceed in-[174]*174eluding the revised Fixed Completion Date of October 12,1998.”

At the trial of this matter, David Conway, the president and owner of CEMS and the first project superintendent on the bicycle path contract,2 testified that the initial correspondence by the FHA regarding the performance and payment bonds requested an incorrect amount for the bonds. Mr. Conway stated that the FHA subsequently requested corrected bonds once the error was discovered and CEMS submitted the performance and payment bonds in the corrected amount. According to Mr. Conway, prior to the issuance of the notice to proceed, CEMS checked with the subcontractors and suppliers, walked the project site, and began gathering scheduling information. Mr. Conway further testified that CEMS lost productivity because CEMS employees and equipment were idle or underutilized until the project could proceed. As a result of the delay in the issuance of the notice to proceed and the failure to conduct a preconstruction conference almost two weeks after the notice to proceed, Mr. Conway stated that he “couldn’t see how we were going to complete by our scheduled deadline____”

The contracting officer’s final decision denied CEMS’ claim for an equitable adjustment for the delay in the issuance of the notice to proceed because it was determined that CEMS had already been granted a sixteen day extension for the delay, and that it was a reasonable delay for which CEMS was not entitled to an equitable adjustment. The contracting officer’s final decision also determined that CEMS was responsible for three days of the delay due to the submission of payment and performance bonds in an incorrect amount. CO Parsons’ testimony at trial regarding the delay in issuing the notice to proceed indicated that CEMS was afforded a “day-for-day” extension of contract time. CO Parsons testified that the original bid opening date was delayed by the FHA from March 10,1998 to March 20, 1998, and it was his election not to amend the notice to proceed date, but allow for an extension of contract time if the issuance of the notice to proceed was delayed. Although recognizing that due to a bid opening date of March 20, 1998, the timeframe for the issuance of the notice to proceed by April 1, 1998 could be difficult, CO Parsons testified:

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Granite Construction Company
Armed Services Board of Contract Appeals, 2023
East Coast Repair & Fabrication, LLC v. United States
199 F. Supp. 3d 1006 (E.D. Virginia, 2016)
Structural Concepts, Inc. v. United States
103 Fed. Cl. 84 (Federal Claims, 2012)
Redland Co. v. United States
97 Fed. Cl. 736 (Federal Claims, 2011)
Delhur Industries, Inc. v. United States
95 Fed. Cl. 446 (Federal Claims, 2010)
Information Systems & Networks, Corp. v. United States
81 Fed. Cl. 740 (Federal Claims, 2008)
Renda Marine, Inc. v. United States
71 Fed. Cl. 378 (Federal Claims, 2006)
CEMS, Inc. v. United States
65 Fed. Cl. 473 (Federal Claims, 2005)
George Sollitt Construction Co. v. United States
64 Fed. Cl. 229 (Federal Claims, 2005)
R.P. Wallace, Inc. v. United States
63 Fed. Cl. 402 (Federal Claims, 2004)

Cite This Page — Counsel Stack

Bluebook (online)
59 Fed. Cl. 168, 2003 U.S. Claims LEXIS 324, 2003 WL 22533158, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cems-inc-v-united-states-uscfc-2003.