THIS OPINION WAS INITIALLY ISSUED UNDER PROTECTIVE ORDER AND

THIS OPINION WAS INITIALLY ISSUED UNDER PROTECTIVE ORDER AND

IS BEING PUBLICLY RELEASED IN ITS ENTIRETY ON SEPTEMBER 22, 2025

DISMISSED FOR FAILURE TO STATE A CLAIM: September 4, 2025

CBCA 8151, 8162, 8163

GDM A-E, INC.,

Appellant,

v.

DEPARTMENT OF VETERANS AFFAIRS,

Respondent.

Italia A. Carson, Polaris Law Group, P.C., North Pole, AK, counsel for Appellant.

Neil S. Deol, Office of General Counsel, Department of Veterans Affairs, Decatur,

GA; and Kathleen Ramos, Office of General Counsel, Department of Veterans Affairs,

Arlington, TX, counsel for Respondent.

Before Judges GOODMAN, KULLBERG, and KANG.

GOODMAN, Board Judge.

GDM A-E, Inc. (GDM or appellant) filed three appeals from the Department of

Veterans Affairs (VA or respondent) contracting officer’s (CO) final decisions (COFDs)

denying GDM’s certified claims concerning three contracts.1 These appeals were docketed

1

Appellant designated its notices of appeal, which were not paginated, as

complaints in the three appeals. References to page numbers in the complaints are to the

CBCA 8151, 8162, 8163

2

as CBCA 8151, CBCA 8162, and CBCA 8163. Respondent filed a motion to dismiss in each

of these appeals for failure to state a claim upon which relief may be granted, presenting

substantially similar legal issues across the motions.2 The Board consolidated the appeals

on August 27, 2025, pursuant to Board Rule 2(f) (48 CFR 6101.2(f) (2024)) and resolves the

three motions to dismiss in this decision.3 We grant respondent’s motions and dismiss these

consolidated appeals for failure to state a claim.

Background

The Solicitations and Contracts

The VA issued Requests for A/E [Architect-Engineer] Fee Proposals (solicitations)

pursuant to Federal Acquisition Regulation (FAR), part 36, Construction and ArchitectEngineering Contracts. The solicitations sought proposals to award contracts to A/E

contractors who would, in turn, design construction projects to attain goals associated with

Electronic Health Record Modernization (EHRM) projects. Respondent’s Motions to

Dismiss at 1.

For each solicitation, the VA prepared an independent government cost estimate

(IGCE), which was used to determine the VA’s estimated construction contract price (ECC

price) for the project that would be designed by the A/E contractor. Id.

PDF document filed, beginning with the transmittal cover. References to exhibits are to

appeal file exhibits.

2

The motions are substantially identical. References to page numbers in the

motions are to all three motions without identification of docket number, unless otherwise

indicated.

3

Appellant retained counsel after appellant’s chief executive officer filed the

notices of appeal and oppositions to respondent’s motions. “We construe a pro se litigant’s

pleadings liberally,” but such lenience does not affect “a pro se litigant’s burden of proof or

our [assessment] of the factual record.” House of Joy Transitional Programs v. Social

Security Administration, CBCA 2535, 12-1 BCA ¶ 34,991, at 171,975 (citing Haines v.

Kerner, 404 U.S. 519, 520 (1972); Greenlee Construction, Inc. v. General Services

Administration, CBCA 416, 07-1 BCA ¶ 33,514, at 166,062).

CBCA 8151, 8162, 8163

3

Each solicitation and awarded contract contained the Design Within Funding

Limitations clause (APR 1984), FAR 48 CFR 52.236-22 (2021) (FAR 52.236-22), which

included the ECC price for the project to be designed and reads as follows:

(a)

The Contractor shall accomplish the design services required under this

contract so as to permit the award of a contract, using standard Federal

Acquisition Regulation procedures for the construction of the facilities

designed at a price that does not exceed the estimated construction

contract price as set forth in paragraph (c) of this clause. When bids or

proposals for the construction contract are received that exceed the

estimated price, the contractor shall perform such redesign and other

services as are necessary to permit contract award within the funding

limitation. These additional services shall be performed at no increase

in the price of this contract. However, the Contractor shall not be

required to perform such additional services at no cost to the

Government if the unfavorable bids or proposals are the result of

conditions beyond its reasonable control.

