U.S. Government Printing Office Contract Appeals Board Lawrence Kennelly, Member Jay E. Eisen, Member Appeal of Information Systems, Inc. CA 78-11 January 18, 1979 Motion to Dismiss The appellant made a claim against the United States Government for an alleged breach of contract that was entered into between the United States Government Printing Office and Information Systems, Inc. This claim was denied by the Contracting Officer and an appeal was made to the Board. The Respondent has made a Motion to Dismiss this claim on the basis that this Board has no jurisdiction to hear this claim. The Appellant has opposed this Motion. The contract entered into was a "requirements" contract that required the Appellant to produce hard copy prints (drawings) on furnished Aperture Cards. These were to be produced for the Air Force. The contract provided that while no specific number of orders could be guaranteed, it was anticipated that approximately two orders per week would be placed during the term of the contract (March 1, 1977 to February 28, 1978). The total quantity estimated during the term of the contract was 8,000 prints with an order averaging approximately 25 Aperture Cards (75,623 items). The Appellant was low bidder and bid $67,913.82 for the production of the items that were to be produced on specific orders. During the term of the contract, the Appellant was asked to produce only 134 items for a total cost of $1,558.51. On May 28, 1978, the Appellant made a claim for $52,297 alleging the Government had not complied with the specifications in the contract. This was arrived at by totalling the anticipated profits of $19,700 and $32,597 for expenses incurred in obtaining the necessary equipment to produce the work. The claim was denied by the Contracting Officer on the basis that the amounts set forth in the contract were estimates and they were not to be construed as a guarantee of the volume of work which may be ordered under the contract. The appellant appealed and alleged there was a breach of contract and requested relief for "the material breach of the contract and the inequitable burden imposed on the contractor by that breach." The Respondent moved for a dismissal on the grounds that this Board lacks jurisdiction to decide questions involving breach of contract. The Respondent based its position on U.S. v. Utah Construction and Mining Co., 384 U.S. 394 (1966); Jack Clark , ASBCA No. 333672 (1957), 57-2 BCA ¶ 1402; Alco Lumber Co., Inc., ASBCA No. 9641 (1964), 1964 BCA ¶ 4349; E & E.J. Pfotzer, Eng. BCA No. 2656 (1965), 65-2 BCA ¶ 5144; Harbor Printing & Copy Service, GPO CAB CA 77-5 (1977). The Appellant responded by opposing the granting of the motion on the basis that there are a number of factual issues to be decided. The Appellant also claims in the alternative that the contractor's claim had followed the roadways in the "Disputes" clause, and if the contract was ambiguous and permitted either party to misdirect a claim through the "Disputes" procedure, the burden of the ambiguity must be borne by the Government as the drafter of the contract. The Appellant cites Bennett v. U.S., 371 F.2d 857, as authority that the parties cannot deny the applicability of the "Disputes" procedure after they had followed it on any matter which could be resolved within the procedure. The Appellant cited H. L. Yoh Co., Inc. v. U.S., 153 Ct. Cl. 104, 288 F.2d 493 (1961), as an example of a dispute similar to the one involved here. That one travelled through the conduct of the "Disputes" clause to the Armed Services Board of Contract Appeals. In the H.L. Yoh case, there was a claim made by a contractor under a "time and materials" contract. The Government reduced the number of drawings the contractor was to work on in the Detroit Arsenal. The contractor appealed to the Secretary of the Army and the appeal was heard by the Armed Services Board of Contract Appeals. The appeal was denied. The Appellant petitioned the Court of Claims and it upheld the appeal. The court held: ". . . where a time and materials contract did not specify the number of drawings and lists to the changed and converted but the parties contemplated a total job and the rate to be charged for overhead was computed on that basis, a change order calling for selective rather than total conversion was a change increasing the contractor's overhead expense." 153 Ct. Cl. 104 at 104. The important thing to note in that case is that it is a time and material contract. In the case we are considering it is a "requirements" contract and the H. L. Yoh case is distinguishable on that basis; also there was no change order required or issued under the terms of the contract. The other case cited by the Appellant is Bennett v. U.S., 371 F.2d 859 (1967). In that case, we had a contractor suing the Government for additional compensation for extra work in excavating a river levee. The Court of Claims held that the contractor's interpretation of the specifications which fixed the distances was reasonable and thus the contractor was entitled to receive additional compensation. The court found there was an ambiguity and the burden of that ambiguity falls on the party who drew the specifications. 