DENIED: July 30, 2024

DENIED: July 30, 2024

CBCA 7618

UNITED FACILITY SERVICES CORPORATION,

Appellant,

v.

GENERAL SERVICES ADMINISTRATION,

Respondent.

William Weisberg of Law Offices of William Weisberg PLLC, McLean, VA, counsel

for Appellant.

Justin S. Hawkins, Office of General Counsel, General Services Administration,

Washington, DC, counsel for Respondent.

Before Board Judges LESTER, RUSSELL, and GOODMAN.

LESTER, Board Judge.

Respondent, the General Services Administration (GSA), is seeking to recover money

from appellant, United Facility Services Corporation (UFS), for damages caused by a burst

frozen water pipe in a federal courthouse building in Memphis, Tennessee, for which UFS,

by contract, was providing operations and maintenance (O&M) services. UFS filed this

appeal to challenge the Government’s claim. This decision is being issued following the

parties’ presentation of witness testimony at a hearing on April 17, 2024.

Previously, by decision dated February 27, 2024, the Board granted summary

judgment to GSA on its argument that UFS had breached its contractual obligation to

respond within no more than thirty minutes to an emergency call about the burst pipe,

CBCA 7618

2

entitling GSA to damages. United Facility Services Corp. v. General Services

Administration, CBCA 7618, 24-1 BCA ¶ 38,535, at 187,319. GSA’s recoverable damages

for UFS’s four-hour delay, to be established at the hearing, would be the difference between

the damage that would necessarily have resulted within that thirty-minute response-time

grace period and the full damage that actually occurred.

There was a second potential breach of contract, however, that was not addressed in

the February 27 summary judgment decision. Under its contract, UFS was required to make

reasonable attempts to protect the building from damage caused by reasonably foreseeable

freezing temperatures. GSA’s summary judgment motion did not address that issue, and it

remained open for development at the hearing.

During the hearing, UFS’s president volunteered that he had long known that piping

in the area of the burst pipe was too close to an uninsulated exterior wall of the building and

that, as he had previously told GSA on several occasions, the pipe was going to freeze and

burst when it got too cold outside. After learning of the impending freezing temperatures in

February 2021 (which was predicted days in advance of the weather event), UFS did nothing

to attempt to limit damage or protect the uninsulated pipes from freezing, instead believing

that GSA was at fault for not providing better insulation. In fact, UFS let all of its building

engineers stay home during the weather event and then let its project manager leave the

building for more than four hours, even though, as UFS’s president acknowledged, UFS

knew that pipes were likely to freeze and burst. Although UFS is not strictly liable under its

contract for the fact that a pipe burst, it is liable under the terms of its contract for damages

from a burst that, as here, it could reasonably have foreseen and made no effort to prevent.

Further, having accepted this contract knowing of the conditions in the building, it cannot

validly complain that GSA should have given it a better building to maintain.1

1

UFS suggests in its post-hearing briefing that the Board, in its summary

judgment decision, held that UFS was not liable for failing to attempt to protect the building

from freezing temperatures. The Board made no such ruling. GSA’s motion for summary

judgment focused solely on UFS’s failure to have an employee on-site when the pipe burst.

During briefing, neither party sought a ruling on the adequacy of UFS’s preparations for

freezing temperatures or knowledge of the likelihood of a pipe burst. Further, in a

scheduling order issued a few hours after its summary judgment decision, the Board notified

the parties that the April 17 hearing would “address all unresolved issues in this appeal

(including quantum issues).” Order (Feb. 27, 2024) at 2. And, at the beginning of the

April 17 hearing, the Board indicated that its “summary judgment decision did not find that

[UFS] was strictly liable for the mere fact that a pipe burst, but [that] if GSA wants to pursue

such an argument, it can do so here,” since “[t]he summary judgment motion just didn’t

address that.” Hearing Transcript at 8. It was clear that UFS’s liability for breach of its

CBCA 7618

3

Having breached its obligation to attempt to protect the building from reasonably

foreseeable (and, in this case, anticipated) damage, UFS is responsible for the damage caused

by the burst pipe. Because GSA has established through virtually uncontroverted evidence

that it incurred $526,478.46 to remedy the damage caused by the flooding, it is entitled to

recover that amount from UFS.

