Kandahar Mahali Transit & Forwarding LTD.

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeal of - )

)

Kandahar Mahali Transit & Forwarding ) ASBCA No. 62319

LTD. )

)

Under Contract No. W91B4N-11-D-7009 )

APPEARANCE FOR THE APPELLANT: Wojciech Z. Kornacki, Esq.

Watson & Associates, LLC

Denver, CO

APPEARANCES FOR THE GOVERNMENT: Dana J. Chase, Esq.

Army Chief Trial Attorney

Robert B. Neill, Esq.

James D. Stephens, Esq.

MAJ Jill B. Wiley, JA

CPT Blaine L. Hutchison, JA

Trial Attorneys

OPINION BY ADMINISTRATIVE JUDGE O’CONNELL

ON RESPONDENT’S MOTIONS FOR SUMMARY JUDGMENT

This appeal involves a claim for approximately 900 cargo transports in

Afghanistan. The government previously filed a motion to dismiss for failure to state

a claim that the Board denied. Kandahar Mahali Transit & Forwarding Ltd., ASBCA

No. 62319, 20-1 BCA ¶ 37,635 (KMT I). Undeterred, the government has filed a

series of motions: a motion for partial summary judgment and to dismiss in part for

lack of jurisdiction, a motion for summary judgment on its release defense, a motion

for summary judgment on appellant’s duress argument, and a supplemental brief

contending appellant failed to state a sum certain in its claim. The Board grants the

motion to dismiss in part for lack of jurisdiction and for summary judgment based on a

release.

STATEMENT OF FACTS (SOF) FOR PURPOSES OF THE MOTION

The following facts are undisputed or uncontroverted.

1. A contracting officer (CO) awarded appellant, Kandahar Mahali Transit &

Forwarding Ltd. (KMT) the above-captioned contract on August 11, 2011. The

contract was one of 21 contracts awarded under the National Afghan Trucking (NAT)

multiple award task order contract (gov’t statement of undisputed material facts on its

motion for summary judgment on the affirmative defense of release (GSUMF-R ¶ 3:

R4, tab 1 at 5). The contract included a 12-month base period, along with a 12-month

and a 3-month option, both of which were exercised. The base period began on

September 16, 2011, and, ultimately, performance was extended to June 15, 2014.

(GSUMF-R ¶¶ 4-5; R4, tab 2 at 11-13, 15; tab 47 at 3 1)

2. The contract provided for the transportation of dry and heavy cargo in

Afghanistan by truck. KMT was paid specified rates for each “mission unit” of travel,

which was 50 kilometers. The payments were calculated in the Afghan currency

(AFN). The parties refer to each discrete trucking mission as a “Transportation

Movement Request” (TMR). (R4, tab 1 at 3, 8-11; tab 36 at 18).

3. The contract provided that the work would be ordered through task orders

issued by the CO (R4, tab 1 at 20). During performance the CO issued task orders

numbered 0001-0006 (R4, tabs 3, 9-10, 24, 41, 47).

4. The government used a document referred to as a “mission sheet” to provide

KMT with pertinent mission information, including the required pickup and delivery

dates and locations. Because KMT “could [] be financially responsible” if cargo

delivery could not be confirmed, the contract “encouraged” KMT to have the receiving

official sign upon acceptance. Accordingly, the mission sheet provided areas for both

the shipper and receiver to sign. KMT could then use the completed document in

support of payment. KMT could also submit a signed memorandum or sworn

statement from the customer, which it bore the responsibility to obtain. (R4, tab 36

at 29, 41; see, e.g., R4, tab 84 at 12).

5. The billing process for the work can be summarized as follows. KMT

would submit a monthly draft invoice on a form specified in the contract. The

contracting officer’s representative (COR) would then review the invoice and provide

comments or feedback. The parties would then work through the issues and attempt to

agree on whether completed missions would be classified as full payment, partial

payment, no payment, or pending missions which required additional investigation.

At the end of this process, KMT would upload the invoice into the government’s Wide

Area Work Flow (WAWF) system. KMT’s WAWF submission included a

spreadsheet that identified not only the TMRs for which the government had agreed to

pay, but also those for which it was refusing to pay. Invoice guidance provided by the

government stated that missions for which the COR and KMT disagreed could be

submitted to the CO as a dispute. (R4, tab 2 at 10; tab 36 at 22, 29, 44-45; tab 582;

Second Qadir affidavit at ¶¶ 4-5; Van Collie affidavit at ¶ 4, ex. G-13 at 84).

