Jmr Construction Corp. v. United States
2014 U.S. Claims LEXIS 633
Fed. Cl.2014Background
- JMR Construction contracted with the U.S. Army Corps of Engineers on June 26, 2007 to build an aircraft maintenance facility at Nellis AFB with a 420‑day performance period; final work was completed September 4, 2009.
- Project suffered multiple delays (design issues, base scheduling conflicts, faulty structural steel, and later a custom permanent power converter and Room 109 lighting), resulting in four contract modifications and an extended completion date.
- Key disputed periods for damages are January 16–February 3, 2009 and February 4–September 4, 2009; JMR removed its job trailer on February 3 and performed limited on‑site work afterward (four days) and some off‑site administrative work.
- JMR submitted Requests for Equitable Adjustment and later appealed a contracting officer’s denial under the Contract Disputes Act, seeking field overhead, home (unabsorbed) office overhead (Eichleay) damages, and related bond/fee, painting, scheduling, and consulting costs totaling about $428,261.44.
- The government moved for partial summary judgment seeking dismissal of field overhead for Feb 4–Sept 4, all home office overhead damages for Feb 4–Sept 4, and related fee/bond amounts; JMR conceded some categories (painting, scheduling, consulting and certain home office periods) but contested others.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Entitlement to field (jobsite) overhead for Feb 4–Sept 4, 2009 | JMR says it performed field work after Feb 3 (Quality Assurance Reports) and incurred jobsite overhead during the delay. | US argues JMR removed its job trailer Feb 3 and did not occupy the field; post‑Feb 3 on‑site activity was minimal so no field presence. | Denied summary judgment for defendant — QA reports show six days of field work after Feb 3, creating a factual dispute. |
| Entitlement to home (unabsorbed) office overhead for Jan 16–Feb 3, 2009 (Eichleay standby elements) | JMR contends work during this period was minor/punchlist/changed work and that most contract work was suspended, satisfying Eichleay standby. | US contends significant on‑site work occurred (avg. ~10 hrs/day) so work was not suspended and standby cannot be shown. | Denied summary judgment for defendant — material factual dispute as to whether work was sufficiently suspended to satisfy Eichleay standby. |
| Entitlement to home (unabsorbed) office overhead for Feb 4–Sept 4, 2009 (Eichleay standby elements) | JMR argues delays (especially the custom power converter) were indefinite and it was required to remain on standby. | US argues delays were knowable/not indefinite, remaining tasks were non‑time sensitive (temporary measures in place), and JMR was not required to return at "full speed and immediately," so standby fails. | Granted summary judgment for defendant — JMR cannot show it was required to return at full speed and immediately (stopgap measures and lack of time‑sensitive tasks). |
| Fee and bond/insurance damages derived from overhead reductions | JMR seeks these as percentages tied to overhead claims. | US asks proportional reduction if overhead is disallowed. | Denied summary judgment for defendant — relationship between these items and overhead not sufficiently defined on the record; factual development required. |
Key Cases Cited
- E.R. Mitchell Constr. Co. v. Danzig, 175 F.3d 1369 (Fed. Cir.) (Eichleay formula governs recovery of unabsorbed home office overhead)
- Nicon, Inc. v. United States, 331 F.3d 878 (Fed. Cir.) (Eichleay prerequisites and burden shifting on replacement work)
- P.J. Dick Inc. v. Principi, 324 F.3d 1364 (Fed. Cir.) (three‑part Eichleay standby test explained)
- Interstate Gen. Gov't Contractors, Inc. v. West, 12 F.3d 1053 (Fed. Cir.) (idleness not required to show standby; minor tasks do not necessarily defeat standby)
- Cmty. Heating & Plumbing Co., Inc. v. Kelso, 987 F.2d 1575 (Fed. Cir.) (field/jobsite overhead is recoverable)
- Mech–Con Corp. v. West, 61 F.3d 883 (Fed. Cir.) (requirement that contractor be required to resume with urgency for standby)
- Altmayer v. Johnson, 79 F.3d 1129 (Fed. Cir.) (home office overhead is indirect and allocable; cited on Eichleay principles)