BOARD OF CONTRACT APPEALS
U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON, DC 20401
In the Matter of )
)
the Appeal of )
)
GRAPHICDATA, INC. ) Docket No. GPO BCA 35-94
Program D306-S )
Purchase Order 94586 )
DECISION AND ORDER SCHEDULING A HEARING
By Notice of Appeal dated October 21, 1994, GraphicData, Inc.
(Appellant or Contractor), alleging that Contracting Officer
Richard Weiss has failed to issue a final decision on an
equitable adjustment claim it filed with the U.S. Government
Printing Office (Respondent or GPO or Government) within a
reasonable time, asks the Board to assert jurisdiction over
the matter.1 GPO Instruction 110.12, Subject: Board of
Contract Appeals Rules of Practice and Procedure, dated
September 17, 1984, Rule 1(c) (Board Rules).2 The Appellant
attached its Complaint to its Notice of Appeal. Board Rules,
Rules 2 and 6.
The Notice of Appeal and accompanying Complaint were assigned
docket number GPO BCA 35-95 by the Clerk of the Board on
October 27, 1994, and copies were sent to the Respondent the
same day.3 Board Rules, Rule 3. However, on November 4,
1994, before the Board could prepare and serve its official
docketing letter on the Contractor, the Respondent filed a
document entitled, "Motion to Dismiss" (Motion) asking the
Board to dismiss the appeal on the ground that it is premature
because the Contracting Officer has not had a reasonable
amount of time to dispose of the claim. See, Motion, pp. 1,
2-3. In that regard, Counsel for GPO stated that consistent
with the Board's preference for audited claims, see, Motion,
p. 2 (citing, Banta Company, GPO BCA 03-91 (November 15,
1993), Sl. op. at 57; R.C. Swanson Printing and Typesetting
Company, GPO BCA 15-90, Decision on Motion for Reconsideration
and Order (December 20, 1993), Sl. op. at 14), the Contracting
Officer had referred the matter to GPO's Office of the
Inspector General (OIG) for an audit, and until that
investigation was finished, there was no basis for an appeal
to the Board, see, Motion, pp. 2-3 (citing, Cosmo Construction
Company, IBCA No. 412, 64 BCA ¶ 4,059). Since the Contracting
Officer was entitled to a reasonable amount of time under Rule
1(c) of the Board Rules to issue a final decision on a claim
of this magnitude,4 the Respondent asked the Board to dismiss
the appeal.5 See, Motion, p. 3.
Thereafter, on November 8, 1994, Counsel for the Appellant
filed the Contractor's "Opposition to Government's Motion to
Dismiss and Request for Telephonic Conference" (Opposition).
In its Opposition, the Appellant argued, inter alia, that: (1)
the appeal fully complied with Rule 1(b) of the Board Rules,
which allows a contractor to seek Board redress from the
failure of a contracting officer to issue a final decision
once the claim has been in the contracting officer's hands for
60 days or a reasonable time (the Appellant says that should
have been less than 60 days under the circumstances here)
(citing, EPCo Associates, GPO BCA 26-93 (November 18, 1993);
(2) the Contracting Officer waited an unreasonable length of
time to order an audit of the claim, and in any event an
audit, timely or not, does not offset the Contracting
Officer's failure to issue a final decision (citing, Dewey
Electronics Corporation, DOTCAB No. 1224, 82-2 BCA ¶ 15,828;
Inter-con Security Systems, Inc., ASBCA No. 45749, 93-3 BCA ¶
26,061); (3) by analogy to the Contract Disputes Act of 1978
(CDA), 41 U.S.C. § 601 et seq., in this case the Contracting
Officer not only failed to make a timely final decision, but
he also refused to establish a date certain for ruling on the
claim, see 41 U.S.C. § 605(c)(2)(A),(B); (4) on the other
hand, even if the Board finds that the appeal is premature, it
should continue the appeal but stay further proceedings
pending issuance of a final decision by the Contracting
Officer, see Board Rules, Rule 1(d); and (5) a telephone
conference between the parties and the Board would be
appropriate in order to discuss the date by which the
Contracting Officer would issue a final decision. See,
Opposition, pp. 2, 5-8.
