*1 24-26, 828-29, E. (1967) (unconstitutional prose- L.Ed.2d 705 Marsden also right claims that his to a on defendant’s failure to cutorial comment speedy violated, trial was the state subject to the harmless error testify is court instructing trial erred in jury II.C., rule). stated in Part For the reasons on the lesser included offense of man- gun fired specially the fact that slaughter, and that the district court erred the murder scene bullet found at holding in not an evidentiary hearing. We Marsden, improp- we find that the traced to agree magistrate and the district testify, Marsden’s failure to er comment on court that Marsden is procedurally barred error, though constitutional was harmless raising speedy trial issue and that beyond a reasonable doubt. the state trial court did not err in refusing jury manslaughter.
to instruct the Our disposition of Marsden’s other claims 2. makes it clear that the district court did not During closing argument, pros refusing err in evidentiary to conduct an ecutor made two references to evidence or hearing. lack thereof the case. Marsden’s coun objected After the first sel both times. III. comment, object por he stated: “I to that We find that none of the claims advanced argument regard
tion of his to what granting petition Marsden warrant his just Norman Marsden told Joanne corpus. Accordingly, for a writ of habeas happened, alluding he is to the fact the decision of the district court is af- that the Defendant did not take the stand.” firmed. second, object After the he said: “We AFFIRMED. portion argument says of his where he you anyone have not heard from in this
case as to where that bottle came from.
We think there is an inference there that commenting
he is that the Defendant failed stand,
to take the object and we and move
to strike that statement.” The trial court objections.
sustained both Tri State Court Transcript, al Vol. V at 900-02. CORPORATION, Appellant, MAXIMA We conclude that the two indirect com prosecutor ments were references to STATES, Appellee. The UNITED the failure of the defense to counter or No. 86-1292. explain prosecution’s theory or evi (Who placed poisoned dence whiskey on Appeals, United States Court of Gillespie’s porch? sup What did Marsden Federal Circuit. posedly tell Gillespie’s his wife after May death?), upon and not comments Marsden’s failure to take Stynch the stand. See
combe,
(prosecutor’s
ment that “there has been no evidence
from the defense at all that [the defendant]
was not that house” was a proper refer
ence to the failure of the defense to offer
any alibi evidence as to defendant’s where crime).
abouts at the time of the They
therefore violate Marsden’s Fifth right
Amendment to remain silent. *2 Blow, Reeder, Patton, Boggs & R.
Joe appellant. D.C., Washington, argued were Richard M. him on the brief With Dilley. Dean M. Stolbach Petersen, Litiga- Commercial W. Thomas Justice, Branch, Washington, Dept, of tion D.C., appellee. With him on the argued for Willard, Atty. K. Asst. Richard brief were Director, Cohen, Gen., Ste- David M. Also on the brief were phen J. McHale. Counsel, Blake, Thomas A. S. Gen. Francis Counsel, Darner, Richard D. Asst. Gen. E.P.A., Beyer, Anthony Feldman and G. counsel. SMITH, NIES
Before Judges. NEWMAN, Circuit NEWMAN, Judge. Circuit PAULINE (“Maxima”) appeals Corporation Ap- of Contract Board the decision (the the Interior Department of peals of the “Board”) No. 68-01- pertaining to Contract the Environmen- Maxima and 6466between (the “Agency”).1 On Agency tal Protection summary judgment the motions for cross properly Agency had held Board for conve- constructive invoked nience, completion perform- year after payment, and final the contract and ance of certain Maxima to refund ordered in accordance with made to it that had been the contract. We reverse.
Background
Business Ad-
through the Small
ministration,
this contract to
entered into
editing, and
photocopying,
typing,
provide
Agency. The con-
services to the
related
Requirements
annual “Production
tract set
Minimum”, specifying an
... Guaranteed
1, 1986).
18,888
(April
BCA
Corp.
¶
IBCA No.
86-2
v. United
1. Maxima
of hours and
minimum number
annual
Nearing completion of
of service.
categories
pages for various
negotiations
connection
for fu-
perform
arrangements,
parties agreed
ture
up
work,
requested,
to a
amount of
provide
Agency
would
maximum,
Agency agreed to
(thirteenth)
stated
additional
month of services
*3
“Guaranteed Mini-
Maxima the annual
beyond
additional consideration”
“without
$420,5342 (plus
equip-
mum” sum of
the Total Guaranteed Minimum for the
issue).
Maxima was
sum not at
ending, along
months then
twelve
with en-
monthly reports of the
present
quired to
try
subsequent
into a new contract for the
The contract term was
performed.
work
year,
plus
now on a cost
fixed fee formula.
from October
The unused contract minimum was billed to
options to
one-year
renew
with two
31,1982,
Agency
upon
on October
com-
by
Agency.
pletion
work,
of the thirteenth month’s
paid in
December 1982.
entry into the contract
Before
contained the “Termination
The contract
arrangement,
proposed a different
had
government”
of the
clause
for convenience
compensate
whereby
Agency would
contracts.
that is usual
plus fixed fee formula
Maxima on a cost
during
not invoke this clause
Agency did
obligation
include a minimum
that did not
nor for a
the term of
Agency rejected Maxi-
on either side.
