BOARD OF CONTRACT APPEALS
U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON, DC 20401
In the Matter of )
)
ARTISAN PRINTING INC. ) Docket No. GPOBCA 15-93
Program D332-S )
Purchase Order 93577 )
DECISION ON MOTION AND CROSS-MOTION
FOR SUMMARY JUDGMENT AND ORDER
Artisan Printing, Inc. (Appellant or Contractor), 7905 Fernham
Lane, Forestville, Maryland 20747, by Notice of Appeal dated May
13, 1993, timely appealed the May 5, 1993, final decision of
Contracting Officer Richard Weiss of the U.S. Government Printing
Office (Respondent or GPO), terminating the Appellant's contract
(Program D332-S, Purchase Order 93577) for default because of its
"inability to fulfill the requirements of the contract." Rule 4
File, Tab N.1
On November 16, 1993, the Board conducted a prehearing conference
at which a consensus developed that a hearing would be necessary
to resolve the issues presented by the appeal. Report of
Prehearing Conference Under The Accelerated Procedure, dated
February 27, 1994. A hearing was originally scheduled for
January 12, 1994, but at the request of the parties it was
subsequently rescheduled for March 8, 1994. That hearing was
canceled at the Appellant's request when the Appellant advised of
its belief that this appeal could be resolved by means of a
motion for summary judgment.2
Subsequently, in accordance with the schedule established by the
Board, the parties filed the following documents: (1) Appellant's
Motion for Summary Judgment (denominated Memorandum of Points and
Authorities in Support of Appellant's Motion for Summary
Judgment) (hereafter Motion), accompanied by a Statement of Facts
as to Which There Is No Material Dispute (hereafter Statement of
Facts) and the affidavits of Kenneth R. Wiggins, the Appellant's
president (hereafter Wiggins Affidavit), and Jeffrey Crescenze,
the Appellant's vice president (hereafter Crescenze Affidavit);
(2) Respondent's Opposition to Appellant's Motion for Summary
Judgment (hereafter Resp. Op.), accompanied by the declarations
of GPO Printing Specialist Betty Shanks (hereafter Shanks
Declaration) and Contracting Officer Weiss (hereafter Weiss
Declaration); (3) Appellant's Reply to Respondent's Opposition to
Appellant's Motion for Summary Judgment (hereafter App. Reply);3
(4) Respondent's Motion for Summary Judgment (hereafter Cross-
Motion); and (5) Appellant's Opposition to Respondent's Motion
for Summary Judgment (hereafter App. Op.).4 After careful
consideration of the parties' positions and of the undisputed
facts, the Board DENIES the Motion and GRANTS the Cross-Motion.
I. BACKGROUND
1. On March 30, 1993, the Appellant was awarded a contract for
Program D332-S, calling for the printing of a publication for the
Department of Agriculture entitled "Agricultural Research," a
pamphlet that would be published approximately 12 times per year
and run from 16 to 32 pages. Work was to be performed under
individual print orders issued by the Department and was to
commence one work day after the Appellant was notified of the
availability of the print order and of the material to be
furnished by the Government. Rule 4 File, Tab A.
2. On April 14, 1993, Print Order 80001/ARS was issued to the
Appellant for the printing of the May issue of the publication
and appropriate material (a disk and other items) was made
available. In accordance with the delivery schedule provisions
of the contract, the Print Order required the Appellant to
furnish random page proofs on April 19 (and the Respondent to
return them on April 20), composite cromalin and Dylux proofs by
April 23 (returnable by the Respondent on April 27), and the
finished product on May 4. Rule 4 File, Tab E.
3. The Appellant did not furnish proofs on April 19, but did so
on April 20. Also on April 20, the Respondent, by facsimile
transmission and by certified mail, sent the Appellant a "Cure"
Notice based on the Appellant's failure to furnish the proofs on
April 19. The notice, signed by Contracting Officer Weiss,
advised that the failure was "endangering performance of the
contract" and that the Appellant had 10 days "to present, in
writing . . . the measures adopted which have cured such
condition." The notice warned that a failure to cure could
result in a termination for default. Rule 4 File, Tab H. The
certified mail return receipt showed an April 21 date of delivery
and was signed for by an employee of the Appellant. Id.
4. The proofs delivered on April 20 were determined to be
unacceptable and were rejected that same day. The Appellant was
told that extra time would not be allowed and that it would be
required to meet the original schedule. Rule 4 File, Tab G. The
proofs were resubmitted on April 21 and accepted by the
Respondent on April 23.
5. The Appellant did not furnish cromalin and Dylux proofs on
April 23. On April 26, Contracting Officer Weiss sent to the
Appellant, by certified mail, another Cure Notice. This notice
identified the failure to furnish cromalin and Dylux proofs as
endangering contract performance and allowed the Appellant 5
days5 to present measures adopted to cure the problem. Rule 4
File, Tab I. The delivery receipt was returned to the Respondent
by the Postal Service, but no delivery date was indicated and the
receipt was unsigned. Id.
