M.E.S., Inc. v. United States

99 Fed. Cl. 239, 2011 U.S. Claims LEXIS 1279, 2011 WL 2712732
CourtUnited States Court of Federal Claims
DecidedJune 30, 2011
DocketNo. 10-92
StatusPublished
Cited by3 cases

This text of 99 Fed. Cl. 239 (M.E.S., Inc. 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
M.E.S., Inc. v. United States, 99 Fed. Cl. 239, 2011 U.S. Claims LEXIS 1279, 2011 WL 2712732 (uscfc 2011).

Opinion

MEMORANDUM OPINION AND ORDER

BRADEN, Judge.

I. RELEVANT FACTS AND PROCEDURAL HISTORY.1

On July 20, 1998, the United States Postal Service (“USPS”) issued a solicitation for the construction of a new post office in River-head, New York (the “Riverhead P.O. Project”). USPS Compl. ¶ 9. On August 11, 1998, pursuant to the terms of the solicitation for the Riverhead P.O. Project and the Miller Act,2 M.E.S., Inc. (“MES”) acquired Performance Bond No. 73 SB 103097863 BCM (the “Performance Bond”) from Travelers Casualty & Surety Company of America (“Travelers”). USPS Compl. ¶ 14. The Performance Bond required Travelers “to be ‘firmly bound’ to [the USPS] for any ‘penal sum’ (not to exceed the value of the Performance Bond: $3,954,000) to be paid to [the USPS] in the event of a [MES] default.” USPS Compl. ¶ 17. On September 9, 1998, the USPS awarded Contract No. 332495-98-B-0307 to MES for the performance of the Riverhead P.O. Project for $3,954,000 (the “Contract”). Compl. ¶ 4. On October 6,1998, the USPS issued a Notice to Proceed to MES. Compl. ¶ 5.

On June 2,1999, the USPS terminated the Contract for default, because MES allegedly failed to adhere to the schedule set forth therein. USPS Compl. ¶ 19. In July 1999, the USPS asked Travelers to complete the Riverhead P.O. Project, as required by the Performance Bond. Compl. ¶ 7. On August 16, 1999, MES appealed the termination for default to the USPS Board of Contract Appeals (“USPS BCA”). Compl. ¶ 8. On October 12, 1999, the USPS Contracting Officer (“CO”) informed Travelers and MES that USPS would have to reprocure the River-head P.O. Project to complete it in a timely manner. Compl. ¶ 9. On November 10,1999, Travelers informed the USPS that it would not take over the Riverhead P.O. Project while MES’s USPS BCA appeal was pending. USPS Compl. ¶ 25.

On November 6, 2001, MES submitted a certified claim to the CO “requesting compensation for change order work, differing site conditions, delay, additional office and site work, and payment of damages for defective specifications and actions by the USPS.” Compl. ¶ 10. On November 26, 2001, the CO deferred consideration of MES’s certified [241]*241claim until the USPS BCA ruled on MES’s pending appeal. Compl. ¶¶ 12-13.

On July 7, 2003, the USPS notified Travelers that it intended to reprocure the Riverhead P.O. Project, and would seek reimbursement from Travelers under the Performance Bond for any costs incurred that exceeded the Contract price. USPS Compl. ¶ 27. On August 25, 2003, Travelers responded that it would not consider any claim under the Performance Bond unless the USPS BCA determined that MES’s termination for default was lawful. USPS Compl. ¶ 28.

On April 26, 2004, the USPS issued a second solicitation for the Riverhead P.O. Project. USPS Compl. ¶ 29. On July 25, 2004, USPS awarded a contract to THC Realty Development (“THC”) for $4,914,000. USPS Compl. ¶ 31.

On January 31, 2006, the USPS BCA denied MES’s August 16, 1999 appeal. See M.E.S., Inc., PSBCA No. 4462, 06-1 BCA ¶ 33,184. The board found that, although MES was entitled to sixty days of delay, the June 6, 1999 termination for default was reasonable because MES still would have been more than a month behind schedule in completing the Riverhead P.O. Project. Id.