On November
thereafter.
Agency’s
proposal, and insisted on
ma’s
the contract
Agency advised Maxima that
ready
stand
whereby Maxima would
terms
constructively
for conve-
terminated
guaranteed minimum lev-
perform at the
on October
based
nience
Agency’s
in-
el.
In consideration of
the con-
to have ordered
Agency’s failure
pay-
guaranteed
crease
of services dur-
minimum amount
tractual
ment,
substantially reduced its
appeal to the
On
ing
contract term.
charges
hourly
page
from those
only for
Board,
Agency
held liable
original proposal.3
received,
actually ordered
the services
in the contract for
at the rate set
Throughout the term of the contract the
ordered to
Maxima was
various services.
by
ordered
the Agency fell short
mini-
of the
the balance
contractual
refund
of the
represented
rate
by
guaranteed
previ-
paid the
Agency
mum that
annual minimum. The Board found that
December.
ous
several
reports,
“[i]n
Maxima noted
The Issue
a concern that the services
being
were
un-
appeal, as it was before
The issue
derutilized on the contract.” Maxima,
law, the
question of
Board,
“the central
95,285.
86-2
undisputed
BCA at
It is
the termination
of whether
question
the matter
raised
Maxima and that
retroac-
asserted
can be
change
declined to
the con-
quanti-
tively where
Agency acknowledged
terms. The
tract
ordered.”
have not been
ties
decision that
its termination
action
“[n]o
of this
95,287.
review
Our
the business States, 681 F.2d v. United Torncello obligations contractual into enters States 764-66, Ct.Cl. through authority, and constitutional com- rules the laws for con- War II termination World After access government benefits merce peacetime applied to to be came venience private the vast interaction to and in order non-military procurement, the United “When the nation. sector purpose: fundamental the same achieve authority, makes States, with constitutional for breach liability governmental reduce responsi- incurs contracts, rights and has allocating to contractor contract, by *4 who of individuals those similar bilities change in unexpected of of the risk share Perry v. instruments.” parties to such are Thus the at 765-66. Id. circumstances. States, 294 U.S. United receiving compensa- contractor, of instead (1935). also 432, 435, L.Ed. 912 79 of contract breach governmental tion for States, 292 U.S. Lynch v. United damages, is of measures on classical based (1934) 1434 840, 844, L.Ed. 78 54 incurred, prof- recovery “costs limited obli- of contractual (“Punctilious fulfillment preparing and the costs done it work the maintenance essential gations is proposal. Re- settlement private debt- as public as credit of well precluded.” anticipated profit covery of Postal ors”); Alvin, v. United States Ltd. Cibinic, Procurement Federal & J. R. Nash (Fed.Cir.1987) 1562, 1564 Service, F.2d 816 ed.1980). (3d 1104 Law as into contracts enters (“The government are its contracts person, private does a generated jurisprudence extensive law”). by the common governed fairly uniform illustrates its concept by this held The courts have application. modern to the common exceptions few ofOne of contract breach governmental a is that of contract mutuality requisite a termination as may construed be for conve- The “termination here at issue. when only the serves concept, which nience” realloca- justify changed circumstances unpredictable government, arose from When such contractor. risk to tion of governmental procure- wartime nature of may exist, be circumstances a right to terminate ment. The without in- by terminated or has no fault breach there when breach: consequences of curring the is, non-governmental party, cont’d. footnote Pages Completed Yearly Requirements in Production (By Type Page) 1 of Work Per Site—Year —Off Cost for for 48 hr. 168 Guaranteed Cost per hr. No. Turnaround Turnaround Minimum Maximum Item No. Page Page Pages Description Pages Per Typing-Straight Text-NBI Diskettes 4.40 5.06 44300 Typing-Straight Equations- & Text 4.75 5.46 Mag Cards provide not requirements on-site describes the
Attachment
hours,
pages and
editing,
number
up
maximum
3-4 list
Attachments
detail.
in similar
when
provide 48-hour turnaround
also
graphical artwork
and
requested,
indexing, and
proofreading,
For this
and off-site.
on-site
both
dol-
guaranteed minimum
total
services.
agency guaranteed the minimum
capability the
as
supra)
calculated
(see
footnote
lars
payment stated in the
amount
turn-
168-hour
at the
total
required
rate, although
around
that,
where
we have followed
rule
Point
thus
govern-
limited the
liability
“termination,
ment’s
the contract embodies
convenience-ter-
rescission,
would,
provision
repudiation”
or
mination
as this one
of a contract during its
perform-
Government directive to
term.
Point,
end
Under the facts in College
cases,
ensuing
ance of the work will
be
considered
there was an
stop-
actual
page,
breach but rather a convenience termi-
and therefore there had not been full
lawfully
nation—if it could
come under
the contractor.