6. The Appellant delivered the cromalin and Dylux proofs on
April 28. These proofs were not acceptable to the Respondent.
Rule 4 File, Tab L. On April 30 representatives of the Appellant
met with representatives of the Respondent to discuss the matter.
Rule 4 File, Tab Mc. At this meeting the Appellant was given a
new computer disk with three changes. Complaint at 19; Answer at
2.
7. On May 3 the Appellant delivered the revised proofs. These
were also found to be rejectable and "worse than the first set
submitted." Rule 4 File, Tab Mc.
8. On May 5, the Respondent terminated the contract for default
because of the Appellant's "inability to fulfill the requirements
of the contract." Rule 4 File, Tab N.
II. POSITIONS OF THE PARTIES
A. The Appellant
The Appellant asserts that it is entitled to summary judgment
because the default was improper as a matter of law. The
Appellant states that an appropriate cure notice must precede a
termination for default for "failure to make progress," and that
this legal requirement is not satisfied here because it never
received the second Cure notice and therefore never knew that as
of April 26, 1993, it "was in a 'cure' status." The Respondent
asserts that the weight of the evidence establishes that the
Appellant did receive the second Cure Notice. The Respondent
further asserts that in any event the second Cure Notice was not
necessary because the initial Cure Notice placed the Appellant on
notice "that its poor performance in furnishing acceptable proofs
was a condition that must be cured" and because the Appellant
thereafter "never cured the problem of late proofs cited in the
April 20, 1993, Cure Notice." Resp. Op. at 5, 6.
With respect to the Cross-Motion, the Respondent shifts gears
somewhat, asserting that it was entitled to immediately default
the Appellant for failure to furnish the end product by the
required delivery date of May 4, 1993, without having to first
issue a cure notice. The Respondent further asserts that it is
not required to issue a cure notice when less than 10 days remain
before performance is due, and points out that only one day
remained before performance was due when it found the proofs
delivered on May 3 to be unacceptable. The Appellant asserts
that the Respondent's position must fail for four reasons: (1)
the termination notice was not based on a failure to make timely
delivery, but on the Contractor's inability to fulfill contract
requirements; (2) the Respondent's furnishing the Appellant with
a new disk on April 30 constituted a constructive change that
entitled the Appellant to at least three more days to deliver the
final product; (3) as of May 5, the termination date, the
Appellant was "ready and waiting to complete performance," and
was only awaiting the return of the proofs furnished on May 3;
and (4) the Contracting Officer failed to consider factors set
forth in the PPR, Chap. XIV, Sec. 1, ¶ 3.c.(3), in particular the
time it would take the Appellant to complete performance versus
the time it would take to obtain an acceptable product from a
reprocurement contractor. App. Op. at 3-4.
III. ISSUES PRESENTED
1. On what basis was the Appellant's contract terminated for
default?
2. Did the Respondent's furnishing of a second computer disk
entitle the Appellant to an extension of the contract delivery
date?
3. Was the Contracting Officer's alleged failure to consider the
factors set forth in the PPR prior to terminating the contract
for default an abuse of discretion?
IV. DISCUSSION
A. Summary Judgment
In deciding motions for summary judgment, the Board is guided by
Rule 56 of the Federal Rules of Civil Procedure, pursuant to
which courts will grant such motions where the pleadings and
supporting documents show that there are no genuine issues as to
material facts and that the moving party is entitled to judgment
as a matter of law. Composite Laminates, Inc. v. United States,
27 Fed. Cl. 310 (1992); GraphicData, Inc., supra. The burden is
on the moving party to demonstrate that it is so entitled.
Celotex Corp. v. Catrett, 477 U.S. 317 (1986). Where, as here,
both parties have moved for summary judgment, the Board must
consider each motion, with each party in its capacity as the
opponent of summary judgment entitled to all applicable
presumptions and inferences. Bataco Ind., Inc. v. United States,
29 Fed. Cl. 318 (1993).
B. Termination for Default
The rules governing terminations of Federal Government contracts
for default emanate primarily from contract "default" clauses and
applicable regulations. The "Default" clause in GPO contracts
provides that the Respondent, by written notice to the
contractor, may terminate a contract in whole or in part if the
contractor fails to: (1) deliver the supplies or perform the
required services within the time specified or any extensions
thereof; (2) make progress, so as to endanger performance; or (3)
perform any other contract provision. GPO Contract Terms,
Solicitation Provisions, Supplemental Specifications, and
Contract Clauses, Contract Clauses, ¶ 20, GPO Publication 310.2,
effective December 1, 1987 (Rev. 9-88) (hereafter GPO Contract
Terms). A default termination, however, is a drastic action
which may be taken only for good cause and on the basis of solid
evidence, with the contracting agency having the burden of
proving the basis for the default but with the contractor having
the burden of showing that its failure to perform was excusable.