On November 25, 1994, Counsel for GPO submitted a document
entitled "Respondent's Reply to Appellant's Response to Motion
to Dismiss" (Reply) to the Board. The Reply served two
purposes, namely, it placed on the record: (1) the
Respondent's disagreement with the Appellant's version of the
date on which the claim was forwarded to the OIG for an
audit;6 and (2) GPO's position not only with respect to the
meaning of the Board's opinion in EPCo Associates, supra, but
also why that decision did not apply to the facts here. See,
Reply, pp. 1-2. Accordingly, the Respondent renewed its
contention that the appeal was premature and should be
dismissed in order to give the Contracting Officer time to
render a reasoned decision based on the results of the OIG
audit.7 See, Reply, p. 3.
The Board has carefully weighed the procedural arguments of
the parties against the requirements of the Board Rules, and
has concluded that the Appellant's request for a conference is
appropriate under the circumstances presented here. Board
Rules, Rule 5.
As a rule, an appeal is initiated with the Board when a
contractor notes a disagreement with a contracting officer's
final decision. EPCo Associates, supra, Sl. op. at 3. See,
Board Rules, Rule 1(a). Indeed, in most cases the Board's
jurisdiction is predicated on a contractor first submitting
its claim to the contracting officer for a decision. See,
Shepard Printing, GPO BCA 37-92 (January 28, 1994), Sl. op.
32. Accord, Associated Contract Specialties Corporation,
ASBCA No. 37437, 90-3 BCA ¶ 23,258; Spruill
Realty/Construction Company, ASBCA No. 40477, 90-3 BCA ¶
23,255. Thus, the underlying precepts of the Board Rules are
essentially the same as those of the CDA, which places great
emphasis on the role of a contracting officer in resolving
contract claims, makes his/her decision an indispensable
precondition to the assertion of a contract appeal, and
characterizes that final decision as "the linchpin" for the
contract appeal process. Paragon Energy Corporation v. United
States, 645 F.2d 966, 967 (Ct.Cl. 1981). See also,
Continental Products, Inc., ASBCA No. 45193, 93-2 BCA ¶
25,879, at 128,740; John C. Grimberg Company, Inc., ASBCA No.
42695, 91-3 BCA ¶ 24,074, at 120,521 (The [CDA] does not
authorize an impatient contractor to jump-start the litigation
process); DHR, Incorporated, EBCA No. 401-12-87, 88-1 BCA ¶
20,451, at 103,430.
To the extent that the Rule 1 allows a contracting officer 60
days to issue a final decision for claims of $50,000 or less,
or a "reasonable time" for claims in excess of $50,000, the
Board Rules are no different than the requirements of the
CDA.8 Compare, Board Rules, Rules 1(b) and 1(c) with 41
U.S.C. §§ 605(c)(1),(3). See also, Robert Augustine & Sons,
Inc., VABCA No. 3079, 90-1 BCA ¶ 22,506 (claims of $50,000 or
less); Executive Elevator Service, Inc., VABCA No. 2741, 88-3
BCA ¶ 20,964 (claims in excess of $50,000). A "reasonable
time" is determined under the CDA by taking into account such
factors as the size and complexity of the claim and the
adequacy in support of the claim provided by the contractor.
41 U.S.C. § 605(c)(3). See, Roebbelen Engineering, Inc., DOT
BCA No. 1814, 87-1 BCA ¶ 98,628; Universal Contracting, DOT
CAB Nos. 1565, 1600, 1601, 85-3 BCA ¶ 18,326. There is no
comparable definition of "reasonable time" in the Board Rules,
although the similarity between those regulations and the CDA
with respect to other relevant language, as well as their
shared procedural philosophy, allows the conclusion that the
CDA's definition is implied in the Board Rules.
