Redland Co. v. United States
97 Fed. Cl. 736
Fed. Cl.2011Background
- Redland filed a Contract Disputes Act (CDA) claim against the United States Air Force for paving work at Homestead Air Reserve Base (HARB).
- The contract required removal of existing asphalt/concrete and resurfacing with new materials, with work to commence after a December 1, 2000 notice to proceed.
- Work started in 2004 after a four-year suspension ordered by the Air Force due to other project delays.
- Plaintiff sought compensation for unabsorbed home office overhead (Claim 1), delay in completion (Claim 2), and various extra work (Claims 3–9).
- The Air Force did not assess liquidated damages for the delay, and the CO failed to issue a final decision within the statutory period, prompting the lawsuit under the Tucker Act and 41 U.S.C. § 7104.
- The court granted summary judgment to the Air Force on Eichleay damages (Claim 1) and delay damages (Claim 2), denied as to Claim 3, and granted partial liability on Claims 6–8 while denying other claims; remaining issues were left for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiff can recover Eichleay unabsorbed overhead | Redland seeks Eichleay damages for pre-start delay | Delay occurred before performance commenced; Eichleay not available | Not entitled to Eichleay damages |
| Whether plaintiff was on standby during the suspension | Suspension order required standby | Standby not proven by CO order alone; indirect evidence required | No standby; no unabsorbed overhead recovery |
| Whether pre-start delay tolled liability for delayed completion | Delay is government-caused; should be charged to defendant | Multiple external causes; no presumption of government fault | Delay not shown to be solely government-caused; no recovery for entire period |
| Whether additional work (Claims 6–9) was a constructive change obligating an equitable adjustment | CO approval of some work shows liability for breach | Constructive changes require 1) outside-contract work and 2) government order; some items outside the contract | Liability established for Claims 6–8; issue remains for Claim 9 regarding depth of crack |
| Whether Claim 3 (milling of excess asphalt) is recoverable under differing-site-conditions rules | Excess milling qualifies as differing-site condition with notice | No timely written notice or CO approval; factual issues remain | Genuine issues of material fact; claim denied on summary judgment |
Key Cases Cited
- Nicon, Inc. v. United States, 331 F.3d 878 (Fed. Cir. 2003) ( Eichleay/standby prerequisites for unabsorbed overhead)
- P.J. Dick, Inc. v. Principi, 324 F.3d 1364 (Fed. Cir. 2003) ( standby and Eichleay prerequisites; burden-shifting framework)
- Smoot v. United States, 388 F.3d 844 (Fed. Cir. 2004) ( rejects McMullan presumption; court decides government delay claims de novo)
- Ace Constructors, Inc. v. United States, 499 F.3d 1357 (Fed. Cir. 2007) ( impracticability as constructive change; equitable adjustment authority)
- Raytheon Co. v. White, 305 F.3d 1354 (Fed. Cir. 2002) ( impracticability doctrine permits equitable adjustments)
- Int’l Data Prods. Corp. v. United States, 492 F.3d 1317 (Fed. Cir. 2007) ( cardinal change concept and constructive changes under contract)
- Miller Elevator Co. v. United States, 30 F. Cl. 662 (Fed.Cl. 1994) ( constructive changes and equitable adjustments)
- Tecom, Inc. v. United States, 66 Fed. Cl. 736 (Fed. Cir. 2005) ( constructive-order-based changes)