Venture, Ltd., GPOBCA 01-96 (September 26, 1997), slip op. at
13-14, 1997 WL 742427; Big Red Enterprises, GPOBCA 07-93 (August
30, 1996), slip op. at 24-25, 1996 WL 812960; Vanier Graphics,
Inc., GPOBCA 12-92 (May 17, 1994), slip op. at 47-48, 1994 WL
275102. When a default termination is based on untimely
performance, the contractor challenging the termination must meet
a four-fold burden of proof. It must: (1) prove affirmatively
that the delay was caused by or arose out of a situation which
was beyond the contractor's control and that it was not at fault
or negligent; (2) show that performance would have been timely
but for the occurrence of the event which is claimed to excuse
the delay; (3) show that it took every reasonable precaution to
avoid foreseeable causes for delay and to minimize their effect;
and (4) establish a precise period of time that performance was
delayed by the causes alleged. Venture, Ltd., supra; Gold
Country Litho, GPOBCA 22-93 (September 30, 1996), slip op. at
16-17, 1996 WL 812956 and cases cited therein.
It is also well established that because the "Default" clause
provides that the Government "may" terminate for default when one
of the specified grounds for default is present, a default
termination is a discretionary act subject to challenge as an
abuse of discretion. Schlesinger v. United States, 390 F.2d 702
(Ct. Cl. 1968); Darwin Constr. Co. v. United States, 811 F.2d 593
(Fed. Cir. 1987); Big Red Enterprises, supra. The PPR, Chap.
XIV, Sec. 1, ¶ 3.c.(3), also sets forth various factors for
Respondent's contracting officers to consider in determining
whether to terminate a contract for default.
Where a default termination is based on a failure to make timely
delivery, no prior notice to the contractor is necessary. Where
the termination is based on a failure to make progress or to
perform in accordance with any other contract provision, the
Respondent must notify the contractor of the failure and allow a
reasonable period for the contractor to cure the failure. The
notification, through a "Cure Notice," is to concisely set forth
"the provisions of the contract which the contractor has failed
to meet or a summary of the findings which have demonstrated that
the contractor has failed to make acceptable progress, PPR, Chap.
XIV, Sec. 1, ¶ 3.c.(2), and normally is to allow at least a 10-
day cure period, although the contracting officer may determine
that a shorter period is reasonable under the circumstances. GPO
Contract Terms, Contract Clauses, ¶ 20; PPR, Chap. XIV, Sec. 1,¶
3.c.(2). However, "[i]f the time remaining in the contract
delivery schedule is not sufficient to permit a realistic 'cure'
period, the 'Cure Notice' shall not be issued." PPR, Chap. XIV,
Sec. 1, ¶ 3.c.(2). Instead, "where practicable," a "Show Cause"
notice should be issued that gives the contractor an opportunity
to explain its failure before any termination for default is
made. PPR, Chap. XIV, Sec. 1, ¶ 3.c.(1).
C. Appellant's Motion
There are two critical elements to the Appellant's summary
judgment motion. One is the assertion that the default
termination was for failure to make progress. The other is that
the Appellant did not receive the second Cure Notice, which the
Appellant views as a prerequisite to a valid default termination.
Interestingly, while the Respondent, in its Cross-Motion,
asserts that the termination was based on the Appellant's failure
to deliver the finished product by the contract due date so that
a Cure notice was not required, it does not make that argument in
its Opposition to the Motion, relying instead on a presumption of
delivery of the mailed second Cure Notice and the argument that
in any case the first Cure Notice was sufficient to support the
default termination. Nonetheless, before the Board can grant
summary judgment, it must determine that the Appellant, as the
moving party, is entitled to summary judgment as a matter of law.
GraphicData, Inc, supra. Therefore, the initial question for
resolution is whether the Appellant is correct when it states
that the termination was for failure to make progress.
The May 5, 1993, letter from Contracting Officer Weiss notifying
the Appellant that the contract was "hereby terminated for
default" did not refer to a failure to make progress. It also
did not refer to either of the other two bases for default set
forth in the "Default" clause, i.e., a failure
to deliver within the time specified or a failure to perform any
other contract provision. It set forth the basis for default as
the "inability to fulfill the requirements of the contract."
Rule 4 File, Tab N.
Despite the literal disconnect between the language of the
"Disputes" clause and the language used in the termination
letter, the undisputed facts of record and a proper understanding
of the "Disputes" clause establish that the termination was based
not on a failure to make progress, but on the first basis for
default set out in the clause-the failure to deliver within the
time specified. The failure to make progress basis for default
is used in connection with circumstances that arise before the
specified delivery date that endanger the completion of
performance by that date. See John Cibinic, Jr. and Ralph C.