In princi-
ple
though
contracting
justification
that clause—even
it was the
that was retroac-
cancellation,
tive,
wrongly
officer
calls it a
not the termination.
mistakenly
illegal,
deems the
or
jurisprudence
makes clear that ter
erroneously thinks that he can terminate mination
convenience,
whether actual
ground.
on some other
work
constructive,
is not of unlimited avail
G.C. Casebolt Co. v.
United
ability to
government,
that it is not an
open
illustrated
of con-
e.g., Torncello, 681 F.2d at
structive termination for
772 (refusing
convenience en-
to authorize termination
ables the
actual breach of
convenience that would “vitiate the con
retroactively justified.
contract to
sideration normally
Such
furnished” or allow the
justification may
appropriate
“dishonor,
with impunity,
its contractual obligations”); Kalvar Corp.
situations
*5
States,
v. United
1298,
543 F.2d
1304-05,
stopped
has
or curtailed a contractor’s
211
(1976),
Ct.Cl.
denied,
192
cert
434 U.S.
performance for reasons that turn out to
830,
112,
98 S.Ct.
54
(1977)
L.Ed.2d 89
questionable
or invalid. Constructive-
(authorizing constructive termination for
ly,
clause
justify
govern-
can
convenience to moot
claim breach of the
actions,
ment’s
avoid breach and limit
contract during
term,
its
absent bad faith
liability.
or clear
discretion);
abuse of
Inland Con
Torncello, 681 F.2d at
(citing
College
tainer,
Inc.
States,
v. United
512 F.2d
Point Boat Corp.
States,
v. United
(1975) (contract
These price cases are upon tune with the purpose *7 of such reducing reduction government’s the and the contractor knew the risk based on unexpected declined). cost had events The that in American court during occur the term Western relied of a U.S., Roberts v. by on shifting some of 357 F.2d this 938, risk 946-47, to the 174 (1966), contractor. Ct.Cl. 940 wherein
the court stated: when the acting Government is in its B proprietary capacity, may it estopped government by The argues an act of in that a waiver the rul same manner ing in favor of private as Maxima would render contractor. the Such a is result termination for justified plain super clause the language of the fluous, and thus would regulations violate contract and accords principles the with which require inclusion of the of in fair clause dealing. the Board, recognizing 4. The consequences the Maxima, of 95,289 36-2 BCA at n. 2. Such a holding, its warned the that of the "effect case warning legitimize can not the Board’s new the any guarantees law is to void concerning mini- ory of retroactive per termination after full quantities promised by the Government formance. operation the rights.” of the Termination 1556 thirteenth of the inclusion the particularly Appeal favorably cited court Roberts the twelve- part as of of month Co., WDBCA Construction Randall of unauthorized payment, as month unrea- held (1944), which 1117 675, 2 CCF binding on it. not therefore year after one than more delay of sonable its contract- that argument government’s government the before of work completion did know he not erred because ing officer price. contract the to reduce attempted clause, a for convenience termination the of government the knew that Here the con- of pages four occupying clause or- of rate its minimum meeting of government the tract, not relieve does in Ameri- contractor the but, unlike ders Both obligations. contractual its situa- the brought Western, Maxima can knowledge of charged with are a contract during Agency of attention tion nor the contractor terms. Neither government term, responsibili- legal avoid can government with comply quired Maxima Further, the asserting ignorance. ties weighs on circumstance This written.5 as the contractual that argument Maxima’s side “discovered”, as that was an “error” objection any raising in delay it; it was describes dissent on performance complete year after until timely made. unreasonable. is sides both legal asserts as opportunity to What denying the terms with compliance termi- imposed is its error terms
negotiate in legal error no discern cited We convenience, Board nation also whereby Indeed behavior. limitation this one-year con- comply with the provides required “Clause dealing is fair for mutual claim shall need tract. the contractor’s to which effective in contracts required after year less within submitted any other in than party, termination, thereafter is a date “It is no less ow- arrangement. amount determination commercial unilateral contracting offi- the Govern- good law good morals ing the contractor dealing 95,289. in We at comers square 86-2 BCA turn should cer.” curi- should people not intend Board than people assume barred their dealing claim that Maxima’s square corners result ous turn moot- any Paper event is Co. v. arose, Regis St. government.” before However, view we do decision. 368 U.S. by our United J., (Black, supporting the (1961) L.Ed.2d Hickel, completion one Brandt also dissenting). clusion (“To say unreasonable Cir.1970) this case (9th performance. terms You change you. joke ‘The time appellants, these worthy hardly us,’ is have trusted shouldn’t C quoted government”), great of our Services Community Health Heckler v. its ac dismisses 51, 61 n. Inc., 467 U.S. County, expired, term the time tions Crawford ear- several ignored Maxima’s agency *8 agency in wrote Maxima held Maxima complaints and had the fol lier negotiations contract during of the terms, minimum option the unused agency had such that lowing year, for which volumes). October (and larger end of unpaid even until terms same accumulated at month) services volume when (the the lower stated thirteenth 1982 signifi during plus "resulted the Octo- first ordered annual entire billed potentially serious "a operating J267,872.50. and losses” This was services, cant a total of ber not, “[although the problem", and states, flow cash for one payment the dissent as protection provided guarantees some the dis- (Nor endorse we do services. month’s term, of each at the end against losses facts, the characterizations other sent’s sort of provision for some no contract there progress authorities, holdings of and arguments, the guar payments in accordance opinion.) our anteed minimum.”