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Citations are to the .pdf page number in the electronic Rule 4 file.

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2014 CO Final Decisions on Unpaid TMRs

6. Two COs issued final decisions in 2014 concerning more than 300 disputed

TMRs (ex. G-1). Each letter in exhibit G-1 states that it is a final decision and

informed KMT of its right to appeal to the Board or file a direct action in the Court of

Federal Claims. While the COs agreed to pay many of the disputed TMRs (e.g., id.

at 4 (finding entitlement to AFN 4,624,435)), they denied payment on others. The

COs cited a variety of reasons, including that the paperwork was missing signatures,

that the TMR had been altered, or that KMT had failed to provide the original TMR

(id. at 2 (ABK0697), 48 (ACD6211, ACE5523)). As is relevant here, the government

contends that those decisions included 38 TMRs for which the CO denied payment

and that KMT did not appeal until it filed the present appeal more than five years later.

7. For six of the 38 TMRs, the COs denied payment not because there was any

substantive problem with the documents demonstrating that KMT had performed the

work, but rather because they alleged that KMT had never submitted an invoice. They

stated that KMT needed to submit an invoice before it submitted a claim. (Ex. G-1

at 11 (ABL3183) and 18-19 (ABL0133, ABL0993, ABL0996, ABL0997, ABL0998)).

8. The TMRs for which the CO cited a substantive problem such as a missing

signature are: ABK0698, ABK1043, ABK0694, ABK0697, ACC5762, ACD5574,

ACC4632, ACD6870,ACD6874, ACD6867, ACD6869, ACD6871, ACD6861,

ACE5523, ACD6211, ACD6209, ACD6210, ACE0650, ACE0651, ACE0655,

ACE0647, ACE0649, ACG1399, ACE0374, ACE0375, ACE0377, ACG5083,

ACJ1751, ACJ0681, ACJ1054, ACE6489, ACB4429 (GSUMF ¶ 46; ex. G-1).

The 2018 Demurrage Claim

9. On February 12, 2018, or about 44 months after the contract term ended,

KMT submitted a certified claim for demurrage (an agreed on penalty charge by the

vendor for delays beyond the scheduled time to load or unload shipments) on Task

Orders 0001, 0003, 0004, 0005 and 0006 in the amount of AFN 85,856,325.00 (R4,

tabs 78, 7980).

10. CO Celeste Hobert issued a final decision on May 8, 2018. She found that

KMT was entitled to a demurrage payment on 916 of the 1,337 TMRs included in the

claim. She calculated the amount due as AFN 57,209,855.00 or $808,000. (R4, tab 79

at 1-3).

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11. On June 28, 2018, the parties entered into a settlement agreement in which

KMT agreed to accept the $808,000 calculated by CO Hobert in the final decision.

Paragraph 3 of the settlement agreement contained the following language:

This Settlement Agreement constitutes a full release and

accord and satisfaction by KMT of any and all claims,

demands, or causes of action, actual or perceived, known

or unknown, arising under or related to this contract which

formed the basis for this Settlement Agreement.

Therefore, KMT remises, releases, and discharges the

Government, its officers, agents, and employees of and

from all civil liabilities, obligations, claims, appeals and

demands which it now has or hereafter may have, whether

known or unknown, administrative or judicial, legal or

equitable, including attorney’s fees, arising under or in any

way related to the disputes which formed the basis of this

Settlement Agreement.

(R4, tab 80 at 2-3)

12. The parties effectuated the settlement through the issuance of a new task

order (Task Order 0007) signed by both parties. KMT’s president, Abdul Qadir,

signed for KMT; his signature is dated September 9, 2018. (R4, tab 81).

13. In Task Order 0007, the parties modified the release language in paragraph

3 of the settlement agreement somewhat, referring to appellant as “the contractor”

rather than “KMT” and by starting a new paragraph after the first sentence and

deleting the word “Therefore.” Accordingly, the Task Order reads as follows:

3. This settlement agreement constitutes a full release and

accord and satisfaction by the Contractor of any and all

claims, demands, or causes of action, actual or perceived,

known or unknown, arising under or related to this contract

which formed the basis for this settlement agreement.

4. The contractor remises, releases, and discharges the

Government, its officers, agents, and employees of and

from all civil liabilities, obligations, claims, appeals and

demands which it now has or hereafter may have, whether

known or unknown, administrative or judicial, legal or

equitable, including attorney’s fees, arising under or in any

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way related to the disputes which formed the basis of this

settlement agreement.