Nash, Jr., Administration of Government Contracts 929, 932-33
(Third ed. 1995) (hereafter Cibinic & Nash, Administration);
John Cosgrove McBride, Government Contracts § 35A.40 (Rev. 1997);
Walter F. Pettit, Carl L. Vacketta, and David V. Anthony,
Government Contract Default Termination 4-2 (1991); Composite
Laminates, Inc. v. United States, supra, at 317. A cure notice
based on the failure to make progress is intended to spur the
contractor into taking steps to remedy the lack of progress by a
certain date so that contract performance will no longer be
endangered. See Composite Laminates, Inc. v. United States,
supra, at 317. Obviously, once the contract delivery date has
passed without delivery, the Government is no longer concerned
about a failure to make progress that is endangering
performance.6 Performance at this point is no longer
endangered-it has failed. Thus, if the Government decides that
default termination is now
warranted, it cannot be on the basis that a failure to make
progress is endangering contract performance.
The obvious basis for default, and indeed the only one in the
Default clause, that is applicable to situations where the
delivery date has passed is the first basis for termination set
forth in the clause-failure to make timely delivery.7 By its own
terms, it applies where the contractor has failed to deliver by
the time specified, and it gives the Government the right to
terminate immediately without the need for a cure notice. De
Vito v. United States, 413 F.2d 1147 (Ct. Cl. 1969); National
Farm Equipment Co., GSBCA 4921, 78-1 BCA ¶ 13,195; K.C. Printing
Co., GPOBCA 02-91 (February 22, 1995), slip op. at 13, 1995 WL
488531. The fact that cure notices based on a failure to make
progress had been issued previously does not limit the Government
to defaulting the contractor for that reason should a default
termination become necessary; if the contractor, for failure to
make progress or for some other reason, fails to deliver by the
required date8 the Government properly may default on the basis
of a failure to timely deliver. See, e.g., DBA Sys., Inc.,
ASBCA 34664, 89-1 BCA ¶ 21,465 (contractor terminated under the
first basis for default-failure to make timely delivery-following
cure notice based on failure to make progress). The Appellant's
contract established a date of May 4, 1993, for delivery of the
final product. The contract was terminated for default on May 5,
one day after the established delivery date. On these facts and
in accordance with the discussion above the Board concludes that
the Respondent's imprecise termination letter defaulting the
Appellant because of its "inability to fulfill the requirements
of the contract" was based not on a failure to make progress or
on a failure to "cure" itself of a failure to make progress, but
on the Appellant's failure to deliver on time. See Hurt's
Printing Co., Inc., GPOBCA 27-92 (January 21, 1994), slip op. at
8, 1994 WL 275098 (where the Board found it clear that a default
for "inability to produce this job according to the
specifications" was actually a default for failure to make timely
delivery).9 That being so, the Appellant's failure to receive
the Cure Notice of April 26, 1993 (which in any event dealt with
the Appellant's initial failure to timely deliver cromalin and
Dylux proofs, not with the subsequent determination that the
proofs eventually delivered were unacceptable or the Appellant's
ultimate failure to deliver the final product) cannot invalidate
the default termination. Accordingly, the Appellant's Motion is
denied.10
D. Respondent's Cross-Motion
The denial of the Appellant's Motion does not compel the granting
of the Cross-Motion; the Respondent must independently satisfy
the requirements for summary judgment, i.e., it must establish
that there are no genuine issues as to the material facts on
which the Cross-Motion relies and that the Respondent is entitled
to judgment as a matter of law. See Vanier Graphics, Inc.,
supra, at 47.
The Respondent seeks summary judgment on the basis that "Artisan
failed to deliver the finished product by the contractually
established date of May 4, 1993." Cross-Motion at 3. It is not
disputed that Artisan did not deliver the finished product by May
4, 1993, and, as the Board concluded above, the termination was
based on that failure to deliver. The Respondent thus has met
its burden to establish that it had a legitimate basis for the
default. A termination for default for failure to meet the
delivery date specified in the contract cannot be upheld,
however, if the contractor was entitled to additional time. Kings
Point Mfg. Co., Inc., ASBCA 27201, 85-2 BCA ¶ 18,043; Wise
Instrumentation and Control, Inc., NASA BCA 673-7, 1072-12, 75-2
BCA ¶ 11,478. It is the contractor's burden to show that it was
entitled to additional time or that the default is otherwise
excusable. K.C. Printing Co., supra; Woodside Screw Machine Co.,
Inc., ASBCA 6936, 62 BCA ¶ 3308.
The Appellant, asserting that the delivery date was or should be
extended, offers three different bases for that assertion.