(b)

The Contractor will promptly advise the Contracting Officer if it finds

that the project being designed will exceed or is likely to exceed the

funding limitations and it is unable to design a usable facility within

these limitations. Upon receipt of such information, the Contracting

Officer will review the Contractor’s revised estimate of construction

cost. The Government may, if it determines that the estimated

construction contract price set forth in this contract is so low that award

of a construction contract not in excess of such estimate is improbable,

authorize a change in scope or materials as required to reduce the

estimated construction cost to an amount within the estimated

construction contract price set forth in paragraph (c) below, or the

Government may adjust such estimated construction contract price.

When bids or proposals are not solicited or are unreasonably delayed,

the Government shall prepare an estimate of constructing the design

submitted and such estimate shall be used in lieu of bids or proposals

to determine compliance with the funding limitation.

(c)

The estimated construction contract price for the project described in

this contract is $ [amount of the contract].

CBCA 8151, 8162, 8163

4

CBCA 8151, Exhibit 15 at 15-16; CBCA 8162, Exhibit 9 at 13; CBCA 8163, Exhibit 20

at 18.

Veterans Affairs Acquisition Regulation (VAAR) 836.606-71, 48 CFR 836.606-71,

limited the A/E contractor’s fee to six percent of the ECC price specified in the contract. If

the Government changed the scope of work of the project to be designed by the A/E

contractor, the A/E contractor could request an equitable adjustment in its fee pursuant to the

Changes clause, FAR 52.243-1. CBCA 8151, Exhibit 15 at 18; CBCA 8162, Exhibit 9 at 15;

CBCA 8163, Exhibit 20 at 30.

The solicitation for the contract for the Togus, Maine, EHRM Infrastructure Upgrades

was issued on May 6, 2022. CBCA 8151. Appellant submitted a fee proposal, CBCA 8151,

Exhibit 14, and was awarded a firm-fixed price (FFP) A/E design services contract on

December 1, 2022, in the amount of $3,836,578.86 if all options were exercised (Togus

contract). CBCA 8151, Exhibit 15 at 7; Exhibit 7; Exhibit 30 at 1 (COFD). The contract

established an ECC price of $29,984,000. Id. at 16.

The solicitation for the contract for the Birmingham, Alabama, EHRM Infrastructure

Upgrades was issued on August 19, 2021. CBCA 8162, Exhibit 5. Appellant submitted a

fee proposal, CBCA 8162, Exhibit 7, and was awarded a FFP A/E design services contract

on September 27, 2021, in the amount of $1,350,185 (Birmingham contract), with an ECC

price of $16,503,365. CBCA 8162, Exhibit 9 at 5, 13. The total estimated award if all

options were exercised was $1,889,773. Id. at 5. Five modifications were issued, increasing

the contract price to $2,524,569.36. CBCA 8162, Exhibit 62 at 2 (COFD).

The solicitation for the contract for the Murfreesboro, Tennessee, EHRM

Infrastructure Upgrades was issued on August 30, 2022. CBCA 8163, Exhibit 14. Appellant

submitted a fee proposal, CBCA 8163, Exhibits 16, 19, and was awarded a FFP A/E design

services contract on January 31, 2023, in the amount of $2,858,918 (Murfreesboro contract).

CBCA 8163, Exhibit 20 at 7. The contract established an ECC price of $30,945,000. Id.

at 18.

Each solicitation and contract contained a list of attachments and/or attachments

comprised of several hundred pages, which included the statements of work, specifications,

site maps, and other contract requirements. Solicitation (CBCA 8151), Exhibit 7 (sixty-eight

pages with attachments listed but not included); Contract (CBCA 8151), Exhibit 15 (556

pages including attachments); Solicitation (CBCA 8162), Exhibit 5 (362 pages including

attachments); Contract (CBCA 8162), Exhibit 9 (344 pages including attachments);

CBCA 8151, 8162, 8163

5

Solicitation (CBCA 8163), Exhibit 14 (644 pages including attachments); Contract (CBCA

8163), Exhibit 20 (627 pages including attachments).

Claims and Appeals

For each of the three contracts, appellant submitted a certified claim pursuant to the

Contract Disputes Act (CDA), 41 U.S.C. §§ 7101–7109 (2018). On February 5, 2024,

appellant submitted a certified claim with regard to the Togus contract in the amount of

$2,513,128.14. On May 28, 2024, the CO issued a COFD denying the claim. On July 18,

2024, appellant filed a notice of appeal, docketed as CBCA 8151.

