American Boys Construction Company
ASBCA No. 60515
A.S.B.C.A.Sep 13, 2017Background
- Contract W56SGK-16-C-0013 (fixed-price, $120,801) awarded 14 Feb 2016 to American Boys Construction Company (ABC) to install a sniper screen in Kabul; performance window 28 Feb–29 Apr 2016 and contractor to begin within 5 days of a Notice to Proceed (NTP).
- Preconstruction conference on 18 Feb: government reiterated that work must not begin prior to NTP and that material submittals required CO approval on Air Force Form 3000 before installation.
- ABC emailed material submittals on 20 Feb; government personnel (CO and rep)s deny approving the submittals. ABC asserts an earlier verbal approval, which the Board found unpersuasive.
- Government issued a stop-work order on 23 Feb and barred ABC personnel from the site on 25 Feb; contract was terminated for convenience effective 28 Feb.
- ABC submitted a termination settlement proposal seeking $67,793 (about $55,893 for materials and $11,900 for stand-by labor). The CO denied payment; ABC appealed to the ASBCA.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Recoverability of materials purchased before government approval of submittals | ABC says materials were purchased reasonably early because it allegedly received a verbal go-ahead and materials were scarce | Government says purchases were premature because no CO approval was given and contractor should have awaited approval/NTP | Denied: Board found no evidence of government approval and that purchasing before approval (and before NTP) was unreasonable under the circumstances, so material costs not recoverable |
| Recoverability of stand-by labor costs incurred before NTP | ABC sought $11,900 for stand-by labor (itemized by position) | Government contested lack of substantiation | Denied: Board held stand-by labor can be recoverable in principle but ABC failed to substantiate costs; no award without proof |
| Effect of FAR termination clauses and burden of proof | ABC relied on FAR 52.249-2 entitlement principles to make it whole for termination costs | Government relied on CO determination and argued limits on costs pre-NTP or without approval | Board applied FAR 52.249-2 principles: contractor may recover reasonable proven costs from terminated work, but costs must be reasonable and proven by contractor; here ABC failed that burden |
Key Cases Cited
- Lisbon Contractors, Inc. v. United States, 828 F.2d 759 (Fed. Cir. 1987) (contractor bears burden to prove termination costs)
- Dawco Construction Co. v. United States, 930 F.2d 872 (Fed. Cir. 1991) (limitations on awarding speculative damages when contractor fails to substantiate claims)
- Rejlectone, Inc. v. Dalton, 60 F.3d 1572 (Fed. Cir. 1995) (discussed in context of evidentiary standards; earlier cases may be affected on other grounds)