First, in support of its own Motion, it states that its delivery
of cromalin and Dylux proofs on April 28, 1993, had the effect of
extending the final product delivery date to May 7. Statement of
Facts at 3. Second, it asserts that the furnishing of a new
computer disk on April 30 "required Appellant to perform work
which was not contemplated by Appellant and which caused
Appellant's performance delay." Complaint at 8. Third, it
asserts that the Respondent's failure to timely provide
Government-furnished property, failure to timely return proofs,
and furnishing of a new computer disk constituted constructive
changes to the contract. Complaint at 8.
The first assertion does not involve any genuine issue of fact.
The original contract schedule allowed seven workdays from the
contractor's furnishing of cromalin and Dylux proofs (scheduled
for April 23) to the final product delivery on May 4. It is
undisputed that the Appellant, through no fault of the
Respondent, failed to deliver the cromalin and Dylux proofs on
April 23 and did not do so until April 28. There is nothing in
the contract that has the effect of extending the due date for
final product delivery because of the contractor's earlier delay
in furnishing the required proofs. To the contrary, the contract
states that "[a]dherence to this schedule must be maintained" and
that if revised proofs are required because of contractor errors,
"[n]o extra time can be allowed for this reproofing; such
operations must be accomplished within the original production
schedule. . . ." Rule 4 File, Tab A.11 Thus, the Appellant's
position in essence is that because the contract contained a
schedule for pre-publication deliveries with specific time
periods between those delivery dates and the date for final
product delivery, its tardiness in providing the required pre-
publication proofs allows it to be late in furnishing the final
product. The pernicious effect of such a notion on Government
contracts, in which time is usually of the essence, De Vito v.
United States, supra; see generally Cibinic & Nash,
Administration at 909-11, is too obvious to warrant further
comment.
The Board has no difficulty in concluding that the Appellant's
failure to deliver cromalin and Dylux proofs on time did not give
rise to an extension for delivery of the final product.
The assertions regarding the respondent's failure to timely
provide Government-furnished property and to timely return proofs
also do not raise any genuine factual issues. The facts are
undisputed: (a) the original computer disk and other items were
furnished to the Respondent on April 14, the day the Print Order
was issued; and (b) the random proofs delivered by the Appellant
on April 20 were rejected and returned that same day, while the
cromalin and Dylux proofs submitted on April 28, which were also
unacceptable, were discussed with the Appellant on April 30.
The revised cromalin and Dylux proofs furnished by the Appellant
on May 3 were, "worse than the first set," Rule 4 File, Tab Mc,
led to the default termination two days later. There is nothing
in these facts to support the assertion that the Respondent
failed to timely return proofs. The contract allowed the
Respondent to hold the random proofs for one day and the cromalin
and Dylux proofs for two days. The Respondent adhered to this
schedule. As for the alleged untimely furnishing of Government
property, the Appellant states, and the Respondent admits, that
the Appellant had been told by a Department of Agriculture
representative that the Government-furnished property would be
provided by April 9. Complaint at 3; Answer at 3. The Print
Order, however, was not issued until April 14, and the Government
had no obligation to furnish the disk or other material prior to
issuance of the Print Order. In this regard, the contract
schedule is based on the availability to the contractor of both
the Government-furnished property and the Print Order, with the
Appellant's obligation to perform in accordance with the contract
schedule commencing when both the property and the Print Order
were available to it. The Board fails to see how the furnishing
of the Government property on April 14 could be viewed as
untimely.
The remaining assertion regarding the second computer disk, if
supported, could provide a basis for defeating the Cross-Motion,
since if what was on this disk had the effect of changing the
Government's original requirements and causing the Appellant to
have to devote extra time to meet those changed requirements or
in some other way causing the Appellant performance delay the
Appellant would be entitled to an extension of the contract
delivery date. See GPO Contract Terms, Contract Clauses, ¶ 12(c)
("In the event a delay is caused by any action of the Government
. . . the . . . schedule will be extended automatically by the
total number of workdays that work was delayed PLUS 1 workday for
each day of delay . . . ."). The Appellant, however, has
provided absolutely no support for its assertion.