On January 22, 2024, appellant submitted a certified claim with regard to the

Birmingham contract in the amount of $456,455.58. On May 21, 2024, the CO issued a

COFD denying the claim. On July 29, 2024, appellant filed a notice of appeal, docketed as

CBCA 8162.

On June 24, 2024, appellant submitted a certified claim with regard to the

Murfreesboro contract in the amount of $1,052,936. On July 9, 2024, the CO issued a COFD

denying the claim. On July 29, 2024, appellant filed a notice of appeal, docketed as CBCA

8163.

Appellant attached to its notices of appeal its certified claims and requests for

equitable adjustments previously submitted to the COs.4 After appellant designated its

notices of appeal as complaints in the three appeals, respondent designated the COFD in

CBCA 8151 as its answer and, thereafter, filed a motion to dismiss the appeal. In

CBCA 8162 and CBCA 8163, respondent filed motions to dismiss in lieu of responsive

pleadings.

The complaints are substantially similar, including identical introductions:

The following documented cardinal change required GDM to perform duties

above and beyond those required by the solicitation and awarded contract for

which GDM is seeking—and rightfully owed—equitable compensation.

4

The same CO administered the Togus and Birmingham contracts, and a second

CO administered the Murfreesboro contract.

CBCA 8151, 8162, 8163

6

Complaint (CBCA 8151) at 3; Complaint (CBCA 8162) at 3; Complaint (CBCA 8163) at 3.

Appellant’s factual allegations and legal arguments in the complaints are included as

they relate to the issues in the discussion below.

Discussion

Appellant, an A/E contractor, after reviewing solicitations and submitting proposals,

was awarded three FFP contracts to design VA projects based upon the scope of work,

specifications, and the ECC prices in the contracts. The Design Within Funding Limitations

clause of the contracts required appellant to design the projects pursuant to the statements of

work, specifications, and other requirements that would then allow the VA to award

construction contracts that did not exceed the ECC prices. The ECC prices in the contracts

were the VA’s estimates of the prices for the construction contracts that would be eventually

awarded based on appellant’s designs. Appellant’s fee, under these FFP contracts, was

limited to six percent of the ECC price specified in the contract. The fee could be increased

if the scope of work of the project appellant designed was increased under circumstances

described in the Design Within Funding Limitations clause.

Appellant submitted certified claims for the contracts, alleging that the IGCEs upon

which the ECC prices were based were defective and did not reflect the complexities of the

projects to be designed. During performance of the contracts, appellant’s ECC prices for the

projects it designed exceeded the ECC prices specified in the contracts. Appellant advised

the COs as to the increase in the ECC prices and also that, as a result of its design efforts, the

number of design drawings it produced exceeded the number estimated in its proposals.

However, the COs did not revise the scopes of work of the projects being designed by

appellant or increase the contract ECC prices but directed appellant to continue to design the

projects within the scopes of work of its contracts. Appellant, therefore, asserts that the

continued directions to design under these circumstances were cardinal and constructive

changes, entitling it to compensation for the increased costs that it incurred in excess of the

FFPs for its contracts.

Standard of Review

Respondent has moved to dismiss the appeals for failure to state a claim upon which

relief may be granted, pursuant to Rule 8(e). The standard to resolve a motion to dismiss for

failure to state a claim is well established. The contractor must point to factual allegations

that, if true, would state a claim for relief that is plausible on its face when the Board draws

CBCA 8151, 8162, 8163

7

all reasonable inferences in favor of the contractor. B.L. Harbert International, LLC v.

General Services Administration, CBCA 6300, et al., 19-1 BCA ¶ 37,335, at 181,569. In

resolving respondent’s motions to dismiss, “[t]he Board decides legal issues, and may treat

any document that is incorporated in or attached to the complaint as part of the pleadings.”

Id. (citing Amec Foster Wheeler Environment & Infrastructure, Inc. v. Department of the

Interior, CBCA 5168, et al., 19-1 BCA ¶ 37,272, aff’d mem., 835 F. App’x 603 (Fed. Cir.

2021)).