(R4, tab 81 at 2)

14. KMT has raised a duress defense based on an affidavit from its president,

Mr. Qadir, attached to the amended complaint (First Qadir Affidavit). Mr. Qadir

testified as follows:

8. The contracting officer emailed KMT several times to

sign the documents by September 19, 2018 or KMT would

have to wait for funding for the next fiscal year.

9. Because KMT did not know how long this would take,

KMT felt rushed to sign the documents. KMT was

concerned that if it did not sign the documents before the

end of the fiscal year, it would have to wait for many

months to get paid.

10. The contracting officer kept telling KMT to sign the

documents in many emails between June 2018 and October

2018. KMT felt it had no other option than to sign the

documents and return them to the contracting officer.

15. The emails cited by Mr. Qadir in this affidavit reveal the following

sequence of events:

May 14, 2018 KMT informs CO Hobert that it would

accept the amount in her final decision.

May 23, 2018 CO Hobert sent KMT the settlement

agreement and asked Mr. Qadir to sign and

return to her.

June 13, 2018 The CO asked KMT about the status of

signing the settlement agreement.

June 27, 2018 The CO asked KMT about the status of

signing the settlement agreement.

June 28, 2018 KMT returned the signed settlement

agreement to the CO. The CO notified KMT

the same day that she would request funding.

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August 29, 2018 The CO asked Mr. Qadir to review and sign

the task order attached to her email and to

submit an invoice using the exact words she

had provided under the heading “Supplies or

Services and Prices.” She warned that

inaccuracies would delay payment.

August 30, 2018 The CO informed KMT that if it wished to

be paid by the end of the fiscal year KMT

needed to sign and return the documents by

September 10, 2018.

Sept. 7, 2018 The CO reminded KMT it needed to return

the documents by September 10 for it to be

paid by September 15, 2018 (although, as

noted above, KMT purportedly signed the

task order on September 9, 2018 (SOF 12)).

Sept. 18, 2018 The CO informed KMT that she was

providing a final reminder that if she did not

receive signed documents by the following

day, KMT would have to wait for funding

the following fiscal year, “and that may take

several months.”

Sept. 19, 2018 KMT states that it sent the signed documents

on September 10, 2018.

October 7, 2018 KMT asks the CO about the status of

payment.

October 10, 2018 The CO states that she did not receive an

email from KMT on September 10 or 19,

2018. The CO stated that she had called and

emailed KMT several times without

response. She directed KMT to resend the

documents.

October 16, 2018 The CO asked KMT about the status of the

settlement documents and asked why

responses from KMT take several weeks.

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October 24, 2018 The CO informed KMT that she still had not

received the documents and if she did not

receive a response soon, she would close out

the contract.

October 25, 2018 KMT sent some documents to the CO. The

CO responded 29 minutes later by stating

that what KMT had sent was not an invoice

and was not even in the correct amount. The

CO reminded KMT that she had instructed it

to use the precise wording she had provided.

She once again provided instructions on how

to complete the invoice.

(R4, tabs 219-221)

16. The government paid KMT for the demurrage claim in February 2019 (R4,

tab 938).

The Unpaid TMRs Claim

17. On September 3, 2019, KMT informed CO Hobert that it would be

submitting another claim (R4, tab 82 at 3). KMT appears to have submitted the claim

on September 25, 2019, although it is dated September 4, 2019 (R4, tab 83; am.

compl. ¶ 15). KMT did not submit any narrative to explain what it was seeking, but it

provided the government various documents. First, there is a one-page “cover letter”

that contains a (defective) claim certification in which KMT states that its claim

included dry cargo trips totaling AFN 153,374,065.65, and heavy cargo trips totaling

AFN 48,221,500.42, for a total claim amount of AFN 201,595,566.07 (R4, tab 83).

18. Second, the claim certification referenced 13 binders of documents

“containing the whole claim and all documents related to KMT Complete Missions

Claim NAT 1.0” (id.; R4, tabs 84-96). The first binder contains a spreadsheet that

identifies the amount of the dry TMR claim as AFN 153,374,065.65, which is

consistent with the claim certification, but there is no corresponding spreadsheet or

subtotal for heavy TMRs, and thus no total amount (R4, tab 84 at 4).

