Melwood Horticultural Training Center, Inc.
ASBCA No. 60666
| A.S.B.C.A. | Jun 7, 2017Background
- Melwood Horticultural Training Center contracted with the Army (Contract No. W911S0-11-F-0040) for base operations/facility maintenance at Fort Meade.
- On 11 April 2016 Melwood submitted a certified claim to the contracting officer seeking reimbursement for retention bonuses ($114,000), subcontractor costs ($130,985), a 20.78% markup, and "anticipatory lost profits" for procurements the Army allegedly diverted from Melwood in an amount listed as "TBD." The submission totaled $295,892.88 + TBD.
- The contracting officer responded asking for more information and did not issue a final decision; Melwood did not supply the requested information.
- Melwood appealed to the Armed Services Board of Contract Appeals (ASBCA) on 16 June 2016. The government moved to dismiss for lack of jurisdiction, arguing (1) no CO final decision, (2) no sum certain, and (3) failure to state a claim.
- The Board considered whether Melwood’s April 2016 submission constituted a CDA claim in a "sum certain" under FAR/contract Disputes clauses and whether jurisdiction existed.
- The Board granted the government’s motion, holding the claim lacked a sum certain because the lost-profits component was unspecified (TBD) and the overall claim therefore did not meet the FAR definition of a claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CO issued a final decision | Melwood asserted CO’s failure to decide within FAR time allowed deemed a denial enabling appeal | Gov argued CO’s 13 June 2016 letter was not a final decision and no decision issued before appeal | Not reached as separate ground; Board dismissed on sum-certain ground first |
| Whether the submission stated a "sum certain" | Melwood argued lost profits are calculable from government contracts (over $28,431,350) and the government has required information | Gov argued claim included an unspecified "TBD" lost-profits component so overall claim lacked a sum certain | Held: Claim not a sum certain because lost-profits component was unspecified; jurisdiction lacking |
| Whether portions of the claim with specific amounts could be severed | Melwood implied Board could hear the fixed-sum components and ignore TBD portion | Gov argued entire claim must meet sum-certain requirement; cannot sever to create jurisdiction | Held: Board will not sever; entire claim must be in a sum certain, so dismissal required |
| Whether post-submission discovery or later calculations could cure the defect | Melwood argued discovery and govt-held information could establish the sum certain later | Gov argued sufficiency determined at time of submission; later supplementation cannot rehabilitate an invalid claim | Held: Later supplementation cannot cure initial lack of sum certain; claim invalid at submission time |
Key Cases Cited
- Tecom, Inc. v. United States, 732 F.2d 935 (Fed. Cir. 1984) (contractor may amend a claim upon learning additional facts, but a claim’s sufficiency is assessed at time submitted)
