CONNER BROS. CONST. CO., INC. v. Geren

550 F.3d 1368, 2008 U.S. App. LEXIS 26811, 2008 WL 5412460
CourtCourt of Appeals for the Federal Circuit
DecidedDecember 31, 2008
Docket2008-1188
StatusPublished
Cited by34 cases

This text of 550 F.3d 1368 (CONNER BROS. CONST. CO., INC. v. Geren) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
CONNER BROS. CONST. CO., INC. v. Geren, 550 F.3d 1368, 2008 U.S. App. LEXIS 26811, 2008 WL 5412460 (Fed. Cir. 2008).

Opinion

BRYSON, Circuit Judge.

Conner Bros. Construction Company, Inc., a construction contractor doing work for the Army Corps of Engineers, sought delay damages after it was denied access to its construction site on a military base for 41 days following the terrorist attacks of September 11, 2001. The Armed Services Board of Contract Appeals denied Conner’s claim on the ground that the sovereign acts doctrine shielded the Army from liability. We agree with the Board that the order excluding Conner from the base was a sovereign act that precludes recovery of damages for the delay that resulted from that act.

I

On April 21, 2000, Conner contracted with the Corps of Engineers to construct an Army Ranger regimental headquarters facility within the 75th Ranger regimental compound at Fort Benning, Georgia. The Ranger compound is a segregated area within Fort Benning that is under the operational control of the Ranger regimental commander. The contract, which was for the construction of four buildings at two sites within the compound, was administered by a Corps of Engineers project manager.

In response to the terrorist attacks against the United States on September 11, 2001, Fort Benning was placed at force protection condition Delta and shut down to everyone except essential personnel. General (then Colonel) Joseph Votel, the commander of the 75th Ranger regiment, also restricted access to the Ranger compound to mission-essential personnel and ordered his staff to direct Conner to stop work and vacate the compound immediately. Conner’s workforce left the compound by 2:00 p.m. on September 11, 2001, at which point its contract work was roughly 70-75% complete. On September 17, 2001, Fort Benning lowered its force protection condition, allowing contractors and other personnel to return to the base. However, *1371 the Ranger compound continued to operate under condition Delta and remained subject to General Votel’s order restricting access to mission-essential personnel, and Conner continued to be excluded from its worksites within the compound.

In the immediate aftermath of the terrorist attacks, the Rangers prepared for deployment to Afghanistan. They executed a “protracted low-level deployment” whereby they departed in small groups so that their movements would not attract notice. During that period, the Rangers occupied one of the partially constructed buildings on Conner’s worksite. General Votel testified that he decided to shut down Conner’s construction activities in order to maintain operational security by preventing information leaks while the Rangers prepared to deploy. He explained that because Conner’s work was the “biggest thing happening on the installation,” Conner’s activities put its employees and subcontractors in a unique position to observe sensitive deployment activities.

Conner was excluded from the compound until September 27, 2001, when it was allowed to return to one of its work-sites. It was permitted access to its other site on October 15, 2001, and it resumed work there on October 21, 2001. Conner subsequently sought additional time to complete the project and $137,744 in delay damages attributable to 35 of the 41 days during which it was shut down^ — 'that is, for the period between September 17, 2001, when other contractors were permitted back on the compound, and October 21, 2001, when Conner returned to work. The contracting officer granted Conner the requested additional time to complete the project but denied the monetary claim. Conner appealed that decision to the Board.

After conducting a three-day hearing, the Board denied Conner’s appeal. As an affirmative defense, the Corps of Engineers asserted that the exclusion of Conner from the construction site constituted a sovereign act that precluded Conner from recovering damages for the delay. Conner argued that it was the sole target of the shutdown order, as it was the only contractor ordered to leave the compound. For that reason, Conner argued, the shutdown order was not a “public and general” act, and the government therefore could not invoke the “sovereign acts doctrine” as a defense to liability for breach of contract. The Board, however, found that the exclusion order was a sovereign act because it stemmed from the government’s war-making powers, was merely incidental to the accomplishment of a broader governmental objective relating to national security, and was not directed principally at Conner’s contract rights. The Board also rejected Conner’s arguments that it was entitled to relief under the contract’s “Changes” and “Suspension of Work” clauses. Conner now appeals to this court.

II

The sovereign acts doctrine provides that “the United States when sued as a contractor cannot be held liable for an obstruction to the performance of the particular contract resulting from its public and general acts as a sovereign.” Horowitz v. United States, 267 U.S. 458, 461, 45 S.Ct. 344, 69 L.Ed. 736 (1925). The doctrine is an affirmative defense that is an inherent part of every government contract. Hughes Commc’ns Galaxy, Inc. v. United States, 998 F.2d 953, 958 (Fed.Cir.1993). It is based on the government’s dual roles as contractor and sovereign, and it is designed to balance “the Government’s need for freedom to legislate with its obligation to honor its contracts.” United States v. Winstar Corp., 518 U.S. *1372 839, 896, 116 S.Ct. 2432, 135 L.Ed.2d 964 (1996) (principal opinion of Souter, J.).

The doctrine is rooted in three early Court of Claims cases. In Deming v. United States, 1 Ct.Cl. 190 (1865), a supplier who had contracted to provide rations to the Marine Corps sued for damages when the enactment of the Legal Tender Act resulted in the imposition of additional duties on some articles making up the rations, thereby raising the contractor’s costs. The Court of Claims explained that “[a] contract between the government and a private party cannot be specially affected by the enactment of a general law” and held that the imposition of the duty constituted a sovereign act that did not form the basis for governmental liability for breach of contract. Id. at 191 (emphasis in original). In what has become the iconic statement of the sovereign acts doctrine, the court wrote: “The United States as a contractor are not responsible for the United States as a lawgiver.” Id.

In Jones v. United States, 1 Ct.Cl. 383 (1865), the Court of Claims extended the rule of Deming from legislative to executive acts. The court rejected a suit brought by surveyors working for the Commissioner of Indian Affairs when their performance was hindered by the withdrawal of U.S. troops from Indian territories. As in Deming, the court emphasized that “the United States as a contractor cannot be held liable directly or indirectly for the public acts of the United States as a sovereign.” Id. at 385.

Finally, in Wilson v. United States, 11 Ct.Cl. 513 (1875), the plaintiff contracted to deliver mules to the Quartermaster-General during the Civil War.

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Cite This Page — Counsel Stack

Bluebook (online)
550 F.3d 1368, 2008 U.S. App. LEXIS 26811, 2008 WL 5412460, Counsel Stack Legal Research, https://law.counselstack.com/opinion/conner-bros-const-co-inc-v-geren-cafc-2008.