1557
13,
2218, 2224,
13,
104 S.Ct.
n.
81 L.Ed.2d
States,
United
1343,
615 F.2d
5,
1346 n.
(1984).
42
222
(1980).
Ct.Cl. 436
“[A] Guaranteed
Minimum Quantity clause
to en
government argues
[serves]
The
that it is never
mutuality
sure
obligations,
and to make
recovering
barred from
monies erroneously
the contract
enforceable
both
by
(at
paid, pressing
argument)
oral
as “con-
it.” Id. at 1350.
government,
trolling precedent”
and the
United States v.
dissent, ignoring the
Wurts,
obligations
303 U.S.
58 S.Ct.
82 L.Ed.
as negotiated
and
sides,
both
932
is
reliance
curious. Wurts
asking the court to make a
held
valid
two-year
that a
statute of limitations
invalid. This contravenes
against
recovery by
government
fundamental
of an
obligation to interpret
erroneously paid
contracts so as
income tax
refund did not
preserve their validity,
start until the
not to destroy
payment
erroneous
it.
was ac-
Schlecht,
v.
Walsh
tually
401, 408,
429
made.
Id. at
U.S.
at 639.
S.Ct.
679, 685,
The issue in
into such See, contracts. e.g., Mason v. for services actually govem- ordered 6. The urges, dissent also supporting without Supreme au- Court the Court of Claims not thority, always can change only support, require, just application contracts, even, here, well pay- after final retroactive termination for convenience. The expiration period converse, in which the always can contractor could file a claim. The dissent change bargain, ac- long perform- even *9 cuses majority the "largesse”. of The issue is ance bargain facts, of that and whatever the "largesse”, law; integrity the of com- anathema not principles of rule law but to the government. merce with the The decisions great of of a commercial nation.
1558
convenience
for
termination
ruled
accepted
and
ment, performed
escape
“to
allowed the
a
audit
an
government.1
by the
damages
breach
liability for
discover-
payment
of
later,
erroneous
the
retroactively,” cit-
against
asserted
a claim
even when
...
asserted
agency
the
and
v. United
Corp.
the
Boat
of
over-
College Point
ing
the amount
for
contractor
the
199, 69
for the contrac-
L.Ed.
States,
allowance
267 U.S.
less
payment
Maxima
added).
costs.
convenience
for
(1925) (emphasis
tor’s
allowed
decision
officer’s
contracting
95,287.
Corp.
The
at
ap-
and Maxima
claim
government’s
the
case the
in this
holds that
majority
The
the
board.
decision
pealed
for
to terminate
entitled
is not
en-
government’s
upheld
not,
retroactively.
The board
does
It
convenience
of
for return
claim
might
titlement
Maxima
however,
so that
remand
of en-
the issue
On
payment.
erroneous
of contract
of
breach
amount
prove
held:
the board
titlement
v. United
in Torncello
damages, as
unautho
invoice
Rather,
of
(1982).
Ct.Cl.
F.2d
Such
mistaken.
therefore
“fully per
rized
holds
majority
law must
of
a mistake
paid under
funds
quantities
an indefinite
formed”
v. United
DiSilvestro
refunded.
provid
of
capability
“maintainpng]
Cir.1968),
cert
(2d
States, con
in the
set
services
ing
minimum
denied,
U.S. 964
[3]96
therefore,
cannot
and,
tract,”
1828, 86-2 BCA
pay
No.
Corp.,
IBCA
amount
refund
ordered
1986).
On
95,289 (Apr.
“in
¶ 18,888,
made
majority, was
(CCH)
that, per the
ment
quantum
issue
the contract.”2
with
accordance
govern
held that
recovery, the board
rulings
following
majority makes
the amount
correctly calculated
had
quan-
indefinite
“standard
respect to a
with
ser
unperformed
for
overpayment
containing a
is, one
contract,” that
tities
ques
brought
board
That
vices.
a
purchase
by the
promise
Al
by Maxima.
setoff
possible
of a
tion
goods or
quantity
against
no claim
had filed
though Maxima
a termination
incorporating
services
“no useful
board saw
government,
clause:
convenience
for
long-standing
remanding this
purpose
performs
stan-
fully
A contractor
1.
Therefore,
it reviewed
Id.
dispute.”
indefinite
dard
which
the setoff
the amount
approved
for de-
“capability”
maintaining the
voluntarily deducted
livery
Maxima’s termi
estimate
on an
based
contract.3
in the
specified
quantity
The board
costs.
for
nation
supplies
contract or
this
with
cordance
provides:
XI
1.Article
deductions,
if
accepted,
less
delivered
AND PAYMENT
CONSIDERATION
Unless, otherwise
provided.
any,
herein
as
an invoice
submit
shall
Contractor
A. The
any portion
be for
payment will
specified,
Delivery
completed
each
payment with
accepted for
supplies
or
rendered
ap-
services
will be
invoice
The Contractor’s
Order.
proved
separately stated
price is
by the Government
accept-
tract.
completion
upon
Project Officer
added).
