Johnson & Sons Erectors Co. v. United States

30 Cont. Cas. Fed. 70,001, 231 Ct. Cl. 753, 1982 U.S. Ct. Cl. LEXIS 330, 1982 WL 1441
CourtUnited States Court of Claims
DecidedJune 18, 1982
DocketNo. 435-81C
StatusPublished
Cited by7 cases

This text of 30 Cont. Cas. Fed. 70,001 (Johnson & Sons Erectors Co. 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
Johnson & Sons Erectors Co. v. United States, 30 Cont. Cas. Fed. 70,001, 231 Ct. Cl. 753, 1982 U.S. Ct. Cl. LEXIS 330, 1982 WL 1441 (cc 1982).

Opinion

This case is stated in the petition to be one for review of a decision by the Armed Services Board of Contract Appeals (ASBCA) both under the Wunderlich Act, 41 U.S.C. §321, and under the Contract Disputes Act of 1978, 41 U.S.C. § 601 and ff (Supp. Ill 1979) (cda). Defendant’s Department of the Air Force awarded plaintiff a construction contract, F 35610-76-C-0100, on August 28,1975. Disputes arose and plaintiff filed claims for equitable adjustments on various theories, and for breaches, including government-caused delay. The contracting officer issued a decision February 13, 1979. The effective date of the cda was March 1 of that year. On March 14, 1979, the contractor appealed, and the absca assigned it number 23689. The board ruled that these claims were not pending before the contracting officer on March 1 and, therefore, the broadening of its jurisdiction effected in the cda was not applicable. Section 16 of Pub. L. No. 95-563. The contractor again presented virtually the identical claims to the contracting officer in December 1979. He refused to decide alleging he had already made his final decision. The contractor appealed from this refusal and the board numbered this appeal 24564. The board considers that this second appeal validly puts before it certain claims that the first one does not, i.e., those of which it did not have cognizance under the prior law, but did under the cda.

Defendant moved to dismiss No. 24564 on the ground that it was "merely duplicative” of No. 23689. By opinion dated June 3,1980, the board denied this motion, holding that the contractor had resorted to a permissible procedure to bring before the board breach and reformation claims not previously within its cognizance, but made so by the new law. [755]*755The board noted later that the two sets of claims were substantially identical so far as concerned the facts of the wrongs complained of. The lack of identity resided in the fact that the later claims were founded on a different legal theory.

The board, later in a decision of December 30, 1980, Johnson & Son Erectors Co., 81-1 BCA (cch) ¶ 14,880, reaffirmed on motion for reconsideration March 31, 1981, 81-1 bca ( cch) ¶ 15,082, allowed a government motion to strike from both appeals all references to contract breaches wherever a contract clause existed that would provide a means for an equitable adjustment if the contractor established entitlement to one, retaining only allegations of breach of procurement regulations and breach by government-caused delay, there being, as to the latter, no contract clause for "suspension of work.” These retentions were limited to Appeal No. 24564 only. The breach issues excluded from both appeals were defective and ambiguous specifications, withholding of superior knowledge, and impossibility of performance. The board construed contract clauses as providing for equitable adjustments if grievances of these characters were established factually, and it took the view that whatever was otherwise established as a contract breach was not a breach if it was remediable under the contract.

The immediate practical consequence of this view is to throw all those latter classes of claims into the earlier appeal, No. 23689, because the board had cognizance of them when first presented in that appeal, without the aid of the cdA. This in turn withdraws from plaintiff in proving these claims the benefit of the board’s new nationwide subpoena power under 41 U.S.C. § 610 and remits plaintiff to the more cumbersome and costly procedure that previously obtained, by which the United States District Court of the district where the witness resided had to issue the subpoena. This seems to be what this possibly over-hasty appeal to us is really about. Plaintiff has no clear perception that the measure of damages is different, but the accrual of interest may be; however, the contract provides for interest as generally contracts of its date did. Plaintiff is a small business and has been bankrupted by this contract, [756]*756so finding the most inexpensive manner of litigating is vital to its ability to maintain the suit.

Since the board can subpoena some witnesses in connection with the remaining breach claims under Appeal No. 24564, and since under § 610 it will be necessary to resort to a district court if a subpoenaed witness is recalcitrant, it is at this point anyone’s guess what added costs, if any, plaintiff will incur. We suppose defendant will produce without subpoena all witnesses under its control. In connection with the impossibility issue, there will be third parties having needed information.

At any rate, plaintiff-appellant appeals the grant of defendant’s motion to strike. In response to defendant’s obvious response that this is an interlocutory matter and the recourse to this court, whether by way of Tucker Act petition under former law, or appeal under the new law (apparently it is both), is obviously premature and unauthorized, plaintiff says the order of the board is final so far as it bars prosecution of breach claims before the board if they are in the categories stated. By this view, the finality of the order is not impaired by the fact that only procedure, not substance is shown to be directly affected. In view of the novelty of the issue and the fact it arises as incident to the transition to operations wholly covered by the new law, we are willing to assume that plaintiff is right. Defendant cites no case that is open and shut to the contrary.

On the legal substance of its contention, plaintiff-appellant says that the whole theory of constructive changes in contracts is a "legal fiction” invented to enable contract appeal boards to do justice in what are really breach cases. Now that in the CDA the Congress has broadened board jurisdiction so boards can do all that courts could do in government contract cases, the need for this fiction is past and therefore it must be considered swept away. What looks like a government breach and would be a breach but for a contract exculpatory clause, can be dealt with as a breach by the contractor and by the board. We are not entirely clear whether plaintiff would override exculpatory clauses entirely, or only when the use of them involves invention of a fiction that something has occurred that in fact has not occurred: a formal change order or formal suspension of [757]*757work, for example, where a suspension of work clause exists. In either event, the position ignores history and imputes to Congress intent to achieve a sweeping change of which it gave no notice.

By plaintiff-appellant’s view, Congress provided a new board remedy in disregard of contract clauses, and Appeal No. 24564 must be held to invoke a power the board now has to consider withholding of superior knowledge, impossibility, etc., as breach issues whether or not in pre-Dispute Act days they were remediable under contract clauses also found in the contract under review.

The various clauses that provide for contract equitable adjustments, and the disputes clause, were put there for purposes highly important to the government as well as to the contractor, among which the issue of board jurisdiction was minor. If a board could not remedy a breach, a court could. One major purpose is to keep the work going at all events, despite controversies that may arise.

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Cite This Page — Counsel Stack

Bluebook (online)
30 Cont. Cas. Fed. 70,001, 231 Ct. Cl. 753, 1982 U.S. Ct. Cl. LEXIS 330, 1982 WL 1441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/johnson-sons-erectors-co-v-united-states-cc-1982.