19. The Army represents, and KMT does not dispute, that the 13 binders

identify a total of 871 TMRs (ex. G-2). The binders contain only mission sheets and

“ping” information for the GPS system that tracked the trucks (e.g., R4, tab 84 at 12-

14). Paging through the first binder, one can see that many of the mission sheets lack

a signature for the government shipper or receiver, or both (id. at 12, 15, 20, 27, 30,

35, 54, 66, 103, 113). The binders do not include invoices or other records that

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demonstrate how KMT calculated the amounts in the claim certification or the

spreadsheet in the first binder.

20. KMT provided a complete claim breakdown in a different spreadsheet that

it submitted to the CO in September 2019 (R4, tab 82a; see also tab 82). The tab 82a

spreadsheet lists 718 dry cargo TMRs totaling AFN 160,562,944.49, which is a

different amount from the certification. The spreadsheet lists 206 heavy cargo TMRs

totaling AFN 48,412,750.42, which is also different from the certification. The sum of

the dry and heavy cargo amounts in the tab 82a spreadsheet is greater than in the

certification. The spreadsheet lists a total of 944 TMRs, which is greater than the 871

contained in the 13 binders.

21. In response to the government’s motions, KMT submitted a second

affidavit from Mr. Qadir, along with a revised spreadsheet that lists the total number of

TMRs as 889 but contains the same subtotals and total amount in the claim

certification (Second Qadir affidavit at ¶ 2-3).

22. In response to a request for admission from the government, KMT admits

that it invoiced the government for 780 of the TMRs more than six years before

September 25, 2019, or more than six years before submission of the claim (gov’t 2d

supp. resp. on its mot. for part. sum. judg., ex. A at 27-28).

23. The government contends that as a result of the drafting process for

invoices (SOF 5), KMT knew by the time it submitted an invoice which TMRs the

government was refusing to pay. For example, the government points us to invoice

number KMT9064, submitted on September 3, 2013, for dry cargo in the amount of

AFN 44,757,790.88 (R4, tab 581). KMT submitted an extensive spreadsheet in

support of the invoice. The spreadsheet, like the invoice, reflected an amount sought

of AFN 44,757,790.88 (R4, tab 582). This spreadsheet lists not only the TMRs that

the government had agreed to pay, but those for which it was refusing to pay (e.g.,

listing 231 “failed missions”). For example, one of these failed missions is TMR

ACF3097 (id. at line 347, column T). In addition to listing this as a failed mission,

under “COR REMARKS” the spreadsheet that the COR verified that the truck never

in-gated at its destination 2 (id. at column AB; gov’t 2nd supp. resp. on gov’t mot. for

part. sum. judg. SUMF ¶¶ 41-42). On September 26, 2013, the government paid the

invoice in the amount requested, AFN 44,757,790.88 (R4, tab 275).

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KMT agrees that the government has accurately described the information

concerning ACF3097 but states that “this paragraph does not resolve material

facts concerning whether the mission was completed” (app. resp. to 2d supp. br.

at 8, ¶ 42). KMT does not tell us what these material facts are, however. The

Board considers this response to be conclusory and inadequate under Board

Rule 7(c).

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24. The spreadsheet that is attached to the second Qadir affidavit includes

TMR ACF3097. Consistent with the government’s contentions, KMT identifies the

government’s explanation for its refusal to pay as “Verified with the 610th MCT that

the truck never in-gated BAF.” KMT nevertheless contends that it completed the

mission and is entitled to be paid. (Second Qadir affidavit at 25, line 202). There are

nearly 300 TMRs among the 889 TMRs for which the COR stated that the truck never

in-gated at the destination.

25. The spreadsheet lists a variety of other reasons why the COR denied

payment. All are terse but some are simple and easy to understand (“Signatures are

fraudulent and match previous fraudulent documents,” “no shipper signature,” “[n]o

signatures,” “no supporting documentation” (id. at 22-23)). However, others are more

ambiguous. By our count, for more than 400 of the TMRs the COR remark includes

the word “Investigate.” This appears on its own, or with further explanation that is

somewhat less favorable to KMT such as “Investigate [] No ingate or outgate/Need

verification via email or memo” (id. at 29). The record does not indicate when or if

the government concluded an investigation of these TMRs or if it was awaiting further

information from KMT.

26. On September 27, 2019, CO Hobert denied the claim, citing the “full

release” that KMT signed in connection with the demurrage settlement (R4, tab 97

at 9).

27. KMT filed a timely appeal on December 20, 2019.

DECISION

I. The Board Lacks Jurisdiction To Consider TMRs not Timely Appealed

The government has moved to dismiss KMT’s claim with respect to TMRs for

which a CO issued a final decision in 2014 but KMT did not appeal at that time.