Delivery
(Emphasis
required
ance of
work
"De-
Order(s)
article entitled
under the
issued
be read
could
opinion
majority's
2.
livery Orders”.
pay-
finding by
the board
indicating a
Contractor
will
Government
B. The
accordance
ment was
under
of the work
See attached
so hold.
The board
terms.
rates
appropriate fixed
stated
at the
Appendix.
1-12,
are in effect
whichever
in Attachments
performance....
time
at the
the indefinite
majority’s conclusion
added.)
(Emphasis
equates
case
in this
quantities contract
following
include
Provisions
The General
Co., ASBCA
Disposal
Chicago
in North
clause:
PAYMENTS
15,488 (Nov.
(CCH)
¶
BCA
82-1
No.
upon
paid,
submis-
shall be
Contractor
is ludicrous.
garbage
1981),
running
route
vouchers,
price
proper
invoices
sion of
stipulated
per-
fully
Chicago had
in North
The contractor
ac-
rendered in
herein for
*10
1559
government
2. The
does not
by
pies
breach
applicable to standard
quan-
indefinite
failing to order
minimum
tities contracts.
quired
and,
quantity
therefore,
can-
I
each
find
holdings
above
repre-
invoke termination
for conve-
sents a bizarre twist of
contract
retroactively
nience
justify
a
dissent
from each of them.
“breach.”
Where a
If
contractor
is
government
ready,
3.
willing,
does not
exercise
perform,
able to
its right to
prevented
terminate
is
for convenience
prior
doing
by
to the
so
government
end of
term,
this case
—in
the government
by
obligated
become
failure to order
pay
price
for the guaranteed min- minimum amount of services which it was
quantity.
imum
obligated to order under the contract —ob
government
If
viously
were not
a
may
made to
contractor
not be terminated
price
full
for the contractor’s default. See College
minimum quantity,
Point,
contract
12,
267 U.S.
45
However,
S.Ct. 199.
would be void for lack of considera-
it is basic contract
law that a contractor
is
tion.4
not entitled to the
contract price sim
full
ply because he
Since the
has not
majority announces
defaulted.
these new
Actual
“precedential”
delivery
tenets
a
of the full
dealing
decision
goods
amount of
or
a
standard
quantities
indefinite
required
is
for entitlement
tract,
the new tenets
full
cannot be
price.
treated as
contract
In the absence of such
simply an ad hoc decision to
full performance,
achieve a
innocent,
injured con
“fair” result
for a small contractor.
tractor
is at most entitled
damages,
majority proclaims
general
them as
princi- which may include
profits.5
lost
That
formed its
obligations
contractual
(1974).
because the
320
Cibinic,
See R. Nash & J.
2 Federal
required
contract
only
pick up
that it
and haul
(3d
1980).
Procurement Law 1116
ed.
off
garbage
whatever amount
case,
present
there is no evidence of bad
left for collection.
specified
There was no
government.
faith
mini-
quantities
garbage
By
the contract.
point
4. On this
majority totally
imagination
stretch of the
confuses the
can the North
concepts of
Chicago
damages.
consideration and
case be
"the
To
termed
closest case on its
facts,"
make
quantities
an indefinite
majority
contract
enforce-
refers to it.
able, buyer
promise
purchase
must
from a
directly
A case
point
Bainbridge,
Charles
seller a
quantity
goods
19949,
ASBCA
(CCH) 11,414
No.
75-2 BCA
¶
States,
services. See Mason
United
v.
14,
(July
1975).
case
That
involved an indefi
1343,
5,
F.2d
1346 n.
