GSC Construction, Inc.

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeals of -- )

)

GSC Construction, Inc. ) ASBCA Nos. 59402, 59601

)

Under Contract No. W9126G-11-D-0061 )

APPEARANCES FOR THE APPELLANT: Karl Dix, Jr., Esq.

Lochlin B. Samples, Esq.

Douglas L. Tabeling, Esq.

Smith, Currie & Hancock LLP

Atlanta, GA

APPEARANCES FOR THE GOVERNMENT: Michael P. Goodman, Esq.

Engineer Chief Trial Attorney

Stephanie R. Darr, Esq.

Lauren M. Williams, Esq.

Keith J. Klein, Esq.

Engineer Trial Attorneys

U.S. Army Engineer District, Tulsa

OPINION BY ADMINISTRATIVE JUDGE O’CONNELL

These appeals arise from a construction project at Fort Sill, Oklahoma.

Appellant, GSC Construction, Inc. (GSC), challenges the contracting officer’s default

termination of the contract. It contends it is entitled to time extensions and reversal of

the default termination, as well as additional money. The challenge to the default

termination is before the Board in ASBCA No. 59402 and the delay claims in ASBCA

No. 59601.

The Board conducted a 10-day hearing in Atlanta, GA, at which Judge McIlmail

presided. The Board denies the appeals. In accordance with the Board's internal

operating procedures, neither this opinion nor the concurrence in result has precedential

value except for those portions of the opinion in which we all explicitly agree.

FINDINGS OF FACTS

1. The above referenced contract is a multiple award task order contract

(MATOC) for various types of warehouses in areas west of the Mississippi River,

awarded by the U.S. Army Corps of Engineers (Corps) on September 15, 2011 (R4,

tab 28n at 1889-91). The MATOC contained various clauses, including Federal

Acquisition Regulation (FAR) 52.249-10, DEFAULT (FIXED-PRICE

CONSTRUCTION) (APR 1984) and FAR 52.236-21, SPECIFICATIONS AND

DRAWINGS FOR CONSTRUCTION (FEB 1997) (R4, tab 28n at 1897-98).

2. The dispute arises from MATOC task order DS01 awarded on July 13, 2012,

which required GSC to design and build two supply support activity (SSA) warehouses

(referred to as the 100th and the 168th warehouses) and two associated bulk storage

buildings (the SSA Warehouse project) (R4, tab 9a at 1, 6, 8-12, tab 9g at 1808).

3. The task order required completion of the project within 495 days of the

September 26, 2012, notice to proceed, or by February 3, 2014 (R4, tab 9a at 698;

tab 10). It is undisputed that GSC did not complete the work by that date (Jt. Stip. ¶ 14).

4. Contracting Officer (CO) Charles Peterson issued a show cause notice on

January 16, 2014, in which he contended, among other things that GSC was 145 days

behind its schedule and stated that he was considering termination of the contract for

default (R4, tab 8). GSC, through its president, Locke McKnight, responded on

January 28, 2014, citing various delays that he contended were not GSC’s fault

totaling 156 days, but stating that he was “confident” it could complete the project by

June 9, 2014 (R4, tab 7 at 1-4).

5. A different contracting officer, Nathan Kloeckler, responded on February 24,

2014, advising GSC that it needed to submit formally the delays cited in its January 28

letter as requests for equitable adjustments (REAs) (meaning, presumably, that GSC

needed to submit an REA if it wanted him to extend the contract completion date).

CO Kloeckler further stated that he would not terminate the contract for default at that

time due to GSC’s commitment to complete the contract by June 9, 2014, but that the

Corps was not waiving the contract completion date. (R4, tab 6)

6. CO Kloeckler issued a second show cause notice on April 28, 2014,

contending that GSC had not made satisfactory progress towards a June 9, 2014

completion date and that he was again contemplating termination. He once again

stated that the Corps did not “condone any delinquency” or “waive any rights” it had

under the contract. (R4, tab 5)

7. GSC’s project manager, Brannon Cundey, responded by letter dated May 5,

2014, again citing various delays that it contended were beyond its control, but now

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stating that “GSC firmly believes” that it could complete the work by August 30, 2014

(R4, tab 4 at 1-3).

8. CO Kloeckler terminated the contract for default on June 18, 2014, for

failure to meet the contract completion date of February 3, 2014, and failing to make

sufficient progress on completion of the work since that date1 (R4, tab 3). He testified

credibly that the termination was based upon his independent decision and analysis

(tr. 2/282, 3/9-12). GSC filed a timely appeal on July 7, 2014 that the Board docketed

as ASBCA No. 59402.

9. The parties disagree on how much additional time GSC would have required

beyond June 18, 2014. The Corps contends that GSC had completed less than 50% of

the work as of the termination and, based on its pace of work, would have needed until

August 2015 to complete the project (ex. G-12 at 31). GSC contends that as a result of

the various delays it was entitled to a time extension, and the project would have

finished no earlier than December 21, 2014 (app. br. at 38; tr. 10/134).

10. In its post-hearing briefs, GSC focuses on three delays that, in its view,

entitled it to time extensions, $328,293.82 in damages, and conversion of the

termination for default to one for the convenience of the government (app. br. at 2;

app. resp. br. at 2). These delays are: 1) building pad delays; 2) fire water flow test;

and 3) cold formed metal framing/design basis threat. It also alleges delays due to

design revision 3/additional site electric power, damage to roof panels, and the

correction of errors in hairpin reinforcing bars (we address the latter two issues in the

good faith and fair dealing section below).

11. GSC contends that it is entitled to 321 days of excusable delays, including

258 compensable days due to the three main delays (app. br. at 38). Its expert

calculated that it is entitled to 165 days excusable/160 days compensable delay for the

building pads; 22 days of excusable and compensable delay for the fire water flow test;

and 134 days of excusable delay and 76 days of compensable delay for the cold formed

metal framing 2 (ex. A-115).

1 CO Kloeckler also wrote a termination memorandum dated June 17, 2014, in which

he discussed his consideration of the factors in FAR 49.402-3(f) (R4, tab 135;

tr. 3/9-12).

2 GSC’s expert contends that these were the controlling delays and that they

overlapped with other, non-controlling delays, including design revision

3/additional site power and hairpins (see, e.g., tr. 7/95-96, 105; ex. A-115).

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The Building Pad Delays

12. The SSA Warehouse project site was in a corner of what was referred to as

the TEMF [tactical equipment maintenance facility] Complex site, a project that

included demolition of buildings on the SSA Warehouse site; infrastructure work; and

the construction of a TEMF building, unmanned aerial vehicle storage buildings, and

oil storage buildings (R4, tab 9c at 832; tr. 1/73-74; ex. A-18 at 1). The Corps

awarded the TEMF Complex work to Harper Construction, Inc. (Harper or the

“Infrastructure Contractor”) (ex. A-18).

13. As we will illustrate, the work on the two projects required some

coordination, and the dispute boils down to whether GSC or Harper was responsible

for removing and replacing unsuitable soil on the SSA building sites (gov’t resp. br.

at 4-5; app. br. at proposed finding of fact (PFF) 17).

14. The SSA Warehouse task order had various provisions that delineated the

responsibilities of GSC and Harper, including, for example, a provision that Harper

would complete its work on the building pad sites within 120 days of the notice to

proceed (R4, tab 9a at 698).

15. The task order statement of work (SOW) disclosed the presence of

expansive (clay) soils at Fort Sill and specified that the foundation of the buildings

must be designed to meet the geotechnical considerations of the site (R4, tab 9a at 21

(SOW 3.5.5) at 56 (SOW 6.2.1); tr. 1/71). While the Corps had provided a

geotechnical report to offerors with the solicitation, the task order required GSC to

perform a geotechnical investigation and to submit a report with its first foundation

design submittal (R4, tab 9a at 40 (SOW 5.2.2)).

16. SOW 6.3, Site Planning and Design, at 6.3.1.1, provided that the Corps

(that is, Harper, after it demolished the existing structures (tr. 9/193)) would “provide

general site preparation and mass grading” that included brush clearing and removal of

rocks, as well as:

(c) Rough grading to plus or minus 0.3 feet of proposed

subgrade elevation . . . for proposed structures. Maximum

allowable variation of the finished floor elevations is plus

or minus 0.2 feet. The Contractor is responsible for any

additional fill or cut in order to meet the required minimum

or maximum finished floor.

(d) The Infrastructure Contractor will perform rough

grading. In areas that required fill during the rough

grading, general compaction of fills between 95 to 100

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percent of density as measured by Standard Proctor with

fill being constructed in maximum 8-inch lifts.

(R4, tab 9a at 56)

17. In addition, this clause identified the following requirements

for GSC:

(e) The Contractor is responsible for any specific site

preparation required to accommodate the foundation design

prepared or proposed by the Contractor.

6.3.1.2. Time and weather conditions may affect the actual

condition of the building site(s); therefore, the Contractor

shall accept the site(s) as is and be solely responsible for all

final site preparation including any excavation (if

necessary), placement of select fill (if necessary), and any

testing required to accommodate the proposed foundation,

as required by the Contractor’s final geotechnical report.

(R4, tab 9a at 56)

18. Drawing C101, Note 1, provided:

TEMF INFRASTRUCTURE CONTRACTOR SHALL

ROUGH GRADE SITE TO BOTTOM OF BASE LAYER

FOR BUILDING SLAB AREA. . . . TEMF

INFRASTRUCTURE CONTRACTOR GRADING

WORK SHALL BE DONE TO ACCOMMODATE 8"

BUILDING SLAB AND 6" AGGREGATE BASE . . . .

DESIGN/BUILD CONTRACTOR TO PROVIDE

FOUNDATIONS, SUBBASE, BASE AND BUILDING

FLOOR SLABS AS REQUIRED BY THEIR DESIGN

AND COORDINATE THICKNESS WITH GRADING

WORK BY TEMF INFRASTRUCTURE

CONTRACTOR.

(R4, tab 9c at 839) (emphasis added) The Board finds that “Design/Build Contractor”

on this drawing refers to GSC.

19. Similarly, Drawing C203, Note 1, also provided that GSC was responsible

for the foundations, base, subbase, and building floor slabs (R4, tab 9c at 844).

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20. SOW 6.6 is entitled “Structural Design.” At sub-section 6.6.3.1, it

specified that due to soil conditions at Fort Sill, the contractor must use a pier and

supported grade beam foundation with structurally supported slab, a conventional rib

mat slab, or a thickened structural slab. (R4, tab 9a at 64-65)

21. Pier and supported grade beam foundations are common at Fort Sill.

Selection of this foundation would have allowed GSC to leave the expansive soil in

place. (Tr. 1/72, 3/273) Selection of a rib mat slab (or “waffle mat”), on the other

hand, required the removal of the expansive soil and replacement with what the parties

refer to as inert or select fill (tr. 3/113, 241, 4/81, 5/116, 7/80, 9/206). The inert

material would form the subbase for the buildings (tr. 3/256; see findings 18-19).

22. In its proposal, GSC indicated that it intended to install a waffle mat slab

and that it understood it would have to remove the existing soil and replace with select

fill:

Foundations:

. . . the following was determined to be the most cost

effective solution with the assumptions based on the local

construction practices for these soil conditions and the

building type:

• Remove and replace a minimum of 8 feet and up to 9 feet

of the unsuitable fill for an area including a 5 ft apron

around the foot print and replace it with select structural

fill. . . .

• Foundation is to be a Concrete Waffle Mat supported on

new structural fill . . . .

(R4, tab 9i at 1854)

23. GSC’s proposal was incorporated in the contract (R4, tab 9b at 730, tab 28e

at 441, tab 28n at 1920).

24. The SSA Warehouse solicitation, at appendix MM, attached at least part of

the TEMF Complex specifications. However, they were marked ‘PROVIDED FOR

INFORMATION ONLY – NOT IN CONTRACT.” (R4, tab 9d at 853) Appendix MM

included the TEMF contract Earthwork section, which included the following language:

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3.2.1 Building Slab

Overexcavate 8 feet below existing grade of existing soil

and replace with inert fill as required by the geotechnical

investigation. Extend limits of removal to at least 5 feet

beyond the building footprint. Only imported inert fill or

nonexpansive on site soils shall be used for building slab

fill.

(Id. at 974, 981)

25. CO Kloeckler testified that the Corps provided the TEMF specifications in

the SSA Warehouse solicitation because the contractors had to coordinate their work

on the projects and that GSC had to tie in some of its work with Harper’s work,

including fire and domestic water lines, paving, and site lighting (tr. 3/15-16). To

facilitate this process, the Corps conducted regular coordination meetings between

GSC and Harper (R4, tab 140; tr. 2/180, 3/96).

26. On September 28, 2012, (two days after the notice to proceed) Mr. Cundey,

GSC’s project manager, wrote to government officials, including administrative

contracting officer (ACO) Robert Owens, attaching a letter from GSC’s structural

engineer. Mr. Cundey stated that the information from GSC’s structural engineer

would provide the Infrastructure Contractor the depth of cut and fill (R4, tab 12 at 3-4).

27. ACO Owens responded by email later that afternoon, stating that he was

“slightly confused with your needs.” He stated that the Infrastructure Contractor

would not provide any select fill and that “[i]f your foundation design requires any

special fill [you] must excavate and re-fill at your cost IAW subparagraph [6.3.1.1]

(e)” of the SOW. He further stated that the Corps’ intent was for the Infrastructure

Contractor “to provide you with a pad at the two elevations noted [in SOW 6.3.1.1(c)]

but not with anything other than local soil.” (R4, tab 12 at 1)

28. Mr. Cundey replied by email on October 9, 2012. Among other things, he

acknowledged ACO Owens’ reference to SOW 6.3.1.1(e) but stated that this provision

required GSC to perform “site preparation,” not mass grading, which, he contended

were “completely separate entities.” Mr. Cundey stated that site preparation referred

only to any additional cut around the building pads. He further stated that site

preparation “does not refer to the responsibility of removing soil and replacing soils.”

(R4, tab 13 at 1)

29. As referenced earlier, and contrary to Mr. Cundey’s assertion, SOW 6.3.1.2

provided that GSC was “solely responsible for all final site preparation including any

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excavation (if necessary), [and] placement of select fill (if necessary) . . . .” (R4, tab 9a

at 56).

30. Soon after Mr. Cundey’s October 9 email, ACO Owens spoke with

Mr. Cundey. As a result of this conversation, he believed that Mr. Cundey had agreed

that GSC would remove and replace the unsuitable soil from the site (tr. 3/100-01,

9/197-98). To confirm this understanding, ACO Owens wrote another email to

Mr. Cundey on October 10, 2012, in which he stated: “[i]f we are still at a point that I

need to send you a formal letter please let me know.” (R4, tab 16 at 1) GSC did not

respond to the email 3 (tr. 9/197).

31. Sometime in March 2013, a GSC official told ACO Owens that it did not

intend to perform the excavation work at the building pad sites (tr. 9/197). As a result,

on April 15, 2013, he formally directed GSC to begin the work (R4, tab 19).

32. GSC thereafter began excavating the unsuitable material but it encountered

a problem at the 168th Warehouse site. When it had excavated down to where it

should have been able to place the inert fill, it encountered what ACO Owens

described as “blackish soil, very wet, heavy” (tr. 3/113). Mr. Cundey wrote to

CO Charles Peterson and ACO Owens on July 10, 2013. He contended that there was

a differing site condition, and proposed to remedy it by cutting one additional foot and

placing one foot of stone to bridge the bad soil. He requested a 30-day time extension

and $89,410. (R4, tab 177 at 1273-74)

33. ACO Owens agreed that there was a differing site condition. However, he

viewed GSC’s proposal as “very excessive.” (Tr. 3/114) The Infrastructure

Contractor, Harper, already had experience with the site conditions and had the

equipment to address them. It proposed to remove more soil than GSC, place one foot

of rock, and three feet of inert material, to be accomplished in four days for

approximately $55,000. Because this was significantly less time and money than GSC

sought, contained a more comprehensive fix, and because GSC was behind schedule

and the work needed to be done quickly, ACO Owens assigned the work to Harper.

