Weatherford Group, Inc. ( 2015 )

ARMED SERVICES BOARD OF CONTRACT APPEALS
Appeals of -- )
)
Weatherford Group, Inc. ) ASBCA Nos. 59315, 59316
) 59851,59852
Under Contract No. W91JA4- l l-C-4005 )
APPEARANCE FOR THE APPELLANT: Keith L. Baker, Esq.
Barton, Baker, Thomas & Tolle, LLP
McLean, VA
APPEARANCES FOR THE GOVERNMENT: Raymond M. Saunders, Esq.
Army Chief Trial Attorney
MAJ Julie A. Glascott, JA
Robert B. Neill, Esq.
Trial Attorneys
OPINION BY ADMINISTRATIVE JUDGE NEWSOM
These appeals involve contractor claims for reimbursement of costs charged by the
government and paid by the contractor for military air travel services (MILAIR) used by
contractor employees for performance of a contract. Weatherford Group, Inc. asserts that
the contract required the government to provide MILAIR services at no cost to the
contractor. The government asserts that the contract authorized the contractor to use
MILAIR services but required it to pay for them.
Appellant elected accelerated procedures pursuant to Board Rule 12.3 in ASBCA
Nos. 59851 and 59852. The Board has jurisdiction pursuant to the Contract Disputes Act,
41 U.S.C. §§ 7101-09. For the reasons set forth below, we deny the appeals.
SUMMARY FINDINGS OF FACT
1. On 14 January 2011 the Army's Phoenix Regional Contracting Center awarded
Contract No. W91JA4-11-C-4005 (Contract) to Weatherford Group, Inc. (R4, tab 7 at 1).
The Contract required Weatherford to provide support services and related supplies and
equipment for Partner Nation military personnel in Afghanistan, to include services
related to warehouses, billeting, and transportation, as described in the Statement of
Work (SOW) (id. at 3, 34-50). The Contract provided for a base year of performance for
a firm-fixed price of $3 ,221,87 5 plus the cost of Defense Base Act insurance, followed
by two one-year options (R4, tab 7 at 2-7).
2. The Contract incorporated a local clause authorized by U.S. Central Command
(CENTCOM) Contracting Command (C 3), clause 952.225-0011, GOVERNMENT FURNISHED
CONTRACTOR SUPPORT (JUL 2010) (C 3 Clause). It summarized the "type of support the
Government will provide the contractor, on an 'as-available' basis," and identified MILAIR
as one of the services, stating in relevant part:
c.J <'LAUSE 952 225-001 I GOVERNME1'l'T FUR1'HSHED CONTRACTOR SUPPORT (JUL 2010)
The following is a 8Ulllmary of the type of support the Government will provide the contractor. on an ··as-available"
basis In the event of any discrepancy between this summary and the description of services in the Statement of
Work, this clause will take precedence.
U.S. Citizens Accompanying the Force
[8J APOIFP0:~1PO/Postal Services [8J LlFACs [8J Mil issue Equip
0 Authorized Weapon [8J Excess Baggage [8J .MILAIR
[81 Billeting [81 Fud Authorized [8JMWR
[8J CAAF [8J Govt Furnished Meals [81 Resuscitative Can:
[81 C-0ntrolled Access Card (CAC')fID C'zd [81 Military Ranking [81 Transportation
0 C<>mmi~aJ)' 0 Military Clothing DAii
0 Dependents Authorized [81 Military Exchange 0Nonc
(R4, tab 7 at 31)
3. The SOW contained additional detail bearing upon government-furnished
services and equipment. Section 10 listed specific items the government would provide,
and subsection 10.11 stated that if a contractor employee required medical evacuation, the
costs "to include the cost of the air medical evacuation" shall be the "responsibility of the
contractor." (R4, tab 7 at 44-45)
4. SOW section 11, entitled "GENERAL INFORMATION," also addressed air
transportation. Subsection 11.6, entitled "Travel and Lodging," imposed responsibility on
the contractor to pay certain employee travel costs, stating:
The contractor is responsible for the cost involved with
contractor employee travel and lodging accommodations while
deploying, re-depl_oying, and while on R&R travel.