Findings of Fact

I.

UFS’s Contract

On September 30, 2016, GSA and UFS executed a fixed-price contract, no. GS-04-P16-EW-A-7021 (contract 7021), under which UFS would provide O&M services at the

Clifford David-Odell Horton Federal Courthouse (Odell courthouse) in Memphis, Tennessee,

for a twelve-month period beginning November 1, 2016, preceded by a thirty-day phase-in

period running from October 1 through 31, 2016. Appeal File, Exhibit 2A at 63, 65.2 The

contract contained four one-year options, all of which GSA exercised, that extended UFS’s

performance under the contract to October 31, 2021. Exhibit 1 at 16-17, 31-32, 42-43,

54-55.

As detailed in the Board’s February 27 decision, see United Facility Services, 24-1

BCA at 187,312-14, UFS’s contract required it to “provide staff to ensure services are

continued without disruption to the tenant” and to “ensure employees maintain

communications access with the [contracting officer] or his/her designee to allow contact by

the Government at all times during normal working hours and to effectively communicate

with Government personnel.” Exhibit 2A at 102 (clause C.8.1). It also required UFS to

provide staff “as necessary to meet all requirements of the contract” and “to ensure services

are continued without disruption to the tenant,” id. at 103 (clause C.8.1); “maintain

uninterrupted utilities services . . . so as to preserve the asset value of the facility and its

systems and to otherwise minimize operating costs to the Government without compromising

other Contract objectives or requirements,” id. at 111 (clause C.21.1); and have “a system

for onsite work force personnel to report potentially hazardous conditions in the building to

the [contracting officer] or designee” and to “provide reasonable assistance to security or

emergency response personnel as needed.” Id. at 117-18 (clause C.29). It required UFS to

“respond to emergency service request[s],” including those dealing with “broken water pipes,

. . . immediately (within the shortest possible time consistent with the mechanic’s location)

during normal working hours and within 30 minutes.” Id. at 114 (clause C.23.2). And it

contractual obligation to protect piping in the building from freezing temperatures was an

open issue for the hearing.

2

Unless otherwise noted, all exhibits are found in the appeal file.

CBCA 7618

4

provided that UFS “shall provide all labor, materials and equipment necessary for the

protection of Government personnel, equipment, furnishings, buildings, and facility

accessories (such as parking lots, fences, etc.) from damage caused by Contractor’s

negligence.” Id. at 118 (clause C.30).

Another contract provision, clause C.21.8, required UFS to “be responsible for any

necessary operation and prevention of damage to equipment during on and off duty hours . . .

due to inclement weather, high wind events, or freezing temperatures.” Exhibit 2A at 113.3

Similarly, clause C.29 required UFS to “make reasonable efforts to prevent hazardous

conditions and property damage” at the Odell courthouse, albeit without expressly

mentioning freezing temperatures. Id. at 117.

The contract also contained clause C.40.9, titled “Force Majeure (Uncontrollable

Events),” which read as follows:

The Contractor shall not be responsible for deficiencies or breakdowns caused

by vandalism, misuse by people other than Contractor employees, abuse by

people other than Contractor employees, or acts of God including natural

disasters unless the Contractor could have reasonably foreseen such events

and prepared accordingly to prevent such deficiencies or breakdowns.

Exhibit 2A at 131 (emphasis added).

II.

UFS’s Knowledge of Building Conditions

When awarded contract 7021, UFS had already been providing O&M services at the

Odell courthouse for the prior five years under a predecessor contract. Hearing Transcript

at 153-54. As UFS’s president, Steven R. Brown, testified at the hearing, when GSA

awarded contract 7021 in 2016, UFS was “very aware that this [was] an older building and

3

Although the contract did not contain a specific definition or list of the

“equipment” that UFS was to protect from damage, the piping at issue here is sufficiently

tied to the sprinkler system equipment to be covered under clause C.21.8. See Exhibit 2A

at 82 (in clause C.1.1, describing UFS’s “equipment and systems” responsibilities as

including, among other things, (1) plumbing and domestic water equipment and (2) fire

protection and life safety systems and equipment, including sprinkler systems); see also

Schaeffer Piano Manufacturing Co. v. National Fire Extinguisher Co., 148 F. 159, 164-68

(7th Cir. 1906) (describing sprinkler system as “equipment”); Toll Brothers Inc. v. Century

Surety Co., No. 07-1296, 2013 WL 3009721, at *1 (E.D. Pa. June 17, 2013) (same).