peal reports, Maxima monthly progress entirety below. in its forth period of work the amount ported request issued EPA April On cumulative basis on a to date work and the fixed-price, indefinite proposal quantities. of the minimum percentage as a photocopying, typing, quantity noted a reports, Maxima In several Cor- services. Maxima related editing, and being under- that the services were concern a cost responded with (Maxima) poration waning In the utilized advice and included proposal, technical performance, year of of the first months definition quantity lack did not want that it EPA determined involved, fixed costs magnitude option to renew exercise given to a should consideration serious quantities, maximum *13 and with minimum or labor reimbursement cost on a contract with replace contract seek to but would agreement. type materials and hour/time type. Because reimbursement a cost to be ex- prices Maxima’s considered EPA con- process new to time constraints the firm that Maxima advised and cessive service, EPA desiring continuous if EPA prices tract and proposed its lower could 1 month on quantities. an extension minimum wanted increase to were quantities to was asked existing minimum did raise EPA re- with the quantities proposal maximum cost reimbursable provide half sub- proposal following revised Maxima’s for the sult service provide prices. original stantially September decreased by it letter years, to the was awarded contract resulting The also stated Maxima’s 13, The letter 1982. (SBA) by Administration Business Small initial paid be should belief minority 8(a) program for under EPA negotiat- the basis term on contract firms. disadvantaged small business guaran- prices and minimum ed fixed-unit the entire contract subcontracted SBA tees. 1, 1981. The October effective 1982, 24, September parties met Septem- period was performance of the exist- extension 1-month a to discuss years 1982, option 30, additional with ber fol- for proposal ing of the Government. the election at basis. cost-plus-fixed-fee lowing years on a “Termination contained The contract what, any- if disagree as to ser- supply for clause Convenience” meeting. upon at the thing, was contained The contract contracts. vice 27, 1982, Maxi- September By letter dated describing work to pages attachment meeting ma discussed providing some items done stated: then Pages” and No. of Minimum “Guaranteed agree to will Corporation other The Maxima Pages,” and No. of a “Maximum subject contract renegotiation Mini- “Guaranteed providing items performance No. period “Maximum of Hours” and No. extend page face consid- (30) additional days without thirty Hours.” following: contained Environmental eration, provided 1— Requirements Year fol- agree Production to the Agency will Protection Minimum.$419,009.00 Guaranteed lowing terms: 79,689.00 Charges Year 1... Equipment negotiate to effect EPA will 1. 1— Charges Year Travel of a sole-source 1,525.00 award Minimum. Guaranteed 500,223.00 ... process- Minimum Total Guaranteed for word Corporation related production editing, and other ing, computed by multi- figures were above consistent effort quantities a level of minimum the estimated plying (En- of work by contract’s statement type of service the enclosed for each a cost- price B). for that service. will This contract fixed closure (12) twelve for a plus-fixed-fee ser- the outset of the From and will period by issuance month by required Maxima vices October the EPA Office of Gen- eral Counsel learned that the voucher had (2), (12) include two option twelve month paid. By letter dated periods. November The fixed agree- fee for this 1983, the EPA termination and will not be less than of the total claims 8% tracting (successor estimated costs. officer to James Kran- da) advised Maxima 2. agree EPA will EPA’s approve and ex- failure to order peditiously process Maxima’s invoice for all under items constructive termination of the contract current contract. for the convenience of the Government ef- agree production EPA will fective October requested quirements (30) thirty day exten- Maxima to submit a termination settlement period sion will not exceed the require- proposal in accordance with the termination ments for period August January 1984. There has through August 29, 1982 more than been no proposal submitted 10%. May 31,1984, Maxima. On the contracting acceptance of these terms is essen- officer issued a final decision demanding tial re-negotiation. repayment $233,974.051 to EPA of deducting estimated amounts for October Beside each of the paragraphs numbered 1982 equipment costs, production require- are handwritten notations with the initials ments, and *14 “JK” termination Kranda, for James expenses. the contracting appealed officer. paragraph Beside that 1 is the final decision to word this Board. “agreed,” paragraph beside EPA requested are the has this Board to order words “when EPA process,” received will to submit a termination settlement and paragraph appear beside the words proposal. Maxima counterclaims in un- qty “understood did not exceed.” specified amount for per- the services formed in Under plus date of October 1982 September 1982, 21, interest there- modi- fication 1 on. EPA existing has moved pre- to dismiss the coun- pared deobligating $40,000 premature terclaim year from fiscal appellant because $40,000 1981/1982 and reobligating did of fis- not submit the claim to contracting the cal funds, 1982/1983 extending and officer for a final decision. period the for month Appellant’s accompanied motion is by an through 31,1982. October By voucher dat- Appendix A entitled “Material Facts as to October billed EPA Which There is no Dispute” Genuine and for the month of October in the contains a listing of 39 Appel- statements. $272,210.90. amount This amount argues lant in that lieu of exercising his by deducting previous calculated billings of right to the terminate contract for conve- $152,661.50from the total of the contract nience, contracting the agreed officer to minimum dollar $420,534 amounts of leav- the in exchange mínimums ing $267,872.50. a balance of To this was for an added month free services and a added the October (not lease issue) costs more favorable follow-on cost $4,338.40. reimburse- The voucher was forwarded ment contract. It contends the EPA finance office to the project Government officer, received additional considera- who checked the box next to the tion bargain words or it “Goods made and services that it have been deliv- requested upset ered as cannot now by the agree- consummated contract to sup- port payment.” this by appears claiming It the actions of the con- regular payment procedure tracting officer based on were and mistake that the contracting officer did not law beyond and were scope see or of his au- approve the voucher. The voucher thority. the Government’s response, paid on or about December 1982. counsel addressed each of the “Material $229,635.65 changed Amount by to amend- mathematical error. ment of complaint Government's to correct provision render
