Delcon Construction Corp. v. United States

38 Cont. Cas. Fed. 76,476, 27 Fed. Cl. 634, 1993 U.S. Claims LEXIS 286, 1993 WL 30485
CourtUnited States Court of Federal Claims
DecidedFebruary 9, 1993
DocketNo. 91-1226C
StatusPublished
Cited by2 cases

This text of 38 Cont. Cas. Fed. 76,476 (Delcon Construction Corp. 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
Delcon Construction Corp. v. United States, 38 Cont. Cas. Fed. 76,476, 27 Fed. Cl. 634, 1993 U.S. Claims LEXIS 286, 1993 WL 30485 (uscfc 1993).

Opinion

OPINION

MARGOLIS, Judge.

This case comes before the court on defendant’s motion for summary judgment. The plaintiff, Deleon Construction Corporation (“Deleon”), contracted with the U.S. Postal Service (“USPS”) to build a postal facility in Chappaqua, New York. The plaintiff incurred costs in excavating rocks from below the surface at the construction site. The dispute centers on whether rock excavation was part of the contract. The plaintiff argues that the parties understood that rock excavation was not part of the contract, and therefore the plaintiff is entitled to additional compensation for this work. The defendant, United States, argues that rock excavation was part of the contract, any ambiguity in the solicitation was a patent one, and the plaintiff bore the responsibility to clarify ambiguities. After careful consideration of the record and after hearing oral argument, this court holds that the solicitation contained a patent ambiguity as to whether the contract required rock excavation, that the plaintiff had a duty to clarify the ambiguity, and that the plaintiff’s inquiry failed adequately to fulfill that duty. Therefore, the risk of misinterpreting the contract requirements falls on the plaintiff. .Accordingly, the court grants the defendant’s motion for summary judgment.

FACTS

On July 31, 1989, the USPS issued a solicitation for bids on a contract to build a postal facility. The solicitation called for the contractor to provide all labor and materials for site preparation and construction, including general excavation. The USPS held a pre-proposal conference on August 14, 1989, to enable prospective offerors to ask questions and obtain a better understanding of contract requirements. Deleon Vice President Michael Greene at[636]*636tended the conference and asked whether rock excavation and removal were to be included in the contract. In response to the question, the project architect handed him a copy of an amendment to the solicitation, Amendment AOl, which contained copies of boring logs and a Boring Location Plan drawing. These logs described the amount and types of subsurface materials at the site and indicated the presence of subsurface rocks. The cover page of AOl stated “Boring Data is furnished for INFORMATIONAL PURPOSES ONLY AND IS NOT A PART OF THE SOLICITATION.” (emphasis in original). All the boring logs and the drawing contained the handwritten notation “for information only — NIC,” which stands for “-not in the contract-”. The government states this notation meant simply that the data disclosed in these documents were not a guarantee of what materials lay beneath the surface of the site. Deleon, however, interpreted “NIC” to mean that rock excavation was not required by the contract.

Deleon submitted a proposal on August 25,1989. The cover of its proposal notes in handwriting “PROPOSAL INCLUDES ROCK EXCAVATION,” but Deleon claims that this notation was an error and that its proposal did not include rock excavation. The USPS awarded the contract to Deleon on October 20, 1989.

At a post-award, pre-construction meeting on October 26, 1989, Deleon officials stated their understanding that rock excavation was not part of the contract. The government disagreed. Despite the disagreement, Deleon fully performed the contract, including excavating and removing rocks from the site. Deleon filed a claim for $207,954.50 with the contracting officer on May 30, 1990 for additional compensation for rock excavation. The contracting officer denied the claim on July 20, 1990. This litigation followed.

DISCUSSION

Summary judgment shall be rendered if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. RCFC 56. All justifiable inferences are to be drawn in favor of the non-movant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 2513, 91 L.Ed.2d 202 (1986).

This dispute is over contract interpretation, which is a question of law. Monarch Painting Corp. v. United States, 16 Cl.Ct. 280, 286 (1989). This court must first determine whether an ambiguity in the contract exists. An ambiguity is said to exist if the contract is susceptible of two different interpretations, each of which is found to be consistent with the contract’s language. Sun Shipbuilding & Dry Dock Co. v. United States, 183 Ct.Cl. 358, 372, 393 F.2d 807 (1968).

At the outset, the court notes that neither the original solicitation nor amendment AOl specifically mentions that rock excavation and removal are part of the contract. The solicitation does specifically require general excavation of the site. It requires the contractor to “remove all materials of any nature to the design sub-grades indicated.” “All materials” would seem to include rocks. Thus, a reasonable interpretation of the solicitation is that it included rock excavation because it required general excavation without limiting the type of material to be excavated. Other provisions of the solicitation can be construed to support this interpretation.1 The [637]*637defendant argues for these reasons that the solicitation clearly required rock excavation.

The plaintiff, however, argues that the solicitation is ambiguous because it does not specifically mention rock excavation, and a contractor would reasonably expect rock excavation to be specifically mentioned if the contract required it. Deleon states that rock excavation is typically bid on a per-unit basis, not in a lump sum, unless language more specific than the language in this solicitation states otherwise. This was a lump-sum contract. At oral argument, Deleon reasoned that the government could not expect contractors to bid on rock removal because the government did not provide full information on the quantity of subsurface rocks. Deleon claims it would be unreasonable to expect contractors to bear the risk of the uncertainty of the presence of rocks since rock removal is expensive.

The court notes that a government contractor does not bear the burden of interpreting a contract correctly, only of interpreting it reasonably. Salem Eng’g & Constr. Corp. v. United States, 2 Cl.Ct. 803, 807 (1983). The court finds that the original solicitation was ambiguous. Viewing the solicitation from the position of a reasonably prudent contractor, the specifications could be read to show a patent ambiguity as to whether rock excavation was part of the contract.

The next question is whether Del-con fulfilled its duty to inquire about the ambiguity. Where there is a patent ambiguity in contract specifications, contractors have a duty to clarify the ambiguity prior to bidding on the contract. J.B. Steel, Inc. v. United States, 810 F.2d 1139, 1141 (Fed.Cir.1987). Deleon argues that it did inquire. Deleon Vice President Michael Greene asked at the pre-bid conference whether rock excavation was included in the contract. The government’s response was to hand out a copy of amendment AOl.

However, AOl did not state that rock excavation was excluded or included in the contract requirements.

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38 Cont. Cas. Fed. 76,476, 27 Fed. Cl. 634, 1993 U.S. Claims LEXIS 286, 1993 WL 30485, Counsel Stack Legal Research, https://law.counselstack.com/opinion/delcon-construction-corp-v-united-states-uscfc-1993.