CBCA 7618

5

that it was very poorly maintained for many, many years.” Id. at 154. Mr. Brown described

the building’s known condition as follows:

From the mechanical equipment all the way down to exit overhead garage

doors, which we were in charge of maintaining[, t]he systems within the

building were very tired. And, the government was not renovating the

building. There w[ere] no upgrades being done. It was held together with duct

tape and a hammer half the time. And I’m being nice about it. There w[ere]

coils in the building that were leaking into courtrooms. And equipment just

being broken and then just left instead of it being replaced, it would just be

taken out of service.

Id. at 155.

In fact, Mr. Brown testified specifically about UFS’s knowledge of uninsulated piping

in parts of the building that were exposed to outside air and the likelihood that such piping

would freeze and potentially burst if outdoor temperatures were sufficiently below freezing:

[F]rom the minute we took this building the 10 years prior to our last day of

the contract, we had complained about non-insulated pipes in the building that

w[ere] exposed to outside air. There [are] plenums, which allow fresh air to

come in and out of the building. And you’re talking about 7, 12 degrees

during the winter in a snow storm. It is no shock that they finally had a real

pipe burst, but it’s not the first time. There’s documented, many documented

instances where they’ve had coils freeze over and break.

Hearing Transcript at 166-67.

By February 2021, the date of the incident at issue, UFS had already had nine years

of familiarity with the state of the building. Hearing Transcript at 153-54.

III.

The Incident

As National Weather Service records indicate, temperatures in Memphis fell below

freezing on the evening of February 10, 2021, and remained there for the next nine days,

falling to lows of 14° on February 14 and 9° on February 15 and a record low of 1° on

February 16, 2021. https://www.weather.gov/wrh/climate?wfo=meg (last visited July 28,

2024). In addition, on February 14 and 15, 2021, a total of 5.3 inches of snow fell in

Memphis. Id. This weather was far from typical for the area.

CBCA 7618

6

On February 16, 2021, at approximately 1:00 p.m. Central Time (CT), a frozen pipe

that was related to the building’s sprinkler system burst inside a locked room at the Odell

courthouse, causing flooding. Exhibit 6 at 415; Respondent’s Motion for Summary

Judgment, Statement of Undisputed Material Facts (SUMF) ¶ 3; Appellant’s Statement of

Material Facts (SMF) ¶ 1.

Before the pipe burst, the UFS project manager, who had checked in at the building

that morning, had departed for what turned out to be a lunch of more than four hours, and

there were no other UFS employees in the building. Exhibit 6 at 415, 421; Respondent’s

SUMF ¶¶ 4-5, 7; Appellant’s SMF ¶ 1; Complaint ¶ 6. The two UFS mechanics who were

normally at the building during normal business hours were not at work that day, having been

allowed to stay home because of inclement weather, and UFS’s administrator had called out

sick that day. Exhibit 6 at 415.

The GSA building manager was notified at approximately 1:00 p.m. CT by a

twenty-four-hour automated monitoring system that a brown liquid was coming from the

locked room and that the fire department needed access to it. Exhibit 6 at 421. At 1:04 p.m.

CT, the GSA building manager called the UFS project manager about the flooding, but the

UFS project manager did not respond. Exhibit 6 at 415, 421; Respondent’s SUMF ¶ 6. The

GSA building manager then contacted the Federal Protective Service (FPS) for assistance.

Exhibit 6 at 421. The UFS project manager did not return to the building until almost four

hours later (arriving by approximately 4:41 p.m. CT) because of what he said was

“something personal.” Id. at 422; Respondent’s SUMF ¶ 7.4 By the time that the UFS

project manager arrived and cut off the flow of water, the basement, first floor, and

mezzanine levels of the building had suffered substantial flooding.

IV.