On June 24, 2006, THC substantially completed the Riverhead P.O. Project. USPS Compl. ¶ 34. On September 27, 2006, USPS made a final payment to THC. USPS Compl. ¶ 36.

On November 1, 2006, the USPS BCA denied MES’s request for reconsideration of its January 31, 2006 decision. See In re M.E.S., Inc., PSBCA No. 4462, 06-2 BCA ¶ 33,430. On September 7, 2007, the United States Court of Appeals for the Federal Circuit affirmed the USPS BCA’s January 31, 2006 decision in a nonpreeedential per curium opinion. See M.E.S., Inc. v. Potter, 240 Fed.Appx. 871 (Fed.Cir.2007).

On February 19, 2009, the CO issued a Final Decision regarding MES’s November 6, 2001 certified claim, finding that the USPS was entitled to excess reproeurement costs in the amount of $803,909. Compl. ¶ 22.

On February 16, 2010, MES filed a Complaint in the United States Court of Federal Claims, challenging the CO’s February 19, 2009 Final Decision and seeking damages incurred in performing the Riverhead P.O. Project, ie., the “additional costs for change order work, differing site conditions, delay, additional office and site work, equipment and materials, and other damages due to defective specifications and actions of the USPS.” Compl. ¶¶ 23-33.

On March 1, 2010, the USPS filed a Complaint in the United States District Court for the Eastern District of New York, alleging that Travelers breached its obligations under the Performance Bond and seeking to recover its excess reprocurement costs. USPS Compl. ¶¶ 43-49.

On May 19, 2010, the Government filed an Answer and Counterclaim in the United States Court of Federal Claims to recover $803,909 in excess reprocurement costs.

On February 21, 2011, MES filed a Motion For Preliminary Injunction And Temporary Restraining Order, requesting that the court enjoin the United States District Court for the Eastern District of New York from proceeding in United States Postal Service v. Travelers Casualty & Surety Company of America, No. 10-00892 (“Pl. Mot.”). On that same date, Travelers filed a Motion For Leave To Intervene (“Travelers Mot.”), and a Motion For Preliminary Injunction and Temporary Restraining Order almost identical to that filed by MES.

On March 10, 2011, the Government filed a Response to MES’s February 21, 2011 Motion For Preliminary Injunction And Temporary Restraining Order (“Gov’t PI Resp.”), and a Response to Travelers Motion To Intervene (“Gov’t Int. Resp.”). On March 21, 2011, MES filed a Reply (“PI. Reply”). On that same date, Travelers also filed a Reply (“Travelers Reply”).

II. DISCUSSION.

A. Travelers Casualty & Surety Company of America’s February 21, 2001 Motion To Intervene As A Matter Of Right.

1. The Parties’ Arguments.

a. Travelers Casualty & Surety Company of America’s Argument.

Travelers requests to intervene in this case as a matter of right, pursuant to Rule [242]*24224(a)(2)3 of the United States Court of Federal Claims (“RCFC”). Travelers Mot. at 3. In Belton Industries, Inc. v. United States, 6 F.3d 756 (Fed.Cir.1993), our appellate court held that a motion to intervene is considered timely upon consideration of the following factors:

1) the length of time during which the would-be intervenors actually knew or reasonably should have known of their rights;
2) whether the prejudice to the rights of existing parties by allowing intervention outweighs the prejudice to the would-be intervenors by denying intervention;
3) existence of unusual circumstances militating either for or against a determination that the application is timely.

Id. at 762.

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Related

M.E.S., Inc. v. United States
104 Fed. Cl. 620 (Federal Claims, 2012)

Cite This Page — Counsel Stack

Bluebook (online)
99 Fed. Cl. 239, 2011 U.S. Claims LEXIS 1279, 2011 WL 2712732, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mes-inc-v-united-states-uscfc-2011.