(Tr. 3/114-15, 3/240-41)

3 On February 18, 2013, GSC submitted a claim for $212,580 to perform the building

pad work. GSC did not certify the claim. (R4, tab 2 at 1-3) After

CO Kloeckler denied the claim, GSC filed an appeal docketed as ASBCA

No. 59401, but the Board dismissed it due to the absence of a certification.

GSC Constr., Inc., ASBCA No. 59401, 15-1 BCA ¶ 35,887. GSC states that

ASBCA No. 59401 involved the cost of performing the additional work

whereas the cost of the delay is now before the Board in ASBCA No. 59601

(app. PFF 41).

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34. GSC contends that it did not have access to the 168th Warehouse site from

its discovery of the differing site condition on July 1, 2013, until July 25, 2013. GSC

also contends that it encountered other differing site conditions including an asbestos

pipe and trash and debris in the building pad area but it does not quantify the delay

caused by these conditions, if any. (App. br. at PFF 39)

35. Based on an analysis by its expert, GSC seeks 165 days of excusable delay

due to the alleged change in the building pad work, 160 of which it contends are

compensable (app. br. at 34 (citing ex. A-115)).

36. The government has submitted convincing evidence that the late

completion of the building pads was largely, if not entirely, GSC’s fault by virtue of its

failure to conduct a timely geotechnical investigation and in delaying its submittal of

the final design of the project. GSC could have begun its geotechnical investigation

once the government issued the notice to proceed on September 26, 2012, but it waited

until October 30, 2012, to order its geotechnical subcontractor to begin work (R4,

tab 37b at 5).

37. GSC needed this report before it could begin designing the slabs and

foundations (tr. 8/44, 8/172; R4, tab 9a at 86-87) but the subcontractor proceeded

slowly. Mr. Cundey expressed his concern on November 27, 2012, when he wrote to

the subcontractor: “[w]e need the final report ASAP. . . . I have to get my structural

engineer working on the foundations and desperately need your help in getting at least

another preliminary recommendations [sic] on the heave potential and undercut/select

fill.” (R4, tab 177 at 223-24)

38. GSC did not obtain the geotechnical report and submit it to the Corps until

January 22, 2013; the Corps rejected it for failing to meet the requirements of the

contract on February 4, 2013 (R4, tab 37b at 1). GSC resubmitted the report on

February 19, 2013 and received an approval from ACO Owens eight days later

(February 27) (R4, tab 37c at 1).

39. As a result of all this, GSC was not able to submit its foundation design

until March 14, 2013 (R4, tab 37e; ex. G-12 at 8). It submitted its final design for the

project on June 13, 2013, and began excavation on the 168th Warehouse site that day

(R4, tab 21 at 14-15, tab 32 at 261, tab 37f).

40. By the time it began excavating, GSC had expended 52.5% of the 495-day

performance period. GSC states in its brief (PFF 40) that it completed the building pad

work on August 12, 2013; thus the actual work took only 61 days, even with the time

required for Harper to remedy the differing site condition.

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41. GSC submitted a certified claim to the contracting officer for four delay

issues, (the building pads, fire water flow test, cold formed metal framing, and design

revision 3) on June 26, 2014. It sought a 246-day time extension for all of the delays

and $328,293.82 in extended overhead costs. (R4, tab 29) The contracting officer did

not issue a final decision and on September 26, 2014, GSC filed an appeal based on a

deemed denial that the Board docketed as ASBCA No. 59601.

Fire Water Flow Test

42. A flow test is necessary to determine water main pressure and flow (gallons

per minute) for the design of a fire suppression system (tr. 6/69, 7/131). The contract

provided for the test to be conducted relatively early in the contract:

FIRE PROTECTION DESIGN

. . . 6. Adequacy of water supply for fire suppression

systems will be determined at or before the 30% design

level. Requests for flow tests should be sent (in writing) to

the project manager before the 10% design level.

(R4, tab 9a at 680)

43. While this provision speaks of the “30% design level,” the contract granted

GSC discretion as to the state of development for the interim design it would submit to

the Corps (R4, tab 9a at 81). GSC did not submit a 30% design (tr. 9/33); its proposal

schedule and initial schedule referenced submission of a 60% design (R4, tab 9i at 1946,

tab 110 at 5). GSC instead submitted a 65% design on February 4, 2013 (R4, tab 37d

at 2).

44. While GSC did not submit a 30% design, there is nothing in the record that

indicates that the parties intended to dispense with the flow test, nor is there any

evidence that GSC contended that the requirement for the test had been omitted.

45. A flow test requires only about 20 to 30 minutes to perform (tr. 9/9). But to

perform the test, the contract required that GSC have a quality control fire protection

engineer on site (R4, tab 9 at 147-48). The contract specifically stated that specialty

quality control personnel “are not intended to be full-time, but must be physically

present at the construction site during work on their areas of responsibility” (id.

at 147) (emphasis in original).

46. GSC did not submit for approval a fire protection engineer until

September 10, 2013 (R4, tab 33 at 450, tab 58b at 3). It first conducted the flow test

(unsuccessfully) on October 25, 2013, or more than eight months after it submitted the

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65% design, and four months after it submitted its final design (R4, tab 32 at 434;

finding 39).

47. From September 2013 until termination, it is difficult to understand the

actions that GSC took. The only testifying witness that impressed the Board with her

knowledge of the flow test issue was Helen Landry. Ms. Landry was assistant fire

chief at Fort Sill from 1992 until her retirement in 2008. During the SSA Warehouse

contract she worked as a fir e protection specialist for the Corps as a contract

employee; she was on the site “quite often” during the contract work (tr. 9/6-7, 33).

48. According to Ms. Landry’s credible testimony, there were hydrants

available for testing on Miner Road during the entire contract term and the Corps, in

fact, had used these hydrants when it had conducted tests in 2011 (tr. 9/12-13, 16-17,

42).

49. There were hydrants closer to the SSA Warehouse building than those on

Miner Road but the line for these hydrants broke in September 2013. They were not

repaired until March 2014 by the Fort Sill water contractor, which prevented testing on

this line during that time (tr. 9/8, 34-35, 38-39).

50. GSC seems to advance two delay theories concerning the flow test but it

does not explain how or whether they fit together. First, it seems to believe that it was

required to perform the tests at the hydrants with the broken line because they were

closest to the warehouses (app. br. at PFF 47, 49). However, it has not identified any

contract provision or written direction from the Corps, nor does it identify any specific

person at the Corps who verbally directed it to perform the test at the broken line.

51. In its brief, GSC cites the “National Fire Protection Act Section 13” as

requiring the test at the nearest hydrant, but we believe it is referring to guidelines

published by the National Fire Protection Association (app. br. PFF 49; tr. 9/35).

However, it has not provided us with any standard or guideline and Ms. Landry

testified that she knew of no requirement that the test be conducted at the closest fire

hydrant (tr. 9/42).

52. Second, GSC appears to contend that it was delayed by Harper’s work on

the water lines for the infrastructure contract (app. br. at PFF 48, 63). However,

Ms. Landry testified credibly that any new lines or hydrants installed by Harper did not

have to be active for GSC to conduct a flow test (tr. 9/17).

53. The Board finds that GSC created this problem for itself by failing to

conduct the flow test before it submitted the 65% design. If it had done so, the water

line break would never have been an issue. Further, it does not seem to have

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understood where it could perform the flow test. GSC has not proven a flow test

delay.

Cold Formed Metal Framing/Design Basis Threat

54. GSC used cold formed 4 metal framing to construct the exterior walls of the

buildings (tr. 8/112).

55. The MATOC, under Special Contract Requirements, provided:

1.7. RESPONSIBILITY OF THE CONTRACTOR FOR

DESIGN (MAY 02)

(a) The Contractor shall be responsible for the professional

quality, technical accuracy, and the coordination of all

designs, drawings, specifications, and other

non-construction services furnished by the Contractor

under this contract. The Contractor shall, without

additional compensation, correct or revise any errors or

deficiency in its designs, drawings, specifications, and

other non-construction services and perform any necessary

rework or modifications . . . .

1.9. CONSTRUCTOR’S ROLE DURING DESIGN (JUN

98)

The Contractor’s construction management key personnel

shall be actively involved during the design process to

effectively integrate the design and construction

requirements of this contract. . . . the constructor’s

involvement includes, but is not limited to actions such as:

. . . ensuring constructability and economy of the design,

[and] integrating the shop drawing and installation drawing

process into the design.

(R4, tab 28n at 1921-22)

56. The contract, at SOW 5.13, SECURITY (ANTI-TERRORISM

STANDARDS), required GSC to comply with DoD Minimum Antiterrorism

Standards for Buildings, UFC [Unified Facilities Criteria] 4-010-01. The clause stated

4 “Cold formed” means that heat is not used to form the metal (tr. 5/23-24).

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that the “element of those standards that has the most significant impact on project

planning is providing protection against explosive effects.” (R4, tab 9a at 55)

57. In January 2012 when the Corps issued the task order RFP, the 2007

version of UFC 4-010-01 (2007 UFC) was in effect; DoD updated the standard in

February 2012 (2012 UFC). The 2007 UFC was easier to meet because, if minimum

standoff distances were met, it did not require a specific analysis of blast effects (R4,

tab 143 at 39-40; tr. 9/101-02). The 2012 UFC required such an analysis unless the

design matched specific criteria in table 2-3 of the standard, including, among other

things, the height or span of the steel studs (R4, tab 163b at 75-76; tr. 9/53-54).

58. On January 28, 2013, in request for information (RFI) 0004, GSC asked the

Corps whether it should use the 2007 or the 2012 UFC. On February 4, 2013, the

Corps informed GSC that it should use the 2007 UFC. (R4, tab 35 at 4) GSC’s

designer thereafter followed the 2007 UFC in preparing the design (e.g., R4 tab 37e

at 13, 19).

59. GSC retained a structural engineer to prepare shop drawings for the cold

formed metal framing. 5 The structural engineer inexplicably used the 2012 UFC in

creating the shop drawings. GSC’s quality control manager did not notice the mistake

and on September 20, 2013, he signed a submittal for the shop drawings, certifying

that he had reviewed them in detail and that they were in strict conformance with the

contract. (R4, tab 164 at 1, 4)

60. The parties agree that if GSC had submitted the shop drawings under the

2007 UFC, they would have been approved (gov’t resp. br. at 20; app. reply at 8). But

the Corps’ structural engineer responsible for reviewing the shop drawings was

unaware of its response to RFI-0004. He saw that the shop drawings had been

prepared using the 2012 UFC and reviewed them under that standard (tr. 9/58-60).

61. The shop drawings did not match the criteria in table 2.3 of the 2012 UFC

but GSC had not submitted the blast analysis required by the 2012 version. The Corps

rejected the submittal (R4, tab 164 at 1; tr. 9/53-54, 57). GSC submitted the shop

drawings four times before the Corps approved them on May 6, 2014 (R4, tabs 164-67).

GSC’s structural engineer continued to use the 2012 UFC through the fourth submittal

(R4, tab 167 at 6).

5 FAR 52.236-21(d) (finding 1) defined shop drawings as: “drawings, submitted to the

Government by the Contractor . . . showing in detail (1) the proposed

fabrication and assembly of structural elements and (2) the installation (i.e., fit,

and attachment details) of materials or equipment.”

13

62. GSC does not challenge the Corps’ contention that it did not provide blast

calculations sufficient to meet the requirements of the 2012 UFC until the fourth

submittal.

63. Another issue that caused some confusion was whether the SSA Warehouse

project was inside a controlled perimeter. This did not matter under the 2007 UFC, but

under the 2012 UFC it dictated the explosive charge the structures had to be designed

to resist (tr. 7/103-04, 9/77, 84-86, 100, 104-05). When the Corps’ structural engineer

rejected the first shop drawing submittal on October 17, 2013, he informed GSC it was

his understanding that the project was not inside a controlled perimeter and GSC must

get a letter from Fort Sill Security clarifying this (R4, tab 164 at 2).

64. GSC did not contact Fort Sill Security, however, and did not re-submit the

shop drawings until March 4, 2014 (R4, tab 165). The issue was not resolved until

ACO Owens, to assist GSC, went to the relevant Fort Sill officials and obtained a

memorandum that he provided to GSC on April 2, 2014, (prior to the third shop drawing

submittal) indicating that the project was inside a controlled perimeter (ex. A-45 at 2;

R4, tab 166).

65. By letter dated March 7, 2014, GSC submitted what it called an REA,

seeking a final decision from the contracting officer related to the cold form metal

framing. It sought $99,950 and a 100-day time extension. (Ex. A-85) The contracting

officer did not issue a final decision and the Corps denies receiving the REA (gov’t

resp. br. at 22); GSC did not appeal. The applicable claim for this issue is, therefore,

the June 26, 2014 claim (R4, tab 29).

66. GSC contends that it suffered 214 days of delay as a result of the multiple

submissions of the shop drawings (app. br. at 23). However, its expert calculated only

134 days of excusable delay, 76 of which were compensable, (and which overlap with

delays from other issues including the flow test) (R4, tab 115).

Design Revision 3/Additional Site Electric Power

67. GSC advises the Board that design revision 3 “was a concurrent, non-driving

delay” and that the Board “need not address” it (app. br. at 37). Perhaps for this reason,

neither party provides a thorough explanation of this issue. The correspondence during

the project tends to be brief, and, in some cases, technical, and it is quite difficult to

discern the precise areas in dispute. However, we address it because it would be a

fallback delay if the Board rejects its contentions concerning the cold formed metal

framing delay, as we do.

68. In September 2013, more than three months after GSC submitted the final

design, it submitted RFIs to the Corps concerning the electrical panels and rain

14

harvesting equipment. On September 25, 2013, GSC submitted RFI-0041 concerning

Drawing E601, Panel Schedule. GSC stated “Panel HA is showing 7 spots available for

extra circuits, a total of 8 circuits are required per the IFC [issued for construction]

drawings. Panel HA is insufficient.” GSC added: “Panel HA can be a 60 circuit panel

instead of a 42 circuit panel. We need to know how much power the site lighting

circuits require to determine if the panel service needs to increase.” (R4, tab 35

at 81-82)

69. On October 4, 2013, the Corps, through electrical engineer Victor Sears,

responded by providing a review of the contract requirements and the IFC drawings.

Mr. Sears’ conclusion was “[i]f Panel HA is installed per the IFC panel schedule, the

42-position panel already meets contract requirements for future spaces. No change is

necessary.” (R4, tab 35 at 81)

70. Thus, while RFI-0041 raised the possibility of changing from a 42-circuit

panel to a 60-circuit panel, the Corps stated that was not necessary. Accordingly, the

Board sees nothing in RFI-0041 that increased or changed the contract requirements.

71. On September 25, 2013, GSC also submitted RFI-0042. It stated:

“Infrastructure drawings ES105 keyed note 8, states (2) 3 phase 480 volt circuits, (2)

3 phase 280 volt circuits and a single phase 120 volt circuit for rain harvesting

equipment per panel schedule. On the IFC drawings E601 and E602 this equipment is

not accounted for.” It further stated: “[w]e need information regarding the electrical

requirements for the rain harvesting equipment so we can make sure we have room for

it on the current service.” (R4, tab 35 at 83-84)

72. On October 4, 2013, Mr. Sears responded: “[u]se the information on sheet

ES-105 in Keyed Note 8 to verify the capacity of the bldg service, panel feeders, panel

ratings, and panel loading. Use the FLA ratings in the NEC for the 4 motor loads and

assume 80% loading on the controller circuit.” (R4, tab 35 at 83)

73. Mr. Sears did not testify, nor did any other witness with expertise in

electrical design or installation. No witness explained RFI-0042. Mr. McKnight

testified for GSC on this delay but the Board found his testimony imprecise and

confusing (tr. 5/185-210). The Board finds that it is unclear whether the terse and

highly technical response to RFI-0042 changed or delayed the work.