Work to Repair Damage Caused by the Pipe Burst

On March 3, 2021, the GSA contracting officer executed a $75,000 task order to UFS,

separate and apart from contract 7021, for water extraction services at the Odell courthouse,

services that UFS had begun providing through a subcontractor on February 16, 2021.

4

At the hearing, UFS’s president testified that, as he understood it, the UFS

project manager’s delay in returning to the building was caused by weather and that he began

trying to return as soon as he received GSA’s emergency call. Hearing Transcript at 180-83.

That testimony, which is hearsay, is inconsistent with all other evidence in the record. While

UFS had listed its project manager as a fact witness, it elected not to call him. Therefore,

there was no explanation of what he originally told GSA was a “personal” reason for his

delayed return. In such circumstances, we reject the UFS president’s unsupported

explanation for the project manager’s delayed return.

CBCA 7618

7

Exhibit 7 at 424-46; Hearing Transcript at 157. GSA paid UFS in full for the extraction work

on March 26, 2021. Exhibits 9, 10; Hearing Transcript at 51-52, 157.

On or about June 7, 2021, after seeking competitive offers from six contractors with

existing indefinite-delivery indefinite-quantity contracts, GSA awarded a task order to

Katmai Support Services, L.L.C. (Katmai), in the amount of $451,478.46 for “build back

repairs required due to water intrusion” from the burst pipe at the Odell courthouse.

Exhibit 11 at 448-49; see Hearing Transcript at 42-44. GSA paid Katmai the contract price

for its work on March 11, 2022. Exhibits 12, 13.

The costs of the UFS water extraction work and the Katmai “build back” work, which

total $526,478.46,5 were necessarily incurred to repair damage from the burst pipe, are

reasonable, and are adequately supported in the record.6 See Hearing Transcript at 38-48.

Although GSA suffered other damage from the burst pipe, including destruction of furniture,

it is not seeking compensation for that damage.

V.

GSA’s Demands for Reimbursement

The contracting officer sent a demand letter to UFS on June 2, 2021, notifying UFS

of its “liability for major damage caused in the [Odell courthouse] due to [the] pipe burst on

February 16, 2021.” Exhibit 3 at 402. She indicated that, “[a]s a result of the extensive

damage done to the building, several floors of office/tenant spaces have to be renovated to

bring the spaces back to its [sic] original state for occupancy. The amount of water dispersed

was extensive and caused major flooding to the first floor, the Mezzanine, the basement, and

office tenant spaces and equipment.” Id. at 403. She indicated that, at that time (which was

a few days before the June 7, 2021, task order award to Katmai), GSA had estimated its total

damage as $451,478.46. Id. In support of her payment demand, the contracting officer cited

several provisions of the contract that she believed UFS had violated, including clauses

C.8.1, C.21.1, C.21.8, C.29, and C.30. Id. at 403-04. She asserted that UFS’s “failure to

adequately perform the duties outlined above resulted in the damage to the building.” Id. at

404.

5

In its post-hearing brief, GSA repeatedly tells us that it is entitled to

reimbursement of $529,478.46, which is $3000 more than the total of the two contracts that

it cites in support of its claimed damages. It appears that GSA’s identified total is a

mathematical error. Because the two contracts upon which GSA relies to support its claimed

damages total $526,478.46, that is the total damage amount that GSA has established.

6

To the extent that UFS’s witness questioned whether these costs include an

upgrade to the facility, see Hearing Transcript at 168-69, the evidence is too speculative to

merit a reduction in the established damages.

CBCA 7618

8

By letter dated June 9, 2021, UFS responded to GSA’s demand letter and disclaimed

any responsibility for the damages to the building, which it asserted were caused by an act

of God that was excusable under the contract’s Force Majeure clause (clause C.40.9):

This clause was written for just this situation. An emergency inclement

weather event was in progress. Snowfall and temperatures both reached

historical levels (one high, one low). Travel was treacherous. The Mayor had

declared a State of Emergency. This was a classic force majeure event. As

such, the contractor is not liable for any part of the $451,478.46 in damages

referenced in your letter.

Exhibit 4 at 406-07.

