CBCA 8030

MOTION TO AMEND COMPLAINT GRANTED; DISMISSED FOR FAILURE TO STATE A CLAIM: June 25, 2024 CBCA 8030 TRI VET CONTRACTING COMPANY, INC., Appellant, v. DEPARTMENT OF VETERANS AFFAIRS, Respondent. Kenneth J. Dubbs, Vice President and Chief Operations Officer of Tri Vet Contracting Company, Inc., Pine Grove, PA, appearing for Appellant. Kathleen Ramos, Office of General Counsel, Department of Veterans Affairs, Arlington, TX, counsel for Respondent. Before Board Judges SHERIDAN, SULLIVAN, and CHADWICK. SHERIDAN, Board Judge. In this appeal, Tri Vet Contracting Company, Inc. (Tri Vet or appellant) seeks to recover $86,918.19, plus interest, from the Department of Veterans Affairs (VA) for alleged material price increases. Before the Board are two motions—one submitted by each party. First, the appellant seeks permission to amend its complaint. Second, the VA moves to dismiss for failure to state a claim for which relief may be granted, alleging that Tri Vet assumed the risk of price increases when it entered into a firm-fixed-price contract. For the foregoing reasons, we grant both motions and dismiss the appeal for failure to state a claim. CBCA 8030 2 Background On July 6, 2020, the VA issued solicitation 36C24421R0001, which required the successful bidder “to provide professional construction services in accordance with the Statement of Work (SOW), drawings, and specifications for the Renovate Building #22 Construction Project” at the Lebanon VA Medical Center and stated that a firm-fixed-price contract would be awarded to the offeror whose proposal was the “best value” to the Government. Exhibit 4 at 7, 59. The solicitation incorporated Federal Acquisition Regulation (FAR) clause 52.243-4 (Changes (JUN 2007)), 48 CFR 52.243-4 (2019) (FAR 52.243-4), but did not include an inflation or economic price adjustment clause. See Exhibit 4 at 18, 50. Furthermore, the terms required bidders to identify any exception to any solicitation requirements in an addendum to their proposal: 6. EXCEPTIONS: If the offeror takes exception to any of the requirements specified in this solicitation, the offeror shall clearly identify each exception and include a complete explanation of why the exception was taken and what benefit accrues to the Government. All exceptions to the solicitation requirements and supporting rationale shall be included in an addendum to the proposal and clearly labeled “Exceptions.” An addendum is only required if the offeror takes exception to any requirement in the solicitation. (The [a]ddendum does not have a page limitation but shall only include information relevant to exceptions taken to the solicitation requirements.) The Government will assume an offeror takes no exceptions to any solicitation requirement if the offeror does not submit an [a]ddendum identifying exceptions. Offerors are advised that solicitation requirements are not necessarily negotiable and such exceptions may render an offeror’s proposal unacceptable and ineligible for award. Id. at 15-16. Tri Vet submitted its proposal on August 31, 2020, but it did not attach an addendum. See Exhibits 6, 8 at 1 (award letter). On December 1, 2020, the VA notified Tri Vet that it accepted Tri Vet’s offer and awarded the appellant the contract in the amount of $4,456,447. Exhibit 8 at 1. The Government issued the notice to proceed on January 11, 2021, and Tri Vet was to complete the contract work by July 10, 2022. Exhibit 10. During performance of the contract, Tri Vet encountered circumstances that required it to perform additional work that was not included in the original contract. See Exhibit 45; see also Complaint at 2. As a result, the parties executed a modification (modification P00004) on May 3, 2023, which added $176,004.25 to the total contract price. Exhibit 45 at 1, 4. Modification P00004 was a “Combination of Change Orders Agreed Upon [and the Contracting Officer’s] Determination of Fair [and] Reasonable Pricing for disputed proposals where work is CBCA 8030 3 required to be completed.” Id. at 2. However, the modification denied costs associated with price increases for certain materials. Id. at 4. On October 20, 2023, Tri Vet submitted eight claims to the VA’s contracting officer, disputing the denial of the costs for certain materials.1 Exhibit 49.