In summary judgment proceedings the parties are required to
satisfy their respective burdens by going beyond the basic
pleadings (". . . the purpose of the summary judgment procedure
is to cut through the pleadings and distinguish substantial
issues from phantom issues raised only in the pleadings." RBP
Chemical Corp., GPOBCA 4-91 (January 23, 1992), slip op. at 26,
1992 WL 487876), typically by providing or relying on affidavits
or other evidentiary support in the record. Vanier Graphics,
Inc., supra; RBP Chemical Corp., supra. In the cited cases, for
example, the parties provided statements or counter statements of
fact that were supported by affidavits of knowledgeable
individuals. In this case the issue is dealt with almost
exclusively through the pleadings, with no supporting affidavits
or other probative documents. The Appellant recites in its
Complaint that the disk was furnished and alleges constructive
change and performance delay as a result, Complaint at 5, 8,
while the Respondent replies that the changes on the disk "were
minor changes to the text, not to the illustrations." Answer at
2. Further, according to the pleadings, when the Appellant's
representative, Howard Harrison, met with the Respondent after
delivery of the revised cromalin and Dylux proofs on May 3, the
Respondent asked about changes in the proofs and why they were
worse than the earlier proofs, Answer at 3, and the Appellant's
representative "explained that changes frequently occur when a
printer receives a new computer disk from the customer."
Complaint at 5-6. The only mention of this matter outside of the
pleadings comes from the Appellant's reiteration, when opposing
the Cross-Motion, of its assertion that the furnishing of the new
disk "was a constructive change that gave rise to a delivery
schedule extension." App. Op. at 1. There is, however, no
affidavit from Mr. Harrison supporting what is alleged in the
Complaint, and there is nothing in the affidavits of Mr.
Wiggins12 and Mr. Crescenze that provides any support for the
assertions in the Complaint and App. Op. that the furnishing of
the second disk constituted a constructive change. There is also
nothing in the Weiss Declaration or the Shanks Declaration that
would provide support for the assertion, and neither computer
disk is part of the record. Thus, the record contains nothing
of probative value regarding the exact nature of the three
changes on the computer disk, what effect those changes had or
should have had on production time, what general impact on proof
production there was from the furnishing of the new disk, and
what effect, if any, that impact had on the Appellant's ability
to deliver.
Where a non-moving party bears the burden of proof, as the
Appellant does here with respect to its entitlement to a delivery
date extension, it must by affidavits or by depositions and
admissions on file make a showing sufficient to establish the
existence of the elements essential to that party's case.
Celotex Corp. v. Catrett, supra; Childers v. Joseph, 842 F.2d 689
(3rd Cir. 1988); James P. Collier, dba Jimbob Logging, AGBCA
88-118-3, 89-1 BCA ¶ 21,561. That means the Appellant must
introduce or point to some evidence on the record that would
arguably show that the furnishing of the second computer disk was
a constructive change and caused performance delay. The
Appellant has not done that; it has simply asserted constructive
change and performance delay without providing or demonstrating
the existence of a scintilla of factual support for the
assertion. Conclusory allegations, without an offer of specific
facts to show the existence of a genuine issue for resolution,
will not defeat a motion for summary judgment. Spread
Information Sciences, Inc., ASBCA 48438, 96-1 BCA ¶ 27,996.
Consequently, although the burden on a non-moving party in a
summary judgment proceeding is minimal, The George Marr Co.,
GPOBCA 31-94 (April 23, 1996), slip op. at 37, 1996 WL 273662
(the burden is "not a heavy one"), the Appellant has not met its
burden on this issue.
The Appellant asserts that the Cross-Motion must fail because as
of May 5, 1993, it was ready and waiting to complete performance,
but in effect was kept from doing so by the Respondent's failure
to return the proofs furnished on May 3. The Appellant further
states that the Respondent's failure to "expedite" its review and
return of the proofs is inconsistent with the idea that time was
of the essence in this contract. App. Op. at 3. What the
Appellant overlooks, however, is that the Respondent not only had
the right to keep the proofs for two days before returning them,
but considered those proofs to be unacceptable and worse than
what had been provided previously, a determination not challenged
by the Appellant, and that as a result the Respondent lost
confidence in the Appellant's ability to perform. Rule 4 File,
Tab Mc. Under the circumstances here, the Respondent simply had
no duty to return the proofs to give the Appellant still another
chance to perform the work notwithstanding the Appellant's state
of readiness. See Hurt's Printing Co., supra; see also Johnson &
Gordon Security, Inc., GSBCA 7804, 87-3 ¶ 20,074 and The Bendix
Corp. Environmental Sciences Division, GSBCA 4352, 77-2 BCA ¶
12,656 (no need to perform a futile act giving contractor further
opportunity to perform when it is clear that contractor cannot
perform).
The Appellant's final challenge to the Cross-Motion is that the
Respondent did not comply with its regulations, PPR, Chap. XIV,
Sec. 1, ¶ 3.c.(3), which provide that the contracting officer
"shall consider the following factors in determining whether to
terminate a contract for default," and then set forth eight
factors, including "(iv) [t]he urgency of the need for the
supplies . . . and the period of time which would be required to
obtain sources as compared with the time in which delivery could
be obtained from the delinquent contractor." The Appellant
states that "the record is devoid of any discussion of the date
by which a reprocurement contractor could deliver a compliant
product." App. Op. at 4.