The contracting officer responded by letter dated October 14, 2021, asserting that the

Force Majeure clause “only applies to damages caused by Acts of God ‘unless the Contractor

could have reasonably foreseen such events and prepared accordingly to prevent such

deficiencies or breakdowns.’” Exhibit 6 at 419. She represented that, “although the pipe

freezing and bursting may be considered an Act of God, the Contractor could reasonably

have foreseen the subsequent damage and prepared accordingly to prevent the deficiencies

and breakdowns that followed.” Id. She identified GSA’s total damages at that point as

$529,478.46. Id. at 422.

On December 7, 2022, the GSA contracting officer issued a final decision, which

incorporated the contracting officer’s demand letter from June 2, 2021, and demanded the

payment of $505,492.92 (an unexplained decrease in the dollar amount identified in the

October 14, 2021, letter, as well as a lower figure than that being sought here) for “damages

caused at the Odell [courthouse] as a result of the pipe burst and flooding due to the

contractor’s failure to adequately perform the duties outlined in the terms and conditions of

the contract.” Exhibit 6 at 413. The contracting officer included in the decision a notice of

UFS’s appeal rights under the CDA. Id. at 414.

VI.

Proceedings Before the Board

UFS filed its notice of appeal with the Board on December 20, 2022, challenging the

contracting officer’s assertion of the government claim. On November 9, 2023, after the

parties had completed discovery, GSA filed its motion for partial summary judgment, which

the Board granted on February 27, 2024. In its decision, the Board found that GSA had

established UFS’s breach of its obligation to respond to emergency calls within thirty

minutes. United Facility Services, 24-1 BCA at 187,319. The Board then scheduled a

hearing on all issues remaining in the appeal, including but not limited to quantum, to

commence April 17, 2024. By order dated April 11, 2024, the Board directed that, because

CBCA 7618

9

the claim at issue is a government claim (for which the Government bore the burden of

proof), GSA should present its case-in-chief first at the hearing, followed by UFS.

At the commencement of the April 17 hearing, GSA indicated that, in addition to

establishing the amount of its damages, it intended to pursue at the hearing its argument that,

in addition to breaching an obligation to respond to emergency calls within thirty minutes,

UFS had also breached its separate contractual obligation to exercise reasonable care in

preventing damage to the building in response to freezing temperatures. Hearing Transcript

at 21-22. GSA then called two witnesses: the contracting officer for the Katmai “build

back” reconstruction contract and the contracting officer’s representative for contract 7021,

who prepared an independent government estimate for the cost of remedying the water

damage to the building. They established the costs that GSA incurred to remedy the water

damage to the courthouse, but neither witness was at the courthouse during the flooding, and

neither was able to segregate the damage that occurred within the first thirty minutes after

the pipe burst from the total damage that GSA suffered. Similarly, neither could address

questions from counsel for UFS about whether flooding in the first thirty minutes after the

pipe burst was sufficient to cause tiles in the basement, which were secured to the floor with

an asbestos glue, to delaminate, creating friability issues that may have significantly affected

GSA’s overall restoration costs. GSA closed the presentation of its case-in-chief without

addressing those proximate cause issues.

UFS then presented its witness, Mr. Brown. Like GSA’s witnesses, Mr. Brown was

not at the Odell courthouse when the flooding occurred. He testified, though, that he was

very familiar with the building from years of having dealt with it under two contracts. He

testified that the pipe that burst was in a controlled internal space but, as he long had known,

“was exposed to outside. It was a bearing wall pipe. It was attached to a bearing wall, and

then it was . . . outside air right near it. So, that’s why the pipe froze. And the pipe was

broken in multiple spots, not in one. So it wasn’t a one-break. This was a fatigued pipe.”

Hearing Transcript at 173. He also testified that, as UFS had long known, the pipe was not

wrapped or insulated. Id. at 169. He represented that “[a]nything that is exposed to outside

air in a building with an environment like this one, or basically the state, their winters, their

springs, has to be insulated. There was conversation about insulating the pipes. Nothing was

ever done.” Id. Nevertheless, he also testified that “[w]e are a maintenance contractor. We

maintain what is given to us. So, our job is to keep it running at all extent. Whatever we

have to do to keep it running.” Id. at 170.