74. On November 19, 2013, GSC submitted what it referred to as “Revision 3

Miscellaneous Changes” (R4, tab 101a). A memorandum summarizing the contents of

the submission stated, among other things, that on Drawing E-601 GSC had “[a]dded

site lighting and rain harvest equipment to Panels HA and LA” (id. at 2). The Corps

approved the submittal on January 24, 2014 (id. at 1).

15

75. On January 21, 2014, GSC submitted an REA seeking $81,140 in costs

related to what it referred to as “additional site power.” The body of the letter was

only one paragraph in length and was conclusory, stating “[a]s the COE is aware, GSC

had no way to anticipate the cost for the site lighting and power requirements for the

rain harvesting system.” (R4, tab 36 at 53) ACO Owens denied the REA by letter

dated March 17, 2014. His letter was also conclusory, but he contended that GSC

should have been aware of the requirements because the Corps had provided offerors

“the entire Infrastructure Contract requirements for coordination purposes.” (R4,

tab 36 at 121)

76. GSC’s certified claim dated June 26, 2014, is also conclusory (R4, tab 29).

Previously, on April 29, 2014, GSC had requested a contracting officer’s final decision

and $84,140 due to the site power issue. While the letter was slightly longer than the

January 21, 2014, REA, it was again conclusory:

As the COE is aware, GSC had no way to anticipate the

cost for the site lighting and power requirements for the

rain harvesting system. The additional site power

increased the main building panel and added additional

panels and circuits to the electrical distribution.

(R4, tab 4 at 6)

77. The contracting officer did not issue a final decision and GSC did not

appeal its April 29, 2014 claim.

78. The record includes no evidence supporting a finding that there were any

evolutions in the design resulting from RFIs 0041 and 0042 that delayed the project,

particularly in light of GSC’s design responsibilities in this design-build contract. Nor

has it demonstrated that it could not have anticipated this work based on the drawings

attached to the RFP. Finally, GSC has not proven the number of days of delay, if any,

that resulted from this issue. Accordingly, GSC has not proven a delay related to

design revision 3.

GSC Allegations Concerning Good Faith and Fair Dealing

79. GSC contends that the Corps breached the duty of good faith and fair

dealing, that Corps employees acted in bad faith, and that the contracting officer

abused his discretion when he terminated the contract. We review its discrete

allegations.

16

A. Failure to Grant Time Extensions

i. Hairpins

80. GSC alleges that the contracting officer breached the duty of good faith or

acted in bad faith by refusing to provide appropriate time extensions. In addition to

those delays discussed above, GSC relies on a March 7, 2014, claim it submitted to the

contracting officer seeking a 35-day time extension related to “hairpins” (ex. A-80).

The parties have not referred us to any final decision by the contracting officer.

81. GSC’s design provided for bolts to anchor the main columns to the building

foundation. Hairpin reinforcement bars go through the anchor bolts and back into the

concrete. They are important because they provide shear support for the anchor bolts

(tr. 1/97, 3/103-04; see R4, tab 37g at 3340). As ACO Owens explained:

when you put the wind load or even a load on those

A-frames, they’re going to have bilevel stresses on them,

and they push out in the concrete. Without those hairpins,

concrete doesn’t work in shear. Concrete only works in

compression, so the steel picks up that shear and holds the

structural steel where it needs to be.

(Tr. 3/108, see tr. 1/148)

82. Failure to install the hairpins, or to install them correctly, could present

problems ranging from wear and tear on the slab up to collapse of the building

(tr. 3/108-09, 9/127-28).

83. This problem began when GSC reported that it had installed the wrong size

anchor bolts on two columns in the 168th warehouse building (tr. 3/102). While this

was a problem, it proved to be a serendipitous event for the building’s users. When

ACO Owens visited the site, he had some questions on how GSC was going to restore

concrete it had chipped out to fix the bolts, but “then all of a sudden, looking at it, I

realized, you’re missing hairpins. Where are they? They had no answer. We went

and looked at all the locations that were chipped out. They didn’t have hairpins on

column line B.” (Tr. 3/103)

84. Looking further, ACO Owens found other areas where GSC had installed

the hairpins but had installed them incorrectly (tr. 3/106). GSC’s design called for

them to be installed in the upper half of the anchor bolt and in a horizontal position,

but they were installed in the bottom half and “splayed in directions that were other

than horizontal” (tr. 9/135). The Corps quality assurance representative also found that

17

GSC had bent the hairpins incorrectly (tr. 1/99-100). Ultimately, the Corps found that

GSC had installed the hairpins incorrectly at 80-85% of their locations (tr. 9/142).

85. The Corps demanded that GSC provide written confirmation from its

designer that it had considered the placement of the hairpins and that the lateral loads

would be transferred effectively to the slab per the design calculations (R4, tab 177

at 2414). GSC’s designer proffered a solution, but Brannon Cundey insisted that the

as-built configuration was acceptable; GSC continued to perform work, which only

increased the defective work to be fixed. More than two months passed before

Mr. Cundey agreed to fix the hairpins. (Tr. 9/127-28; R4, tab 177 at 3168)

86. GSC contends that “the Corps unduly expanded the inspection requirement

and forced GSC to inspect every hairpin previously installed” and that this “greatly

increased the time required to fix the missing hairpins from a few hours to several

months” (app. resp. br. at 23). Given our findings that missing or defective hairpins

can present problems up to collapse of the building and that GSC had installed 80-85%

of them incorrectly, we consider this contention absolutely astonishing.

87. The Board finds that GSC created this problem for itself and failed to

mitigate any delays. The Board further finds that the Corps acted reasonably in

ensuring that all of the hairpins had been installed correctly.

ii. Damaged Roof Panels

88. On June 23, 2014, GSC submitted a claim in which it sought a 42-day time

extension and $92,126.50 for damaged roof panels consisting of: 16 roof panels

damaged when Harper’s forces ran over them; 46 panels damaged when GSC

relocated them because the Corps failed to provide a laydown area; and 26 panels

damaged due to high winds (app. supp. R4, tab 50).

89. This issue is not adequately explored in the parties’ briefs, but, as best we

can tell: 1) the contracting officer did not issue a final decision; 2) GSC is using the

claim in support of its entitlement to a time extension with respect to the default

termination but is not asking the Board to award it the $92,126.50 referenced in the

claim; and 3) GSC’s expert did not provide any support in his report or testimony for a

delay to the project due to damaged panels (ex. A-115; tr. 7/8-160).

90. In its briefs, GSC does not tell us much more than it views the damage to

the panels as “undisputed” and that it is “irrelevant” that if it had kept to its schedule,

the panels would have long since been installed when the damage occurred (app. resp.

br. at 18). With respect to the wind damage, Mr. McKnight testified that the panels

were damaged in what he called a “microburst” or a “mini-tornado” (tr. 6/8) but we

have not been referred to any documentation of such a weather event.

18

91. The Corps agrees that Harper damaged six panels on or about May 20,

2014. It contends that GSC is at least partly to blame because the panels should have

been secured; by that date GSC had removed its site superintendent and one of its

quality control managers (see R4, tab 32 at 991, 994) and, as a result was not

supervising the work properly. Further, ACO Owens testified that GSC damaged

numerous panels when it unloaded them (tr. 9/157). Unfortunately, it is not clear from

the testimony if these are the same damaged panels to which GSC is referring and the

record and briefing is inadequate for the Board to sort out which panels were damaged

by which contractor or event.

92. The Board finds that GSC has not proven that damage to panels for which

the government was responsible delayed the completion date of the project.

B. The Magnificent Seven

93. In January 2014, as a result of customer surveys, the Corps conducted a

review of Fort Sill projects that had fallen behind schedule. After examining all

Fort Sill projects worth more than $500,000 that it had managed from July 2012 to

January 22, 2014, it found that about three-quarters had been completed early or on

time but there were seven projects that were late (defined as completed or projected to

complete more than 14 days after the scheduled building occupancy date) for reasons

that could not be readily identified (ex. A-12 at 5). The Corps did a “deep dive” to

understand why these projects had fallen behind schedule. GSC was the contractor on

two of the seven contracts. (Tr. 2/215-16; ex. A-12)

94. The area engineer for Fort Sill, Richard West, dubbed the contracts the

Magnificent Seven. At the hearing, both he and the Fort Sill resident engineer,

Keith Maxwell, denied that they used the term Magnificent Seven to disparage the

contractors (tr. 2/182, 9/128-29).

95. GSC contends in its brief that the “obvious significance” of this name is

that, in the movie, “many of the Magnificent Seven died” (app. resp. br. at 3, n.3).

Mr. West testified that he had not even seen the movie and did not make this

connection (tr. 9/129-31). GSC contends that the name shows that a group of Corps

employees (which it calls the “Magnificent Seven cabal”) were targeting GSC (app.

resp. br. at 3, n.3, 10).

96. The Board finds that the Magnificent Seven process was merely an

investigation into why these projects fell behind so that the Corps could “find common

themes and areas for improvement” (ex. A-12 at 1). While using this name was likely

an attempt at dry or sardonic humor, there is no evidence that the “Magnificent Seven

cabal” had any animus towards the contractors performing these contracts, took any

19

inappropriate actions against the contractors, or sought to embarrass them by using this

name internally.

C. Harper Favoritism

97. GSC contends that the Corps’ “disparate treatment of GSC and Harper is

persuasive evidence of bad faith” (app. resp. br. at 11). Among other things, GSC

contends that the Corps did not include Harper in the Magnificent Seven or terminate

its contract even though its project fell more than 500 days behind schedule (id. at 3,

10).

98. While Harper did fall far behind schedule, ACO Owens testified credibly

that GSC was the reason Harper fell behind. As he explained, part of Harper’s work

included the demolition of existing warehouses. These warehouses were to be

demolished when GSC finished construction of the 168th Warehouse. Once GSC fell

behind, Harper’s project fell “day for day” behind. Moreover, when the contracting

officer terminated GSC’s contract in June 2014, the delay to Harper’s work “went

completely wild,” in that work ground to a halt and Harper had to release its

subcontractors from the project. Harper was only able to bring the subcontractors back

in November 2014 but at that point “the subs trickled back, and they couldn’t come

back with full force, because they had work elsewhere.” Harper never succeeded in

fully restoring staffing levels. (Tr. 3/159-60)

99. GSC also relies on emails from a Corps contract employee responsible for

reviewing schedules who expressed frustration that he had repeatedly found some

dates in the Harper schedules to be incorrect. He requested support from his superiors

in getting Harper to make the corrections and raised the issue of favoritism if this were

not done (app. exs. 8-9). However, he testified at the hearing that Harper and GSC

were not treated any differently. He further testified that Harper fixed its schedules

and the Corps did not have consistent problems with the Harper schedules as it did

with GSC (tr. 2/133-34). The emails in question strike the Board as nothing more than

a worker expressing vexation at a recurring but ultimately minor problem.

100. The Board finds that GSC has not proven that the Corps improperly

favored Harper.

D. Partnering

101. The contract contained the following provisions with respect to

partnering:

20

3.1.3 Partnering & Project Progress Processes

3.1.3.1 The initial Partnering conference may be scheduled

and conducted at any time with or following the post award

conference. The Government proposes to form a

partnership with the DB contractor to develop a cohesive

building team. . . .

3.1.3.2 As part of the partnering process, the Government

and Contractor shall develop, establish, and agree to

comprehensive design development processes including

conduct of conferences, expectations of design

development at conferences, fast-tracking, design

acceptance, Structural Interior Design (SID)/Furniture,

Fixtures & Equipment (FF&E) design approval, project

closeout, etc. The government will explain contract

requirements, and the DB contractor shall review their

proposed project schedule and suggest ways to streamline

processes.

(R4, tab 9a at 80)

102. While this clause does not limit partnership meetings to the earliest stages

of the project, the Board finds that the benefits of any such meetings would be skewed

to the early stages of the project, and, in practice, that is when partnering meetings

typically occur (tr. 2/178, 3/275). The Board finds that the portions of the clause that

address the development of a cohesive team, the conduct of conferences, the design

development and approval process, the proposed project schedule, and suggestions on

ways to streamline processes would be most likely to have benefits during the initial

months of the project.

103. GSC first requested a partnering meeting on January 28, 2014, after the

contracting officer had issued the first show cause notice, and six days before it was

supposed to complete the project (R4, tab 7 at 1; ex. A-41). The Corps did not agree to

engage in a partnering meeting because it viewed the issues between the parties as

contractual disputes for which GSC needed to submit an REA or claim (tr. 2/178), as

CO Kloeckler advised GSC in his February 24, 2014, letter (finding 5).

104. By the time GSC belatedly requested a partnering meeting, the Corps and

GSC had long been engaging in three types of regular meetings: a weekly progress

meeting between GSC and ACO Owens and his team at which GSC was allowed to

place items on the agenda; a monthly progress meeting between GSC and the Corps to

21

discuss payments; and coordination meetings with Harper, GSC and the Corps to

discuss each contract and coordinate the work (tr. 3/96-97).

105. In addition, after CO Kloeckler issued the second show cause notice, he

granted Brannon Cundey’s request for a meeting at which CO Kloeckler, ACO Owens

and other Corps personnel attended on May 6, 2014. CO Kloeckler invited GSC

President Locke McKnight to the meeting but he failed to attend. At the meeting, the

parties discussed, among other things, GSC’s lack of progress. (Tr. 2/327-28, 3/34)

ACO Owens met with Locke McKnight on May 15, 2014, at which they discussed the

issues in dispute, as well as on two previous occasions (tr. 3/151-52).

106. GSC has not explained why the issues it wanted to discuss at a partnering

meeting could not have been discussed at one of these meetings, or what could have

been accomplished at a partnering meeting given the contractual nature of the dispute.

The Board finds that the refusal of the Corps to engage in a partnering meeting

requested six days before the expiration of the contract term is not evidence of bad

faith or a lack of good faith and fair dealing.

E. Antagonism of Corps Employees

107. In its briefs, GSC attacks Corps employees, chiefly ACO Owens,

contending that they had “animosity” towards GSC (app. resp. br. at 15). Much of

GSC’s discontent with ACO Owens stems from his rejection of GSC’s contentions on

the building pads, the fire water flow test, and the cold formed metal framing described

above (e.g., app. br. at PFF 15, 34, 45, 73).

108. GSC advances a number of other unsupported allegations. For example, it

contends that ACO Owens refused to approve a QC manager for the project “due to

[his] prior employment with GSC” (app. resp. br. at PFF 136). However, when one

reads the testimony GSC cites, ACO Owens actually stated that the person proposed

had been the QC manager for GSC on another Fort Sill project and had performed

poorly. As of the date of the hearing major quality control issues remained open on

that project including, among other things, the provision of as-built drawings and

operations and maintenance manuals (tr. 3/269-71).

109. GSC also contends that Mr. Owens withheld for over a year a document

from the base commander concerning whether the SSA project was inside a controlled

perimeter (app. resp. br. at 12; see findings 63-64) but there is no evidence that

ACO Owens knew the document existed before he obtained it on GSC’s behalf.

Similarly, GSC’s contention that ACO Owens would wait months to approve a

submittal and then backdate it to make it appear that he had acted in a timely manner

was disproved at the hearing. For example, GSC alleged that ACO Owens had

22

approved a submittal in March 2014 (app. PFF 73) but the Corps produced the

document with a digital signature by him on January 24, 2014 6 (R4, tab 101a).

110. Finally, GSC also places a great deal of weight on testimony by

Keith Adams, a construction management contractor retained by the Corps, that was,

in essence a very unflattering assessment of one of the GSC officers (tr. 1/196, 249).

The Board finds that the statement by itself is insufficient to prove bad faith. This

would not be the first construction project where there was a clash of personalities and

the Corps witnesses backed up their criticisms of GSC with specific examples. For

example, ACO Owens testified that GSC’s site superintendent repeatedly overruled the

decisions of his quality control manager, resulting in a frequent need to redo work

(tr. 3/171).

111. Of more concern, this superintendent overrode the decisions of GSC’s

safety officer so many times that ACO Owens told Brannon Cundey that he no longer

wanted him on the site (tr. 3/171). In a similar vein, ACO Owens testified that he

objected when GSC used a Lull 7 to erect steel, which presented a safety hazard.

