Monica Walker

CourtArmed Services Board of Contract Appeals
DecidedJuly 27, 2016
DocketASBCA No. 60436
StatusPublished

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Bluebook
Monica Walker, (asbca 2016).

Opinion

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeal of -- ) ) Monica Walker ) ASBCA No. 60436 ) Under Contract No. DACA45-5-14-6100 )

APPEARANCE FOR THE APPELLANT: Ms. Monica Walker

APPEARANCE FOR THE GOVERNMENT: Thomas H. Gourlay, Jr., Esq. Engineer Chief Trial Attorney Melissa M. Head, Esq. Engineer Trial Attorney U.S. Army Engineer District, Omaha

OPINION BY ADMINISTRATIVE JUDGE PROUTY

In this appeal, decided pursuant to the accelerated procedures of Board Rule 12.3 and on the record without a hearing pursuant to Board Rule 11, we determine what amount of compensation is due to appellant, Ms. Walker, for damage done to a house that she leased to the United States Army Corps of Engineers (the Corps) for use by an Army recruiter and his family. As will be seen, Ms. Walker is entitled to some compensation, but not the full amount that she has sought.

SUMMARY FINDINGS OF FACT

On 11 August 2010, a Corps real estate contracting officer (CO), executed Lease No. DACA45-5-10-001 l l (the initial lease), through which Ms. Walker and Joseph Gordon Hylton (Ms. Walker's now-former husband) provided a house in Waukesha County, Wisconsin (the house), for use by Army Sergeant First Class (SFC) Jose Rodriguez, Jr., and his family (R4, tab 39). The term of the initial lease was one year, from 20 August 2010-19 August 2011, renewable annually at the choice of the Corps until 19 August 2013 (id. at 1). The initial lease included a provision for an "INITIAL CONDITION REPORT," through which the parties would jointly inspect the leased premises on or before the effective date of the lease and co-sign a report about the condition of the house (id. at 3, ii 3). The initial lease also included a provision (the Restoration Clause) requiring a "final joint inspection and condition report" and that, "[ u]pon written notice, the lessors may require restoration of the demised premises ... to the same condition as that existing at the time of initial occupancy" or payment of money sufficient to make up for the loss of value to the house caused by any damage to the premises (id. at 4, ii 13(A)). This restoration requirement, however, did not extend to "ordinary wear and tear" (id., ii 13(B)).

The Corps duly renewed the initial lease annually through 19 August 2014 (see R4, tabs 35-37). 1 On 16 July 2014, the CO sent a letter to Ms. Walker and Mr. Hylton officially terminating the lease, but noting that it would be replaced by Lease No. "DACA455140006100" (the new lease) (R4, tab 34). This letter also provided that the exit inspection would be performed at the termination of the new lease (id.). The new lease, was, in fact, executed by Mr. Hylton and Ms. Walker on 30 July 2014, and by the CO on 4 August 2014 (R4, tab 33).

The initial lease and the new lease generally contained similar provisions (compare R4, tab 39 to R4, tab 33), but the new lease had a slightly different Restoration Clause. In the new lease, the Restoration Clause explicitly required written notice of "damage beyond normal wear and tear ... along with validation of damages" be provided to the government within 30 days of the termination date (R4, tab 33 at 4, ii 13(A)). The Restoration Clause in the new lease also explicitly provided that the government would not restore "the interior paint of the demised premises, when the Government has possessed the leased premises for three or more years prior to the date of the termination" (id, ii 13(B)). The new Restoration Clause also limited the government's payment, when restoration was deemed warranted, to an amount "depreciated for normal wear and tear" reflecting either the amount that the damage decreased the value of the house or the amount necessary to make repairs (id., ii 13(C)). The new lease was modified on 15 May 2015, primarily to reflect Ms. Walker as the sole lessor (R4, tab 32).

On 26 June 2015, the CO sent to Ms. Walker a letter acting as a notice of termination ofthe lease, effective 19 August 2015 (R4, tab 31). This termination letter raised the issue of the final joint inspection, stating that it needed to be conducted within five days before the termination date, and include the service member, Ms. Walker, and a government representative from the military service member's office (id.). The letter also informed Ms. Walker that, if she felt damage had occurred "above normal wear and tear," she was to inform the government within 30 days so that they could discuss what was needed to negotiate a final settlement (id.).

The walk-through inspection was conducted on 19 August 2015, and Ms. Walker, SFC Rodriguez, and Mr. Keith Falvey from the Corps were in attendance (R4, tabs 22, 23, 26). The 20-page joint survey was completed at the time and signed by both Ms. Walker

1 The record does not reflect any change to the initial lease extending its end date to 19 August 2014 from the 19 August 2013 date originally in the initial lease. The discrepancy, however, is not material to the issues before us.

2 and Mr. Falvey (see R4, tab 26), and multiple photographs were taken by Mr. Falvey. Mr. Falvey wrote up a short memorandum the next day (20 August) including his impression of the state of the home (R4, tab 24). Ms. Walker sent an email to the CO on 20 August 2015 characterizing the amount of "intentional damage" to the house as being "staggering" (R4, tab 22). Attached to this email was a four-page memorandum noting issues observed during the 19 August walkthrough (id. at 3-7). On that day, Mr. Falvey sent SFC Melissa Berberian to the house to meet with Ms. Walker and take additional photographs, which she did (R4, tab 42).

On 21 August, Ms. Walker sent the CO another email, detailing comments from a contractor who she had taken through the house for a further examination of the damage to it (R4, tab 20). We will discuss this in more detail below, but the damage to the house reported in this email was more extensive than in Ms. Walker's or Mr. Falvey's earlier assessments (compare R4, tab 20 at 1-2 to R4, tabs 22, 24), and included, for the first time, claims that five of the interior doors were seriously damaged (R4, tab 20 at 1-2). In apparent response, on 8 September 2015, SFC Rodriguez provided a slide presentation to the CO setting forth his view of the damage to the house (R4, tab 19).

Ms. Walker's communications with the CO adding further details and allegations of damages continued. On 16 September 2015, Ms. Walker sent a memorandum with photographs to the CO further detailing the damage to the house for which she blamed SFC Rodriguez (R4, tab 18). Ms. Walker sent the CO extensive estimates for repairing the damage on 14 October (R4, tabs 11-15), and an additional list of "other damages" done to the house and appliances on 25 October (R4, tabs 7-9). The 25 October email included 10 itemized components setting forth the "Cost of Vandalism to Home," summing to $21,135.92 (R4, tab 6). 2

The CO inquired of Ms. Walker if this was the final total for the cost of the damage to the house and asked her for a signed and dated letter if it were so (R4, tab 6). Ms. Walker responded with a signed letter, dated 27 October 2015, resubmitting the $21,135.92 request and included further explanation and cost estimates (R4, tab 5). The CO considered this to be Ms. Walker's claim, pursuant to the Contract Disputes Act (CDA) (R4, tab 2 at 3, iJ 9). The CO sought and received additional information from SFC Rodriguez (see R4, tab 4), as well as from Ms. Walker (see R4, tab 3).

On 11 January 2016, the CO issued a final decision (COFD) on Ms. Walker's claim (R4, tab 2). In the COFD, the CO agreed to payment of $4,067.87 of Ms. Walker's claim, which the CO calculated to sum to $22,275.92, rather than the $21,135.92 written on the claim (id. at 12). Ms.

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Monica Walker, Counsel Stack Legal Research, https://law.counselstack.com/opinion/monica-walker-asbca-2016.