Town of Floyd v. United States

40 Cont. Cas. Fed. 76,875, 34 Fed. Cl. 170, 1995 U.S. Claims LEXIS 195, 1995 WL 605390
CourtUnited States Court of Federal Claims
DecidedOctober 12, 1995
DocketNo. 94-570 C
StatusPublished
Cited by1 cases

This text of 40 Cont. Cas. Fed. 76,875 (Town of Floyd 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
Town of Floyd v. United States, 40 Cont. Cas. Fed. 76,875, 34 Fed. Cl. 170, 1995 U.S. Claims LEXIS 195, 1995 WL 605390 (uscfc 1995).

Opinion

OPINION

HODGES, Judge.

Defendant moved to dismiss plaintiffs contract claim because it did not state the elements of an implied-in-fact contract. We grant defendant’s motion to dismiss.

Discussion

The Town of Floyd is a municipal corporation located near Griffiss Air Force Base in New York. While investigating the effects of de-icing chemicals used at the base, representatives of the Air Force and residents of the town discovered contamination in drinking water wells adjacent to the base. Until clean up of the site could be accomplished, the Air Force provided a grant of $500,000 to cover the design costs of extending existing water lines from the neighboring City of Rome to provide safe drinking water to the [172]*172affected residents of the town. The Air Force also offered to pay its share of installing the alternative water system.

Plaintiff commissioned engineering designs and plans and solicited bids for the construction work, including the Charles Road and Davis Road areas now in dispute (Area B). Department of Air Force personnel reviewed and approved the designs, plans, and bid specifications. Meanwhile, the Air Force continued testing and analysis to determine the nature and extent of the contamination. Eventually, it set up a buffer zone of coverage, drawing boundaries beyond which the Air Force would not be responsible for water line construction. Consequently, the Air Force divided the Town of Floyd into four parcels — Areas A, B, C, and D — and limited funding for the water line installation costs to those portions of the town in which groundwater had been contaminated by the Air Force. The Air Force' determined that it had not contaminated Area B.

The Air Force entered into a contract with the City of Rome to extend that city’s water system to the contaminated areas of the Town of Floyd. Area B was not included in the contract. Despite defendant’s refusal to pay for Area B, plaintiff financed construction of the entire project. The town seeks reimbursement of $310,000 for construction of the municipal water system allocable to Area B.

Plaintiff contends that Mr. Gary Vest, then the Air Force Deputy Assistant Secretary for Environment, Safety and Occupational Health, bound the Air Force to provide service to Area B and that the Air Force’s failure to include Area B in its contract with the City of Rome constitutes breach of an implied-in-fact contract.

I.

Implied-in-Fact Contract

An implied-in-fact government contract requires findings of mutual intent to contract, consideration, and unambiguous offer and acceptance. City of El Centro v. United States, 922 F.2d 816, 820 (Fed.Cir. 1990), cert. denied, 501 U.S. 1230, 111 S.Ct. 2851, 115 L.Ed.2d 1019 (1991). Moreover, plaintiff must show that an authorized official bound the United States. Id.

A.

Mutual Intent to Contract

Plaintiff must demonstrate that “the parties intended to bind each other and expressed those intentions clearly.” Hubbs v. United States, 20 Cl.Ct. 423, 426 (1990) (citing Russell Corp. v. United States, 210 Ct.Cl. 596, 609 (1976), cert. denied, 429 U.S. 1073, 97 S.Ct. 811, 50 L.Ed.2d 791 (1977)). The Town of Floyd may have intended to enter into a binding contract regarding Area B, but it proffers no evidence that Mr. Vest intended to contract on behalf of the Air Force to extend water lines to Area B. Plaintiff alleges facts showing negotiations between Mr. Vest and the town, but “[ejxtensive negotiations in which the parties demonstrate hope and intent to reach an agreement are not sufficient in themselves to establish a contract implied-in-fact.” Pacific Gas & Electric Co. v. United States, 3 Cl.Ct. 329, 339 (1983) (footnote omitted), aff'd. 738 F.2d 452 (Fed.Cir.1984).

Plaintiff argues that Mr. Vest’s deposition testimony supports an intent to bind the Air Force:

[A]t the time we made the offer of the [$]500,000 [for planning and design] we also indicated that the Air Force would pay its appropriate or fair share of actually putting in an alternative water system____
Q. Okay. And when you offered these sums, did you consider yourself to have bound the Air Force to coming forth with those sums if whatever conditions you imposed for their receipt were met?
A On the basis of my responsibilities in the consultation, coordination that went into the development of the offer, I certainly believed that, and I think it is true that it was a genuine offer and that barring something unbeknownst to me or someone else, that if the offer were accepted, that indeed the Air Force would have taken the — would take the actions to implement that offer. [173]*173This testimony may indicate that Mr. Vest intended to bind the Air Force to its “fair share” of the installation costs, but it does not show that Mr. Vest bound the Air Force to pay for installation to Area B. When Mr. Vest said that the Air Force would pay its fair share, the Air Force had not determined the extent of the contamination; its fair share had not been calculated.
The Town Supervisor asked Mr. Vest at a meeting with town officials whether his offer included Area B. Mr. Vest responded, “I won’t quibble over a road or two.” Plaintiff argues that Mr. Vest included Area B in his offer by so responding. Pressed further, Mr. Vest finally said, “Yes.” This exchange does not demonstrate an unequivocal, definite, mutual intent to bind the Air Force. Mr. Vest thought that the Air Force would pay its fair share of the contamination problem. He did not make a binding promise to correct the problem in Area B.

B.

Consideration

Plaintiff finds consideration for an implied-in-fact contract with defendant in its forbearance of litigation and reliance on defendant’s assurances. Forbearance in pressing bona fide claims can constitute valuable consideration, but that theory does not apply here. Plaintiff did not know the extent of the contamination when it agreed not to pursue damage claims for Area B. Thus, its forbearance is not valuable. Had contamination in Area B been established when plaintiff agreed to forego litigation, its forbearance might have constituted valuable consideration.

We do not have a suitable substitute for consideration such as detrimental reliance. Plaintiff admits that it went forward with construction of the entire project notwithstanding defendant’s refusal to pay for construction costs in Area B. Plaintiff could not have relied on the promise allegedly made by defendant. Plaintiff has no evidence of consideration.

C.

Unambiguous Offer

Mr. Vest’s deposition does not show offer and acceptance. While he did use the terms “offer” and “acceptance,” Mr. Vest stated only that the Air Force would pay its “fair share” of installing an alternative water system. His statements were not unambiguous offers to extend service to Area B. That area had not been deemed contaminated at the time.

D.

Authority

“A government official who allegedly binds the Government to a contract implied-in-fact must have had the actual authority to do so.” Goolsby v. U.S.,

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Bluebook (online)
40 Cont. Cas. Fed. 76,875, 34 Fed. Cl. 170, 1995 U.S. Claims LEXIS 195, 1995 WL 605390, Counsel Stack Legal Research, https://law.counselstack.com/opinion/town-of-floyd-v-united-states-uscfc-1995.