Appellant’s Complaints

Respondent states that, “[i]n this matter, Appellant’s Complaint references the

Solicitation as well as the certified claim, which claim references the awarded Contract. As

such, both the Solicitation and Contract are appropriate to review in the context of a Motion

to Dismiss.” Motion to Dismiss (CBCA 8151) at 4; Motion to Dismiss (CBCA 8162) at 3-4;

Motion to Dismiss (CBCA 8163) at 4. We consider appellant’s notices of appeal designated

as complaints and all attachments to determine whether the complaint can survive the motion

to dismiss for failure to state a claim. Strawberry Hill, LLC v. General Services

Administration, CBCA 5149, 16-1 BCA ¶ 36,561, at 178,063-64 (citing Systems

Management & Research Technologies Corp. v. Department of Energy, CBCA 4068, 15-1

BCA ¶ 35,976, at 175,789).

Failure to State a Claim

Despite the allegations in the claims and complaints, appellant has not asserted factual

allegations that, if true, would state a claim for relief. Even when the Board draws all

reasonable inferences in favor of the contractor, appellant has failed to state a claim in the

three, now consolidated, appeals, as described herein.

Allegations of Defective IGCEs and Contract ECC Prices

Appellant alleges that the VA utilized inappropriate parametric estimating, rather than

typical standards of preliminary cost estimating, to calculate the IGCEs that were used as the

basis for the ECC prices included in the solicitations and contracts upon which, in turn, its

FFP fees were based. Appellant asserts that the resulting ECC prices violated an implied

warranty of the Government to supply accurate information, with appellant emphasizing that

“A/E firms rightfully assume that the VA has reviewed and understand[s] the complexities

of the scope of work, schedule, and site-specific features and has provided a reasonably

CBCA 8151, 8162, 8163

8

accurate estimated construction contract price and design funding limitation.” Complaint

(CBCA 8153) at 4; Complaint (CBCA 8162) at 4; Complaint (CBCA 8163) at 5.

Appellant also alleges:

The design limitation provides the A/E with an understanding of how the VA

has interpreted the risks, magnitude, and complexities of the design along with

underlying assurances that the VA has accurately reflected the costs of the

future construction project.

....

The accepted Fee Proposal was based on a defective estimate in the form of

the stated design limit, and the VA benefitted from all the additional design

work.

Complaint (CBCA 8153) at 8; Complaint (CBCA 8162) at 7; Complaint (CBCA 8163) at 6-7

(with editorial variations).

Case law does not support appellant’s assertions that an ECC price in a solicitation

or contract is a warranty of accurate information such that it represents the VA’s

determination of the ECC price of the project that will be designed by the A/E contractor.

In Acres American, Inc., ASBCA 27743, 85-1 BCA ¶ 17,865, an A/E contractor under a

similar contract, which also contained the Design Within Funding Limitations clause, alleged

that the ECC price had been negligently prepared and sought an increase in the contract price

for designing a project in excess of the ECC price. In that case, the Armed Services Board

of Contract Appeals (ASBCA) acknowledged that, in some circumstances, government

estimates have been held to have been negligently prepared when the Government’s

estimator fails to consider reasonably available information. Id. at 89,437. However, in the

case of an ECC price in an A/E contract, the ASBCA concluded that:

[T]he Government construction limitation [ECC price] is not a normal

construction estimate because it depends on the design to be developed by the

[A/E firm] under the contract for which the fee negotiations were being

conducted.

....

CBCA 8151, 8162, 8163

9

We need not decide whether the Government’s construction limitation was

negligently prepared because we find that it is not the type of estimate or

opinion upon which a contractor could reasonably rely. Statements of opinion

are those where different points of view are to be expected. Restatement of

Contracts, Second, § 168, comment a. at 456. Predictions of the cost to

construct a project not yet designed clearly fit this definition.

Id. at 89,437 (emphasis added).

In the Acres American decision, the ASBCA explained that when a contract’s ECC

price reflects a design that is to be developed by the A/E firm, “the subject matter of the

transaction is one on which the two parties have roughly equal skill and judgment, each must

generally form his own opinions and neither is justified in relying on the other’s.” Acres

American, 85-1 BCA at 89,437-38 (quoting Restatement (Second) of Contracts § 169 cmt.

b (1981)). The exceptions to this general rule are: (1) the Government has superior

knowledge of facts not reasonably available to the recipient; (2) the Government is especially

skilled compared to contractor; and (3) the contractor does not know the underlying facts on

which the ECC is based and reasonably infers that the Government’s opinion is based on

sufficient facts to form such an opinion. Id.; see also O’Neal Engineering, Inc.,

ASBCA 32013, 86-3 BCA ¶ 19,114, at 96,619 (denying, based on Acres American, A/E

contractor’s increased design costs claim that alleged reliance on Government’s “inaccurate”

construction estimates).