371 F.2d 859 at 861. The ambiguity the Appellant is alleging in the contract we are considering is in the "Disputes" clause. The Appellant claims he has followed the road map laid down by the Government; when he has done this, the Government cannot now claim there is no dispute under the contract that can be heard by the Appeals Board. We think there is a distinction between a substantive portion of the contract and an administrative portion. We see no ambiguity in the "Disputes" clause nor do we consider that the Contracting Officer waived the right of the Government to move to dismiss when he denied an appeal and suggested moving to the next step. Therefore, we do not think Bennett v. U.S., 371 F.2d 859, is applicable. The Respondent has cited U.S. v. Utah Construction & Mining Co, 384 U.S. 394 (1966). This case hold that Government contract "Disputes" clause does not extend to breach of contract claims not redressable under other clauses of the contract. What does the court mean when it states "not redressable under other clauses of the contract?" The court discusses this when it states: "An illustration of the disestablishment of breach of contract claims through the fashioning of additional contract adjustment provisions is provided by contractual provisions designed to deal with just such claims for delay damages as are presented here." 384 U.S. 394 at 415. An example of this is given: ". . . A more extensive clause for 'Price Adjustment for Suspension, Delays, or Interruption of Work,' . . . was promulgated in 1961 for optional use in Department of Defense fixed-price construction contracts." 384 U.S. 394 at 416. The Court also pointed out: ". . . An Interagency Task Group is currently reviewing the clauses in the standard contract forms, including the Changes, Changed Conditions and Suspension of Work clauses, to determine whether they should be expended in coverage to prevent fragmentation of remedies . . . . While in one respect it can be said that clauses broadening remedies under the contract have been adopted in response to restrictive interpretation of the disputes clause and express dissatisfaction with the unavailability of an administrative remedy, the fact that the response has taken this measured form has manifested the parties' reliance on the prior interpretation and has properly tended to reinforce it. As the ASBCA remarked in Simmel-Industrie, supra, '[i]t is noteworthy that when it is intended to provide an administrative remedy for Government delays, specific contract clauses have been developed and are set forth for that purpose,' . . . ." 61-1 BCA ¶ 2917 at 15,234. Therefore, what the court is saying is unless there was specific language in the contract to convert what would otherwise be claims for damages for breach of contract into claims payable under such contract, and hence to be regarded as "arising under the contract," the Appeals Board does not have authority to entertain a breach of contract case. There is no provision in the contract in this case that would give the parties the right to convert a pure breach of contract claim for failure to order the total number of hard copy prints that were estimated. Therefore, this case comes squarely under the rule set down in U.S. v. Utah Construction & Mining Co., 384 U.S. 394 at 412 where it states: "Thus the settled construction of the disputes clause excludes breach of contract claims from its coverage, . . . ." The other cases cited by Respondent will be discussed seriatim. Jack Clark , ASBCA No. 3672 (1957), 57-2 BCA ¶ 1402: The Appeals Board in this case said: "In our opinion both items of this claim are beyond the jurisdiction of the Board. The claim for water damage to the matarials [sic] stored in the assigned area, alleged to be situated in low ground, is one for damages for breach of contract and is clearly not within our power to adjudge. . . . We can find no clause, nor have we been referred to one, providing for payment or adjustment under the circumstances asserted." 57-2 BCA ¶ 1403 at 4617. In Alco Lumber Co., ASBCA No. 9641, 1964 BCA ¶ 4349, we had a case where there was a motion to dismiss an appeal because the Government failed to order the minimum quantity of lumber specified in an indefinite quantities contract. The Board found in the absence of a contract provision for an adjustment to dispose of the Government's liability for failure to order, the appeal was beyond the cognizance of the ASBCA. In E. & E.J. Pfotzer, BCA No. 2656 (1965), 65-2 BCA ¶ 5144, the Board found: "To the extent that Claim 0 is promised on a breach of contract by the Government, it is well settled that neither the Contracting Officer nor the head of the department has jurisdiction to decide the matter in the absence of an agreement between the parties, . . . ." In Harbor Printing v. Copy Service, GPO CAB CA 77-5, the GPO Contract Appeals Board dismissed a claim for a breach of contract on the basis the Board had no jurisdiction to decide such a claim. We have reviewed the "Disputes" clause in this contract, and the one in U.S. v. Utah Construction & Mining Co., supra, and find there is no substantial difference between them. The Appellant claims there are a number of fact questions to be decided. If this Board had the authority to grant equitable relief, these might be of some importance. It has been established that Boards of Contract Appeals do not have the right to grant equitable relief. See, Astronetic Research, Inc., 1963 BCA ¶ 3794; International Dairy Supply Co., ASBCA No. 6150, 61-1 BCA ¶ 2873; Baldwin Lima Hamilton Corp., 61-1 BCA ¶ 3018. In all of these cases the Board has ruled that Boards of Contract Appeals have jurisdiction to award relief based on the terms of the contract and which, therefore, are legal in nature and not equitable. Therefore, we see no need to go into the questions raised by the Appellant. Therefore, in view of the above, there is no appropriate question of fact before this Board and we have reached the conclusion that this motion should be granted and the appeal dismissed.