Durable Metal Products, Inc. v. United States

36 Cont. Cas. Fed. 75,897, 21 Cl. Ct. 41, 1990 U.S. Claims LEXIS 260, 1990 WL 95939
CourtUnited States Court of Claims
DecidedJuly 11, 1990
DocketNo. 427-89C
StatusPublished
Cited by19 cases

This text of 36 Cont. Cas. Fed. 75,897 (Durable Metal Products, Inc. v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Durable Metal Products, Inc. v. United States, 36 Cont. Cas. Fed. 75,897, 21 Cl. Ct. 41, 1990 U.S. Claims LEXIS 260, 1990 WL 95939 (cc 1990).

Opinion

OPINION

ROBINSON, Judge:

This matter is before the court on Plaintiff’s Motion For Injunctive Relief, Partial Summary Judgment, And Other Relief, [43]*43filed February 28, 1990. Plaintiffs partial summary judgment motion is based largely upon a portion of a decision which the contracting officer (CO) issued on January 5, 1990, after plaintiff filed suit in this court under Section 10(a)(1) of the Contract Disputes Act of 1978, 41 U.S.C. § 609. Plaintiffs motion requests this court to accept the CO's partial finding for plaintiff on page 6 of his decision with respect to its claim arising out of Modification A00003 to the contract, determine the amount of monetary damages due plaintiff on that claim— which amount was not determined by the CO — and order an immediate payment to plaintiff of that amount. In the alternative, plaintiff asks that this court remand the case to the CO pursuant to 41 U.S.C. § 605(c)(5) for a “final” decision on the amount of damages due plaintiff for its rework claim, and to implement that decision upon issuance. Finally, plaintiffs motion seeks sanctions against defendant under Rule 11 of RUSCC.

Defendant argues that plaintiff has failed to establish as a matter of law that defendant is liable or that plaintiff has incurred any specified amount of damages due to defendant’s actions. Defendant also contends that the CO’s final decision is not binding upon it. Because plaintiff sued in this court, having deemed its claim denied by the CO, defendant states it is not forced to accept the CO’s decision respecting the rework claim, but is entitled to a de novo determination on the merits of that claim. Defendant contends that partial summary judgment must be denied since genuine issues of material facts exist which preelude summary judgment. Defendant strongly opposes plaintiff’s motion for Rule 11 sanctions on various grounds. For the following reasons, all relief sought by plaintiff’s motion will be denied.

Factual Background1

In 1986 Durable Metal Products Company (plaintiff) was awarded Contract DAAE07-86-R-2689 (Contract) that required plaintiff to produce quantities of cylinder assemblies with various delivery dates in April and May, 1987. On October 30, 1986, Defense Contract Administration Service Management Area (DCASMA) Quality Assurance Representative (QAR) Jimmie Friesen accepted 440 of these assemblies. On a Quality Deficiency Report (QDR) dated December 2,1986, the Government questioned whether seals on identical cylinder assemblies which plaintiff produced under a prior contract had been properly installed.

Subsequently, on April 10, 1987, the Government issued Modification A00002 to the Contract which established the proper positioning of the seals as it pertained to future production of assemblies under the Contract. Repair of the 440 accepted assemblies and an issue of contract performance on 1,370 assemblies were resolved by issuance of Modification A00003 dated July 23, 1987.2 Pursuant to plaintiff’s request, Dennis Craft, QAR, inspected the 1,370 assemblies on behalf of DCASMA. He noted in QDR 87-003 eight deficiencies in these [44]*44assemblies.3 As of August 7,1987 plaintiff had not provided a certificate of conformance that a mag particle inspection test had been accepted on 10 percent of the production quantity as required by paragraph 3.E. of Modification A00003. On September 25, 1987 plaintiff provided QAR Kraft with the certificate of conformance that all requirements of the contract had been met as it pertained to the 1,370 assemblies. Kraft executed a DD Form 250 accepting the final lot of 1,370 assemblies under the Contract.

On September 22, 1988 plaintiff submitted a written statement of claim to the CO. On April 18, 1989 plaintiff submitted additional data and a statement supporting and supplementing its prior statement of claim. On June 22, 1989, plaintiff submitted its revised request for equitable adjustment (REA) claim.

On August 8,1989, pursuant to 41 U.S.C. § 605(c)(5), plaintiff filed its complaint in this court after having deemed its amended REA claim submitted to the CO denied in the absence of a CO’s final decision. See generally Vemo Co. v. United States, 9 Cl.Ct. 217 (1985). On January 5, 1990, CO Stephen J. Wilmer issued his final decision which denied most of plaintiffs claim but on page 6, he stated as follows:

Paragraph 3 of modification A00003 pertains to DMP’s agreement to provide a Certificate of Conformance certifying that items A through G of paragraph 3 were accomplished. The intentions and expectations of the Government may not have been as accurately reflected in paragraph 3 as they should have been.

This paragraph also indicates that the product would be accepted when a Certificate of Conformance was provided by DMP certifying that items A thru G were accomplished. It appears that paragraph 3. as interpreted by DMP, would negate the Government’s right to verify by inspection, test, or other means that all conditions of a contract have been satisfied. However, the Government has the right to verify that the contractor’s certifications are appropriate. Paragraph 3 was not interpreted by the Government as having waived these rights. Therefore, when the Government representative asked DMP to perform other criteria required by the contract, to verify the other conditions, the misinterpretation came to light. In retrospect it appears that DMP's interpretation of paragraph 3 fits more closely with the language of the paragraph.

Due to the misinterpretation of paragraph 3 of Modification A00003 by both the Government and DMP, it is my decision that DMP is entitled to an equitable adjustment for CLIN 0004 (rework on the 1,300 units). This decision only pertains to the entitlement for an equitable adjustment for summary item l.f [of plaintiff’s claim submitted to the contracting officer] and does not decide the quantum or dollar amounts. The quantum depends upon DMP establishing causation of damage to DMP and the costs incurred by DMP for the Government’s failure to accept product in accordance with paragraph 3 of modification A00003. The quantum to which is [sic] entitled for

[45]*45summary item l.f cannot be decided at this time due to DMP’s failure to provide adequate proof of the amount of the equitable adjustment for item l.f.

Later, CO Wilmer on deposition admitted that the Government had caused expense and delay to plaintiff, that plaintiff was due an equitable adjustment for CLIN 0004 (the rework claim), that plaintiff had in fact been audited, and that although no additional data had been requested from plaintiff in support of its rework claim, additional data in his opinion was needed to determine plaintiff’s damages.

On February 2, 1990, plaintiff submitted a claim directly to defendant’s attorney at the time, Ms. Evelyn M. Korschgen. This claim matched the parameters of liability which the CO found existed. Plaintiff supplied the information which the CO had testified on deposition was needed in order to determine the amount due plaintiff for its rework claim.

Thereafter, Ms.

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Cite This Page — Counsel Stack

Bluebook (online)
36 Cont. Cas. Fed. 75,897, 21 Cl. Ct. 41, 1990 U.S. Claims LEXIS 260, 1990 WL 95939, Counsel Stack Legal Research, https://law.counselstack.com/opinion/durable-metal-products-inc-v-united-states-cc-1990.