(R4, tab 7 at 45)
5. The Contract also incorporated Defense Federal Acquisition Regulation
Supplement (DFARS) clause 252.225-7040, CONTRACTOR PERSONNEL AUTHORIZED TO
ACCOMPANY U.S. ARMED FORCES OUTSIDE THE UNITED STATES (JUL 2009) (R4, tab 7
at 18). Subsection (c)(4) of that clause required contractor personnel to "have a letter of
authorization issued by the Contracting Officer in order to process through a deployment
center or to travel to, from, or within the designated operational area." The letter of
2
authorization was to "identify any additional authorizations, privileges, or Government
support that Contractor personnel are entitled to under this contract." (R4, tab 7 at 20)
6. Weatherford's owner, Richard Weatherford, testified that his company entered
into one previous contract with the government in which the government provided
MILAIR services at no cost to Weatherford (tr. 26, 72). Mr. Weatherford did not recall
with certainty the agency involved in that prior contract (tr. 72), and appellant did not
offer that prior contract or its terms in evidence.
7. Notice to proceed was effective 2 February 2011 and Weatherford was to start
performing on or about 10 February 2011 (R4, tab 22).
8. During performance, Weatherford employees used MILAIR services. These
services included flights between points within the operational area, flights to deploy into
the operational area, flights to redeploy out of the operational area, and flights to seek
medical attention. (Tr. 51-59, 188)
9. On 16 February 2012 roughly one year after Contract performance had
commenced, the Defense Finance and Accounting Service (DF AS) sent the first of many
vouchers to Weatherford seeking reimbursement for the cost of MILAIR services used by
its employees during the first year of performance (R4, tab 36 at 2). The delay in billing
was unexplained; neither party presented reliable evidence of the reason for the one-year
delay in billing. Between February 2012 and October 2013, DFAS transmitted
approximately 14 vouchers to Weatherford for more than 30 MILAIR flights (id. at 2-25).
The vouchers totaled $56,526 (id. at 1).
10. Believing the vouchers to be in error, Weatherford's owner contacted U.S.
Transportation Command (TRANSCOM) to seek correction (tr. 188-89). TRANSCOM
was listed on the vouchers as the dispute point of contact (e.g., R4, tab 36 at 2).
Mr. Weatherford was advised to pay the vouchers and request reimbursement from the
contracting office (tr. 188-89).
11. On cross-examination, Mr. Weatherford testified that he could not recall the
purposes of specific MILAIR flights for which his company was charged, but stated that all
the flights were taken either for the purposes of deploying, redeploying, seeking medical
attention outside the operational area, or for R&R (tr. 51-59, 188). We find the MILAIR
flights for which Weatherford was charged were, more likely than not, taken for the
purposes of deployment, redeployment, medical evacuation, or R&R.
12. Weatherford paid the vouchers (tr. 50-51) then submitted two requests for
equitable adjustment (REAs) seeking reimbursement. The first REA sought $52,737; and
the second REA sought $5,373, for a total request of $58,110. Both REAs included the
certification required for CDA claims. (R4, tab 35 at 27, tab 37 at 9)
3
13. By written decision dated 14 February 2014, the contracting officer denied the
requests (R4, tab 38). Weatherford filed an appeal with the Board on 14 May 2014, which
was docketed as ASBCA Nos. 59315 and 59316.
14. The Board on 9 July 2014, sua sponte, raised several jurisdictional issues and
directed a response from appellant followed by a reply from the government. Ultimately
the government asserted a possible challenge to the Board's jurisdiction (Bd. corr.
20 October 2014). However on 15 August 2014, Weatherford re-styled the REAs as
claims and submitted them (including the certifications) to the contracting officer along
with a request for a final decision (R4, tabs 41-42, 45-46). The contracting officer denied
the claims by letter dated 16 January 2015 (R4, tab 47). Appellant filed another notice of
appeal with the Board on 23 February 2015, which was docketed as separate ASBCA
Nos. 59851 and 59852. Appellant's counsel characterized the resubmission and the
appeals as protective and as such the subject matter of ASBCA Nos. 59581 and 59852
are the same as ASBCA Nos. 59315 and 59316. 1
DECISION
These appeals present a straightforward issue of contract interpretation. We must
determine to which party the Contract allocated responsibility for the cost of MILAIR
services that Weatherford employees used.
In resolving contract interpretation disputes, we examine the contract as a whole,
harmonizing and giving a reasonable meaning to all of its provisions. NVT Technologies,
Inc. v. United States, 370 F.3d 1153, 1159 (Fed. Cir. 2004); ThinkQ, Inc., ASBCA
No. 57732, 13 BCA ii 35,221 at 172,825. An interpretation that gives reasonable meaning
to all parts of a contract is preferred to one that leaves a portion meaningless. Hol-Gar Mfg.
v. United States, 351F.2d972, 979 (Ct. Cl. 1965); LRV Environmental, Inc., ASBCA
Nos. 8727, 59728, 15-1BCAii36,042.