A failure to comply with these regulations, which mirror Federal
Acquisition Regulation § 49.402-3, is a matter to be
considered in determining whether the contracting officer abused
his discretion in terminating a contract for default. Shepard
Printing, GPOBCA 23-92 (April 29, 1993), slip op. at 26, 1993 WL
526848; Graphics Image, Inc., GPOBCA 13-92 (August 31, 1992),
slip op. at 27, 1992 WL 487875; Darwin Constr.. Co., Inc., supra.
In Graphics Image, Inc., supra, the Board concluded, under the
circumstances of that case, that the contracting officer had
acted arbitrarily in terminating a contract for default without
having considered any of the factors set forth in the regulation.
A failure to take all of the factors listed into account before
terminating does not, however, automatically negate the validity
of the default termination as they are not "prerequisites" to a
valid termination. DCX v. Perry, 79 F.3d 132 (Fed. Cir.), cert.
denied, 117 S. Ct. 480 (1996). "Although compliance or
noncompliance with [the regulations] may aid . . . in determining
whether a contracting officer has abused his discretion . . . the
regulation does not confer rights on a defaulting contractor. A
contracting officer's failure to consider one or more of the
[regulatory] factors therefore does not require that a default
termination be converted into a termination for convenience." 79
F.3d at 135. The regulatory factors "merely alert the
contracting officers to areas of concern to possibly consider"
and all factors need not be specifically considered. Michigan
Joint Sealing, Inc., ASBCA 41477, 93-3 BCA ¶ 26,011 at 129,324,
aff'd, 22 F.3d 1104 (Fed. Cir. 1994) (Table).
In Shepard Printing, supra, we recognized that a contracting
officer's failure to consider the regulatory factors was not "an
automatic ticket to a termination for convenience," stating that
the contractor must show that the failure was harmful error such
that the contract might not have been terminated for default if
the contracting officer had considered those factors. Slip op. at
26-27. A contracting officer, however, need not consider the
factor relied on by the Appellant-the time required for a
reprocurement contractor to complete the contract versus what the
delinquent contractor could do-where the contractor's tardy
performance has led to the loss of confidence in that
contractor's ability to perform. AFTT, Inc., VABCA 3783, 94-3
BCA ¶ 27,014; see Jonatech, Inc., ASBCA 46088, 94-3 BCA ¶ 27,248
(granting summary judgment for the Government and holding that
the contractor did not meet its burden to support its allegation
of abuse of discretion merely by alleging the contracting
officer's failure to consider that factor).
Here, the Appellant was defaulted after it failed to meet
contract schedules, failed to furnish acceptable proofs, and
failed to deliver a final product by the contract delivery date,
leading the Contracting Officer to have no confidence that the
Appellant's "performance will improve." Rule 4 File, Tab Mc.
There is also evidence in the record that the Contracting Officer
considered the procurement to be urgent. Rule 4 File, Tabs Mc and
O. Under the circumstances, the allegations that the Contracting
Officer failed to consider the factors set forth in the PPR is
not sufficient to defeat the Respondent's Cross-Motion.
Jonatech, Inc., supra.
V. ORDER
For the foregoing reasons, the Board concludes that the Appellant
is not entitled to summary judgment as a matter of law. The
Board further concludes that the Respondent is so entitled, the
Appellant having failed to meet its burden in opposing the Cross-
Motion. Accordingly, the Appellant's Motion is DENIED, and the
Cross-Motion is GRANTED.
It is so Ordered.
February 6, 1998 Ronald Berger
Ad Hoc Chairman
GPO Board of Contract Appeals
1 The Contracting Officer's appeal file, assembled pursuant to
Rule 4 of the Board's Rules of Practice and Procedure, was
delivered to the Board on July 7, 1993. It will be referred to
as the Rule 4 File, with an appropriate Tab letter also
indicated. The Rule 4 File consists of 19 documents identified
as Tab A through Tab R.
2 Although the Board's rules do not explicitly provide for a
summary judgment procedure, the Board routinely entertains
summary judgment motions. See Graphicdata, Inc., GPOBCA
35-94 (June 14, 1996), slip op. at 47, 1996 WL 812875, and
cases cited therein.
3 Although this document was not identified in the schedule
established by the Board, the Board, upon the Appellant's request
and without objection from the Respondent, allowed the filing.
Order Granting Appellant's Request to File Reply Brief To
Respondent's Opposition to Appellant's Motion for Summary
Judgment.
4 The record also includes the Complaint dated July 8, 1993,
and the Answer dated August 18, 1993.
5 Unlike the Executive Branch regulations which require a cure
period of at least 10 days, see Federal Acquisition Regulation §
49.402-3(d), the Respondent's rules allow periods of less than 10
days. See Printing Procurement Regulations (hereafter PPR), GPO
Pub. 305.3 (Rev. 10-90), Chap. XIV, Sec.1, ¶ 3.c.(2).