would prevent it would meaningless because showed and appellant set out Facts” invoking in the event Government in part, or in whole disagreement, specific not occur. orders did of these significant Most of18 them. not did contends Government relating facts material alleged are guaranteed mini- aof authorize relies appellant consideration, on which simply repre- words mum, those but that agreement. consummated underpin a new order mini- promise to buyer’s sent in the notations Kranda’s Mr. Regarding would the failure quantity, letter mum margin of the termi- pursuant contends result 17), Government (statement contracting if invoked a confirmation clause not were nation notations terms, (2) a but were and operation three or officer agreement 1982 time authority October contracting mid-to-late has in the officer added frame, any they discussed nor were Federal violate agreements which make or before employee including or Maxima those regulations, EPA procurement 22 that statement Regarding entry. agree- their to certain prior audit requiring an pro- were of Maxima services October the termination ments, which violate those consideration, both added without vided regulations, implementing contracting officer and affidavits his authori- placing limitations those that EPA the view support officer project ty- services to expect October arguments extensive The Government’s to be billed free, were provided here severely truncated citations are Additionally, the prices. unit have the issues reason fact conten- challenges the Government Appellant pleadings. joined contracting officer and tions supported agreement prove a new seeks guaran- pay the officer project by pay- consummated by consideration October in return minimums teed passing ment, has addressed cost reim- of a negotiation *15 the con- respecting many cases cited the supported by This contract. bursement deal- authority those tracting officer’s of the contract- oft-repeated assertion the of indefi- they had officer that constructive project ing with officer and ing pay relies obligated Appellant to to be EPA contracts. always quantity believed nite the authority to minimums guaranteed dealing with on cases There- quantities ordered. im- of the or gardless make unwise contracting officer to disputed there fore, were we found the Government agreements, and provident alleged con- concerning the facts material interpretation, cases on relies under agreement sideration authori- contracting officer’s on the limits paid and was entitlement claimed terminations, and errone- ty, constructive under guaranteed minimums payments. ous tract. motion is based The Government's Decision Discussion contracting (1) The propositions: following central on to decision In addition authority pay express officer had law, question whether question ar- guaranteed minimum. Maxima the can of the clause the termination presence heavily on rests gument here retroactively where asserted provision, the payments contract of ordered, have minimum provision, and the minimum” “guaranteed include in the Board parties ask read the need to “Termination” guaran- interpretation of an decision to all the effect together give them provisions payment teed minimum interpretation of contract terms. above, As stated regardless minimum of this pleadings issue in join is said to produced of work amount research to case, original leaving much permit- payment provision contrary to the has convinced research Board. That completed ting only work
Inc.,
14,579,
ASBCA
80-2 BCA
71,882.
page
It is clear
prece-
from the
placed
little value
can be
Board that there
availability
right
dents that the
guaran-
analysis of a
interpretative
any
on
convenience,
though
terminate for
even
un-
purports to
minimum contract
teed
all,
timely asserted or not asserted at
limits
pay
or
order
bind
Government
liability
of the Government to costs
Since
quantities.
any
recoverable under the termination clause.
Corp. v. United
Point Boat
(1925),
L.Ed.
490]
[45
case,
In the instant
we are confronted
the termination for con-
availability
appellant’s
assertions that
the con-
escape
right of the Government
venience
tracting
knowingly
officer
considered ter-
damages
of contract
or
liability for breach
minating
so,
chose not to do
commitments, even when
contractual
other
agreement
and entered into a new
retroactively,
expanded
has been
asserted
consideration;
which there
thereby,
procurement
of federal
law.
a doctrine
preventing a constructive termination or an
Mr. Justice Brandéis stated:
There
untimely
act of termination
the Govern-
party to a contract who is sued for
A
completion
ment after
of the contract. We
may ordinarily defend on the
its breach
appellant’s
note that
letter of
time,
existed,
there
at the
ground that
27, 1982, agreed
30-day
to a
extension of
him,
nonperformance by
legal excuse for
the contract “without additional considera-
ignorant
although he
then
negotiate
tion” on condition
EPA
will
likewise, justify an assert-
may,
He
fact.
a follow-oncontract with Maxima on a cost-
termination, rescission,
repudiation,
basis,
plus-fixed-fee
pay
that EPA would
was,
by proving that there
of a contract
the invoice
cause,
time,
although
adequate
at the
EPA
quantities, and that
would limit the
him
known to
until
it did not become
required during
30-day
exten-
later.
sion.
Thus,
right
retroactively
assert
right
stating
es-
that the extension was
termination for convenience
long ago,
striking
consideration”,
ap-
tablished
a case with
additional
“without
There,
similarities to the instant case.
being paid
ser-
pellant
relying
parties were unaware of the availabili-
both
during
30-day
vices rendered
extension
ty
option
long
of the termination
until
already obligated on the con-
from funds
Here,
the contract had been cancelled.
contracting
appellant
Both
and the
tract.
parties mistakenly believed that the
both
ignorant
the fact that the
officer were
was liable to
an amount
Government
was liable
for termination
Government
*16
equal
the
mini-
to the cost of
the minimum
the failure to order
costs for
of services.