ACO Owens met with Mr. McKnight who promised that GSC would stop using the

lull and use a crane to lift the steel. Instead, GSC continued using the lull. When

ACO Owens discussed it with the site superintendent, he told ACO Owens that

Mr. McKnight had instructed him to continue using the Lull (tr. 3/178-79). These are

serious issues and the Board is not surprised that they drew the ire of the

administrative contracting officer or other Corps representatives.

DECISION

FAR 52.249-10 (which was incorporated in the contract) provides:

(a) If the Contractor refuses or fails to prosecute the work

or any separable part, with the diligence that will insure its

completion within the time specified in this contract

including any extension, or fails to complete the work

within this time, the Government may, by written notice to

the Contractor, terminate the right to proceed with the

6 Mr. McKnight also testified that ACO Owens, on a previous contract, had told

Mr. McKnight he intended to make his life “a living hell” because he (Owens)

was unhappy that the contracting officer had agreed to provide GSC an

equitable adjustment (tr. 6/180). Because Mr. McKnight made this allegation

for the first time on re-direct when he was not subject to re-cross, and because

ACO Owens denied it (tr. 9/199), the Board finds the allegation not credible.

7 A Lull is a type of equipment known as a material handler. See Norman v. Textron,

Inc., 2018 WL 3199496 at *3-4 (W.D. Mo. 2018).

23

work (or the separable part of the work) that has been

delayed. . . .

(b) The Contractor’s right to proceed shall not be

terminated nor the Contractor charged with damages under

this clause, if—

(1) The delay in completing the work arises from

unforeseeable causes beyond the control and without the

fault or negligence of the Contractor.

(Finding 1) (emphasis added)

The plain language of this default clause provides that the government may

terminate the contractor for failure to complete the work on time. The government has

met its initial burden to prove that its termination was justified by showing that GSC

failed to complete the contract on time (finding 3); see Lisbon Contractors, Inc. v.

United States, 828 F.2d 759, 765 (Fed. Cir. 1987). The burden shifts to GSC to show

that its nonperformance was excusable. DCX, Inc. v. Perry, 79 F.3d 132, 134 (Fed.

Cir. 1996).

GSC attempts to meet its burden by contending: 1) that it was entitled to time

extensions to December 21, 2014, so that it was not in default at the time of

termination; 2) that the Corps waived the February 3, 2014, completion date; 3) that

the Corps breached the duty of good faith and fair dealing in its conduct during the

project; and 4) that the contracting officer abused his discretion by failing to consider

properly the factors in FAR 49.402-3(f). We consider these in turn.

1. The Alleged Delays

GSC must show that it is entitled to time extensions until the December 21, 2014

date calculated by its expert as the date it could finish the project (finding 9). In other

words, it would not be enough if it could show that it was entitled to a time extension

until a date after the February 3, 2014, contract completion date but short of

December 21, 2014. Empire Energy Mgmt. Sys., Inc. v. Roche, 362 F.3d 1343, 1351-52

(Fed. Cir. 2004). By our count then, GSC needs to prove that it is entitled to the days it

seeks for the building pad, fire water flow test, and cold formed metal framing issues,

or, if its proof on the cold formed metal framing fails, possibly the design revision 3 or

hairpin delays (finding 11).

24

A. The Building Pads

Although both parties refer to this issue as the building pad claim, the Board

believes that a more precise description would be whether the contract required GSC to

remove and replace the unsuitable fill (findings 26-31); simply stating that Harper was

to provide GSC a building pad does not, in and of itself, address which party is

responsible for removing the expansive fill. The Board holds that the SSA Warehouse

task order assigned this responsibility to GSC. In so ruling, the Board finds that the

contract is notable both for what it says, and what it does not say.

First, the contract did not say that the existing expansive soils must be removed.

GSC could have left it in place if it had chosen the pier and beam foundation identified

in the contract and used on many other buildings at Fort Sill (finding 21). The contract

stated that GSC was responsible for any specific site preparation required to

accommodate its choice of foundation (finding 17). Because removal of the existing

soil was necessary only to accommodate GSC’s choice of a waffle mat slab (id.), the

contract assigned responsibility for it to GSC.

Second, the contract required GSC to excavate if necessary and place select fill

(finding 17). While it required Harper (after demolition of the existing buildings) to

leave the site at specified grades and density, it did not speak of Harper replacing the

existing soil with select fill (findings 16-17).

Third, while the contract drawings stated that Harper was responsible for

grading to the bottom of the base layer, they specifically provided that GSC was

responsible for the subbase (findings 18-19). The inert or select fill formed the

subbase for the buildings (finding 21). In other words, the drawings effectively

assigned placement of the select fill to GSC.

Fourth, GSC indicated in its proposal (which was incorporated in the contract)

that it understood what the contract required because it proposed to remove the

existing fill and replace it with select structural fill (findings 22-23).

GSC raises a variety of arguments in response. It places a lot of emphasis on

appendix RR of the contract (Contract Duration), which provided that Harper would

provide GSC the building pad sites “complete” 120 days after the notice to proceed

(finding 14). GSC seems to read the word complete to mean that Harper would

remove and replace the existing fill (app. br. at 33). We disagree. 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)). The word

complete must be read in the context of the specific tasks that the contract assigns to

GSC and Harper. Reading “complete” as expansively as GSC does would nullify the

25

provisions discussed above that make GSC responsible for placing select fill and the

subbase and which required Harper only to grade and compact the area.

With respect to its proposal, GSC tries to explain the statements concerning the

removal and replacement of select fill by stating that it did not specifically state that

GSC would do this and that it was only providing information for Harper to perform

the work (app. br. PFF 15). But the Board concludes that when an offeror uses action

verbs such as remove and replace in its proposal, a reasonable agency would

understand them to refer to actions that the offeror proposes to take, not the actions of

another contractor beyond the control of the offeror. A reasonable offeror would have

identified actions it did not propose to take but would have to be performed by another.

GSC also relies upon the TEMF Complex specification concerning building

slab construction that was attached to the task order for information purposes but not

made part of it (finding 24; app. PFF 17, 22). This provision specified how Harper

would excavate and replace the existing soil with inert fill when constructing building

slabs, but GSC takes it out of context. The TEMF Complex contract required Harper

to construct several buildings and the provision in question merely specified how to

construct the building slabs for those buildings. It is an unwarranted leap to read the

provision as requiring Harper to remove and replace soil on behalf of GSC absent a

specific statement to this effect in at least one of the contracts.

Finally, in its reply brief, GSC addresses SOW 6.3.1.2, which provided that

GSC was responsible for placement of select fill (if necessary) (finding 17). GSC

would have us read this provision so that it only took effect after Harper provided GSC

“a properly constructed building pad,” where the unsuitable soil had been replaced

(app. reply at 5). GSC thus flips the responsibility for placing the select fill onto

Harper and contends that its own responsibility for placing select fill came into effect

only if the site somehow changed in the limited time between Harper turning over the

pads and GSC beginning its work. The contract, of course, said nothing about Harper

placing select fill, as we have explained. 8

In conclusion, the contract supports the interpretation of the Corps, not GSC.

As for delays, the Board believes that there is evidence supporting a delay of up to

about 25 days for a differing site condition due to the wet heavy soil discovered under

the 168th warehouse site (findings 32-34), but such a claim is not before us and such a

8 At page 5 of its reply brief, GSC suggests but does not develop the argument that the

requirement in 6.3.1.2 for GSC to place select fill is severely constrained by the

phrase (prior to a semi-colon) “[t]ime and weather conditions may affect the

actual condition of the building site(s).” GSC has waived this argument and, in

any event, we disagree. The most reasonable interpretation of this language is

that they are simply an explanation for why GSC must accept the site “as is.”

26

brief delay would not make any difference with respect to GSC’s challenge of the

default termination under the rule of Empire Energy Management discussed above.

The Board also concludes that GSC was responsible for many of the days of delay it is

seeking due to its slow start with the geotechnical work and its failure to begin

excavation until more than half the contract time had passed (findings 36-40).

B. Fire Water Flow Test

Although not squarely raised by GSC, we address one contract interpretation

issue, namely, the conflicting contract requirements that required GSC to perform its

flow test before the 30% design with other provisions that gave GSC discretion as to its

interim design submittal and resulted in its submission of a 65% design (finding 43).

No one has contended that the flow test was omitted from the contract when the 30%

design was not required (finding 44).

The Board must interpret the contract as a whole so as to harmonize and give

reasonable meaning to all of its parts. NVT Techs., Inc. v. United States, 370 F.3d

1153, 1159 (Fed. Cir. 2004). The Board believes that the most reasonable

harmonization of these design provisions is to conclude that the contract required a

flow test, and that it required it by the 30% level or, if there was no 30% design, the

design substituted for it, namely the 65% design. If GSC had complied with that, it

would have performed the flow test in early 2013, but it did not hire a fire protection

quality control specialist until September 2013 and could not perform the test until

then, when more than 70% of the contract time had elapsed (finding 46). Its dilatory

hiring of the fire protection professional combined with its misunderstanding of the

sites at which it could perform the tests caused the delay, not any action by the Corps

(findings 48-52).

Accordingly, GSC is not entitled to a time extension for the fire water flow test.

C. Cold Formed Metal Framing

As described above, this issue came about after the Corps informed GSC that it

could follow the less restrictive 2007 UFC in designing the building. GSC’s designer

did so, but the message did not reach its structural engineer who followed the 2012

UFC, and its quality control manager failed to catch it, resulting in four shop drawing

submissions over six months. (Findings 59, 61)

GSC places the blame for this delay entirely on the government because the first

cold formed metal framing shop drawings would have been approved if they had been

submitted and reviewed under the 2007 UFC (finding 60). The Board disagrees.

27

This was a design-build contract, meaning that the government paid GSC to

perform the design. MATOC special contract requirement 1.7 provided that “[t]he

Contractor shall be responsible for the professional quality, technical accuracy, and the

coordination of all designs, drawings, specifications, and other non-construction

services furnished by the Contractor.” (Finding 55) Further, MATOC special contract

requirement 1.9 provided that GSC’s “construction management key personnel” were

to be “actively involved during the design process” and were responsible for “ensuring

constructability and economy of the design, [and] integrating the shop drawing and

installation drawing process into the design” (id.). The Board interprets these

provisions to mean that GSC personnel were responsible for coordinating the design

work and ensuring that the shop drawings were consistent with the overall design,

which followed the 2007 UFC (finding 58). GSC’s management clearly failed to

coordinate the work of the structural engineer and its designer (finding 59).

In addition, FAR 52.236-21(e) provided that GSC was supposed to “coordinate”

shop drawings “and review them for accuracy, completeness, and compliance with

contract requirements and shall indicate its approval thereon as evidence of such

coordination and review.” It further provided that the government’s approval of the

shop drawings “shall not relieve the Contractor from responsibility for any errors or

omissions in such drawings, nor from responsibility for complying with the

requirements of this contract.” (Finding 1) Under the plain language of this clause,

the government’s approval of erroneous shop drawings does not shift any of the

responsibility for those errors on to the government. Structural Painting Corp.,

ASBCA Nos. 36813, 37305, 89-2 BCA ¶ 21,605 at 108,771.

Thus, while it probably would have been best if, at the time of the first

submittal, the Corps had pointed out the anomaly of using the 2012 UFC to prepare the

shop drawings, the contract allocates to GSC the risk that government review may not

rescue the contractor from its own mistakes. We also acknowledge that the reviewer

stated incorrectly in the first shop drawing rejection that the project was not within a

controlled perimeter (finding 63). However, this would not have been an issue if GSC

had followed the 2007 UFC (id.) and there is no reason to believe there would have

been any delay if GSC had simply done what it was told – seek clarification from

Fort Sill Security (finding 64).

Accordingly, GSC is not entitled to a time extension for the cold formed metal

framing submittals.

D. Design Revision 3/Additional Site Power

As described above, GSC has not proven that the Corps required GSC to

perform additional work or otherwise delayed the project with respect to its answers to

RFI Nos. --0041 and -0042, or design revision 3 (findings 68-78). In addition, due to

28

GSC’s description of it as “a concurrent, non-driving delay”, it has not proven any

days of delay (finding 78).

E. Missing Hairpins/Damaged Roof Panels

The Board rules that the Corps’ actions were prudent and entirely justified when

it discovered that GSC had failed to install hairpins or had installed them incorrectly

(findings 81-87). While this may have delayed the project, it was entirely GSC’s fault.

GSC is not entitled to a time extension for this issue.

With respect to the roof panels, GSC proved that Harper damaged six panels but

this was not adequate to prove that the project had been delayed (findings 91-92).

2. The Corps Did Not Waive the Completion Date

As we have found, the contracting officer did not terminate GSC when it failed

to complete the project on February 3, 2014, but instead, without waiving the

government’s rights, accepted GSC’s representation that it could finish by June 9,

2014. When GSC failed to meet that completion date, the contracting officer promptly

terminated the contract. (Findings 5, 8)

GSC contends that the Corps waived the completion date under the rule of DeVito

v. United States, 413 F.2d 1147 (Ct. Cl. 1969) (app. resp. br. at 26-27). As the Board

recently explained in Watts Constructors, LLC, ASBCA Nos. 61518, 61961, 19-1 BCA

¶ 37,382, the “waiver doctrine . . . protect[s] contractors who are led to believe that time

is no longer of the essence” when allowed “‘to continue [substantial] performance past a

due date,’ under circumstances that justify a conclusion that the default has been

excused.” Id. at 181,726-77 (quoting Fla. Dep’t, of Ins. v. United States, 81 F.3d 1093,

1096 (Fed. Cir. 1996) (quoting DeVito, 413 F.2d at 1153-54)). But waiver of default

does not normally apply to construction contracts absent unusual circumstances. Id.

at 181,727 (citing HK&S Constr. Holding Corp., ASBCA No. 60164, 19-1 BCA ¶

37,268 at 181,352; AmerescoSolutions, Inc., ASBCA No. 56811, 10-2 BCA ¶ 34,606

at 170,549-50). Essentially, waiver is only recognized in the case of such a default when

the government manifests that it no longer considers the contract completion date

enforceable. Id. (citing Technocratica, ASBCA No. 47992 et al., 06-2 BCA ¶ 33,316

at 165,187).

The Board holds that the contracting officer did not waive the contract

completion date. After the first show cause notice, GSC promised to complete the

project by June 9, 2014, a little more than four months after the date it was required to

complete the work. The contracting officer agreed but emphasized he was not waiving

the completion date. (Finding 5) In the Board’s view, it was reasonable for the

contracting officer to give GSC the additional four months it requested before

29

terminating the contract, but with the caution that the government was not waiving its

rights. Red Sea Engineers & Constructors, Inc., ASBCA No. 57448 et al., 13-1 BCA

¶ 35,245 at 173,032 (government forbearance for four months after its express

reservation of rights was not unreasonably long, particularly in light of contractor’s

optimistic reports encouraging forbearance rather than termination).

GSC has not proven that there was anything unusual here. The contracting

officer consistently advised GSC that he regarded the February 3, 2014 completion date

to be in effect (findings 5-6). He gave GSC another chance to complete by June 9,

2014, but GSC failed to take advantage of the reprieve, resulting in its termination soon

thereafter.

Accordingly, we hold that the government did not waive the completion date.

3. Good Faith and Fair Dealing/Bad Faith

GSC contends both that the government breached the duty of good faith and fair

dealing and that Corps employees acted in bad faith (app. br. at 29-30, 36-37; app.

resp. br. at 9). Every contract imposes upon each party an implied duty of good faith

and fair dealing in its performance and enforcement. The implied duty of good faith

and fair dealing includes “‘the duty not to interfere with the other party’s performance

and not to act so as to destroy the reasonable expectations of the other party regarding

the fruits of the contract.’” Dobyns v. United States, 915 F.3d 733, 739 (Fed. Cir.

2019) (quoting Centex Corp. v. United States, 395 F.3d 1283, 1304 (Fed. Cir. 2005)).

But the implied duty “‘cannot expand a party’s contractual duties beyond those in the

express contract or create duties inconsistent with the contract’s provisions.’” Id.

