HNV Central River Front Corp. v. United States

37 Cont. Cas. Fed. 76,289, 25 Cl. Ct. 606, 1992 U.S. Claims LEXIS 130, 1992 WL 62897
CourtUnited States Court of Claims
DecidedMarch 31, 1992
DocketNo. 285-89C
StatusPublished
Cited by4 cases

This text of 37 Cont. Cas. Fed. 76,289 (HNV Central River Front Corp. 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
HNV Central River Front Corp. v. United States, 37 Cont. Cas. Fed. 76,289, 25 Cl. Ct. 606, 1992 U.S. Claims LEXIS 130, 1992 WL 62897 (cc 1992).

Opinion

OPINION

MARGOLIS, Judge.

This government contracts case is before the court on cross-motions for summary judgment. Plaintiff entered into a contract to store defendant’s grain and four contracts to bag defendant’s grain. On summary judgment plaintiff claims past-due fees withheld by defendant for services rendered under the contracts, plus statutory interest. Plaintiff also claims costs for a loading sequence that defendant terminated by rejecting the grain, plus statutory interest. Plaintiff requests the court to dismiss as a matter of law certain counterclaims brought by defendant for quality discounts on sorghum, quality discounts on wheat sold to a third party, and consequential damages for market losses on a grain swap. As an alternative ground for dismissal, plaintiff asserts that the counterclaims have not been subjected to the disputes process pursuant to the Contract Disputes Act (“CDA”).

In its response, defendant asserts that plaintiff’s claims for misgrading are tort claims, which are beyond the jurisdiction of this court. Defendant also asserts that the inspection agent was mandated by statute, not by contract; consequently no agency relationship existed to impute liability for misgrading to defendant.

Defendant claims that deterioration of the stored grain resulted in plaintiff’s breach both of an express contract and of its duty as bailee to care for the grain. On summary judgment, defendant claims that plaintiff is liable for resultant damages as a matter of law. Defendant acknowledges plaintiff’s entitlement to past-due fees but asserts that withholding is sanctioned by the storage contract due to plaintiff’s offsetting obligation to reimburse defendant for deteriorated grain. In addition, defendant seeks consequential damages for loss[609]*609es it incurred in meeting its grain export obligations when plaintiffs grain was not of suitable quality. Defendant further claims that plaintiff unilaterally, and without justification, terminated performance on the canceled bagging contracts, and defendant is therefore not liable for the costs consequent to these terminations.

After careful review of the parties’ motions for summary judgment, and after hearing oral argument, this court adjudicates several basic jurisdictional and legal issues, but finds that the substantive claims rest on disputed issues of material fact inappropriate for summary judgment. Accordingly, this court denies plaintiff’s motion for summary judgment, and denies defendant’s motion for summary judgment.

FACTS

Plaintiff HNV Central River Front Corporation (“HNV”) and defendant Commodity Credit Corporation (“CCC”), a federally-owned corporation under the purview of the U.S. Department of Agriculture (“USDA”), entered into a contract on June 9, 1986 to store CCC’s grain at the Public Grain Elevator (“PGE”) in New Orleans, Louisiana. Uniform Grain Storage Agreement (“UGSA”) No. A22-3-CCC-943J governed HNV’s obligations to receive, store, condition and load grain. Under applicable statutes governing export grain, the Federal Grain Inspection Service (“FGIS”) inspected and classified all grain entering and leaving PGE according to federal grading standards. 7 U.S.C. § 77(a)(1). CCC used FGIS-determined grades to assess HNV, as insurer of grain quantity and quality under the UGSA, for changes in the grain’s value occurring during storage. As a result of the change in value of the grain, CCC withheld $487,904.13 from HNV in storage and loading fees on this contract.

HNV received four contracts to bag CCC-owned grain. HNV completed Contract No. KCMG-2548, and CCC owes HNV $4,821.03 on the contract. HNV also completed Contract No. KCMG-2549, and CCC owes $17,078.22 on the contract. CCC subsequently canceled bagging Contract Nos. KCMW-2550 and KCMW-2551 before they were fully performed. CCC owes $41,-661.90 for partial performance of Contract No. KCMW-2551. CCC withheld a total of $63,561.15 in bagging fees on these four contracts.

A contracting officer’s final decision on the storage contract was issued October 4, 1988. A contracting officer’s final decision on the bagging contracts was issued on April 30, 1990.

JURISDICTION

Several issues raised by the parties concern the jurisdiction of this court to hear the pending claims. The court finds that the issues raised do not impair the ability of this court to entertain the parties’ substantive claims.

CCC’s Counterclaims

HNV asks the court to dismiss CCC’s counterclaims totalling $3,068,-396.61. HNV argues that this court must deny jurisdiction as a matter of law because HNV did not have notice of the fully liquidated dollar amounts associated with the claims CCC intended to bring against it prior to the contracting officer’s final decision of October 4, 1988. HNV asserts, and CCC does not dispute, that it never received a written claim for a definite amount corresponding to any of CCC’s counterclaims except for those associated with one specific grain swap. HNV therefore argues that the claims are not ripe for adjudication by this court pursuant to the GDA. 41 U.S.C. § 609(a)(1).

Taking the facts in the light most favorable to the non-moving party, HNV received notice that CCC would seek compensation for grain deterioration through counterclaims. CCC withheld fees earned by HNV as a set-off to ensure payment of its counterclaims.1

[610]*610The CDA is silent on what constitutes a claim by the government. 41 U.S.C. §§ 601-613. The CDA states only that claims brought by the government must “be the subject of a decision by the contracting officer.” 41 U.S.C. § 605(a). In short, there is no statutory requirement to certify government claims, and the United States Claims Court has jurisdiction provided that the contracting officer’s decision is final. See 41 U.S.C. § 605(c)(1); Placeway Construction Corp. v. United States, 920 F.2d 903, 906 (Fed.Cir.1990).

The Federal Acquisition Regulations (“FAR”) define a claim as “a written demand or written assertion by one of the contracting parties seeking, as a matter of right, the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief arising under or related to the contract.” 48 C.F.R. § 33.201 (1990).

In a recent decision interpreting the FAR language, the United States Court of Appeals for the Federal Circuit determined that a set-off asserted by the government, though of an indeterminate amount, constituted a government claim such that the contracting officer’s denial of the contractor’s claim amounted to a final decision justiciable in the Claims Court. Placeway, 920 F.2d at 906-07.2 In effect, Placeway required only that the government assert the claim or claims and obtain a final decision of the contracting officer. Id.

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Bluebook (online)
37 Cont. Cas. Fed. 76,289, 25 Cl. Ct. 606, 1992 U.S. Claims LEXIS 130, 1992 WL 62897, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hnv-central-river-front-corp-v-united-states-cc-1992.