Simply put, the procedural issue presented here is does the
Board have jurisdiction to decide the Appellant's claim
because the Contracting Officer has exceeded the time allowed
to issue a final decision, or has otherwise unduly delayed his
decision?9 See, DHR, Incorporated, supra, 88-1 BCA ¶ 20,451;
Computer Systems & Resources, Inc., GSBCA No. 8434-TD, 86-3
BCA ¶ 19,017. Stated otherwise, the question is should the
appeal be dismissed without prejudice at this time on the
ground that it is premature,10 because the Contracting Officer
has not had a "reasonable time" to issue his final decision on
the Contractor's claim?11 See, John C. Grimberg Company,
Inc., supra, 91-3 BCA ¶ 24,074; Executive Elevator Service,
Inc., supra, 88-3 BCA ¶ 20,964; Roebbelen Engineering, Inc.,
supra, 87-1 BCA ¶ 98,628. A review of the Board's previous
decisions discloses that it has never been faced with
precisely this question before.12
It has been said that jurisdiction and prematurity are
distinguishable concepts, primarily because the former depends
on the mere passage of time,13 while the latter invests a
great deal of discretion in the deciding official to determine
how much time is reasonable under the particular circumstances
of the case, a matter on which reasonable jurists may, and
probably will, differ. See, Roebbelen Engineering, Inc.,
supra, 87-1 BCA at 98,630. Regardless, the only procedure
available under the Board Rules to decide the prematurity
issue presented here is the one established to dispose of
jurisdictional challenges. That procedure provides, in
pertinent part:
Any motion addressed to the jurisdiction of the Board
shall be promptly filed. Hearing on motion shall be
afforded on application of either party. However, the
Board may defer its decision on the motion pending
hearing on both the merits and the motion. . . .
Board Rules, Rule 5. [Emphasis added.] The Appellant's request
in this case for a conference to discuss the date by which the
Contracting Officer would issue a final decision, see,
Opposition, p. 8, is tantamount to a request for a hearing on the
Respondent's Motion. In the Board's opinion, the Respondent's
Motion and the Appellant's Opposition have raised a threshold
jurisdictional issue, and it believes that a sound administration
of the rules in this appeal requires a hearing on that question
alone. See, Graphic Image, Inc., GPO BCA 05-94, Order Scheduling
Hearing (April 19, 1994), Sl. op. at 4.
ACCORDINGLY, a hearing has been scheduled for 10:00 a.m.
(EST), on Tuesday, January 3, 1995, in the Board's Conference
Room (Room A-651), at the U.S. Government Printing Office, 732
North Capitol Street, NW., Washington, DC 20401.
It is so Ordered.
December 21, 1994 STUART M. FOSS
Administrative Judge
_______________
1 From the sparse documentation in the appeal file, the Board
understands that the Appellant's claim amounts to
$532,092.74. See, Appellant's Complaint, dated October 21,
1994, ¶ 5.
2 Rule 1(c) of the Board Rules provides: "Where the
contractor has submitted a claim in excess of $50,000 and has
requested a final decision from the contracting officer and
the contracting officer has failed to issue a decision within
a reasonable time, the contractor may file a notice of appeal
as provided in subparagraph (a) above, citing the failure to
issue such decision."
3 On October 27, 1994, and October 28, 1994, respectively,
Counsel for the Appellant telephoned the Board and was given
the docket number of the appeal, and was told that the
documents had been served on the Respondent by the Board. At
the same time, Counsel for the Appellant was informed that
his request to have this procedural matter processed under
the optional Small Claims (Expedited) procedure for claims of
$10,000.00 or less, on the ground that no dollar amount was
involved, see Notice of Appeal, would not be considered.
Board Rules, Rules 12.1(a) and 12.2. Simply stated, while
the Board admired Counsel's creative interpretation of the
rules, the Small Claims (Expedited) procedure does not apply
to this preliminary stage of the appeals process or to the
procedural issue raised.
4 Rule 1(b) allows a GPO contracting officer 60 days to issue
a final decision on claims of $50,000.00 or less. Board
Rules, Rule 1(b). Since the claim in this case is more than
10 times that amount, and is governed by Rule 1(c) which
speaks in terms of a contracting officer's decision being
issued within a "reasonable time", the Respondent believes
that it was unrealistic for the Appellant to expect such a
decision within 60 days, and hence the appeal itself was
unreasonable.
