Regan Construction Co. v. United States

30 Cont. Cas. Fed. 70,306, 231 Ct. Cl. 937, 1982 U.S. Ct. Cl. LEXIS 434, 1982 WL 25816
CourtUnited States Court of Claims
DecidedSeptember 3, 1982
DocketNo. 145-81C
StatusPublished

This text of 30 Cont. Cas. Fed. 70,306 (Regan Construction 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
Regan Construction Co. v. United States, 30 Cont. Cas. Fed. 70,306, 231 Ct. Cl. 937, 1982 U.S. Ct. Cl. LEXIS 434, 1982 WL 25816 (cc 1982).

Opinion

This Wunderlich Act1 case comes to us on cross-motions for summary judgment. The sole issue is whether plaintiff, a joint venture consisting of two corporations, is entitled to an equitable adjustment for additional costs expended by its subcontractors to relocate an air-handling unit ( ahu). The Postal Service Board of Contract Appeals ( psbca or board) upheld the decision of the contracting officer that any increased costs must be borne by plaintiff. On plaintiffs motion for reconsideration, the psbca affirmed its earlier decision. Plaintiff timely appealed to this court. For the reasons stated below, we affirm the decision of the board.

On June 11, 1976, plaintiff was awarded contract No. 109450-76-0061 by the U. S. Postal Service.2 The contract required plaintiff to construct a general mail facility ( gmf) and a vehicle maintenance facility ( vmf) in Albany, New York, for a fixed price of $10,685,000. The work was to be performed in accordance with the general provisions, specifications, schedules and drawings provided by defendant. The contract required plaintiff to furnish and install 19 ahus, one of which is the subject of the present controversy (referred to as "ahu V-2”). Actual procurement and installation of the ahus was to be performed by plaintiffs subcontractor, Campito Plumbing & Heating (Campito). Campito, in turn, employed a sheetmetal subcontractor, Lombardi Industries (Lombardi), to assume responsibility for the installation and attachment of connecting duct work to the ahus.

The section of the specifications which dealt with ahus stated that they shall have physical dimensions suitable to fit the allotted space and meet the performance requirements specified on the contract drawings. The applicable drawings specified that ahu V-2 was required to be [939]*939installed on a steel platform in the mezzanine of the vmf. The height of the platform was shown to be 2 feet 9 inches above the mezzanine floor slab. In installing the ahu on the platform, it was necessary that the coil of the unit be aligned with the door (shown in the drawings) for maintenance purposes.

The roof above the platform on which ahu V-2 was to be installed slopes from south to north and west to east. The height between the underside of the roof and the top of the platform is not specified, but the board concluded that this distance can be computed "without undue difficulty.” psbca No. 633 at 4 (November 14, 1980). Campito did not make this computation before submitting its bid for the subcontract, before ordering the units or receiving delivery of the ahus. Apparently Campito expected that the supplier of the ahus would check the drawings to ensure that all of the ahus would fit into the space provided.

Plaintiff made its initial ahu material submission in December 1976, and a revised submission in February 1977. On February 28, 1977, defendant approved the submission, which included ahu V-2. Not all of the units approved precisely met the performance and power requirements set out in the contract. The model for ahu V-2 supplied by plaintiff met or exceeded the performance requirements specified in the contract.

On March 31, 1977, plaintiff submitted a shop drawing which detailed the installation of ahu V-2. The unit as shown on this drawing could not be placed on the platform and fit in the allotted space. On April 13, 1977, defendant returned this drawing to plaintiff with the following notations: "Approved as Noted.” "Revise and resubmit for final approval before fabrication.” On October 3, 1977, plaintiff resubmitted the drawing with the height of the platform unchanged. Defendant placed the following notation on the revised drawing: "certain dimensions appear to be in error-coordination by Regan/Nager required.” Plaintiff made no further submissions of this drawing.

ahu V-2 was delivered to the construction site by August 1977. The unit was not installed on the platform because the vertical distance between the platform and the roof was insufficient to accommodate the unit. The method by which [940]*940the unit could be installed was the subject of many discussions between plaintiff and defendant. By a letter dated July 5, 1978, defendant proposed that the unit be set in inverted channels with shear pads between the bottom of the channels and the floor. Defendant’s architect/engineer (a/e), by a letter dated December 19,1978, directed plaintiff to install the unit as set forth in the recommendations of July 5, 1978, such work to be performed at no additional cost to defendant and no change in the contract completion date. The contracting officer on December 28,1978, directed plaintiff to complete the work as ordered by the a/e. Plaintiff, in a letter dated January 25, 1979, protested the contracting officer’s directions. The contracting officer, by a final decision dated February 16, 1979, affirmed the previous contracting officer’s decision of December 28,1978.

The relocation of ahu V-2 required Campito to expend additional money for inverted channels and shear pads, and Lombardi incurred additional costs due to the modification of duct work leading to the ahu.

Plaintiff appealed the contracting officer’s final decision to the psbca on March 7, 1979. The board found that the evidence did not support plaintiffs contention that it was defendant’s notations on the shop drawings which caused the clearance problems. The board stated that the ahu supplied by plaintiff would not have fit in the allotted space even if located as shown on plaintiffs drawings as originally submitted. The psbca concluded that the clearance problem was caused by the size of the ahu which plaintiff furnished. The board went on to state, "There is merit to [plaintiffs] position that the unit it furnished was the only one on the market which met or exceeded all of the performance requirements of the contract. Nonetheless, it also had a clear contractual obligation to furnish a unit which would fit into the allotted space.” psbca No. 633 at 12 (November 14, 1980). The board stated that the contract drawings contained sufficient information for a contractor to compute the space available "without undue effort,” and the plaintiff or its subcontractors should have made this computation before ordering the ahu. By providing a unit [941]*941which met the performance but not the space requirements, without consulting with defendant,3 plaintiff deprived defendant of the opportunity to initiate appropriate action. The psbca concluded that plaintiff had assumed the risk of any increased costs, and therefore denied plaintiffs claim of entitlement to an equitable adjustment.

Plaintiff filed a motion for reconsideration of the November 14,1980 decision of the psbca. In a decision dated April 16, 1981, the board stated that its earlier decision "recognized a specification defect which made performance impossible.” psbca No. 633 at 2 (April 16, 1981). As to plaintiffs argument that the impossibility of performance was a "latent” defect, the board stated that it had not addressed this issue since it was not dispositive. The board emphasized its earlier determination that it was not reasonable for plaintiff to order a unit without computing the space available. If plaintiff had done so, the defect would have been discovered, and once having discovered the defect, plaintiff had an obligation to notify defendant before proceeding. The board concluded,

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Bluebook (online)
30 Cont. Cas. Fed. 70,306, 231 Ct. Cl. 937, 1982 U.S. Ct. Cl. LEXIS 434, 1982 WL 25816, Counsel Stack Legal Research, https://law.counselstack.com/opinion/regan-construction-co-v-united-states-cc-1982.