The Contract Disputes Act (CDA), 41 U.S.C. § 7104(a), provides that a

contractor may file an appeal with the Board within 90 days of receipt of a final

decision. The 90-day appeal period under the CDA is jurisdictional and may not be

waived. Cosmic Constr. Co. v. United States, 697 F.2d 1389, 1390-91 (Fed. Cir.

1982).

None of KMT’s briefs mention the word “jurisdiction.” KMT also tends not to

respond directly to many of the government’s factual allegations – at least by

following the same numbering format as the government - so that we have to search its

briefs to determine what its position is. KMT’s primary contention appears to be that,

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even though the 2014 letters from the COs state that they are final decisions and notify

KMT of its appeal rights, the COs were open to considering subsequent evidence from

KMT and would pay individual TMRs if persuaded, rather than stand on their final

decisions and force KMT to litigate. From this, KMT appears to conclude that the

appeal deadlines were suspended for all TMRs. (App. resp. to mot. for part. sum.

judg. at 2-6).

The Board agrees with KMT that if a contractor requests reconsideration, or if

the CO indicates that she wishes to further discuss a claim, this can suspend the

deadline for filing an appeal at the Board or a direct action at the Court of Federal

Claims. Guardian Angels Medical Serv. Dogs, Inc. v. United States, 809 F.3d 1244,

1248-51 (Fed. Cir. 2016). However, it would be unwarranted to conclude that, on a

contract involving hundreds of disputed TMRs, the CO’s willingness to reconsider

individual TMRs suspends the appeal deadline on TMRs for which the contractor did

not request reconsideration. And KMT cites no evidence that it requested

reconsideration of the 32 TMRs for which there was a substantive denial (SOF 8).

This brings us to the second point made by KMT: there were six TMRs for

which the COs denied payment because KMT never submitted an invoice. They

directed KMT to submit an invoice (SOF 7). Certainly, the COs’ decisions in this

respect can be viewed as a willingness to further evaluate these TMRs, which would

make the decision non-final with respect to them. But this does not help KMT. If

KMT never submitted an invoice for these TMRs, the agency never formally denied

payment. If the agency never formally denied payment, there is no dispute for which

the Board possesses jurisdiction. Parsons Global Serv., Inc. ex rel. Odell Intern., Inc.

v. McHugh, 677 F.3d 1166, 1172-73 (Fed. Cir. 2012) (holding that the Board lacked

jurisdiction because “the record does not indicate that the PCO, the appropriate

government official to evaluate the request at issue, ever received a proper request for

payment, such as a voucher. Without a pre-exiting dispute over its routine request,

Parsons has not submitted a valid claim.”).

The Board does not possess jurisdiction to consider KMT’s claim with respect

to the 38 TMRs identified in SOFs 7-8.

II. Whether the TMRs are Untimely

A claim under the CDA must be submitted within six years of accrual.

41 U.S.C. § 7103(a)(4)(A). The Federal Circuit has held that “[w]hether and when a

claim has accrued is determined according to the Federal Acquisition Regulation

(FAR), the language of the contract, and the facts of the particular case.” Electric Boat

Corp. v. Sec’y of Navy, 958 F.3d 1372, 1375 (Fed. Cir. 2020) (citing Kellogg Brown &

Root Servs., Inc. v. Murphy, 823 F.3d 622, 626 (Fed. Cir. 2016)). Pursuant to FAR

33.201, a claim accrues “when all events, that fix the alleged liability of either the

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Government or the contractor and permit assertion of the claim, were known or should

have been known. For liability to be fixed, some injury must have occurred.

However, monetary damages need not have been incurred.” In Electric Boat, the

Federal Circuit held that the contractor’s injury occurred on the date the Occupational

Safety and Health Administration issued a new regulation. However, the Court held

that the statute of limitations did not begin to run until the date on which the contract

allowed the contractor to seek a price adjustment for a change of law (which was after

issuance of the regulation). Electric Boat, 958 F.3d at 1376-77.

The Board has already considered the question of when a claim begins to

accrue on a different National Afghan Trucking contract. In BNN Logistics, ASBCA

No. 61841 et al., 21-1 BCA ¶ 37,912 at 184,127, the Board ruled that the limitations

period began to run when the contractor received a marked-up draft of the invoice

showing the government’s deductions. The Board rejected the contractor’s argument

that the period only began to run when the contractor received a reduced payment.

Accord Afghan Premier Logistics, ASBCA No. 62938, 22-1 BCA ¶ 38,074 at 184,905

recon. denied 23-1 BCA ¶ 38,373.