At the parties’ request, the Board allowed the parties to submit sequential post-hearing

briefing. GSA filed its post-hearing brief on June 21, 2024; UFS filed its response brief on

July 1, 2024; and GSA filed its reply brief on July 11, 2024.

CBCA 7618

10

Discussion

I.

UFS’s Breach, and GSA’s Damages

“The party alleging a breach of contract”—here, the Government—“bears the burden

of proving the breach.” Technical Assistance International, Inc. v. United States, 150 F.3d

1369, 1373 (Fed. Cir. 1998). Further, “before the contractor may be held liable for damage

to property . . . pursuant to [the breach], there must appear by a preponderance of the

evidence, besides the fact of damage . . . , (1) that the damage was ‘occasioned,’ i.e., caused,

in whole or in part by (2) negligence or fault on the part of the contractor, (3) in the

performance of [or failure to perform] work under the contract.” American Stevedores, Inc.,

ASBCA 5286, 60-2 BCA ¶ 2686, at 13,557; see MOPAC Contracting/Engineering, Inc.,

AGBCA 83-144-1, 87-2 BCA ¶ 19,707, at 99,784 (“In assessing damages, the Government

bears the burden of proof.”). That is, after establishing a contract breach, the Government

must show that the contractor’s negligence was the proximate cause of the damages that the

Government is seeking. Harold J. Redding & Associates, ASBCA 1611, 1955 WL 8984

(Nov. 14, 1955).

The Board previously found UFS liable for a breach of the contract requirement

mandating that UFS respond to emergency calls within thirty minutes. Had UFS satisfied

that contract obligation, the water flowing out of the burst pipe would have lasted no more

than thirty minutes, given the uncontested fact established on summary judgment that, “[t]o

stop the flow of water into the room in which the pipe had burst,” access to which the

missing UFS project manager controlled, “all that was necessary was to turn a valve that was

located in the room near the pipe.” United Facility Services, 24-1 BCA at 187,314. Further,

at the hearing, GSA established that it incurred a total of $526,478.46 in repairing damage

caused by the burst pipe. What GSA did not present at the hearing was any evidence

comparing the water damage that the building would have suffered during the initial

thirty-minute grace period that UFS had to respond to the emergency call and the actual

damages that GSA ultimately suffered as a result of the four-hour delay.

“The remedy for breach of contract is damages sufficient to place the injured party in

as good a position as it would have been had the breaching party fully performed.” Indiana

Michigan Power Co. v. United States, 422 F.3d 1369, 1373 (Fed. Cir. 2005). Normally, we

would calculate proximate cause damages by “perform[ing] the necessary comparison

between the breach and non-breach worlds”—in this case, the total costs that GSA actually

incurred and the potentially more limited costs that GSA would have incurred from flooding

even if UFS had responded within thirty minutes of the emergency call—and then award

GSA the difference between those two calculations. Yankee Atomic Electric Co. v. United

States, 536 F.3d 1268, 1273 (Fed. Cir. 2008).

CBCA 7618

11

GSA’s failure to present any evidence allowing for a breach/non-breach world

comparison would be problematic if not for UFS’s breach of another contract obligation that

eliminates the need for such a comparison. UFS’s contract expressly required that UFS “be

responsible for any necessary operation and prevention of damage to equipment during on

and off duty hours . . . due to inclement weather . . . or freezing temperatures,” Exhibit 2A

at 113 (emphasis added), and “make reasonable efforts to prevent hazardous conditions and

property damage” at the Odell courthouse. Id. at 117. UFS was supposed to have “a system

for onsite work force personnel to report potentially hazardous conditions in the building to

the [contracting officer] or designee” and to “provide reasonable assistance to security or

emergency response personnel as needed.” Id. at 117-18. And it was “required to perform

the services required by the Contract and as identified by the [contracting officer] or their

designee [t]o the extent allowed during all emergency situations.” Id. at 179. These

provisions do not impose strict liability on UFS for every pipe that bursts, but they impose

an obligation on UFS to make reasonable efforts to protect against known dangers when it

becomes aware that freezing temperatures may affect the building.

