ASBCA 58023

ARMED SERVICES BOARD OF CONTRACT APPEALS Appeal of -- ) ) BAE Systems San Francisco Ship Repair ) ASBCA No. 58810 ) Under Contract No. W912SU-04-D-0005 ) APPEARANCE FOR THE APPELLANT: Peter B. Jones, Esq. Jones & Donovan Newport Beach, CA APPEARANCE FOR THE GOVERNMENT: Raymond M. Saunders, Esq. Army Chief Trial Attorney MAJ John R. Longley, JA CPT Tyler L. Davidson, JA Trial Attorneys OPINION BY ADMINISTRATIVE JUDGE TING ON APPELLANT'S MOTION FOR SUMMARY JUDGMENT The Army (government) awarded BAE Systems San Francisco Ship Repair (BAE) a task order under a multiple-award, task order contract (MATOC) for the programmed maintenance of a Logistics Support Vessel. The parties' disputes center on the proper equitable adjustment of two items under the task order. This decision addresses BAE's motion for summary judgment on its potable and drain piping claim. BAE contends that, as a matter oflaw, it is entitled to $903,973.00 including the $351,244.12 the contracting officer (CO) allowed in her decision but remains unpaid. BAE contends that the claimed amount was verified by a Defense Contract Audit Agency (DCAA) report as having been incurred. The Army opposes the motion. For reasons set out below, we deny BAE's motion. Background In 2004, the Mission and Installation Contracting Command at Fort Eustis, Virginia, received a requirement to issue contracts for the maintenance and repair of three classes of landing craft stationed at various ports in the Pacific Ocean (R4, tab 13 7 at 1). The vessels included the Army's Logistics Support Vessels also known as "LSV" - class vessels. The effort was referred to as the "Programmed Drydocking, Cleaning, Painting, Repairs and Modifications to US Army Active and Reserve Vessels Located on the West Coast of the United States and Hawaii." The work would be executed as a task order under a MATOC. (Id.)  BAE was one of five shipyards on the West Coast that competed for and received the right to bid on task orders issued for the Army's West Coast watercraft. On 2 April 2004, MATOC Contract No. W912SU-04-D-0005 (Contract 0005) was awarded to BAE in the estimated amount of$99,476,431.91. The contract was for a base year and four one-year options. (R4, tab 137 at 2) Each task order under Contract 0005 would identify definite and indefinite work items to be performed. The contract defined "Definite Item" to mean "[k]nown work that shall be diligently prosecuted upon issuance of delivery order." The contract defined "Indefinite Item" to mean "[w ]ork to be accomplished only upon the written approval of the Contracting Officer. Activation of an indefinite item does not entitle the Contractor to an extension of the performance period." (R4, tab 1 at 24, iii! C.0.1.7., C.0.1.12.) Contract 0005 also addresses situations where the government determines, during the repair of a vessel, that additional replacement parts, materials and installation are required: C.0.2.23.1. In addition to work specified in the specifications the Contractor shall furnish additional replacement parts, materials and installation which are determined to be required by the Government. The Contractor shall purchase additional replacements [sic] parts and materials required under this paragraph at the lowest known cost and shall be paid at cost. "At cost" is defined as the actual net cost of such parts and materials to the contractor including any and all discounts, rebates and allowances thereon (regardless of the date of purchase), material handling costs properly allocable to such parts or materials (if such costs are not reimbursable under any other provision of this contract), and properly identified and supported freight or transportation charges. The Contractor shall install and test such replacement parts and materials at no additional cost to the Government. C.0.2.23.2. If it is determined by the Government that additional replacements parts and materials require machining or fitting, the Contractor shall be paid under this paragraph at cost, as defined herein.