(quoting Precision Pine & Timber, Inc. v. United States, 596 F.3d 817, 831 (Fed. Cir.

2010)). A “‘breach of that duty has to be connected, though it is not limited, to the

bargain struck in the contract.’” Id. (quoting Metcalf Constr. Co. v. United States, 742

F.3d 984, 994 (Fed. Cir. 2014). A breach of the duty does not require breach of an

express provision in the contract but a specific promise must be undermined. Id.

An appellant does not need to prove bad faith to show that the government has

breached the implied duty of good faith and fair dealing. Catherine Kurkjian, ASBCA

No. 61154, 20-1 BCA ¶ 37,594 at 182,539, appeal filed, Kurkjian v. Secretary of

Defense, No. 2020-2201 (Fed. Cir. filed Aug. 26, 2020); CAE USA, Inc. v. Dep’t of

Homeland Security, CBCA No. 4776, 16-1 BCA ¶ 36,377 at 177,349. Bad faith can

be difficult to prove because government officials are presumed to act in good faith,

which can only be overcome by clear and convincing evidence to the contrary. Road

and Highway Builders, LLC, v. United States, 702 F.3d 1365, 1368-69 (Fed. Cir.

2012).

30

GSC has not demonstrated that the Corps breached the duty of good faith and

fair dealing or that its employees acted in bad faith. The great weight of the evidence

shows that the various Corps employees tried to do the best they could with a

contractor ACO Owens described as “extremely slow and nonproductive” and which

had to do a lot of the work twice (tr. 3/171; findings 85, 110), had repeated safety

problems (finding 111), and, absent a stroke of fortune, would have erected a structure

that might have been in danger of collapse (findings 81-84). There is no evidence that

the Corps treated Harper significantly better than GSC (findings 98-100).

The contracting officers did not act in bad faith by refusing to grant GSC time

extensions to which it was not entitled. Nor was it bad faith or a breach of the duty of

good faith and fair dealing to refuse to provide GSC a partnering meeting requested

six days before the contract completion date where the Corps had provided GSC ample

meetings and the issues in dispute involved contract interpretation (findings 103-06).

Nor was the internal usage of the term “Magnificent Seven” to describe seven projects

that had fallen behind schedule, without more, evidence that the Corps’ employees

were antagonistic to GSC or were targeting it for termination (findings 93-96).

4. The Contracting Officer Considered the Factors in FAR 49.402-3(f)

FAR 49.402-3(f) identified seven factors that the contracting officer “shall

consider” before terminating the contract for default. As we have found, the

contracting officer wrote a memorandum documenting his analysis of the factors

(finding 8, n.1).

GSC spends considerable effort challenging the contracting officer’s analysis of

the FAR 49.402-3(f) factors (app. resp. br. at 14-26), but consideration of them is not a

prerequisite to a valid termination. DCX, Inc. v. Perry, 79 F.3d 132, 135 (Fed. Cir.

1996). Although compliance or noncompliance with the regulation may aid the Board

in determining whether a contracting officer abused his discretion, the regulation does

not confer rights on the defaulted contractor. Id. A contracting officer’s failure to

consider one of the factors in FAR 49.402-3(f) does not require that a default

termination be converted to one for the convenience of the government. Id.

GSC mostly uses this issue as an opportunity to repeat its contentions that it was

entitled to time extensions that we have rejected (app. resp. br. at 17-24). But as the

Court of Appeals for the Federal Circuit stated in DCX, the “contracting officer's

contemporaneous memorandum and hearing testimony demonstrate that he addressed

the pertinent regulatory factors and found that they did not counsel against termination

under the circumstances of this case.” DCX, 79 F.3d at 135; (finding 8, n.1).

Finally, GSC also contends in this section of its brief that CO Kloeckler failed

to use his independent judgment when making the termination decision (app. resp. br.

31

at 15). However, this allegation at its core is not based on much more than GSC’s

belief that he made the wrong decision. We have found that CO Kloeckler credibly

testified that the decision was the product of his independent judgment and analysis

(finding 8).

CONCLUSION

The appeals are denied.

Dated: November 24, 2020

MICHAEL N. O’CONNELL

Administrative Judge

Armed Services Board

of Contract Appeals

I concur I concur in result (see separate opinion)

JOHN J. THRASHER TIMOTHY P. MCILMAIL

Administrative Judge Administrative Judge

Chairman Armed Services Board

Armed Services Board of Contract Appeals

of Contract Appeals

32

SEPARATE OPINION BY ADMINISTRATIVE JUDGE MCILMAIL

INTRODUCTION

I concur in the denial of the appeals. I also concur (at least in result) in the

plurality’s rejection of appellant’s claims regarding (1) the “building pad” delay;

(2) the “fire water flow test” delay; (3) the “cold form metal framing” delay; (4) the

“electrical design No. 3” delay; (5) the independence of the contracting officer’s

judgment; and (6) bad faith. In addition, I offer this separate opinion.

Appellant, GSC Construction, Inc., challenges the default termination of its

construction contract, and seeks delay damages, concerning the construction of

two warehouses and two accompanying, open-air “bulk storage” buildings at Fort Sill,

Oklahoma. The U.S. Army Corps of Engineers, Tulsa District (government, Corps, or

COE), defends the termination and opposes any monetary award. The parties refer to

one of the warehouses as “the 168th,” and the other as “the 100th” (e.g., tr. 1/7).

Those short-hand references are to two military units, each of which would use one of

the warehouses and one of the bulk storage buildings (tr. 3/161-62).

In ASBCA No. 59402, the government defends the termination for default,

addressing whether (1) termination for default based on failure to meet the contract

completion date was appropriate; (2) the contracting officer followed termination for

default procedures; (3) the government waived termination for default; (4) it was

appropriate to terminate the contract for default based on failure to make satisfactory

progress; and (5) termination for default is appropriate even if the Board agrees with

some or all of GSC’s excusable delays (gov’t br. in ASBCA No. 59402 at 3).

In ASBCA No. 59402, GSC responds that (1) the government failed to carry its

burden; (2) GSC was making adequate progress at the time of termination and was due

time extensions for various delays to the project; (3) the government failed to follow

the Corps-mandated procedure for default termination; and (4) any termination was an

abuse of discretion or bad faith in the administration of the contract and the issuance of

the termination notice (app. resp. in ASBCA No. 59402 at 2).

In ASBCA No. 59601, GSC seeks $328,293.82, citing 252 days of alleged

delay consisting of (1) the “building pad” delay; (2) the “fire water flow test” delay;

(3) the “cold form metal framing” delay; and (4) the “electrical design No. 3” delay

(app. br. in ASBCA No. 59601 at 2; see tr. 1/28-29).

In ASBCA No. 59601, the government responds that (1) GSC has not shown

government responsibility for delays; (2) each delay was chargeable to GSC; and

(3) none of the delays was on the project’s critical path (gov’t resp. in ASBCA

No. 59601 at 2).

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THE RECORD OF EVIDENCE

A ten-day hearing of these consolidated appeals began on June 19, 2017. The

record of evidence includes 15 stipulations, 54 volumes of Rule 4 material (consisting

of 294 “tabs”), 139 hearing exhibits in 4 volumes, 4 volumes of daily reports, and the

testimony of 18 witnesses in 10 volumes of hearing transcript totaling roughly

1,500 pages. The parties filed six post-hearing briefs between them, totaling

182 pages. Post-hearing briefing concluded on October 19, 2017. The following

witnesses testified at the hearing:

Keith Lee Adams: Construction manager contractor to the Corps at

Fort Sill (tr. 1/196);

James Braghini: Project control scheduler, Corps, Tulsa District (tr. 2/12);

Brannon Cundey: Former project manager, GSC (tr. 8/75);

William Dozier: Estimator and scheduler, Blanchard & Calhoun Real

Estate, Co. (tr. 5/216);

William Green: Senior structural engineer, Corps, Tulsa District

(tr. 9/43-44);

Charles Johnson: Senior structural engineer, Johnson, Lasbocher &

Associates (tr. 7/160);

Nathan Kloeckler: Contracting officer, Tulsa District (tr. 2/276-77);

Helen Landry: Fire protection specialist, Corps (tr. 9/6);

Keith Maxwell: Resident engineer, Corps of Engineers, Fort Sill

(tr. 2/139);

Richard McAfee: Delay expert, called by GSC (tr. 7/8);

G. Locke McKnight: Owner and president, GSC (tr. 4/230-31);

Stuart Ockman: Delay expert, called by the government (tr. 4/9-10);

Robert Owens: Project engineer and administrative contracting officer

(tr. 3/93);

34

John Phillips: Former vice-president, GSC (tr. 6/227);

Randy Reeves: Superintendent, GSC (tr. 8/7-8);

Richard West: Area Engineer, Corps, Fort Sill (tr. 9/106);

Thomas Willcox: Quality control contractor to the Corps, Fort Sill

(tr. 1/61); and

Christopher Veltema: Former quality control manager, GSC (tr. 9/213-14).

ASBCA NO. 59402: TERMINATION FOR DEFAULT

I. Was it “appropriate” (that is, justified) to terminate the contract for default

based on failure to meet the contract completion date? Did the contracting officer

follow termination for default procedures? Did the government waive termination for

default? Was termination for default based on failure to make satisfactory progress

appropriate?

FINDINGS OF FACT

On January 16, 2014, the contracting officer issued a show cause notice, which

GSC received on January 24, 2014 (stip. ¶¶ 11-12). The order to show cause states:

Since you have failed to perform in accordance with [the

contract] within the time frame required by its terms, the

Government is considering terminating the contract under

the provisions for default of this contract. The current

required contract construction completion date is

February 3, 2014 and you are 145 days behind your

construction schedule as of January 15, 2014. Pending a

final decision in this matter, it will be necessary to

determine whether your failure to perform arose from

causes beyond your control and without fault or negligence

on your part. Accordingly, you are given the opportunity

to present, in writing, any facts bearing on the question . . .

within 10 days after receipt of this notice. Your failure to

present any excuses within this time frame may be

considered as an admission that none exist. Your attention

is invited to the respective rights of the Contractor and the

Government and the liabilities that may be invoked if a

decision is made to terminate for default.

35

Any assistance given to you upon this contract or any

acceptance by the Government of delinquent goods or

services will be solely for the purposes of mitigating

damages, and it is not the intention of the Government to

condone any delinquency or to waive any rights the

Government has under the contract.

(R4, tab 8 at 1) GSC responded to the order to show cause on January 28, 2014 (stip.

¶ 13), saying that “[w]e will timely complete this project according to all contract

requirements including time extensions to which we are entitled,” and that “GSC feels

confident that it can complete the project by June 9, 2014” (R4, tab 7 at 1, 3). GSC

also wrote, through its president, Mr. McKnight:

We have submitted sufficient matters of fact to merit time

extensions which will put us back on schedule to

completion. We also request that if you do not accept our

completion plan, that you coordinate any further action

with your counsel and our counsel . . . . Legal consultation

is required before considering any action of termination as

well as consultation with our Small Business

representative. I do not believe that these steps are

necessary as I am confident that we will meet your needs

and timely complete the contract according to the contract

requirements and commitments in this letter. We look

forward to completing this project with you.

(R4, tab 7 at 4)

The construction required by Task Order DS01 was not complete by

February 3, 2014 (stip. ¶ 14). On February 24, 2014, Mr. Kloeckler became the

contracting officer for the project (R4, tab 177 at 3437), and wrote to GSC that:

The Government will not terminate your firm for default at

this time; however, this in no way constitutes a waiver of

the contracts [sic] original contract completion date. The

Government looks forward to your firm meeting the

commitments outlined in your response, including

completion by June 9, 2014.

(R4, tab 6) On March 10, 2014, GSC reiterated to the contracting officer that it could

complete the project by June 9, 2014, and wrote:

36

GSC concurs that termination is not warranted and looks

forward to working with you on the remainder of the

project.

(R4, tab 36 at 103-04) On April 28, 2014, Mr. Kloeckler issued GSC a “Show Cause

Notice,” stating that:

Since you have failed to perform in accordance with [the

contract] within the time frame required by its terms, the

Government is considering terminating the contract under

contract clause 52.249-10 “Default” of this contract.

Current required construction completion is February 3,

2014 and you have exceeded that date by 83 calendar days

as of April 28, 2014. GSC Construction has also failed to

make satisfactory progress towards completing the project

in accordance with the revised completion date of June 9,

2014 as indicated in your firms’ [sic] response to the

Governments first Show Cause notice dated January 24,

201[4]. . . . Any assistance given to you on this contract or

any acceptance by the Government of delinquent goods or

services will be solely for the purpose of mitigating

damages, and it is not the intention of the Government to

condone any delinquency or to waive any rights the

Government has under the contract.

(R4, tab 5)

On June 17, 2014, Mr. Kloekler issued a termination for default determination

(R4, tab 135 at 1-3). On June 20, 2014 (in a letter misdated June 18, 2014), the

contracting officer, Mr. Kloeckler, terminated the contract for default “due to GSC

Construction not meeting the contract completion date of Feb, 03, 2014 and GSC

Constructions [sic] lack of satisfactory progress towards completion of the contract” (see

tr. 3/7-8, 224, 5/53-54; R4, tab 3, tab 136; app. supp. R4, tab 46; see stip. ¶ 15). The

work had not been completed by the date the contract was terminated (see tr. 1/56-57).

RELEVANT CONTRACT PROVISIONS

The contract incorporates by reference FAR 52.249-10, DEFAULT (FIXED-PRICE

CONSTRUCTION) (APR 1984), which provides:

(a) If the Contractor refuses or fails to prosecute the work

or any separable part, with the diligence that will insure

its completion within the time specified in this contract

37

including any extension, or fails to complete the work

within this time, the Government may, by written

notice to the Contractor, terminate the right to proceed

with the work (or the separable part of the work) that

has been delayed. In this event, the Government may

take over the work and complete it by contract or

otherwise, and may take possession of and use any

materials, appliances, and plant on the work site

necessary for completing the work. The Contractor and

its sureties shall be liable for any damage to the

Government resulting from the Contractor’s refusal or

failure to complete the work within the specified time,

whether or not the Contractor’s right to proceed with

the work is terminated. This liability includes any

increased costs incurred by the Government in

completing the work.

(b) The Contractor’s right to proceed shall not be

terminated nor the Contractor charged with damages

under this clause, if—

(1) The delay in completing the work arises from

unforeseeable causes beyond the control and without the

fault or negligence of the Contractor. Examples of such

causes include (i) acts of God or of the public enemy,

(ii) acts of the Government in either its sovereign or

contractual capacity, (iii) acts of another Contractor in the

performance of a contract with the Government, (iv) fires,

(v) floods, (vi) epidemics, (vii) quarantine restrictions,

(viii) strikes, (ix) freight embargoes, (x) unusually severe

weather, or (xi) delays of subcontractors or suppliers at any

tier arising from unforeseeable causes beyond the control

and without the fault or negligence of both the Contractor

and the subcontractors or suppliers;

(R4, tab 28n at 1898; 48 C.F.R. § 52.249-10)

DECISION

At the outset, GSC is mistaken that Wilner v. United States, 24 F.3d 1397 (Fed.

Cir. 1994), “does not apply to either appeal” (see app. br. at 29). Under Wilner, our

review of these appeals is de novo, and the parties start before us on a clean slate. See

38

id. at 1402; First Div. Design, LLC, ASBCA No. 60049, 18-1 BCA ¶ 37,201

at 181,102.

A. Is the termination justified?

Under the default clause, here FAR 52.249–10(a), “[i]f the Contractor refuses

or fails to prosecute the work or any separable part, with the diligence that will insure

its completion within the time specified in this contract including any extension, or

fails to complete the work within this time, the Government may, by written notice to

the Contractor, terminate the right to proceed with the work (or the separable part of

the work) that has been delayed.” The government must prove by a preponderance of

the evidence that a termination for default was justified; should the government justify

the termination, the contractor must prove that the default was excusable. CKC Sys.,

Inc., ASBCA No. 61025, 19-1 BCA ¶ 37,385 at 181,750.