UFS has admitted that it did not do that. It made clear that it was aware of predictions

of unusual weather and freezing temperatures coming to Memphis and had long known the

piping at issue was uninsulated, near exterior walls subject to outdoor airflow, and likely to

freeze and burst. Despite this knowledge, UFS made no effort to monitor the pipes or

attempt to reduce the possibility that they would freeze. In the circumstances here, the fact

that UFS knew of the likelihood of burst pipes but had no engineers or other personnel on

site during the weather event and made no effort to protect the building (through, for

example, strategically placed temporary heaters or insulated tarps) constituted a breach of

its obligations under the contract. Absent this breach, GSA would have suffered no damage,

given either that the pipe at issue would not have burst or, if it had, a responsible UFS

employee would have been there monitoring the pipes during what UFS calls an

unprecedented freeze. The responsible UFS employee could quickly have unlocked the room

in question and turned the valve to stop water flow. Exhibit 6 at 422; Respondent’s SUMF

¶ 9. Based upon this contract breach, GSA is entitled to recover the entire $526,478.46 that

it incurred to remedy the water damage.

II.

UFS’s Defenses to the Breach

A.

UFS’s “Act of God” Defense

Like it did in response to GSA’s summary judgment motion, UFS argues that it cannot

be held liable for the burst pipe because it was caused by an “Act of God”—that is, freezing

temperatures that were extreme for the Memphis area. The contract defines “Acts of God”

as “unanticipated grave natural disasters or other natural phenomenon of an exceptional,

inevitable, and irresistible character; the effects of which could not have been prevented or

CBCA 7618

12

avoided by the exercise of due care or foresight.” Exhibit 2A at 85 (clause C.2.3) (emphasis

added). “If the [contractor] could not reasonably foresee any injury as the result of his act

[or failure to act], or if his conduct was reasonable in light of what he could anticipate, there

is no negligence, and no liability.” Peter Kiewit Sons’ Co., IBCA 1789, 90-1 BCA ¶ 22,525,

at 113,057 (1989) (quoting William L. Prosser, Handbook on the Law of Torts 250 (4th ed.

1971)). Nevertheless, a “contractor would ordinarily be liable for loss or damage resulting

partly from an act of God . . . if their intervening negligence was of such magnitude that it

substantially increased the damage that would otherwise have occurred—in other words, if

they, rather than the natural occurrence, should be considered the supervening or proximate

cause of the damage.” Id. at 113,059.

Here, clause C.21.8 of UFS’s contract expressly required UFS to “be responsible for

any necessary operation and prevention of damage to equipment . . . due to inclement

weather . . . or freezing temperatures,” Exhibit 2A at 113, and clause C.29 similarly required

UFS to “make reasonable efforts to prevent hazardous conditions and property damage” at

the Odell courthouse. Id. at 117. As we discussed in our February 27 summary judgment

decision, UFS cannot blame an “act of God” for its failure to meet contractual obligations

that required it to anticipate and attempt to protect against reasonably foreseeable

occurrences. “A force majeure clause interpreted to excuse the [contractor] from the

consequences of the risk he expressly assumed [and the work to address emergencies that he

expressly agreed to perform] would nullify a central term of the contract.” United Facility

Services, 24-1 BCA at 187,318 (quoting Northern Indiana Public Service Co. v. Carbon

County Coal Co., 799 F.2d 265, 275 (7th Cir. 1986)).

In this case, there is no question that the freezing temperatures which caused the pipe

in the Odell courthouse to burst were reasonably foreseeable. They were predicted days

earlier, they had been ongoing for several days before the pipe burst, and UFS had agreed in

its contract to take responsibility for trying to protect the building from freezing temperatures

when reasonably foreseeable. The contract placed upon UFS an obligation to make

reasonable efforts to minimize the possibility of damage. See Sovereign Construction Co.,

GSBCA 712, 1964 BCA ¶ 4148, at 20,187 (Although a severe “drop in temperature was an

act of nature for which neither party to the contract was responsible[,] . . . [t]his does not . . .

absolve Appellant from its contractual obligation to have prevented the freeze [of pipes in

the building] since the evidence indicates Appellant could have done so.” (citations

omitted)). The evidence in this case makes clear that UFS made no effort to avoid frozen

pipes. It allowed all of its building engineers to stay home on the day in question, despite

knowing of uninsulated piping that, as Mr. Brown testified, was prone to freezing and

bursting. The record is devoid of any attempt by UFS to shield or heat areas of the building

that UFS knew had pipes prone to freezing. And UFS allowed the only employee that it had

on-site the day the pipe burst (and the only one with a key to the room in question) to leave

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for more than four hours. In the circumstances here, UFS’s actions amount to a breach of

its contract obligation to attempt to protect the building from freezing temperatures.