The exceptions to the general rule that a statement of opinion may not be relied upon

are not applicable here. Appellant challenges the VA’s method for computing the IGCEs

upon which the contract ECC prices were based, not whether the VA had superior knowledge

of the project requirements. The projects’ requirements upon which appellant based its

proposals were set forth in the solicitations and the awarded contracts, as the Government

was seeking an A/E contractor to evaluate the requirements and create designs to construct

the projects within the contract ECC prices.

There is no evidence that the government personnel who compiled the solicitations

and contracts were more skilled than the bidding A/E contractors, as the Government’s effort

was to set forth the parameters of the project that would be designed by the awardees of the

contracts. The attachments to the solicitations contained the projects’ scopes of work,

specifications, and other requirements for potential A/E contractor bidders to review when

deciding whether to submit a proposal seeking a design contract award. If the contractor,

after reviewing the solicitation and scope of work and specifications (amounting to several

CBCA 8151, 8162, 8163

10

hundred pages), did not believe it could accomplish the design, it could decide not to submit

a proposal.

There was no assurance, or warranty, as suggested by appellant, that the ECC prices

accurately reflected the costs of the future construction contracts. While appellant contends

that its proposals relied upon the ECC prices, it also acknowledges that its decision to submit

proposals was also based on its review of each contract’s requirements as stated in the

solicitation. In fact, appellant alleges:

There are three essential pieces of information in a solicitation that are relied

on to formulate the A/E fee proposal—the scope of work, the as-built drawings

and other attached pertinent materials, and the stated Design Limitation [ECC

price]; it is imperative that these pieces of information are complete and

accurate when formulating the fee proposal. The design limitation provides

the A/E with an understanding of how the VA has interpreted the risks,

magnitude, and complexities of the design along with underlying assurances

that the VA has accurately reflected the costs of the future construction

project. With those essential pieces of information, the A/E formulates their

fee proposal along with providing the VA with the number of contract

drawings needed to complete the design deliverable.5 The design deliverable

includes not only the contract drawings and details, but the calculations and a

design narrative write-up that support the basis of design.

Complaint (CBCA 8153) at 8 (emphasis added); Complaint (CBCA 8162) at 7 (emphasis

added); Complaint (CBCA 8163) at 6 (emphasis added) (with editorial variations).

In O’Neal Engineering, the ASBCA held that an ECC price was not to be relied upon

under circumstances similar to those in this appeal. While the A/E contractor in O’Neal

Engineering alleged a “grossly inaccurate” ECC price in the solicitation and contract, the

ASBCA noted that the contractor had an opportunity to study the Government’s detailed

statement of work and to visit the construction site. 86-3 BCA at 96,619. The O’Neal

Engineering decision summarizes the appellant’s responsibilities here:

5

As noted elsewhere in this decision, the number of contract drawings in the

proposals were estimates.

CBCA 8151, 8162, 8163

11

It was [A/E firm’s] job, not the Government’s, to provide the direct design

services based upon the contractually defined work scope. [The A/E firm’s]

efforts, in this regard, were expected to lead to the more detailed plans, and

the more precise construction cost estimate. These were [the A/E firm’s]

contractual obligations. Moreover, [the A/E firm was well aware [this was the

case] when it was asked to submit a detailed fee proposal based on its

anticipated design effort. . . . It was during this period that [the A/E firm] had

the opportunity to more precisely define its direct design costs.

....

[The A/E firm] was awarded this contract based upon its architectural ability

in designing electrical and mechanical projects. The Government was not the

expert. It was [the A/E firm] upon whom the Government relied and to whom

it gave the basic information to submit a proposal to design [the project].

Id. (emphasis added).

Here, it is clear that the VA was relying upon the expertise of the A/E contractors to

evaluate the information in the solicitation, and not to simply rely upon the ECC price, when

submitting their proposals.

Allegations of Increased ECC Prices

Respondent does not dispute that the ECC prices of the designed projects increased

as appellant performed its contracts. An increase in the ECC price of the project as designed

does not entitle an A/E contractor to additional compensation. Schoenfeld Associates, Inc.,

VABCA 2104, et al., 87-1 BCA ¶ 19,648, at 99,478. As explained in Schoenfeld Associates,

The mere fact that [the A/E firm] had provided the VA with a project with a

higher budget than that anticipated does not establish a right to compensation.