5 Alternatively, since the OIG anticipated completion of its
audit by the end of January 1995, see, Motion, p. 3, fn. 2,
Counsel for GPO suggested that the appeal should be dismissed
in accordance with the policy announced by the Board in
Universal Printing Company until the audit is completed.
Motion, p. 3 (citing, Universal Printing Company, GPO BCA
9-90 (June 22, 1994)). In Universal Printing Company, the
Board was faced with a contractor's claim which was
"practically undecipherable", and while the age of the case
militated in favor of deciding the dispute on the record as
it existed, the Board stated that: ". . . in the future, if
in the judgment of the Board the clarification of a claim on
appeal is necessary in order to resolve a dispute, it will
remand the matter to the Contracting Officer, through
Government Counsel, with instructions to have the claim
audited, and will dismiss the appeal without prejudice until
the audit is complete. [Footnote omitted.] See, National
Council of Negro Women, LBCA No. 84-BCA-18, 84-2 BCA ¶
17,436, at 86,827. The Board is confident that, in the long
run, this new policy will buttress a major purpose of the
Board's preliminary procedures, namely, obtaining fully
disclosure of relevant and material facts." See, Universal
Printing Company, supra, Sl. op. at 30. The situation in
Universal Printing Company is clearly distinguishable from
the instant appeal; hence, the announced policy is
inapplicable here. In Universal Printing Company, although
the Board was not happy with the record before it,
nonetheless it had extensive documentation from the
contractor concerning the claim, a final decision from the
contracting officer, and it was well aware of the respective
positions of the parties on the claim from the discussions at
the prehearing conference and the briefs they subsequently
filed. Here, by contrast, the parties have barely stepped
across the Board's threshold in developing a record. In
short, this appeal is not what the Board had in mind when it
announced its policy in Universal Printing Company.
6 The Appellant claims that an audit was not requested by the
Contracting Officer until October 11, 1994. See, Opposition,
p. 5, ¶ 8. The Government, on the other hand, contends it
asked the OIG to audit the claim on September 21, 1994, see,
Reply, p. 1 (citing, Declaration of Richard Weiss, dated
November 23, 1994). The auditor assigned to the claim, Edwin
L. Hawse, states that he received the Contracting Officer's
audit request on or about September 27, 1994. See, Reply, p.
1 (citing, Declaration of Edwin Hawse, dated November 23,
1994).
7 In that regard, Counsel for GPO advises the Board that: (a)
the OIG forecasts that its audit will be completed by the end
of January 1995, see, Motion, p. 3, fn. 2; and (b) the
Contracting Officer will provide a final decision on the
claim within two weeks of his receipt of the final audit
report, see, Reply, p. 3, fn. 1.
8 There are, however, two significant procedural differences
between the Board Rules and the CDA in this area which the
Board cannot ignore. First, under the CDA a contracting
officer's final decision which may be appealed pursuant to 41
U.S.C. § 606, may be an actual decision or a "deemed denial"
decision; i.e., one imputed from the failure of the
contracting officer to issue a decision with the "period
required", see, 41 U.S.C. § 605(c)(5). See, e.g., Winston
Corporation, ASBCA No. 40591, 92-3 BCA ¶ 25,213; Melvin R.
Kessler, PSBCA No. 2820, 91-1 BCA ¶ 23,511; Central
Manufacturing Corporation, ASBCA No. 39324, 90-2 BCA ¶
22,885; CBI Na-Con, Inc., ASBCA No. 37972, 89-2 BCA ¶ 21,728.
The Board Rules do not provide for "deemed denial" decisions
as the basis for jurisdiction. See, EPCo Associates, supra,
Sl. op. at 3, fn. 4. Second, within the 60-day decision
period the CDA allows a contracting officer to either: (a)
issue a decision; or (b) notify the contractor of the time
within which a decision will be issued. See, Cessna Aircraft
Co., ASBCA No. 43196, 92-1 BCA ¶ 24,425, at 121,909; John C.