It is not entirely clear how the Board should apply this ruling to the present

appeal. KMT admits that it invoiced 780 of the 889 TMRs more than six years prior to

submitting its claim (SOF 22), which would suggest that close to 90% of its claim is

untimely. But the Board is not even convinced it is true that KMT invoiced 780 of the

TMRs before September 25, 2013, notwithstanding KMT’s admission, based on the

record. The government has submitted a spreadsheet marked as exhibit G-2, which

lists 871 TMRs (based on KMT’s 13 claim binders) and provides a mission

completion date for each one. This document shows KMT completing the 780th TMR

on September 23, 2013. (The spreadsheet shows 468 TMRs completed by July 31 and

725 TMRs completed by August 31, 2013.) We doubt that KMT could have prepared

an invoice, submitted it to the COR, and worked through the process of identifying

payable TMRs in just two days.

Another factor is the use of the word “investigate” with respect to more than

400 TMRs (SOF 25). It is not clear what such an investigation would consist of, or

who would perform it. For purposes of the present motion, the Board will assume that

“investigate” when used by itself refers to a government investigation. Because we

know nothing about the results of any such investigation, including the end date, the

Board cannot grant summary judgment on these TMRs.

It is even less clear what we should do with TMRs marked “Investigate [] No

ingate or outgate/Need verification via email or memo” (SOF 25). While our first

response would be to assume a government investigation, the contract specifies that it

is the contractor’s responsibility to obtain a signed memorandum or sworn statement

from the customer if it did not obtain a signature on the mission sheet from the

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receiving official (SOF 4). Thus, this COR remark could contemplate action by either

party, or perhaps both, and we do not know how any of these concluded. Summary

judgment on these TMRs is denied.

However, it is also clear that, if the Board were to go through the remaining

TMRs one by one, more than 400 could be time barred. But given the Board’s

decision with respect to the release language in Task Order 0007 discussed below, it is

not necessary to perform this analysis. Cf. Minesen Co. v. McHugh, 671 F.3d 1332,

1337 (Fed. Cir. 2012) (court “decline[d] to decide [jurisdictional] issue” because it was

a “complex” matter that did not need to be addressed due to the circumstances in that

case).

IV. Whether KMT Provided a Full Release

A. Paragraph 3 of Task Order 0007

A contractor that signs a general release is barred from maintaining a claim for

damages for events that occurred prior to execution of the release. B. D. Click Co.,

Inc. v. United States, 614 F.2d 748, 756 (Ct. Cl. 1980). While a tribunal may dislike

depriving an appellant of the opportunity to prosecute its claim, “to hold otherwise . . .

would go far toward destroying that certainty in business affairs which releases were

designed to provide.” J.G. Watts Const. Co. v. United States, 161 Ct. Cl. 801, 810

(1963). If a contractor wishes to preserve its rights to submit further claims, it should

list them as an exception to the release. Id. at 805.

The Board returns to paragraphs 3 and 4 of Task Order 0007:

3. This settlement agreement constitutes a full release and

accord and satisfaction by the Contractor of any and all

claims, demands, or causes of action, actual or perceived,

known or unknown, arising under or related to this contract

which formed the basis for this settlement agreement.

4. The contractor remises, releases, and discharges the

Government, its officers, agents, and employees of and

from all civil liabilities, obligations, claims, appeals and

demands which it now has or hereafter may have, whether

known or unknown, administrative or judicial, legal or

equitable, including attorney’s fees, arising under or in any

way related to the disputes which formed the basis of this

settlement agreement.

(SOF 13)

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The Board holds that paragraph 3 of Task Order 0007 clearly contained a

general or full release. Specifically, the phrases “a full release and accord and

satisfaction,” “of any and all claims,” “actual or perceived, known or unknown,” and

“arising under or related to this contract” all convey that KMT was providing the

broadest possible release related to this contract.

To be sure, the ending of this sentence, “. . .arising under or [ ] related to this

contract which formed the basis for this settlement agreement,” is a bit awkward. But

we see no plausible interpretation of the limiting phrase beginning with “which” other

than that it modifies the noun that it immediately precedes: contract. The Supreme

Court has explained this grammatical rule - the last antecedent rule - as follows:

imagine you are the general manager of the Yankees and

you are rounding out your 2016 roster. You tell your scouts

to find a defensive catcher, a quick-footed shortstop, or a

pitcher from last year’s World Champion Kansas City

Royals. It would be natural for your scouts to confine their

search for a pitcher to last year’s championship team, but

to look more broadly for catchers and shortstops.