The [A/E firm] came in with a contract price. The VA evidently did not

require the [A/E firm] to redesign back to the original price. Thus, there was

no extra work directed by the VA from that done under the original contract.

The [A/E firm] has presented absolutely no evidence that the scope of the

work, which it designed for, was any different when it bid, then when it

completed its design. Only the price for construction was higher than either

CBCA 8151, 8162, 8163

12

party anticipated. That alone is not grounds for an increase in design fee. The

[A/E firm] has failed to meet its burden of proof on this issue.

Id.; see also R.M Otto Co. & Associates, VABCA 1526, 82-2 BCA ¶ 15,889, at 78,795 (“An

increase in the cost of construction does not, standing alone, entitle the A/E to additional

compensation.”); Shaw Metz & Associates, VACAB 774, 71-1 BCA ¶ 8679, at 40,310;

Praeger-Kavanagh-Waterbury, DOT CAB 67-13, 69-1 BCA ¶ 7482, at 34,716.

Even if, as appellant has alleged, the ECC prices of the contracts did not reflect the

complexities of the projects to be designed, as discussed previously, appellant was required

to design the projects based upon all the information in the contracts, within the scopes of

the work upon which it based its proposals. It was foreseeable that appellant would conclude

during contract performance that the designs would be more complex than it anticipated

when it prepared its proposals and therefore result in increased ECC prices for the designed

projects. The Design Within Funding Limitations clause alerts those submitting proposals

of this possibility, and the Government was not obligated to change the scope of the project

the awarded A/E contractor was designing. As stated previously, GDM’s efforts, as the A/E

contractor, were expected to lead to more detailed plans and more precise construction cost

estimates, which could exceed the ECC prices in the contracts. See, e.g., O’Neal

Engineering, 86-3 BCA at 96,619.

Pursuant to the Design Within Funding Limitations clause, the A/E contractor is only

entitled to increased compensation if the Government increases the scope of the project to

be designed. As noted by appellant in its complaints, the VA did not increase the scopes of

work but directed appellant to design within the scopes upon which appellant based its

proposals:

For nearly a year, the VA was told over and over again that the project scope

of work was exceeding the design funding limitation. The project scope of

work was not revised in any way to stay within the design funding limitation

at any of the four design submittal stages (35%, 65%, 95%, and 100%) that

took place over the year[-]long design process. The Contracting Officer did

not provide any direction on the matter whatsoever. No request to redesign.

No revised scope of work. No changed specifications. No other direction that

might have lowered the estimated cost of construction was ever received.

Complaint (CBCA 8153) at 6 (emphasis added); Complaint (CBCA 8162) at 6 (emphasis

added). In its CBCA 8163 complaint, appellant similarly acknowledges that:

CBCA 8151, 8162, 8163

13

In accordance with FAR 52.236-22 Design Within Funding Limitations, GDM

alerted the VA with each design submittal (35%, 65%, 95%, and 100%) that

the design limitation was being exceeded. At no time did the VA authorize a

change in scope or materials as required to reduce the estimated construction

cost (ECC) to an amount within the funding limitation.

Complaint (8163) at 5 (emphasis added).

Allegations of Cardinal and Constructive Change

Under a FFP contract, a contractor can demonstrate entitlement to additional

compensation pursuant to the Changes clause, FAR 52.243-1, if the Government changes the

scope of work. See Hengel Associates, P.C., VABCA 3921, 94-3 BCA ¶ 27,080, at 134,965

(explaining that, absent evidence that a design firm “performed any [d]esign work in addition

to that for which it originally contracted” an increased construction budget, alone, does not

establish a right to compensation); Schoenfeld Associates, 87-1 BCA at 99,478. Since the

appellant admits that the Government did not explicitly order a change, appellant would need

to prove constructive change. Nova Group/Tutor-Saliba v. United States, 159 Fed. Cl. 1, 49

(2022), aff’d, 87 F.4th 1375 (Fed. Cir. 2023). Prevailing on a constructive change claim

requires allegations of fact showing: “(1) that appellant performed work beyond the contract

requirements, and (2) that the additional work was ordered, expressly or impliedly, by the

government.” Id. (quoting Bell/Heery v. United States, 739 F.3d 1324, 1335 (Fed. Cir.

