Assessment and Training Solutions Consulting Corporation

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeal of -- )

)

Assessment and Training Solutions ) ASBCA No. 61047

Consulting Corporation )

)

Under Contract No. H92240-14-P-0155 )

APPEARANCE FOR THE APPELLANT: James S. Delsordo, Esq.

Argus Legal, PLLC

Manassas, VA

APPEARANCES FOR THE GOVERNMENT: Jeffrey P. Hildebrant, Esq.

Air Force Deputy Chief Trial Attorney

Phillip E. Reiman, Esq.

Lt Col Nathaniel H. Sears, USAF

Lori R. Shapiro, Esq.

Trial Attorneys

OPINION BY ADMINISTRATIVE JUDGE CLARKE ON THE

GOVERNMENT'S MOTION FOR RECONSIDERATION

The Air Force (AF)/Navy 1 timely moves the Board to reconsider2 its 3 October

2017 decision sustaining in part Assessment and Training Solutions Consulting

Corporation's (ATSCC's) appeal and awarding ATSCC $50,637.08. Assessment and

Training Solutions Consulting Corp., ASBCA No. 61047, 17-1 BCA, 36,867. The

decision was issued pursuant to Board Rule 12.3. We deny the motion.

DISCUSSION

Standard for Reconsideration

The Navy must demonstrate a compelling reason for the Board to modify its

decision. J.F. Taylor, Inc., ASBCA Nos. 56105, 56322, 12-2 BCA, 35,125. The

standard we apply for reconsideration is "[t]o prevail on reconsideration, the moving

party must generally establish that the underlying decision contained mistakes in our

findings of facts or errors of law or that newly discovered evidence warrants vacating

our decision." DODS, Inc., ASBCA No. 57667, 13 BCA, 35,203 at 172,711.

1

This was a Special Operations Command (SOCOM) contract for the Navy to conduct

training on commercial vessels, however, AF trial attorneys represent SOCOM.

2

The motion is styled a "Motion for Partial Reconsideration."

Motions for reconsideration are not intended to provide a party with an opportunity

to reargue issues previously raised and denied. CP, Inc., ASBCA No. 56257,

15-1 BCA ,r 35,829 at 175,194.

Contention of the Parties

The Navy's central argument is that the Board erroneously applied the common

law of baihnent presumption of negligence under the facts of this case. 3 The Navy

contends that the written contract should be enforced over the common law and that

the Navy did not have exclusive possession of the charter boats based on periodic

maintenance requirements of the bailor, ATSCC.

ATSCC argues that the Navy presents no new arguments and that the common

law presumption was fully covered in the original decision. Therefore, the Navy is not

entitled to reconsideration.

Common Law ofBailment Presumption

The decision relies upon a common law of baihnent presumption we discussed

as follows:

The law of bailment imposes upon the bailee the duty to

protect the property by exercising ordinary care and to

return the property in substantially the same condition,

ordinary wear and tear excepted.... When the government

receives the property in good condition and returns it in a

damaged condition, a presumption arises "that the cause of

the damage to the property was the Government's failure

to exercise ordinary care or its negligence." Mohammad

Darwish, 00-2 BCA ,r 31,114 at 153,672; International

Automotriz, ASBCA No. 59665, 15-1 BCA ,r 36,174 at

176,513.

ATSCC, 17-1 BCA ,r 36,867 at 179,632.

The Alleged Errors of Law

The Navy contends the presumption does not apply and thus the Board's

reliance upon it is an error of law:

3

The Navy does not discuss Judge Prouty's concurring decision stating that the record

supports a finding of negligence without reliance on the presumption.

2

Application of this common law presumption

constitutes a two-fold error of law. First, the express terms

of the subject Contract require that negligence be proven,

while the common law bailment rule affords that

negligence may be presumed. Second, the Government

did not exercise exclusive control over the bailed vessels

and exclusive control is a prerequisite for the presumption

to arise.

(Gov't mot. at 8)

The Navy misconstrues the relationship between the contract language and the

presumption. The presumption serves to satisfy the bailor's obligation to prove

negligence and shifts the burden to the bailee (Navy) to overcome the presumption.

The Navy emphasizes that the presumption does not arise in all cases. We

agree. In Mohammad Darwish Ghabban Est., ASBCA No. 51994, 00-2 BCA ,r 31,114

the Board stated, "The Government's retwn to the contractor of bailed property in a

state unfit for service may give rise to a claim for damages." Id. at 153,672 (emphasis

added). The word "may" means just what the Navy argues. For example, if the bailor

has sufficient access to the bailed item(s), access that could cause or contribute to the

damage, the presumption would not arise. See the discussion below, particularly the

facts of United States v. Mowbray's Floating Equipment Exchange, Inc., 601 F.2d 645,

647 (2d Cir. 1979).

Terms of the Contract

ATSCC's contract included a clause that requires ATSCC to bear the cost of

repairs "unless it can be proven that such repairs were due to negligence or willful

damages caused by the government." ATSCC, 17-1 BCA ,r 36,867 at 179,628.

