ASBCA 60952

ARMED SERVICES BOARD OF CONTRACT APPEALS Appeal of -- ) ) Safeco Insurance Company of America ) ASBCA No. 60952 ) Under Contract No. W912HN-08-D-0042 ) APPEARANCES FOR THE APPELLANT: John S. Vento, Esq. Trenam Law Tampa, FL Brett D. Divers, Esq. Mills Paskert Divers Tampa, FL APPEARANCES FOR THE GOVERNMENT: Thomas H. Gourlay, Jr., Esq. Engineer Chief Trial Attorney A. L. Faustino, Esq. Robert W. Scharf, Esq. Engineer Trial Attorneys U.S. Army Engineer District, Sacramento OPINION BY ADMINISTRATIVE JUDGE CLARKE ON THE GOVERNMENT'S MOTION TO DISMISS FOR LACK OF JURISDICTION The U.S. Army Corps of Engineers (COE) moves for dismissal due to lack of jurisdiction. The COE asserts that Safeco Insurance Company of America (Safeco) did not have a contract with the government and therefore the Board lacks jurisdiction under the Contract Disputes Act, 41 U.S.C. §§ 7101-7109 (CDA). Safeco argues that the Board has jurisdiction over its equitable subrogation claim and an implied-in-fact contract based on the contracting officer's final decision (COFD), an escrow agreement, a modification directing payments into the escrow account, payments into the escrow account, and other matters. We grant the COE's motion. STATEMENT OF FACTS (SOF) FOR THE PURPOSES OF THE MOTION 1. Task Order No. CMOl under Contract No. W912HN-08-D-0042 was issued to LL. Fleming, Inc. (Fleming) on 26 April 2010 for the design and construction of a Brigade/Battalion Headquarters at Fort Polk, Louisiana (R4, tab 3). Safeco issued a Payment Bond (R4, tab 6) and a Performance Bond (R4, tab 7) as surety for the contract.  2. Fleming, Engineering Design Technologies, Inc. (EDT), PBS&J Constructors, Inc. (PBS&J), and U.S. Bank National Association, escrow agent, entered into an Escrow Agreement as of 17 February 2011 (app. supp. R4, tab 1). Pursuant to this agreement Fleming agreed to direct the COE to deposit all payments made to Fleming into the escrow account (id. at 1). 3. By letter dated 16 June 2011 to Ms. Grant, COE contracting officer (CO), Safeco's attorneys, Mills Paskert Divers (MPD), inquired as follows: It is Safeco' s understanding that an escrow account has been established with U.S. Bank for all contract [W912HN-08-D-0042] proceeds and that the USACE is making payments of all contract proceeds due to Fleming into that account. If this understanding is incorrect, please let me know in writing at your earliest opportunity since it is Safeco's expectation that the· USACE is paying all contract proceeds into the U.S. Bank escrow account. (R4, tab 9) 4. By letter dated 13 July 2011 to CO Dones, COE, MPD inquired as follows: As you know from my prior communications, it is Safeco' s understanding that all payments due on the above-referenced contract [W912HN-08-D-0042] were to be paid into an escrow account with U.S. Bank. Safeco has reason to believe that funds may no longer be going to such escrow account. Please inform Safeco of the bank account into which contract funds for this Project are currently being directed and an approximate date for the next payment. In addition, Safeco requests that the Corps not release any funds to Fleming without Safeco's written consent. Please direct such requests for Safeco's consent to my attention. (R4, tab 10) 5. On 18 July 2011, Mr. Vento, PBS&J's attorney, sent an email to Mr. Henson, COE, with a copy to CO Dones, expressing concern that subcontractors 2 would not be paid ifthe COE did not change the CAGE 1 code to insure payments went to U.S. Bank escrow (R4, tab 24 at 2). 6. By letter dated 22 July 2011 to Mr. Henson, MPD wrote: As stated in my letter to the Contracting Officer, Ms.