The government says that the termination of the contract for default was justified

because GSC did not meet the contract completion date (gov’t br. in ASBCA No. 59402

at 5). Because GSC did not complete the work by the contract completion date of

February 3, 2014, GSC defaulted; consequently termination for default was justified. 9

See Truckla Serv.s, Inc., ASBCA Nos. 57564, 57752, 17-1 BCA ¶ 36,638 at 178,445.

GSC does not say that the termination of its contract was a pretext, such that we might

have to address the following, which we said in Truckla:

In [Darwin Constr. Co. v. United States, 811 F.2d 593

(Fed. Cir. 1987)], the Federal Circuit held that a default

termination that was done “solely to rid the Navy of having

to further deal with” the contractor was an abuse of

discretion, in circumstances where the reason given for the

termination was found to be a pretext, which the court

called a “technical default.” 811 F.2d at 595. In the

McDonnell Douglas A-12 aircraft litigation, the Federal

Circuit clarified Darwin, explaining that the technical

default theory bars only a termination for default in which

there is “no considered nexus between the default

termination and the contractor’s performance under the

9 During the hearing, the government suggested that it might rely upon labor violations

allegedly committed by GSC to justify the termination, or, at least, that it was

not ready to abandon any such position (see tr. 1/25). Because the government

has not addressed any issue of labor violations in its post-hearing briefing, it has

waived any contention that labor violations justify the termination. See

SmithKline Beecham Corp. v. Apotex Corp., 439 F.3d 1312, 1319 (Fed. Cir.

2006) (“arguments not raised in the opening brief are waived”).

39

contract.” Because in the A-12 termination, the

government identified a nexus between the contractor’s

performance and the termination, the Court reversed a

lower court decision overturning the termination.

17-1 BCA ¶ 36,638 at 178,445 (citing McDonnell Douglas Corp. v. United States,

182 F.3d 1319, 1326 (Fed. Cir. 1999)). Rather, the question here is whether the

termination has a nexus to performance. It does: GSC failed to complete the work by

the contract completion date. Because the government has established that GSC was in

default, the termination of the contract for default is valid. Aerospace Facilities Grp.,

Inc., ASBCA No. 61026, 20-1 BCA ¶ 37,668. For that reason, too, it is not necessary to

address, at least not in this, the justification stage, whether the termination was the result

of bad faith in the administration of the contract or in the issuance of the termination

notice. See id. at 182,877-78.

B. Did the contracting officer follow termination for default procedures?

The parties disagree whether the contracting officer properly considered the

factors set forth in FAR 49.402-3(f) in deciding to terminate the contract for default (see

gov’t br. at 15-16; app. resp. at 16). That issue need not be decided. However a

contracting officer arrives at a termination decision, the government may rely upon a

contractor’s failure to do its job to justify the termination of the contract for default.

Aerospace Facilities, 20-1 BCA at 182,877; HK&S Constr. Holding Corp., ASBCA

No. 60164, 19-1 BCA ¶ 37,268 at 181,352 (citing cases); aff’d, 825 F. App’x 921 (Fed.

Cir. Oct. 7, 2020) (per curiam, unpublished opinion); see also Watts Constructors, LLC,

ASBCA No. 61518, 19-1 BCA ¶ 37,382 at 181,728 (citing and parenthetically quoting

HK&S with approval).

C. Did the government waive termination?

The parties disagree whether the government waived the contract completion date

under DeVito v. United States, 413 F.2d 1147 (Ct. Cl. 1969) (gov’t br. at 11; app. resp.

at 26). Time is of the essence in any contract containing fixed dates for performance.

Waiver is an affirmative defense that the contractor has the burden to prove. The waiver

doctrine protects contractors whom the government leads to believe that time is no

longer of the essence when allowed to continue substantial performance past a due date,

under circumstances that justify a conclusion that the default has been excused. But

waiver of default does not normally apply to construction contracts absent unusual

circumstances. Essentially, waiver is only recognized in the case of such a default when

the government manifests that it no longer considers the contract completion date

enforceable. Watts Constructors, 19-1 BCA ¶ 37,382 at 181,727.

40

Absent “unusual circumstances” indicating that time is no longer of the essence, a

reasonable forbearance from terminating a delinquent construction contract is not a

waiver of the contract completion date. Red Sea Engineers & Constructors, Inc.,

ASBCA No. 57448, 13 BCA ¶ 35,245 at 173,032. For example, there are no such

“unusual circumstances” where the government has waited a few months to terminate a

contract for default after having expressly reserved its termination rights, particularly

where a contractor has provided optimistic reports encouraging forbearance rather than

termination as the most expeditious way of completing the project. Cf. id. (four months

of forbearance did not waive termination right). Nor does a contractor’s work after a

completion date indicate a waiver, particularly where it is against the backdrop of a

government manifestation that it still considers that date to be the contract completion

date. See Watts Constructors, 19-1 BCA ¶ 37,382 at 181,727.

GSC does not expressly identify any of the circumstances here as “unusual”;

indeed, GSC does not use the term “unusual” at all in any of its post-hearing briefs, in

any context. Rather, GSC argues that because “the government did not mention or

assess liquidated damages,” the government waived the construction contact

completion date (app. resp. in ASBCA No. 59402 at 27). But in Technocratica, we

said:

[T]his Board has applied the waiver doctrine to

construction contracts . . . where there is a manifestation by

the government that it no longer considered the contract

completion date enforceable. For example, . . . we held the

waiver doctrine applicable where the government

permitted the contract completion date to pass without

apparent concern, the contractor continued to perform

contract work, and the government did not mention or

assess liquidated damages. Similarly, . . . the doctrine [is]

applicable where the government permitted the completion

date to pass without taking any action, did not unilaterally

or bilaterally establish[] a new completion date, and did

not mention or assess liquidated damages.

ASBCA No 47992 et al., 06-2 BCA ¶ 33,316 at 165,186 (emphasis added). That

discussion demonstrates that not mentioning liquidated damages is not enough to

waive a construction contract completion date. Rather, what is important is whether

the government acts as though time is no longer of the essence, see

AmerescoSolutions, Inc., ASBCA No. 56811, 10-2 BCA ¶ 34,606 at 170,550

(explaining B.V. Constr., 04-1 BCA ¶ 32,604 at 170,550), especially where the

government has expressed that it is not waiving its rights, see Watts Constructors, 19-1

BCA ¶ 37,382 at 181,727. As for the passage of time after a contract completion date,

although nearly a year or more without termination may indicate that time is no longer

41

of the essence, AmerescoSolutions, 10-2 BCA ¶ 34606 at 170,550 (explaining

Technocratica (10 to 13 months)), B.V. Constr. (two years)); here, only 135 days –

fewer than five months – passed between the February 3, 2014 contract completion

date and the June 20, 2014 termination date. Cf. Watts Constructors, 19-1 BCA ¶

37,382 at 181,727 (seven months not a waiver). That does not indicate that time was

no longer of the essence or that the government considered the contract completion

date unenforceable, nor do the “continued work on the job and [] three pay

applications” to which GSC points (app. resp. in ASBCA No. 59402 at 28).

Rather, the government indicated twice in the 135 days that passed between the

February 3, 2014 contract completion date and the June 20, 2014 termination of the

contract that time was still of the essence: (1) on February 24, 2014 (21 days after the

contract completion date), the government expressly disavowed that it was waiving the

contract completion date; and (2) on April 28, 2014 (84 days after the contract

completion date and 63 days after expressly stating that it was not waiving the contract

completion date), the government warned that the contract might be terminated for

default. In any event, GSC says the January 16, 2014 order to show cause waived the

contract completion date (app. resp. at 28). Nothing in that document waives the

February 3, 2014 contract completion date; if anything, the language: “[a]ny

assistance given to you on this contract or any acceptance by the Government of

delinquent goods or services will be solely for the purposes of mitigating damages, and

it is not the intention of the Government to condone any delinquency or to waive any

rights the Government has under the contract” preserved the government’s right to

completion by February 3, 2014. GSC points (app. resp. at 28) to R4, tab 6, but that

document is a February 24, 2014 letter from the government that says, in deciding not

to terminate the contract “at this time,” “this in no way constitutes a waiver of the

contract’s original completion date,” and “[t]he Government looks forward to your

firm meeting the commitments outlined in your response, including completion by

June 9, 2014.” And on April 28, 2014, the government sent GSC another order to

show cause, which says that the “[c]urrent required construction completion is

February 3, 2014.” Although the April letter does not include the language “this in no

way constitutes a waiver of the contract’s original completion date” found in the

February letter, and although the April letter refers to “the revised completion date of

June 9, 2014,” the April letter’s language that the “[c]urrent required construction

completion is February 3, 2014” and “it is not the intention of the Government to

condone any delinquency or to waive any rights the Government has under the

contract” preserved the February 3, 2014 contract completion date.

In addition, although Mr. Kloeckler waited 135 days after the contract

completion date to terminate the contract, he advised GSC a little more than two

weeks before the contract completion date that the completion date was February 3,

2014, and that the government did not intend to waive any rights under the contract,

and then, weeks after the February 3, 2014 contract completion date, advised GSC that

42

he was not waiving the contract completion date. Cf. Abcon Assocs., Inc., 44 Fed. Cl.

625, 631 (1999) (no waiver; government notified contractor that it did not intend to

waive right to terminate for default). Again in April 2014, after the contract

completion date passed, Mr. Kloeckler reiterated that the contract completion date

remained February 3, 2014. In addition, Mr. Kloeckler terminated the contract only

nine days after the June 9, 2014 date by when GSC had said (months earlier, after the

contract completion date had passed) that it could complete the work.

Moreover, GSC provided to the government optimistic reports encouraging

forbearance rather than termination as the most expeditious way of completing the

project. Responding to the government’s January 16, 2019, order to show cause

stating that it was “considering terminating the contract,” GSC wrote to the

government four days later that it would timely complete the project “according to all

contract requirements including time extensions,” that it could complete the contract

work by June 9, 2014, that the government consult with GSC’s counsel before taking

any further action toward termination, and that termination would not be necessary

because GSC was “confident that we will meet your needs and timely complete the

contract according to the contract requirements and commitments in this letter.” And

on March 10, 2014, a month after the February 3, 2014 contract completion date, GSC

wrote to the government that GSC concurred that termination was not warranted, and

looked forward to working with the government on the remainder of the project.

Patten Co., ASBCA No. 35319, 89-3 BCA ¶ 21,957, which GSC relies upon in

support of its waiver argument (app. resp. br. in ASBCA No. 59402 at 31), does not

involve a construction contract. GSC complains that the government did not partner

with it to meet the June 9, 2014 proposed completion date (app. resp. br. ASBCA

No. 59402 at 30), but even if true, that would not indicate a waiver of the February 3,

2014 contract completion date. For all these reasons, the DeVito waiver doctrine does

not apply to this construction contract, and even if it did, the government did not waive

the February 3, 2014 contract completion date.

However, if the government did waive the February 3, 2014 contract

completion date, it established a new contract completion date: June 9, 2014.

Pointing to Mr. Kloeckler’s testimony that he did not establish a new contract

completion date, GSC says that the government never established a new contract

completion date (app. resp. in ASBCA No. 59402 at 30). After waiving a contract

completion date, the government cannot terminate a contract for default based upon a

contractor’s failure to make progress with or complete the contract work unless it

reaches agreement on a new completion date with the contractor or establishes by

specific notice a new completion date, which is reasonable based on the contractor’s

performance capabilities at the time that date is established. Technocratica, 06-2 BCA

¶ 33,316 at 165,188. The April 28, 2014 order to show cause says: “GSC

Construction has also failed to make satisfactory progress towards completing the

43

project in accordance with the revised completion date of June 9, 2014 as indicated in

your firms’ [sic] response to the Governments first Show Cause notice dated

January 24, 2015” (emphasis added). That is a direct reference to GSC’s position on

completion: on January 28, 2014, GSC told the government that “[w]e will timely

complete this project according to all contract requirements including time

extensions,” and that “GSC feels confident that it can complete the project by June 9,

2014.” Assuming for the sake of decision that the government waived the February 3,

2014 contract completion date, the government re-established a new contract

completion date of June 9, 2014, which GSC also failed to meet; the government

terminated the contract only 11 days after that “revised” date, on June 20, 2014.

After February 3, 2014, the government continued to view time as of the essence,

and never waived the February 3, 2014 contract completion date. GSC’s DeVito

waiver argument is rejected.

D. Did GSC fail to make satisfactory progress?

The government also raises the issue whether “termination for default based on

failure to make satisfactory progress was appropriate” (gov’t br. in ASBCA No. 59402

at 3). That question need not be answered. Where, as here, the delivery date has passed,

any termination constitutes termination for failure to meet a performance deadline, not

for failure to make progress. See Abcon, 44 Fed. Cl. at 631. Only if excusable delay

extended a contract completion date beyond a contract termination date would failure to

make progress toward the extended contract completion date become an issue. Because

(below) I find no such excusable delay, I do not address further whether GSC “failed to

make progress.”

II. Is the default excused?

FINDINGS OF FACT

A. GSC’s subcontractors

Both before and after the termination, GSC wrote to some it its subcontractors

on the project, blaming them for problems including delay of the project, termination

of the contract for default, and monetary losses to GSC. I find those statements

admissions against GSC’s interest, and, based upon those admissions, find that

subcontractors to GSC delayed the project, causing the termination for default and

millions of dollars in monetary losses to GSC.

44

1. Mitchell Acoustics

GSC blamed Mitchell Acoustics, which GSC contracted to erect and install

exterior structural studs, interior studs, sheetrock, and insulation (tr. 5/20, 8/213, 260),

for causing the termination of the contract for default by delaying the work, and

informed Mitchell Acoustics that it had caused in excess of $2.1 million in losses to

GSC (see R4, tab 179n at 1). On September 24, 2014, GSC wrote to Mitchell

Acoustics through Mr. Phillips, GSC’s then-vice-president:

This letter is to inform you that GSC’s contract was

terminated on the SSA contract. We have been

investigating the cause behind this and it appears that this

was due to lack of progress by Mitchell Metals.[ 10] This

has resulted in excess of $2.1 million in losses. As in

accordance with our subcontract, GSC requests mediation

and arbitration to resolve this matter as soon as possible.

GSC requests your response by 10/1/14 and how you

intend to pursue.

(R4, tab 179n) Mr. Phillips testified at the hearing but never testified regarding this

letter (tr. 6/227-39), even though Mr. McKnight (who also did not testify regarding

that letter) testified regarding GSC’s efforts “to speed performance of [Mitchell

Acoustic’s] work,” including meeting with Mitchell Acoustics “to increase their

manpower” (tr. 5/26, 6/15). Along the same lines, on June 9, 2014, GSC’s then-

project manager Mr. Cundey wrote to Mitchell Acoustics that:

I need to know what the plan is for making up for lost

production time. I can understand cutting the crew if you

they [sic 11] are not producing but you also told me you

would have another crew of qualified individuals on

Monday. This did not happen. I do not think the answer is

to use a 8 man crew and take equipment off of the project.

I need a completion dates and another crew on-site

yesterday. Framing and sheathing need to be going on

concurrent to make up for loss production time. Please

have these answers to me by the end of the day.

10 I take this unexplained reference to “Mitchell Metals” to refer to Mitchell Acoustics.

11 As will be seen, Mr. Cundey’s correspondence is rife with punctuation, spelling, and

grammar anomalies, too many to signal with the convention “[sic]” without

unduly distracting the reader; thus, I will bring almost no further attention to

them.

45

(R4, tab 179l; tr. 8/166-67) Later the same day, Mr. Cundey wrote to Mitchell

Acoustics that:

Mitchell Acoustics has now been on this project for

(5) weeks. The original timeline discussed to complete the

exterior studs on the 168th was (15) working days or

(3) weeks. At this point in time we are not even half way

complete with the studs and not even a quarter of the way

complete with the sheathing. I personally discussed these

issues with you last week and you stated you understood

and felt that personnel issues were the cause of the

problem. At that time you went from having 16 employees

on-site to 8 employees. You also stated that as of Monday

I would have two experienced crews on-site to work the

168th and 100th buildings concurrently. As of today there

are still 8 employees on-site and the production they are

making is a joke. The 6 individuals you had on-site

Saturday accomplished more production with less people.