The Navy argues, "Where there is a written bailment contract, the assignment

of liability for loss or damage is determined by the provisions of the contract, rather

than by common law" (gov't mot. at 6). This is only the case when the written

contract and common law differ. In that case the written contract is enforced over the

common law. We discussed the situation where the written contract and common law

are essentially the same in the decision:

In this case, contrary to the Navy's argument, the criteria

for government liability are the same under the common

law of bailment and the express contract-negligence. The

Board has applied the common law presumption when an

express written contract exists if the common law is

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consistent with the written contract. [Mohammad Darwish,

00-2 BCA ,r 31,114 at 153,672] (we construe the language

used here as no more than an expression of the common

law liability of the bailee).

ATSCC, 17-1 BCA ,r 36,867 at 179,632.

We relied upon the Board's decision in Mohammad Darwish where we applied

the presumption even though there was a written contract where the contract and

presumption imposed the same negligence standard. The cases cited by the Navy do

not contradict Mohammad Darwish. The Navy fails to explain why we should not

follow our decision in Mohammad Dan-vish.

The Navy relies on three cases in support of its argument that only the express

contract applies: Cramer Alaska, Inc., ASBCA No. 39071, 92-2 BCA ,r 24,969;

H.N Bailey and Associates, ASBCA No. 29298, 87-2 BCA ,r 19,763; and

Universal Maritime Service Corp., ASBCA Nos. 22661, 22804, 81-1 BCA ,r 15,118

(gov't mot. at 6-7). Cramer Alaska addressed the AF's failure to return a "655-B

loader" in accordance with the written contract and does not involve damage and the

presumption as the Navy suggests. H.N Bailey deals with the loss of roller bearings,

government-furnished property, and the Board found, "In this case we have been

unable to conclude that appellant had the control and custody of the bearings alleged to

be missing or, indeed, that these bearings were in fact delivered to appellant."

H.N Bailey, 87-2 BCA ,r 19,763 at 100,004. The case does not involve damage and

the presumption as the Navy suggests. Universal Maritime Service also deals with a

case where the government had exclusive control of a warehouse where lost items

were stored at night and on weekends. The Board held, "Inasmuch as the Government

has not shown that the cargo was lost during the hours when it was in the custody and

control of appellant, the inference of negligence rule is not for application." Universal

Maritime Service, 81-1 BCA ,r 15,118 at 74,792-93. These cases do not contradict

Mohammad Darwish.

Proof of Negligence

The Navy argues, "where a bailment contract requires proof of the bailee's

negligence, the presumption may not be implied and the bailor must provide proof of

actual negligence of the bailee" (gov't mot. at 7). This is too simplistic a

characterization of the law, ignores Mohammad Darwish, and is a repackaging of the

Navy's argument discussed above. The Navy relies on two cases as support of its

proposition: Analog Precision, Inc., ASBCA Nos. 31277, 32877, 87-2 BCA ,r 19,804;

and Elro Swindle dlbla Aircraftsman, Inc., ASBCA No. 26964, 84-1 BCA ,r 17,172.

The Analog Precision decision dealt with computer equipment damaged during

shipment. The Board found, "Even if the Government, as bailee, is initially presumed

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to have been negligent in retuming the equipment in a damaged condition, the

evidence produced by the Govemment, as shown by the findings, rebuts that

presumption insofar as preparation for shipment is concemed." Analog Precision,

87-2 BCA ,r 19,804 at 100,170. Analog Precision implicitly supports our decision in

ATSCC. In Aircraftsman, the issue was liability for an aircraft accident. The Board

found that the pilot was not negligent and that the bailor did not sustain its burden of

proof. However, the Board does not discuss the presumption and we do not agree that

this decision conflicts with Mohammad Darwish. In Mohammad Darwish, just like in

ATSCC, the contract included a clause requiring proof of government negligence, yet

this Board imposed the presumption because the contract's negligence standard was

the same as the common law presumption. ATSCC, 17-1 BCA ,r 36,867 at 179,632.

Exclusive Possession

The Navy argues, "The presumption of negligence may not be applied where

the bailee's possession of the property was not exclusive to that of the bail or"

(gov't mot. at 7). We agree with this as a general proposition, but the Navy's

interpretation of exclusive possession is too narrow.

The Navy relies on several cases in support of its argument. The Navy cites

Mowbray, 601 F.2d at 647 ("[I]t is established law that no inference of negligence

against the bailee arises if his possession of the damaged bailed property was not

exclusive of that of the bailor."). While the quote is accurate, the Navy ignores the

facts of Mowbray where a 115-foot, flat-bottomed barge (the Victor) sank while

moored in a berth owned by Ellis, the bailee. The bailor's argument was that Ellis was

presumed negligent in the sinking of the barge. The problem was that the bailor's

employees had significant access to the barge. The Court's decision bears repeating:

Throughout the time that the Victor was berthed at the

wharf, Atmanchuck [bailor] and his agents-not Ellis-

[bailee] repaired and overhauled the vessel. The wharf

was not enclosed or fenced off; Atmanchuck had

unimpeded access to the Victor. No request for permission

to board her was made of or required by Ellis. In fact an

employee of Atmanchuck was on board the vessel earlier

in the evening on the very night the vessel sank.