30-day
agreeing that the
quantities. By
Later, in John Reiner
Co. v. United
&
additional considera-
extension was without
¶ 72,358],
F.2d
States
CCF
[325
438]
[9
tion,
merely allowed the contract
appellant
(1963),
denied,
Ct.Cl. 381
cert
contracts, could and promise tracting officer’s unauthorized cost for its asked had EPA basis. Government which the payments for make contract, new for a proposal reimbursable promise unauthorized not liable. was Septem- dated by letter provided was do so cannot contracting officer to of re- condition Stating this 13, 1982. ber consideration. to be found be already intentions, that EPA’s peated restricting production EPA condition The third communicated been 30-day con- extension during for with Maxima requirements desired reimbursable over percent cost on a more than tinuing period services to no extension, with- given August 30-day for requirements production basis. purpose consideration, for the James existing was contract. out relates ser- securing the interruption of condition avoiding this notation beside Kranda’s con- CPFF that new condition is in not exceed” qty did vices. “understood related negotiated with indicating the work tense, tract past pro- intentions, Maxima's complet- expressed EPA’s had been for October quirements prospective and the posal This made. was notation when the ed not relate It did contract. CPFF posi- new of the Government’s supportive also find no existing we the letter placed on the notes tion that this agreement in any new sideration the extended sometime written were condition. case, any completed. contract had require- production agreement limitation condition The second 30-day extension during the for all ments an invoice Government, protect- mutually held mistak rather expressed benefit items might requirements the Govern parties that appellant belief en guar perform. for the capacity to liable appellant’s was exceed any exist new Under quantities. no consideration find anteed We liability determinations, such no in this condition. ing judicial agreement existed. 85-2760 article court authority istrative statute, regulation, and ments cussed mínimums, case contracting officer Corp. officer thority Government pellant longstanding Government’s is of [786 cites, dealing liability for failure liability. Whether agreed with this supra (CAFC, Mar. determinations. also limited See United charged with do rendered Government to make consequence. He had liability minimum judicial so clearly limit 387] [33 it would approval, to make 6, 1986). such restrictions States could limits judicial second CCF knowledge to order agents to act authority follow that for which payments. a law payments placed ¶ 74,266],No. the Govern v. Amdahl condition contracting There, cases bind the quantity journal admin on no there dis Ap au unordered without ment, conclude Such must L.Ed.2d 429] denied, cited, tract 81, 1982.2 tion in our Having found there Appellant's the month unauthorized in an funds we nor case, authority to quantum refunded. constructively terminated conclude unspecified production any consideration [396] of the Government paid under F.2d 150 (1969). In the and based of October counterclaim contracting officer determination payment of DiSilvestro agree to requirements under amount therefore (2d a mistake [90 Cir.1968), the authorities no new circumstances original con is subsumed pay for for services *17 on October the invoice compensa- v. United mistaken. which one, we 441, 24 lawof agree cert to order minimum that failure any is to void case law 2. The effect payment in accordance quantities will result concerning minimum guarantees practice This clause. the termination operation by the promised Government misleading con- encouraged avoid should rights. that some We note of the Termination agencies promises. unenforceable tractors with contractors to warn undertaken have computa- the Government’s predicated on standard of sound servic-
tion based August require- exceeding the
es not
ments, quantity. known Clause provides that the contractor’s ter- shall claim be submitted within 1
mination termination,
year after the effective date of
and thereafter unilateral determina- owing
tion of the amount the contractor contracting officer. We see no useful remanding
purpose long-standing
dispute negotiation of the termination
settlement. appeal is denied. Maxima has re- provide its
fused to termination settlement computed
proposal. The Government $32,236.85 allowing
amount for the Oc- ordered, $4,338.40 requirements
tober costs, $6,000 equipment
October expenses.
termination settlement This re- $229,635.65, overpayment
duces the hereby repay Maxima is ordered to Government, together with interest (85
computed pursuant to P.L. 92-41 Stat.
97) (Clause contract) May 34 of the
31, 1984, the date of the final decision
demanding repayment.
UNION PACIFIC RAILROAD COMPA Companies,
NY and Affiliated
Plaintiff-Appellant, STATES,
The UNITED
Defendant-Appellee.
Appeal No. 87-1452. Appeals,
United States Court of
Federal Circuit.
May notes the convenience clause to create a breach work, did; it none, stop in or- the contractor there retroactively, where sought obligations then to recover the contractor change der Supreme prospective profits. The full completed under ap- Navy did not observed Court “sugges- the time of its pear to know at Analysis right of can- it had an absolute tion” that A statute, and held on a 1917 cellation based retroactively government could arguments several offers Maxima right. statutory The Court on this rely position of its support anticipatory had been held that there an un retroactive subject government, and the breach em Maxima clause. der the convenience damages: measure question was required to and it phasizes that procure providing government’s] efforts capability As [the maintain the contract, futile, stopping proved to cancel consent set services anticipatory breach. con contractual full the work was thereby providing the mea- us that remains whether question reminds Maxima sideration. for this con recoverable damages form of on sure insisted Agency had have been same as would is the this basis tract, breach and that possessed the points to had not prices. if the Government unit reduced its acceptance of cancellation. Agency’s right of offer and within month thirteenth at 200. 267 U.S. payment established anticipatory breach held that an thus Point Agency’s and the twelve-month (constructively) justified; but may later amount. the contract payment of creation retroactive not authorize it does per completion year after argues that none, and there where of a breach payment, is too late formance, final performed on fully where retrospectively, new impose, Agency to sides. both on Maxima. terms non-negotiable Reiner relied on John & Board also