B.

UFS’s Recharacterization of the Contract Requirements

At the hearing, UFS’s president asserted that “it [was] not [UFS’s] responsibility to

sit as a babysitter and almost sit there and wait for pipes to break.” Hearing Transcript at

176. He testified that UFS’s “job is to notify them and let them know that hey, you have a

possibility that eventually you’re going to have a pipe freeze.” Id. at 176. “[I]t is my

responsibility to have people onsite, but not when it’s an emergency, or you can’t drive or

get to work.” Id. at 177; see id. at 177-78 (“You can’t predict when a pipe is going to freeze,

or if something is going to break down. You can advise the government of what’s going on,

but I can’t sit there and say okay, you don’t want to spend money on this so I’ll have a guy

stand under a pipe when it gets below 32 degrees. That’s not our job.”); id. at 180 (“You’re

paying me to do the [preventative maintenance] in your building . . . on items that run on a

daily basis. If there’s an act of God, or excessive freezing, or a hurricane, you’re not paying

me for that.”). Mr. Brown’s characterization of UFS’s contract conflicts with the actual

contract language. See Exhibit 2A at 113, 117. UFS cannot avoid liability for breach by

misdescribing the contract requirements.

C.

UFS’s Complaints About Building Conditions

UFS also blames GSA for handing it a building to maintain that did not have all of the

upgrades and protections that UFS thinks it should have had, and it attempts to shift

responsibility for deficiencies in the building and the piping to GSA. Yet, UFS’s remedy for

its complaints about the building was simple: it did not have to bid for or accept this

contract. But it did, even though it knew of the building’s condition. In doing so, UFS

voluntarily assumed certain contractual responsibilities, including duties that it was required

to perform when it became aware of an impending weather event that UFS could reasonably

foresee might affect the building. Having accepted the contract with knowledge of the

building’s deficiencies, it could not ignore a weather emergency and blame GSA for not

giving it a better building to operate and maintain.

In these circumstances, UFS is responsible for all damage resulting from the burst

pipe, which GSA has established totals $526,478.46.

III.

CDA Interest

In its post-hearing reply brief, GSA asks us to apply interest pursuant to the Contract

Disputes Act (CDA), 41 U.S.C. §§ 7101–7109 (2018), to its damages award. Although the

CDA provides for interest on contractor claims, see id. § 7109(a)(1), it contains no

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corresponding provision providing interest to the Government on a successful government

claim. Odyssey International, Inc., ASBCA 62085, et al., 21-1 BCA ¶ 37,861, at 183,851;

see Maggie’s Landscaping, Inc., ASBCA 56748, 11-2 BCA ¶ 34,807, at 171,293 (“No CDA

interest shall run on the amount of the government’s claim.”), reconsideration granted on

other grounds, 11-2 BCA ¶ 34,849; John Cibinic, Jr., James F. Nagle & Ralph C. Nash, Jr.,

Administration of Government Contracts 1097 (5th ed. 2016) (“[T]he Act does not provide

for interest on government claims.”). GSA has not identified any other basis, outside the

CDA, for an award of interest. GSA’s request for interest is denied.

Decision

UFS’s appeal is DENIED, and GSA’s claim, as adjusted, is granted. UFS shall pay

$526,478.46 to GSA as compensation for damage caused by UFS’s breach of its contractual

obligation to attempt to protect the Odell courthouse from freezing temperatures. GSA is not

entitled to CDA interest.

Harold D. Lester, Jr.

HAROLD D. LESTER, JR.

Board Judge

We concur:

Beverly M. Russell

BEVERLY M. RUSSELL

Board Judge

Allan H. Goodman

ALLAN GOODMAN

Board Judge