2014)); see also Praeger-Kavanagh-Waterbury, 69-1 BCA at 34,717 (holding that additional

compensation is warranted when the Government “alters the basic project requirements so

as to importantly affect the prior design work, thus imposing a significant additional

workload on the architect.”).

In its complaints, appellant alleges that, as it performed the design contracts, the total

numbers of design drawings appellant produced exceeded the estimated number included in

appellant’s proposals.6 For the Togus contract, the number of drawings increased from an

estimated 305 to 573. Complaint (CBCA 8151) at 8. For the Birmingham contract, the

number increased from an estimated 305 to 467. Complaint (CBCA 8162) at 7. And, for the

Murfreesboro contract, the number increased from an estimated 295 to 477. Complaint

(CBCA 8163) at 7.

6

Appellant’s proposals contained estimated numbers of contract drawings.

CBCA 8151, Exhibit 14 at 9; CBCA 8162, Exhibit 7 at 14; CBCA 8163, Exhibit 19 at 17.

CBCA 8151, 8162, 8163

14

While appellant emphasizes that it produced more drawings than specified in its

accepted fee proposals, the number of drawings appellant specified in its proposals were

clearly designated as estimates. An increase in the actual number of drawings from an

estimated number does not prove a change in scope, entitle a contractor to additional

compensation, or lead to the conclusion that a change in the scope of work has been

authorized. See Elcon Associates, ASBCA 44189, 95-2 BCA ¶ 27,859, at 138,915 (requiring

an A/E firm to allege more than just that it produced more drawings than anticipated).

Appellant acknowledges that the Government did not increase the scopes of the work.

Accordingly, there was no change, actual, constructive, or cardinal.

Again, appellant’s primary basis for relief is the less tangible assertion that the

projects’ designs became more complicated than anticipated. A more complicated design is

not, in and of itself, the basis for a compensable change. Schoenfeld Associates, Inc., 87-1

BCA at 99,478. “It [is] the [A/E firm’s] expertise that the Government [seeks and] . . . the

A/E’s job to flesh out and focus the design so that an end product [can] be constructed.” Id.

As stated previously, appellant had the opportunity to review the detailed requirements in the

solicitations before submitting its proposals. If an A/E firm views an estimate as woefully

inadequate, it should not bid or accept the contract. Id; see also Hengel Associates, P.C.,

94-3 BCA at 13,965 (“If [the A/E firm] felt that the Government’s estimate was unrealistic

and thus if it could not do the design for the price offered, it should not have put in a final

offer.”).

Respondent’s Direction Pursuant to the Design Within Funding Limitations Clause

Appellant advised the COs that the ECC price of the projects that were being designed

to meet the contracts’ requirements continued to increase and exceeded the ECC prices in

paragraph c of the Design Within Funding Limitations clauses in the contracts. While the

COs did not increase the scopes of work of the contracts or of the projects to be designed,

appellant asserts that it is entitled to an increase in its design fees for the quantum of the

certified claims. Complaint (CBCA 8153) at 3; Complaint (CBCA 8162) at 3; Complaint

(CBCA 8163) at 3.

As noted previously, appellant states that the COs did not revise the scopes of the

projects when appellant advised that the construction projects could not be designed within

the stated funding limitations of the contracts (i.e., the ECC prices in the contracts).

Appellant asserts that this lack of revision of the scopes of the projects denied appellant an

increase in its fee:

CBCA 8151, 8162, 8163

15

GDM used the [Design Within Funding Limitations clause] . . . and the other

solicitation documents to develop a proposal for a project of the magnitude and

with the complexities presented. In accordance [with the Design Within

Funding Limitations clause,] GDM advised the Contracting Officer that the

design limitation was being exceeded. At no time did the Contracting Officer

revise the scope or required materials nor did the Government revise the [ECC

price] published in paragraph (c) of the clause. Rather, the Contracting

Officer[s] took no action other than to advise GDM to continue with the

design. By advising GDM to continue with the design without any revision to

the scope of work, materials, or the design limitation implies acceptance of

GDM’s 100% construction documents and estimated construction cost,

constituting a cardinal change to the contract.

Complaint (CBCA 8153) at 6 (emphasis added) ; Compliant (CBCA) 8162 at 6 (emphasis

added); Complaint (CBCA 8163 at 5) (emphasis added).