Lockhart v. United States, 577 U.S. 347, 351-52 (2016). In this appeal, the CO

perhaps could have written a nicer sentence if she had simply written “all claims . . .

arising under or related to this contract” or “all claims . . . arising under or related to

contract W91B4N-11-D-7009” but the meaning of the sentence conveyed by our

rewrites is the same as it was in paragraph 3 of Task Order 0003. It is a release of all

claims, known or unknown, for the contract at issue.

B. Paragraphs 3 and 4 of Task Order 0007 Read In Context

In interpreting the release language, we are mindful that we must construe a

contract “to effectuate its spirit and purpose giving reasonable meaning to all parts of

the contract.” LAI Servs., Inc. v. Gates, 573 F.3d 1306, 1314 (Fed. Cir. 2009) (quoting

Hercules, Inc. v. United States, 292 F.3d 1378, 1381 (Fed. Cir. 2002)). In our view,

this requires us to consider both paragraphs 3 and 4 of Task Order 0007 in evaluating

the interpretations presented by the parties.

KMT contends that it provided a limited release pertaining only to the

demurrage claim. KMT does not provide a plausible interpretation of paragraph 3 of

Task Order 0007 that explains why it is not a “full release” as it states. KMT’s

contention that paragraph 3 is a limited release has the additional drawback of making

it entirely redundant with paragraph 4, which is a limited release. Paragraph 4 clearly

states that the matters released relate only to “the disputes which formed the basis of

this settlement agreement,” that is, to the demurrage claim.

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The government’s interpretation is that paragraph 3 is a general release and

paragraph 4 is a specific limited release related to the demurrage claim. This, too, is a

bit redundant because a full or general release would, by implication, have released the

demurrage claim. However, it is less redundant than that of KMT and we see two

virtues of the government’s approach.

First, if there were no paragraph 4, the demurrage claim may have been

released by the language in paragraph 3, but paragraph 4 forecloses any doubts

because it makes the demurrage release explicitly true rather than leaving it as implicit.

Second, the demurrage claim, for which there had already been a certified claim and

final decision, was a claim ripe for litigation, as opposed to those potential claims that

had not been submitted to the CO. The government faced a more immediate threat of

litigation related to demurrage than it did for other claims that were inchoate or merely

theoretical. Accordingly, there is some logic in favor of a more in-depth treatment of

the demurrage claim that recognizes the government’s risk. Paragraph 4, unlike

paragraph 3, releases the government from liability for attorney fees that KMT might

have been entitled to if it prevailed on the claim in litigation (“all civil liabilities . . .

including attorney’s fees”). Paragraph 4 also makes it clear that if, unbeknownst to the

CO, KMT had already filed an appeal at the Board or an action in court, that KMT was

waiving the right to pursue such litigation (“all civil liabilities . . . administrative or

judicial, legal or equitable”).

The Board recognizes that there was some change in the language and

formatting of the release language from the settlement agreement to Task Order 0007

(SOF 11, 13). But KMT has not contended that the result would be any different if the

Board solely analyzed the language in the settlement agreement (we don’t perceive it

to be materially different) and we consider any such argument to have been waived in

any event.

Finally, KMT also contends that there was no meeting of the minds with respect

to releasing the claim for unpaid TMRs. The most KMT could possibly show in this

respect is that it did not appreciate what it was signing when it signed Task Order 0007

(see First Qadir affidavit, ¶ 6). The Court of Claims disposed of a comparable

argument by stating: “unilateral ignorance of one’s legal rights where ‘all the facts

bearing on the existence of the injury were known’ does not suffice to relieve one of

the consequences of having released the claim.” J.G. Watts, 161 Ct. Cl. at 810 (citing

Shepherd v. United States, 125 Ct. Cl. 724, 742 (1953)).

C. KMT’s Duress Argument

Claims may be considered after the execution of a release only in special and

limited circumstances, such as where the release contains a specific exception for the

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claim, or if the release was entered under economic duress. Mingus Constructors, Inc.

v. United States, 812 F.2d 1387, 1395 (Fed. Cir. 1987) (citing J.G. Watts, 161 Ct. Cl.

at 806-07). “To render a contract unenforceable for duress, a party must establish (1)

that it involuntarily accepted the other party’s terms[;] (2) that circumstances permitted

no other alternative[;] and (3) that such circumstances were the result of the other

party’s coercive acts.” N. Star Steel Co. v. United States, 477 F.3d 1324, 1334 (Fed.