6 For a decision holding that failure to make timely delivery and
failure to make progress are not mutually exclusive, see Finast
Metal Prods., Inc., ASBCA 19860, 77-1 BCA ¶ 12331, where the
Armed Services Board of Contract Appeals held that a contractor
who had failed a first article requirement and had other progress
failures could be defaulted on both bases. See also Industrial
Metal Fabricating Co., Inc., ASBCA 11170, 70-2 BCA ¶ 8533, also
involving a failure to deliver preproduction items, where an
agency based a default on both grounds.
7 The third basis in the clause-failure to perform any other
contract provision-is also intended for application in
situations arising prior to delivery. According to Professors
Nash and Cibinic, "[t]he significance of the 'other
provisions' language in the default clause is to give the
Government the right to terminate prior to delivery date
without the necessity of establishing a progress failure."
Cibinic & Nash, Administration 936 (emphasis added).
8 This should be after the expiration of the cure periods,
as cure periods are not to be provided where the time
remaining until delivery is not sufficient to allow a
realistic cure period. PPR, Chap. XIV, Sec. 1, ¶ 3.c.(2).
9 For other cases where the Respondent's contracting officers
have used this or similar language to default contractors
for failure to deliver on time, see, e.g., Rose Printing,
Inc., GPOBCA 32-95 (December 16, 1996), slip op. at 10
("inability to perform"), 1996 WL 812880; Gold Country Litho,
supra, at 8 ("inability to perform per specifications"); Asa
L. Shipman's Sons, Ltd., GPOBCA 06-95 (August 29, 1995), slip
op. at 7 ("inability to perform the requirements of the
contract"), 1995 WL 818784; International Lithographing,
GPOBCA 1-88 (December 29, 1989), slip op. at 10 ("inability
to perform within the schedule of the contract"), 1989 WL
38498. See also Univex International, GPOBCA 23-90 (July 31,
1995) slip op. at 20, 1995 WL 112554, where the Board had no
difficulty in determining that a default termination based on
a "failure to print an acceptable product" also was a default
for failure to deliver by the time specified.
10 In reaching its decision, the Board recognizes that, while the
Appellant made no mention of an extended delivery date in its
Motion or App. Reply, it did state in its Statement of Facts that
based on the April 28, 1993, delivery of the cromalin and Dylux
proofs, "the final product was due on May 7, 1993," and did
allege in its Complaint that at the time of termination the
"delivery date had not yet passed," that the delivery of a new
computer disk on April 30, 1993, "caused Appellant performance
delay," and that furnishing the disk constituted a constructive
change. The Appellant also raised the constructive change
argument in opposing the Cross-Motion, asserting that the change
entitled it to at least three additional days to perform. See
App. Op. at 3. The Appellant's pleadings and assertions,
however, do not clearly establish that there was or should have
been an extension to the delivery date. While the Appellant's
president referred in his affidavit to a "deadline of May 7,
1993," Wiggins Affidavit at 2, there is nothing further to
indicate why or how the delivery deadline had become May 7
instead of May 4. On the other hand, in his declaration the
Contracting Officer unequivocally stated that he did not grant
any extensions and that the Appellant had been advised that there
would be no extensions. Weiss Declaration at 1. In short, the
record falls far short of establishing that the contract deadline
had changed. Particularly in this summary judgment proceeding,
where facts not firmly established are construed against the
moving party, Vanier Graphics, Inc., supra, at 32-37; RBP
Chemical Corp., GPOBCA 4-91 (January 23, 1992), slip op. at
23-24, 1992 WL 487876, for purposes of the Motion the Board
cannot view the contract delivery date as anything other than May
4, 1993. Moreover, the default termination is necessarily based
on what the contracting officer believes the delivery date to be;
consequently, even if the Appellant establishes, subsequent to
the default, that it was entitled to an extension of the delivery
date, that would have no effect on the basis for the default.
11 The Contracting Officer also states that he "did not authorize
any extension and [that] Artisan's delinquencies did not entitle
[it] to unilaterally extend the schedule." Weiss Declaration.
12 The affidavit does state that "[a]s a result of [the April 30]
meeting, I felt that Artisan could readily correct all of the
problems . . . and . . . that we could do so within our deadline
of May 7, 1993." Wiggins Affidavit at 2. There is nothing in
this affidavit to explain the basis for the "deadline of May 7";
there is also no mention of the new disk or any problems or
delays that the disk might engender. Accordingly, and since this
affidavit was furnished along with the Motion and Statement of
Facts, the deadline date referred to by Mr. Wiggins would seem to
be based on Artisan's tardy delivery of cromalin and Dylux proofs
on April 28 rather than on any constructive change resulting from
the furnishing of the new disk.