Sharman Co. v. United States

37 Cont. Cas. Fed. 76,246, 24 Cl. Ct. 763, 1991 U.S. Claims LEXIS 592, 1991 WL 279402
CourtUnited States Court of Claims
DecidedDecember 20, 1991
DocketNo. 90-108 C
StatusPublished
Cited by13 cases

This text of 37 Cont. Cas. Fed. 76,246 (Sharman 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
Sharman Co. v. United States, 37 Cont. Cas. Fed. 76,246, 24 Cl. Ct. 763, 1991 U.S. Claims LEXIS 592, 1991 WL 279402 (cc 1991).

Opinion

OPINION

WIESE, Judge.

This government contract suit comes before the court on defendant’s motion to [765]*765dismiss for lack of subject matter jurisdiction. The contention is that the complaint does not present a claim for money presently due and, therefore, is essentially a demand for declaratory relief—a form of relief not generally available here. Plaintiff opposes the motion and, in addition, seeks a stay of proceedings and an order remanding the case to the contracting officer.

For the reasons explained below, defendant’s motion is granted in part and denied in part. We also deny, on grounds of prematurity, plaintiff’s motion for a stay of proceedings, and we deny, for lack of jurisdiction, plaintiff’s motion for a remand to the contracting officer.

I

Plaintiff is a government contractor whose contract for the manufacture of steel water tanks for the United States Marine Corps was terminated for default through a notice of termination and final decision issued by the contracting officer on July 27, 1989.

In a follow-up letter to the contractor some six weeks later (September 12, 1989), the contracting officer served a “notice of demand for payment of contract debt.” The letter informed Sharman that the “Defense Contract Administration Services Region (DCASR), Atlanta has determined that the Sharman Company has been overpaid progress payments in the amount of $2,066,696.36.” The letter went on to state that “if the amount identified above has not been paid within 30 days from the date of the demand, interest will incur and will be computed from the date of the demand.” Sharman was also told that it could submit a proposal for deferment of collection “if immediate payment is not practicable or if the amount is disputed.” Finally, the letter gave Sharman the name of the individual responsible for determining the amount of the debt and for its collection.

The contractor did not seek a deferment of collection or otherwise dispute the amount asserted. Instead, it responded by bringing suit. In a complaint filed here on February 2,1990, Sharman sought invalidation of the default termination, conversion of the termination to one for Government convenience and recovery of all uncompensated costs incurred in the contract’s performance.

The Government answered the complaint and then, on June 25,1990, filed the motion to dismiss now before the court. Action on the motion was postponed in order to afford the parties an opportunity to explore settlement. However, settlement proved unattainable, and thus we now confront the specifics of the Government’s jurisdictional arguments.

As background to those arguments, one additional fact needs to be added to the recitation of events noted above. On October 18, 1990 (while the parties were still engaged in their settlement efforts), the contracting officer sent plaintiff a second letter concerning the unliquidated progress payments. Unlike the first demand letter, this one described itself as a “notice of the Contracting Officer’s final decision,” and it now identified the amount owed by Sharman as $1,391,240.29. Sharman was asked to make payment of this amount. The letter concluded by advising the contractor that questions concerning the repayment demand should be directed to the Department of Justice trial attorney assigned to the case or to the agency counsel assisting the Department’s attorney.

II

Defendant’s Motion To Dismiss.

The Government’s motion raises two points. First, the Government contends that the grievance presented in the complaint is basically an attack upon the default termination, unaccompanied by a money claim, and is, therefore, simply a demand for declaratory relief over which the court has no jurisdiction. Second, the Government contends that, even if plaintiff’s complaint is read as including a demand for relief from the debt asserted in the contracting officer’s letter of September 12, 1989, that would not remedy the jurisdictional difficulty in the complaint. It would not offer a remedy, maintains defen[766]*766dant, because the letter was not issued as a contracting officer’s “final decision” and thus cannot serve as the basis for a claim here.

We agree only with the Government’s first argument, not the second. Defendant is right in saying that under the Tucker Act, 28 U.S.C. § 1491 (1988) (the court’s basic jurisdictional statute), it is not enough that the transaction sued on implicate a right to money or be money-related. Rather, to invoke our jurisdiction, the entitlement claimed must be for “actual, presently due money damages.” United States v. King, 395 U.S. 1, 3, 89 S.Ct. 1501, 1502, 23 L.Ed.2d 52 (1969). To put it more precisely, the allegation “must be that the particular provision of law relied upon grants the claimant, expressly or by implication, a right to be paid a certain sum,” or the claim “must assert that the value sued for was improperly paid, exacted, or taken from the claimant in contravention of the Constitution, a statute, or a regulation.” Eastport S.S. Corp. v. United States, 178 Ct.Cl. 599, 605, 372 F.2d 1002, 1007 (1967).

Moreover, where the entitlement claimed derives from a contract that is subject to the provisions of the Contract Disputes Act, 41 U.S.C. §§ 601-613 (1988)—the case here—then the adjudication of that entitlement is conditioned upon exhaustion of administrative requirements. Specifically, the Contract Disputes Act requires that the claim sued on (whether presented in court or before a contract appeals board) be one that was “submitted to the contracting officer for a decision.” 41 U.S.C. § 605(a). Absent submission of a claim to the contracting officer for a decision, the court cannot hear the claim. Paragon Energy Corp. v. United States, 227 Ct.Cl. 176, 184, 645 F.2d 966, 971 (1981). Thus, to gain a jurisdictional foothold here, a plaintiff pursuing a contract claim against the Government must satisfy both of the court’s fundamental jurisdictional requirements—that the claim be for money presently due and that a “decision” on the claim have been entered in accordance with the Contract Disputes Act.

Plaintiff’s demand for convenience termination damages meets neither of these requirements—the claim was never quantified and the claim was never submitted to the contracting officer for decision. Hence, it cannot be adjudicated here.

Nor is it any longer open to argument that a challenge to a contracting officer’s final decision on a default termination is, of itself, sufficient to satisfy these prerequisites to suit. That contention was put to rest in Overall Roofing & Construction, Inc. v. United States, 929 F.2d 687

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Bluebook (online)
37 Cont. Cas. Fed. 76,246, 24 Cl. Ct. 763, 1991 U.S. Claims LEXIS 592, 1991 WL 279402, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sharman-co-v-united-states-cc-1991.