I am trying to keep from writing your company directives

per the subcontract agreements or procuring another

company to complete the other building and deduct their

contract amount from your subcontract agreement.

Therefore I am once again asking you what is the plan to

make up for loss time. If the individuals you have on-site

now are the experienced crew you mention last week then

we have a major problem. They are making far less

production than when you had 16 people and even making

less production than the 6 individuals that worked this

Saturday. I am extremely concerned and perplexed about

the lack of urgency.

Please have a plan of action by the end of the day or I will

be forced to take other measures.

(R4, tab 179i) The next day, Mr. Cundey wrote to Mitchell Acoustics:

GSC has expressed our concerns regarding lack of

production verbally and via email correspondence. GSC

has gone above and beyond trying to help Mitchell

overcome manpower and production issues. Mitchell

Acoustics has now fallen (2) weeks behind the original

completion date for the 168th exterior studs and is at least

46

(3) weeks behind on the 100th exterior studs. The original

duration that was given for GSC for the exterior studs was

15 days. Mitchell has now been on site for 21 days and is

not even half way completed with the 168th building and

the 100th building has barely started. Sheathing has barely

started in the 168th and has not started at all in the 100th.

Mitchell Acoustics will need to almost double the current

crew to make up for the slow production.

Per Article 4.1.8.1 of the subcontract agreement, GSC is

informing Mitchell that if additional manpower is not on-

site no later than 6-11-14 that GSC will be forced to

procure additional forces. All cost for such additional

forces shall be deducted from the Mitchell’s contract

amount. I will also require completion dates for exterior

and interior metal stud walls by the end of the day.

(R4, tab 179m) At the hearing, Mr. Cundey (who by the hearing no longer worked for

GSC (tr. 8/75)) confirmed that Mitchell Acoustics “was not properly manning the

project” and that “the time it was taking Mitchell to frame and sheath was

unacceptable” (tr. 8/225, 228). Based upon those admissions, I find that Mitchell

Acoustics delayed the project, caused the termination for default, and caused GSC to

lose $2.1 million.

2. TTG Electric

In September 2014, GSC blamed TTG Electric Co., Inc. (TTG), which GSC

had contracted for various electrical and lighting work on the project (R4, tab 183a

at 15, 29-30), for causing the termination of the contract for default and more than

$2.4 million in losses to GSC by delaying the work (see R4, tab 183j at 1). On

September 16, 2014, Mr. McKnight wrote to TTG:

GSC has reviewed the events leading up to termination and

believe one of the delays was attributed to TTG Electric.

TT[G] violated its contract with GSC by delaying the

submittals and approval of the electrical panels on this

project. It worked without GSC’s knowledge to develop

site lighting with the infrastructure contractor. Once the

power requirements was known, it misled GSC leading to

revision to the electrical requirements and request for self-

inflicted change order. Basically, TTG worked with [the

government] and infrastructure contractor without GSC’s

knowledge to place site electrical loads in the warehouse

47

area without GSC’s knowledge and the knowledge that

GSC’s limits of responsibility were 10’ outside building

limits.

It is clear TTG played a key role in 6-1/2 Month delay in

this project and termination by GSC for lack of progress.

GSC requests to be compensated $2,453,000.00 for its

losses. GSC demands mediation and arbitration to resolve

this matter as dictated by Article 6 of the executed

contract.

(R4, tab 183j) Mr. Phillips wrote virtually the same thing to TTG on September 25,

2014 (R4, tab 183k). Along the same lines, on March 31, 2014, Mr. Cundey wrote to

TTG on behalf of GSC:

I need to speak with the individual who made the decision

to abandon the project first thing this morning. . . . I am

directing TTG to have individuals on-site no later than

9:00am. Abandoning the project is not the way to handle

disputes.

R4, tab 183i Based upon those admissions, I find that TTG delayed the project, caused

the termination for default, and caused GSC to lose $2,453,000. Despite these many

communications, at the hearing Mr. McKnight said that he had blamed TTG because,

he said, he “had limited information at that time” and “did not know all the facts”;

even so, he did not disclaim the contents of his letter (see tr. 5/207-09).

3. Steel Resources

According to GSC’s own communications, another subcontractor, Steel

Resources, LLC, which GSC had contracted to design, supply, and install “all steel,

purlins, decking, metal roof, roof insulation, gutters, soffit, fascia and downspouts” for

the SSA project (R4, tab 185d at 1, 10), delayed the project by failing to properly staff

the project, and by engaging in a slowdown or shutdown over a payment dispute with

GSC (see e.g., R4, tab 185s at 1-4; tr. 6/194). In November 2013, Mr. Cundey wrote

to Steel Resources:

As per our conversation today and in the past we where

scheduling start erection of warehouse during completion

of slabs on the other area ,per your schedule erection steel

is app 2 weeks . We discussed 2 crews as both steel

erection could accrue within two weeks apart . As of today

48

we have no erectors on site ,no erector crew is scheduled to

be on site as you stated did not have a agreement with

crews as of today to start or continue . Further more crews

on site have major issues with payrolls that may effect

GSC pay request on activities completed to date . We need

to discuss ,payrolls and manpower available to start and

complete activities as need . One crew with 4 labors is

unacceptable . Does GSC need to find erector to continue

activities next week ?

R4, tab 185q at 1 (emphasis added) Days later, GSC wrote to Steel Resources:

GSC is informing Steel Resources that the continuous

issues with erection crews are seriously delaying the

project schedule. At this time Steel Resources has no

erection crews on site and GSC has not received any type

of safety documents on the new erection crew. GSC is

informing [Steel Resources] that if erection crews are not

on site on Monday, 25, GSC intends on following the

subcontract agreement to acquire outside forces to

complete Steel Resources’ scope of work.

R4, tab 185u at 1 (emphasis added) Only days after that, GSC wrote to an attorney for

Steel Resources:

Please inform your client due to delays on this project and

not manning the project, this is notification he is in

violation of Article 3.4.3 and GSC is taking steps under

Article 3.4. GSC further feels it has notified and suffered

sufficient delays to execute Article 7.2 of the contract and

seeks damages as allowed by these articles. . . . It is

GSC’s hope that you will convey to your client to

complete his contract in a timely manner so losses can be

minimized and every one can get paid.

R4, tab 185w at 1-2 (emphasis added) On November 19, 2013, GSC wrote to Steel

Resources that Steel Resources had “no grounds per contract for non performance and

intentional delay of project and should be held liable for delays and cost,” and stated

that “GSC is demanding mediation and arbitration per contract to resolve” (R4,

tab 185s at 1-2). On December 2, 2013, Mr. McKnight wrote to Steel Resources:

As clearly outlined by Article 11.1 of Steel resources

signed executed contract Steel resources is to get paid as

49

GSC gets paid. I cannot help that Steal resources billed for

material not onsite “insulation” now “trim” and the user

does not warrant payment of Steel Resources invoice.

Article 11 and 4.7 further clearly states that Steel

Resources is not to delay project for disagreements on

payment. GSC has also suffered damages do to your

violations of Article 3.2 of the executed contract of which

need resolution .

GSC has demanded mediation and Arbitration required by

Article 6 of which I have received no response. We need

to firm up a date so the all disagreements can be resolved

to avoid any additional delays and cost can be avoided. If

you refuse to agree to a date and arbitrator by Wednesday,

GSC will be forced to enforce article 7.2 of the contract

and hold accountable for any additional cost. . . . It is my

hope that you will work with GSC to try and finish your

contract work as soon as possible.

(R4, tab 185aa at 1) (emphasis added) On December 11, 2013, Mr. McKnight again

wrote to Steel Resources:

It is my understanding that Brad called up our erector and

threatened him. So he has abandoned the project and we

are once again without an erector. This goes against our

agreement to work with this erector and get MBCI paid.

GSC has rented an great amount of equipment and Steel

resources will be held accountable for this and delay cost.

I also understand that Brad has also tried to sabotage the

project by giving false information on concrete. As u can

see from the attached picture of columns standing. This

also goes against our agreement that Brad would not talk to

COE and would be taken off job.

...

Thus unless I hear something to prove this is incorrect

today and u intend complete your contract. I will make my

attorney very rich to make u pay for doing what u did to

GSC.

(R4, tabs 177 at 2547, 185cc) (emphasis added) Mr. Knight also wrote:

50

GSC will experience great unnecessary losses completing

your contract work. It is clear by your actions, ”

Demanding Errectors to leave Project” Steel resources had

no intentions of completing this project. I will let my

attorneys explain this and why [Steel Resources]

abandoned project. I have instructed gsc attorney to get us

into mediation ASAP and then arbitration so GSC can

recover losses.

(R4, tabs 177 at 2546, 185dd at 1) (emphasis added) Mr. McKnight testified regarding

that letter that he was “trying to motivate [Steel Resources] to perform” (tr. 6/111), and

denied that problems with Steel Resources abandoning the project were “one of the

significant reasons why [GSC] was experiencing delays” (tr. 6/113-14). Nevertheless,

based upon those admissions, I find that Steel Resources delayed the project and

caused GSC monetary losses.

4. Other, internal issues, and issues with other subcontractors

GSC was delayed by other issues, both internal and with other subcontractors.

In December 2013, Mr. McKnight wrote that it would “take another 10 months to

complete” the project, citing that GSC had “not even completed concrete,” and had

“4 [quality control] people on this project and only 60% of submittals complete after

1 year” (R4, tab 177 at 2532). In December 2013, Mr. McKnight blamed GSC’s

superintendent, Mr. Reeves, for GSC’s problems with submittals:

I am very disappointed by your actions. I clearly explained

to you all to get the info submitted and approved and not

rely any contractors. If it changed we would resubmit.

But u still look for excuses to not get the job completed.

Example “we have no contractor for cmu”.

Scott completed all submittles on project in six months. U

have ben on this project for 10 months and have not

completed 50%. I would suggest you help scott to help u

get out of this mess.

(R4, tab 177 at 2734) On December 18, 2013, GSC blamed a company named

“Boatwright” for delays to submittals (R4, tab 177 at 2777). On February 20, 2014,

GSC wrote to Division Counsel of a company referred to as “MBCI”:

As you are aware, GSC has encountered several issues

while erecting the PEMB that were supplied by your

51

company. GSC indicated to MBCI that building

components shipped were mislabeled, fabricated

incorrectly, or not shipped at all. To date MBCI refuses to

address any of the issues with the PEMB steel. The

following is an estimated cost for the deficient or

outstanding building components.

1) 168th and 100th building all holes were fabricated

incorrectly to allow the cross bracing for the walls to

pass through the columns. The holes were ¾” and the

bracing is 1-1/4”. GSC is having to drill out with a

mag drill. $8,000.00.

2) 168th and 100th building column line (1-2) missing G-8

spandrel beam, column line (1-2) missing G-1 spandrel

beam, column line (B-C) missing spandrel beam G-11,

column line (F-E) missing spandrel beam G-10. GSC

having to have AISC certified welding shop fabricate

missing steel and deliver to site. $10,000.

3) On grid line L-5 in both buildings the column plate was

installed in the wrong direction. GSC having to take

steel to a AISC certified welding shop and then bring

back to site$5,000.00.

4) Wrong size diameter bolts provided at wind girt

locations. GSC having to purchase bolts through

Fastenal. $1,500.00.

5) 168th and 100th building extension components

fabricated incorrectly that are identified as EB-4. The

mounting plate does not match up to the column bolting

pattern. GSC having to take steel to a AISC certified

welding shop and then bring back to site. $5,000.00.

GSC has requested MBCI to correct deficiencies of which

have been we have been directed that MBCI will not

correct any deficiencies. GSC has been forced to use other

forces to correct in order to minimize delays. MBCI has

also refused to provide detailed invoices on items provided

or legibly mark any materials provided. GSC requests

MBCI come to the jobsite to review. GSC provided a

check to MBCI less 10% of total billed amount until onsite

52

material could be verified. Now it appears GSC’s worse

fears in that deficiencies and missing material provided by

MBCI are in effect causing delays and increased costs.

(R4, tab 177 at 3312-13) (emphasis added) On March 7, 2014, Mr. Reeves wrote to

Mr. McKnight:

Govt dies [sic] not have to request my removal, I will leave

tomorrow . I knew this was heading down this way and of

course I will need to be the fall guy from scheduling steel

erection to other activities even though no contractor are

available.

(R4, tab 177 at 3535) (emphasis added) On April 4, 2014, Mr. McKnight wrote to

Mr. Cundey:

U just approved 11k bill for last week to steve Hendrix.

GSC also has another 10k bill for our people working last

week on panels. Total payment is 21k for three panels to

be installed. I am directing u and your staff to give me a

detail time sheet of what that person did every day every

hour. We have spent over 200k getting up the two

buildings steel. This has got to get under control. Does

Jacob he has any responsibility? He needs to know he is

just not responsible for quality but we are looking at him

and you for the overall health of the project.

(R4, tab 177 at 3858) (emphasis added)

On May 21, 2014, Mr. Cundey wrote to Mr. McKnight and to Knight

Architects, GSC’s design firm:

The design build group is holding the project hostage and

creating several issues for my [field] staff. What I cannot

understand is that several of the issues are CA items that

Knight’s is billing for and has not completed. I have

mention to Joe on several occasions that the LEED issues

on both projects are becoming a serious with the COE and

they are holding money until complete. The LEED issue

for the CIF and SSA is not just some small deal. The COE

will not . . . release withholdings for the SSA until the

website is set up and data entered. When I talked to Joe

last I informed him that the LEED website data had not

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been started at all for the SSA. . . . No site visits have

been made for the SSA over the duration of the project.

(thought this was a part of CA fees) It appears that DOR

missed the PEMB coordination with the exterior walls.

(R4, tab 177 at 4606) Knight Architects wrote back, under the subject line “Knight

Architects refusal to work for no money!”:

As I have said, I would have been happy to visit the site,

but it is your construction site and we don’t just show up. .

. . As you know, we have billed you at 50% completion for

the Construction Administration. After this, GSC will still

owe us $5,555 per our conversation on March 21 (an

explanation of which was included in the email I sent you

last Friday at 2:26 PM), $500 on our original design fee

plus the remaining $23,000 on our CA fees. The difficulty

we have had in the past with getting paid by GSC doesn’t

encourage me to gamble our professional time on your

work; we have completed an extensive amount of effort on

Construction Administration and have no indication that

you are planning to pay us! We, like you, need to be paid

for our work.

(R4, tab 177 at 4611) Mr. Cundey replied:

I am just making everyone aware that what is included in

the CA fees is not complete. The government will not

release remaining monies on the CIF project until the

LEED documentation is corrected and re-submitted. My

LEED APP has been requesting this information for over

7 months from Knights. The government is now

withholding money on the SSA project for the LEED

documentation that was suppose[d] to be entered into the

website during the 100% design over a year ago. It

appears that you are billing for design requirements that

have not been completed. Holding this project hostage

when there are outstanding items on your end included in

this billing is just going to hold up the outstanding monies

longer.

(R4, tab 177 at 4610) (emphasis added) Knight Architects replied: “Okay- I will look

into it. I was not aware that the LEED Documentation you mentioned is 7 months

overdue until just now. Can you forward me one of the memos you have received on

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this?” (R4, tab 177 at 4610) Mr. Cundey reacted to Knight Architect’s response by

writing to Mr. McKnight: “I am at my wits end. Please resolve” (R4, tab 177

at 4616).

5. Expert opinions

a. Mr. McAfee, GSC’s Delay Expert

According to Mr. McAfee, GSC’s delay expert, (1) construction to the building

pad was delayed 65 days (tr. 7/75); (2) a “fire water flow test” was delayed 22 days

(tr. 7/94-95); and (3) “cold form metal framing” was delayed 134 days (tr. 7/106).