The reason for the rule that a bailee who fails to

retum goods or retums damaged goods to the bailor has the

obligation of rebutting an inference of negligence is that

normally the bailor has no way of knowing what happened

to the goods entrusted to his bailee. R. Brown, The Law of

Personal Property§ 87 at 359 (2d ed. 1955). The appellant

5

here was obviously under no such disadvantage. He and

his employees enjoyed daily access to the vessel which

they were repowering.

Id. at 647.

Similarly, ATSCC had no way of knowing how the Navy was operating the

vessels because ATSCC was not involved in the training. Therefore, application of the

presumption was appropriate. There is no similarity between bail or's access in

ATSCC and that in Mowbray. The Navy also cites Analog Precision, 87-2 BCA

,r 19,804 that we distinguished above.

Our ATSCC decision discusses "exclusivity" as follows:

The Navy argues that the common law presumption

does not apply because the Navy did not have exclusive

control of the FS and LBV. It bases this argument on

ATSCC 's obligation to preform quarterly preventive

maintenance, yet states that ATSCC had "regular and

frequent access to the vessels in order to perform and

coordinate maintenance and repairs as required by the

PWS." (Gov't reply br. at 4) We do not agree that

ATSCC's obligation to maintain the vessels amounts to

"frequent access" sufficient to avoid the presumption. The

damage to the FS port engine occmTed during Navy

operations and training and ATSCC did not participate in

the Navy's training. Accordingly there is a presumption

that the damage was caused by the Navy's negligence.

ATSCC, 17-1 BCA ,r 36,867 at 179,633.

Simply put the Navy presents no evidence that ATSCC's quarterly maintenance

had any connection to the engine failure. Indeed, the record supports the conclusion

that the damage occurred during Navy training operations when the Navy had

exclusive control of the vessel. ATSCC, 17-1 BCA ,r 36,867 at 179,628-31, findings 3,

8-10, 16-19. The Navy's interpretation of"exclusive control" is too narrow. The

Navy would have us conclude that any access to a bailed item by a bailor, even access

that has nothing to do with the loss or damage, is sufficient to invalidate the

presumption. That is not what we found in Mowbray and Universal Maritime Service

cited by the Navy and discussed above. Apparently the Navy would contend that the

presumption would not apply to a bailment of an automobile damaged in an accident

because the car had routine maintenance at the dealership. None of the cases cited by

the Navy support such a narrow interpretation.

6

Engine Logs

The Navy argues that the discussion of engine logs in the decision is, "the

equivalent of imposing a legal obligation that does not exist in the Contract" (gov't br.

at 10). The decision does no such thing. The question here is if the Navy operated the

engines in an overheated condition that could cause the manifolds to crack. The Navy

entered several logs into the record indicating that in July 2014 it did operate Free

Spirit with overheated engines. ATSCC, 17-1 BCA ,r 36,867 at 179,629, finding 8.

The Navy set itself up for our decision by presenting testimony that hourly inspections

of the engine were conducted during training and the results entered in logs kept on the

vessel. Id. at 179,630-31, finding 18. These logs would affirmatively answer that

question one way or the other. Whether these logs were required by the contract or not

is irrelevant - according to sworn testimony of SBC Alb hourly checks were done and

log books were filled out and kept on the vessel. Id. As explained in the decision, the

Navy entered numerous logs into the record but not the ones leading up to and

including the 6 August 2015 engine failure that might rebut the presumption.

Testimony, unsupported by contemporaneous records that the Navy said existed, was

not enough.

CONCLUSION

The Navy failed to prove that the decision's reliance on the common law

presumption was legal error. The motion is denied.

Dated: 6 March 2018

Administr~ve Judge

Armed Services Board

of Contract Appeals

I concur in result (see separate opinion)

J.~

Administrative Judge

Vice Chairman

Armed Services Board

. of Contract Appeals

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OPINION BY ADMINISTRATIVE JUDGE PROUTY

I concur in the result. As stated in my concurrence with Judge Clarke's original

decision, I respectfully disagree with the reasoning in that opinion regarding the

application of the presumption of negligence from bailment law. My conclusion that a

finding of government negligence is supported by the facts, even without this

presumption, however, is not altered by the government's motion, which presents no

new or compelling arguments upon the matter and expressly limits itself to challenging

Judge Clarke's decision upon the presumption of negligence issue.

Dated: 6 March 2018

J. REIDPR0UTY

Administrative Judge

Vice Chairman

Armed Services Board

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. 61047, Appeal of

Assessment and Training Solutions Consulting Corporation, rendered in conformance

with the Board's Charter.

Dated:

JEFFREY D. GARDIN

Recorder, Armed Services

Board of Contract Appeals

8