The government contends that C 3 Clause 952.225-0011, which identified the
support that the government "will provide the contractor," authorized Weatherford to use
MILAIR services but was silent as to responsibility for their costs. Responsibility to pay
for MILAIR services was set forth, the government asserts, in SOW subsections 10.11
and 11.6, which expressly required the contractor to pay the costs of travel for medical
evacuation, deployment, redeployment, or R&R (gov't hr. at 11).
1
Since ASBCA Nos. 59851 and 59852 are protective appeals, we process them under
Rule 12.3 as well.
4
Appellant contends that the C 3 Clause portion stating that the government "will
provide" MILAIR services meant that the government would provide and pay for those
services. Because SOW subsections 10.11 and 11.6 purport to require Weatherford to pay
for MILAIR services, appellant contends that the SOW conflicts with the C3 Clause.
Noting that the C3 Clause expressly states that "[i]n the event of any discrepancy between
this summary and the description of services in the Statement of Work, this clause will take
precedence," appellant argues that the Board must disregard SOW subsections 10.11 and
11.6. (App. br. at 9-13)
We agree with the government's interpretation, which is reasonable and gives
meaning to all portions of the Contract. The C3 Clause summarizes the government support
to which the contractor is entitled. SOW subsections 10.11 and 11.6 filled details regarding
that support, plainly and expressly allocating cost responsibility for MILAIR services to the
contractor. (Findings 2-4)
Appellant's interpretation, in contrast, would require us to read into the Contract a
conflict between the SOW and C3 Clause 952.225-0011 and would require us to
disregard SOW subsections 10.11 and 11.6. That argument runs afoul of principles of
contractual interpretation which provide that we should not construe a provision as being
in conflict with another unless no other reasonable interpretation is possible. Hol-Gar
Mfg., 351 F.2d at 979.
Here, a reasonable interpretation is available that creates no conflict. Specifically,
in the context presented here, we interpret C3 Clause 952.225-0011 as an implementation
of DFARS 252.225-7040(c)(4 ). That DFARS clause generally entitled the contractor to
"authorizations, privileges, or Government support" (finding 5), but did not identify the
specific support to be provided. The C3 Clause picked up where the DFARS clause left
off. Where the C3 Clause stated that the government "will provide" certain services, the
intention was to define the "authorizations, privileges, or Government support" to which
DFARS 252.225-7040( c)(4) referred, and not necessarily to allocate responsibility for
their costs. Reinforcing this interpretation is the fact that the C3 Clause stated expressly
that it was a "summary" of the "type of support" to be provided (finding 2). As a
summary, it left the details - including cost responsibility - to be addressed elsewhere in
the Contract. Those cost responsibilities were set forth in SOW 10.11 and 11.6 which
stated expressly that the contractor would pay the costs of its employee travel
(findings 3-4).
Appellant also argues that its prior course of dealing established that the
government would pay MILAIR costs (app. br. at 14). This course of dealing is said to
have included ( 1) appellant's allegation that in a single previous contract, the government
did not charge Weatherford for MILAIR services; and (2) the government's
5
approximately one-year delay in billing Weatherford for MILAIR services on this
Contract (app. br. at 14).
We hold that no prior course of dealing was established. A course of dealing is "a
sequence of previous conduct between the parties to an agreement which is fairly to be
regarded as establishing a common basis of understanding for interpreting their expressions
and other conduct." RESTATEMENT (SECOND) OF CONTRACTS§ 223(1) (1981). Appellant
did not introduce the prior contract in evidence nor present reliable evidence that the
primary contract involved the "same contracting agency, the same contractor, and
essentially the same contract provisions" as in these appeals (finding 6); see T&M
Distributors, Inc., ASBCA No. 51405, 00-1BCA~30,677 at 151,509. As for the delay in
billing, Weatherford presented no evidence that the delay reflected an understanding that
the government would pay MILAIR costs, rather than simply being the result of an
"accident or mistake" or a routine delay in billing processes (finding 6). See Western
States Construction Company, ASBCA No. 37611, 92-1BCA~24,418 at 121,894.
CONCLUSION
For the reasons explained, the Board denies the appeals.
//
--~-- .--------......._)
Dated: 21 October 2015
Adminis r ·ve Judge
Armed Services Board
of Contract Appeals
I concur
Administrative Judge
Vice Chairman
Armed Services Board
of Contract Appeals
6
I certify that the foregoing is a true copy of the Opinion and Decision of the Armed
Services Board of Contract Appeals in ASBCA Nos. 59315, 59316, 59851, 59852, Appeals
of Weatherford Group, Inc., rendered in conformance with the Board's Charter.
Dated:
JEFFREY D. GARDIN
Recorder, Armed Services
Board of Contract Appeals
7