During the hearing, Mr. McAfee did not opine on any delay to “Electrical Design

No. 3” (tr. 7/8-159).12 In support of Mr. McAfee’s opinion, GSC entered into the

record as demonstrative exhibits eight “windows” that Mr. McAfee created (demo.

exs. 58-65; tr. 7/59-108). In “Window 0” (WIN00), Mr. McAfee used the

government-approved schedule as his baseline, and added to that schedule some

federal holidays that had been omitted from the schedule (tr. 7/59-61; demo. ex. 58).

That schedule shows the critical path through the project as the parties saw it on the

windows data date, September 26, 2012, before any work was started (demo. ex. 58;

tr. 7/67). It shows a start date of September 26, 2012; a finish date of January 29,

2014; a data date of September 26, 2012; and a run date of July 5, 2015 (demo ex. 58).

It shows (1) the notice to proceed issued on September 26, 2012; (2) the 100th

building pad as the first critical activity (depicted as a red bar (tr. 7/62)), starting on

September 26, 2012, finishing (“ready”) on January 24, 2013, and labeled

“Infrastructure prepare Bldg Pads 100th”; and (3) exterior wall framing 168th

becoming critical on September 3, 2013, and finishing on September 16, 2013 (id.). It

does not identify a “fire water flow test” as an activity, critical or otherwise (id.).

Window 1 (WIN01) shows the critical path through the project as of March 7,

2013 (demo. ex. 59; tr. 7/69). It shows a start date of September 26, 2012; a finish

date of April 9, 2014; a data date of March 7, 2013; and a run date of July 5, 2015

(demo. ex. 59). It shows (1) the 100th building pad still on the critical path as of

March 7, 2013, starting on September 26, 2012, finishing (“ready”) on April 10, 2013,

and labeled “Infrastructure prepare Bldg Pads 100th”; (2) exterior wall framing 100th

becoming critical on October 15, 2013 and finishing on October 26, 2013; (3) interior

wall framing 100th becoming critical on November 16, 2013, and finishing on

December 6, 2013; (4) exterior wall framing 168th becoming critical on November 18,

2013, and finishing on December 2, 2013; and (5) interior wall framing 168th

12 GSC has clarified that “[t]he Board need not address the Design Revision 3 delay,”

calling it a “non-driving delay” (app. br. in ASBCA No. 59601 at 2, 37);

accordingly, GSC has abandoned any claim based upon “the Electrical Design

No. 3 delay.” See SmithKline Beecham, 439 F.3d at 1320-21.

55

becoming critical on December 3, 2013, and finishing on December 19, 2013 (id.). It

does not identify a “fire water flow test” as an activity, critical or otherwise (id.).

Window 2 (WN02) shows the critical path through the project as of May 9,

2013 (demo. ex. 60; tr. 7/78). It shows a start date of September 26, 2012; a finish

date of July 1, 2014; a data date of May 9, 2013;13 and a run date of July 5, 2015

(demo. ex. 60). It shows (1) the 100th building pad still on the critical path as of

May 9, 2013, starting on April 16, 2013, and finishing (“ready”) on July 15, 2013; and

labeled “COE DIRECTS GSC – BUILD PADS”; (2) exterior wall framing 168th

becoming critical on February 18, 2014, and finishing on March 1, 2014; and

(3) interior wall framing 168th becoming critical on March 3, 2014, and finishing on

March 19, 2014 (id.). It does not identify a “fire water flow test” as an activity, critical

or otherwise (id.).

Window 3 (WIN03) shows the critical path through the project as of July 11,

2013 (demo. ex. 61; tr. 7/84). It shows a start date of September 26, 2012; a finish

date of July 7, 2014; a data date of July 11, 2013; and a run date of July 9, 2015

(demo. ex. 61). It shows (1) the building pads on the critical path as of July 11, 2013,

starting on July 13, 2013, finishing with respect to the 100th (“ready”) on July 18,

2013; and labeled “GSC Continues BUILD PADS”; (2) exterior wall framing 168th

becoming critical on February 22, 2014, and finishing on March 5, 2014; (3) interior

wall framing 168th becoming critical on March 6, 2014, and finishing on March 22,

2014 (id.). It does not identify a “fire water flow test” as an activity, critical or

otherwise (id.).

Window 4 (WN04) shows the critical path through the project as of August 8,

2013 (demo. ex. 62; tr. 7/89). It shows a start date of September 26, 2012; a finish

date of July 18, 2014; a data date of August 8, 2013; and a run date of July 9, 2015

(demo. ex. 62). It shows (1) the 100th building pad finished (“ready”) as of August 8,

2013; and (2) exterior wall framing 168th becoming critical on March 4, 2014, and

finishing on March 17, 2014 (id.). It does not identify a “fire water flow test” as an

activity, critical or otherwise (id.).

Window 5 (WN05) shows the critical path through the project as of

November 13, 2013 (demo. ex. 63; tr. 7/93). It shows a start date of September 26,

2012; a finish date of August 9, 2014; a data date of November 13, 2013; and a run

date of July 9, 2015 (demo. ex. 63). It shows a “flow test” becoming critical on

October 25, 2013, and finishing February 28, 2014, and labeled as “FLOW TEST

DELAY: WATERLINE REPLACEMENT BY OTHERS” (id.). Mr. McAfee added

13 Mr. McAfee explained that the data date is “a schedule update provided by the

contractor with the dates of actual performance agreed to by the parties”

(tr. 7/79; see tr. 7/82).

56

the activity “COE DIRECTS GSC – BUILD PADS” to the schedule (tr. 7/128). The

February 28, 2014 finish date is “a guess into the future” on the part of Mr. McAfee

(tr. 7/129). According to Mr. McAfee, the fire flow test delay had no effect on the

erection of structural steel (tr. 7/132).

Window 6 (WN06) shows the critical path through the project as of January 4,

2014 (demo. ex. 64; tr. 7/97). It shows a start date of September 26, 2012; a finish

date of October 6, 2014; a data date of January 4, 2014; and a run date of July 9, 2015

(demo. ex. 64). It shows (1) exterior wall framing 100th becoming critical on

March 27, 2014, and finishing on April 15, 2014; (2) interior wall framing 100th

becoming critical on May 5, 2014, and finishing on May 21, 2014 (id.). It shows a

“flow test,” labeled as “FLOW TEST DELAY: WATERLINE REPLACEMENT BY

OTHERS,” unfinished but no longer critical as of January 4, 2014 (id.). Mr. McAfee

explained that because of Window 6A, Window 6 can be ignored (tr. 7/108).

The final window, Window 6A (WN06A), shows the critical path through the

project as of January 4, 2014, incorporating a “design basis threat” produced by the

government after Mr. McAfee submitted his schedule analysis (demo. ex. 65; tr. 7/101,

103, 141). It shows a start date of September 26, 2012; a finish date of December 21,

2014; a data date of January 4, 2014; and a run date of September 19, 2015 (demo.

ex. 65). It shows (1) “COE REVIEW DELAY COLD FORMED METAL

FRAMING,” becoming critical on January 4, 2014, and finishing on May 6, 2014;

(2) exterior wall framing 100th becoming critical on June 7, 2014, and finishing on

June 26, 2014; and (3) interior wall framing 100th becoming critical on July 17, 2014,

and finishing on August 2, 2014 (id.).

Mr. McAfee provided the following answers to the following questions:

Q [Y]our methodology is susceptible to manipulation due

to modeling if only one party’s delays are considered,

since the method cannot account for the impact of delays

not explicitly inserted. Do you agree with that?

A To the extent that the other party’s delays are not in the

schedule, yes.

(Tr. 7/34)

Mr. McAfee also said the following:

Q And it’s your testimony that the critical path shifted to

fire protection in October of 2013. Is that correct?

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A Yes.

(Tr. 7/130) In addition, Mr. McAfee would not agree that in order to be compensable,

a delay would have to be on the critical path (tr. 7/117).

Mr. McAfee also answered the following:

Q Okay. If you go to page 81 of this document, several

caveats are described, and Ms. Darr quoted one in her

questioning of you. How did you take into account these

caveats when performing your analysis?

A Well, the first one, because it does not rely on as-built

data, it’s hypothetical. What I did for the delays is to go

into the record to establish what the project record said

about various things. So when I would come up with a

date, it would be based upon what’s actually in the record

or estimation of durations for remaining activity, which is

based upon professional judgment, estimation, experience,

years of experience.

(Tr. 7/48)

Mr. McAfee also answered the following:

MS. DARR: Okay.

THE WITNESS: I believe you asked if I added activities.

Was that it?

BY MS. DARR:

Q You added activities?

A I think you asked me if I added activities.

Q Yes. Did you?

A Yes, because the delays were not allowed to be

presented contemporaneously in the schedule.

Q Okay.

58

A So I put them in there.

(Tr. 7/40; see also tr. 7/120-21, 128-29, 133-35, 138, 153)

b. Mr. Ockman, the Government’s Delay Expert

According to Mr. Ockman, (1) the project was delayed 85 days by the late

submittal of the “foundation/civil design package”; 96 days by late submittal of an

acceptable contractor quality control plan; 105 days by late finish of “100th

Warehouse footing/slab on grade”; and 68 days by slow progress with “100th

Warehouse metal building erection”; for a total of 354 days (demo. exs. 11 at 52, 12

at 3-4; tr. 4/67-131). Also according to Mr. Ockman, (1) at the time of termination on

June 18, 2014, the project was less than half finished; (2) it took GSC four months to

submit its foundation design, compared to the five weeks in its proposal schedule;

(3) it took seven months to place the foundation concrete, compared to the ten weeks

that GSC originally planned; (4) once “the 100th warehouse” foundation was ready for

metal building erection, it took five months to erect the framing, roof panels, and

sheathing, part of that projected, versus the eleven weeks originally planned; and

(5) GSC would not have completed the project until sometime around August 2015

(see tr. 4/93).

On cross-examination, Mr. Ockman admitted that (1) in adjusting GSC’s

proposed schedule by changing the notice to proceed (NTP) date from the May 2012

date that GSC used to the actual September 2012 notice to proceed date, he did not

make any separate adjustment “for weather days based on an NTP starting in September

instead of May”; (2) he input the activities that he found critical, and not “the exact

activities from GSC’s schedule”; (3) he didn’t have any cost-loading or resource-

loading information for the initial, proposed project schedule, even though resource-

loading information “tells [one] the resources [one] need[s] to dedicate to each

activity,” and didn’t add either cost-loading or resource-loading to his “revised or

recreated” schedule; (4) his schedule does not show “the pad being turned over” on

January 24, 2013, even though “you have to finish the building pad before you can do

foundations”; (5) “if the pad is getting turned over 120 days after NTP, we would go

120 days from September 26, 2012,” to January 24, 2012; (6) a 1999 article he co-wrote

states “[h]ypothetical impacted as-planned network delay analysis which do not take

into account actual events on the project as they evolve are unacceptable methods to

evaluate the impact of project delays,” (7) the same article states “[t]he logic network

necessarily must reflect a plan that takes into account physical contraints, preferential

logic, and commitment of a certain level of resources”; (8) his proposal schedule

“doesn’t have any resources in it”; (9) the same article states “CPMs that do not include

reasonable resource leveling and appropriate logic constraints are unrealistic and do not

provide a basis for evaluating project delays”; (10) the recreated proposed schedule that

he used as the basis for his analysis doesn’t have any resource leveling; and (11) “there

59

is no logic restraint in [his] recreated proposal schedule [] for the [] building pad

turnover” (tr. 4/147-64). Mr. Ockman attempted to distance himself from the statement

in the article that he co-wrote that “CPMs that do not include reasonable resource

leveling and appropriate logic constraints are unrealistic and do not provide a basis for

evaluating project delays,” by claiming that “that portion was written by” his co-author,

and that he (Mr. Ockman) “would not have written it the way [his] co-author wrote it”

(tr. 4/161-62).

On cross-examination, Mr. Ockman also admitted (11) that the article he co-wrote

states, referring to “the importance of looking at the logic behind a schedule,” that

“[f]requently, these schedules appear to be in excellent condition from the outside.

However, a detailed examination often exposes a flawed, if not useless, schedule . . . .

[t]he predictable result is that this information is not available in print on the majority of

projects today. This means that the logic underlying most schedules today is hidden from

all project participants unless they work directly with the computer”; (12) his opinion in

these appeals is the first that he remembers “using a proposal schedule to analyze a job”;

(13) another article he wrote states, referring to an approved schedule, “[o]nce a

reasonable as-planned schedule has been approved, it becomes the benchmark for

measuring contractor and owner performance on the project”; (14) he “didn’t use the

approved schedule to analyze GSC’s claims”; that same article states “[w]ith a proper

scheduling specification, the approved schedule becomes a benchmark for assessing the

contractor’s performance throughout the project”; (15) the schedule specification for the

project is a reasonable scheduling specification; (16) his article states that the approved

schedule “is the basis for negotiating equitable time extensions for changes and owner-

caused delays, and thus, vital for determining equitable compensation for delay damages .

. . [a]s the benchmark for measuring performance, the schedule also becomes the owner’s

most effective tool or weapon for keeping the project on schedule”; (17) he didn’t use the

approved schedule; (18) his article states “[i]f a contemporaneous original progress

schedule was prepared and particularly if the original progress schedule was approved by

the owner, the original progress schedule, with appropriate adjustments to make it

reasonable, if required, becomes the reasonable as-planned schedule”; (19) he didn’t take

the approved schedule and make adjustments to that schedule; (20) his article states

“[t]he reasonable as-planned schedule is the benchmark for measuring the impact of

subsequent changes or delays,” and that is because “whatever the reasonable as-planned

schedule is, that’s what forms the foundation for your analysis”; (21) he ran his analysis

using the approved schedule after being deposed regarding his expert report, without

revising his expert report; (22) the recreated proposed schedule that he used as the basis

of his analysis has 80 activities, whereas GSC’s proposed schedule had about 150

activities, and the approved schedule had 342 activities; (23) the activity descriptions in

his recreated proposed schedule do not match the activity descriptions in the approved

schedule; (24) “[i]f there’s not an exact activity match for erecting the building structure,

then there’s no way to track progress unless you assume other activities cover the

proposal work”; (25) he hadn’t “done an analysis of the impact of GSC having to design

60

a building pad”; and (26) he did not make any adjustment “to the schedule to take into

account a monolithic pour” of the kind used when installing a “Wafflemat” slab (which

slab GSC proposed for the project (tr. 4/254)) (tr. 4/165-84).

On cross-examination, Mr. Ockman also admitted that (27) he did not include

any delayed fire protection in his analysis; (28) he opined in his report that GSC

poured concrete on November 20, 2013, before there was an approved submittal;

(29) he did not look at how long the cold-formed metal framing submittal took to get

approved; and (30) he did not give time to GSC for roof panels that were damaged by

another government contractor (tr. 4/192-93, 198, 203).

Mr. Ockman has received a mixed reaction from this Board. In John C.

Grimberg Co., ASBCA No. 58791, 18-1 BCA ¶ 37,191 at 181,041, the government

employed Mr. Ockman; there, the Board found that “a considerable portion of

Mr. Ockman’s analyses” was “fundamentally flawed” and in other respects “without

merit.” In Curry Contracting Co., ASBCA No. 53716, 06-1 BCA ¶ 33,242 at

164,748, the Board found Mr. Ockman’s analysis “generally to be correct.” Here, the

many discrepancies recited above that were elicited by the cross-examination of

Mr. Ockman make his opinion unreliable, unhelpful, and not credible. Of them, two

are the most devastating. First, Mr. Ockman failed to employ a methodology that he

co-wrote was essential to a delay analysis: the use of an approved, as-planned

schedule. Accord THEODORE J. TRAUNER ET AL., CONSTRUCTION DELAYS 16, 44

(1990) (“The analyst must carefully choose the schedule that best represents the

project as-planned schedule. . . . If the Contractor submits the schedule a second and

third time until it is finally accepted by the Owner, chances are that the third schedule

submission best represents the as-planned schedule for the Project. . . .”). Second, he

attempted to lay that discrepancy at the feet of his co-author.

DECISION

By way of excuse for its default, GSC claims entitlement to 321 days of

excusable delay (258 days of which GSC says are compensable), that it says res

This text is long and has been trimmed here. Open the source document for the complete record.