Cir. 2007) (citation omitted). “Economic pressure and ‘even the threat of considerable

financial loss’ are not duress.” Johnson, Drake & Piper, Inc. v. United States, 531

F.2d 1037, 1042 (Ct. Cl. 1976) (quoting International Tel. & Tel. Corp. v. United

States, 509 F.2d 541, 549, n.11 (Ct. Cl. 1975)).

KMT has not made a plausible showing that it meets any of the elements of

duress. It has not identified any evidence showing that it accepted the terms of the

settlement involuntarily, that it had no alternative to acceptance, or that the

government engaged in coercive acts. The emails cited by Mr. Qadir in his affidavit

(SOF 14) do not show any objection by KMT to the release language or any mention

of it at all. It is true that CO Hobert sent KMT periodic reminders asking about the

status of KMT signing documents but there is nothing coercive in her emails.

With respect to Mr. Qadir’s one specific statement – that he felt pressured to

sign the documents by September 19, 2018 or KMT would risk waiting months to get

paid in the new fiscal year – the Board observes the following from the undisputed

facts. KMT signed the settlement agreement in June 2018 (SOF 11), long before the

end of the fiscal year became an issue. KMT has not identified anything that changed

in the deal after the signing of the settlement agreement. Thus, KMT had already

agreed to the terms of the deal long before the fiscal year deadline became an issue.

The CO did make the statement that KMT cites: on September 18, 2018 she

stated that if KMT did not sign by the following day it would have to wait until the

following fiscal year for funds, which might take months (SOF 15). But KMT

responded by representing to the CO that it had already signed the documents on

September 10, 2018 (and the task order bears a September 9, 2018 signature date by

KMT (SOF 12)), or eight days before the statement that supposedly caused the duress.

If KMT was truthful with the CO, it could not have felt duress from a statement that

had not yet been made. Further, it is also undisputed that the CO did not actually

receive the documents until after the fiscal year ended. (SOF 15-16). Thus, regardless

of whether KMT actually signed the documents on September 10 and sent them to the

CO, there is no evidence that shows that KMT took any action to sign the settlement

documents after the CO’s September 18 email and provide those documents to her by

the following day.

KMT also does not provide any evidence that the CO’s statement about the

timeline to obtain new funding in the next fiscal year was untrue. Budgets, fiscal years

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and the complexities of government appropriations are simply a fact of life in

government contracting and present challenges when the agency is trying to settle a

contract claim. See National Science Foundation-Potential Antideficiency Act

Violation by the National Science Board Office, B-317413, 2009 CPD ¶ 94 (Comp.

Gen. April 24, 2009) (“Generally, costs of a settlement are to be paid using

appropriations current at the time of settlement. . . . payment is chargeable to

appropriations current at the time of final action on the settlement because the

settlement creates a new right in the successful claimant”).

Interwoven with KMT’s duress contention is an argument that the release, to

the extent that it goes beyond the demurrage claim and also releases the TMR claim,

fails due to a lack of consideration. The Board disagrees. KMT received valuable

consideration of $808,000. Even if KMT was entitled to this money and the TMR

claim was entirely valid, the release is still enforceable. Inland Empire Builders, Inc.

v. United States, 424 F.2d 1370, 1375-76 (Ct. Cl. 1970).

CONCLUSION

KMT’s claim with respect to the TMRs identified in SOFs 7-8 is dismissed for

lack of jurisdiction. The Board grants the government summary judgment on the

remainder of KMT’s claim. Accordingly, the appeal is denied. 3

Dated: February 13, 2024

MICHAEL N. O’CONNELL

Administrative Judge

Acting Vice Chairman

Armed Services Board

of Contract Appeals

(Signatures continued)

3

Due to our rulings, the Board need not address the government’s contention that the

appeal should be dismissed because KMT’s claim failed to state a sum certain.

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I concur I concur

OWEN C. WILSON J. REID PROUTY

Administrative Judge Administrative Judge

Acting Chairman Vice Chairman

Armed Services Board Armed Services Board

of Contract Appeals of Contract Appeals

I certify that the foregoing is a true copy of the Opinion and Decision of the

Armed Services Board of Contract Appeals in ASBCA No. 62319, Appeal of Kandahar

Mahali Transit & Forwarding LTD., rendered in conformance with the Board’s Charter.

Dated: February 13, 2024

PAULLA K. GATES-LEWIS

Recorder, Armed Services

Board of Contract Appeals

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