As mentioned previously, appellant alleges:

For nearly a year, the VA was told over and over again that the project scope

of work was exceeding the design funding limitation. The project scope of

work was not revised in any way to stay within the design funding limitation

at any of the four design submittal stages (35%, 65%, 95%, and 100%) that

took place over the year long design process. The Contracting Officer did not

provide any direction on the matter whatsoever. No request to redesign. No

revised scope of work. No changed specifications. No other direction that

might have lowered the estimated cost of construction was ever received.

The problem with this assertion is that the VA could write in any unreasonable

“low-ball” estimated construction contract price knowing that an A/E firm is

restricted by the Brooks Act to 6% of construction for design and construction

documents, abusing the right to direct additional design effort without

consequence.[7]

7

Appellant’s speculation that the VA might intentionally have included

unreasonable ECC prices to reduce the A/E’s fee is not supported by appellant’s complaints,

which challenge the VA’s methodology of calculating the IGCEs but do not allege any

intention to include reduced ECC prices to disadvantage those who submit proposals.

CBCA 8151, 8162, 8163

16

Complaint (CBCA 8153) at 6 (emphasis added); Complaint (CBCA 8162) at 6 (emphasis

added).

The Government’s actions described by appellant above do not entitle appellant to

additional compensation. As explained in Michael Roth & Associates, Architects & Planners

Inc., 133 Fed. Cl. 279 (2017), which is factually similar to the case here, “[t]he design within

funding limitations clause imposes only one duty on the VA.” Id. at 290. That duty is to

review the contractor’s revised ECC after the contractor informs the Government that the

project, as designed, is likely to exceed the initial ECC. Id. And, then after review, the

Government “may . . . authorize a change in scope or materials as required to reduce the

estimated construction cost to an amount within the estimated construction contract price . . .

or the Government may adjust such estimated construction contract price.” Id. (quoting FAR

52.236-22) (emphasis added). The use of “may” is permissive, and the Government here was

not obligated to change appellant’s scope when appellant informed it of the increased ECC.

See id. (stating that “the VA was not obligated to choose one of the options set forth in the

[funding limitations] clause; the options were discretionary.”). Here, the Government did not

authorize a change in scope or an increase in the contract ECC price. Appellant

acknowledges this discretion when it alleges:

GDM understands that had the Contracting Officer issued direction to revise

the scope of work, services necessary for the redesign would have been at

GDM’s expense (FAR 52.236-22); however, that is not what took place.

Rather, the VA remained silent and maintains that “the decision to increase the

ECC . . . was at the discretion of VA.”

Complaint (CBCA 8153) at 6 (emphasis added); Complaint (CBCA 8162) at 6 (emphasis

added) (editorial variations).

Thus, appellant acknowledges that even if the CO had increased the scopes of the

contracts by directing redesign to comport with increased ECC prices, there would be no

entitlement to additional compensation.

Conclusion

Appellant concludes:

On numerous occasions through the year-long design process, GDM fulfilled

its responsibility to inform the VA that the estimated cost of construction was

exceeding the design limitation. By advising GDM to continue designing the

CBCA 8151, 8162, 8163

17

awarded scope of work, the VA approved a change to the estimated cost of

construction contract. As this is a material matter to the solicitation and award,

it is GDM’s position that this is a cardinal change to the contract for which

GDM is owed equitable compensation.

Complaint (CBCA 8153) at 8-9; Complaint (CBCA 8162) at 8; Complaint (CBCA 8163)

at 7.

Appellant agreed to perform each contract for a firm, fixed price. The fact that

appellant realized during performance of the design contracts that the contract requirements

were more complex than it had anticipated when preparing its proposals—requiring more

design effort than appellant estimated, resulting in increased ECC prices for the projects

designed—did not change the scopes of the projects being designed or require the

Government to increase the scopes or require redesign of the projects. There were no

changes to the design contracts—actual, constructive, or cardinal, as alleged by

appellant—for which appellant is owed additional compensation. In these appeals, appellant

has failed to state claims upon which relief can be granted.

Decision

Respondent’s motions to dismiss for failure to state a claim, filed in CBCA 8151,

CBCA 8162, and CBCA 8163, are granted, and these consolidated appeals are DISMISSED.

Allan H. Goodman

ALLAN H. GOODMAN

Board Judge

We concur:

H. Chuck Kullberg

H. CHUCK KULLBERG

Board Judge

Jonathan L. Kang

JONATHAN L. KANG

Board Judge