Grimberg Company, Inc., supra, 91-3 BCA at 120,520; Robert
Augustine & Sons, Inc., supra, 90-1 BCA at 112,972 (the
contracting officer's notification must be based on a "good
faith" estimate of the time within which a decision will be
issued). See, 41 U.S.C. § 605(c)(2)(A),(B). There is
nothing in Rule 1 of the Board Rules, or in Chapter X of
GPO's Printing Procurement Regulation, GPO Publication 305.3
(Rev. 10-90), which applies to the processing of claims,
comparable to the "notification" provision of the CDA (41
U.S.C. § 605(c)(2)(B)).
9 It should be noted that even where jurisdiction is
asserted, the Board has the same authority as its
counterparts under the CDA to still direct the contracting
officer to issue a decision and, at its option, stay further
proceedings until that it accomplished. Compare, Board
Rules, Rule 1(d) with 41 U.S.C. §§ 605(c)(4),(5). See, EPCo
Associates, supra, Sl. op. at 3-4. Accord, DHR,
Incorporated, supra, 88-1 BCA ¶ 20,451; Emerson Electric
Company, ASBCA No. 31184, 86-2 BCA ¶ 18,979; Feinstein
Construction Company, Inc., ASBCA No. 30519, 86-1 BCA ¶
18,660; A.D. Roe Company, Inc., ASBCA No. 26078, 81-2 BCA ¶
15,231. Similarly, it is also well-settled that a
contracting officer is not relieved from the obligation of
issuing a final decision merely because the contractor has
filed a premature appeal. See, Rice King, ASBCA No. 43352,
92-2 BCA ¶ 24,805; Atherton Construction, Inc., ASBCA No.
41414, 91-1 BCA ¶ 23,635; ACS Construction Company, ASBCA No.
36535, 89-1 BCA ¶ 21,406.
10 Generally, contract appeals boards tend to see premature
appeals as "unwise", see, Sierra Blanca, Inc., ASBCA No.
30910, 85-3 BCA ¶ 18,440, at 92,653, and not an
inconsequential matter to be regarded lightly, see, Emerson
Electric Company, supra, 86-2 BCA at 95,856. However, it is
also the case that prematurity is not always fatal to the
justiciability of an appeal. See, Briggs Engineering and
Testing Company, Inc. v. United States, 230 Ct.Cl. 828
(1982); Monaco Enterprises, Inc., ASBCA No. 27423, 86-2 BCA ¶
18,922; The Boeing Company, ASBCA No. 27396, 83-1 BCA ¶
16,256; R.G. Robbins, Co., Inc., ASBCA No. 26521, 82-1 BCA ¶
15,643. See also, John C. Grimberg Company, Inc., supra,
91-3 BCA at 120,520. This is particularly true where despite
the lack of a final decision, the facts indicate that no
useful purpose would be served by suspending or dismissing
the appeal and directing the contracting officer to issue a
formal decision, especially if the record already contains
the Government's expression of an opinion on the claim so
that the matter has clearly crystallized into a dispute ripe
for adjudication. See, Emerson Electric Company, supra, 86-2
BCA at 95,857; Fuel Storage Corporation, ASBCA No. 26994,
83-1 BCA ¶ 16,418.
11 If the Board in this appeal was faced with a claim of
$50,000 or less, the issue could be decided by simple
reference to the calendar and a brief arithmetical
computation to see if more than 60 days had passed without a
final decision by the Contracting Officer. Board Rules, Rule
1(b). However, because the claim is for a greater amount, a
more complex legal determination of what is a reasonable time
under all the circumstances is required of the Board.
12 Although instructive, the situation in EPCo Associates can
be distinguished from this proceeding. In that case, the
parties came to the Board after the Federal Claims Court had
dismissed the contractor's direct action suit because it had
not exhausted its administrative remedies. See, EPCo
Associates v. United States, No. 93-309C (August 17, 1993).
The appeal record showed: (a) the disputed claim was
virtually identical to allegations in the complaint
considered by the Court; (b) the contracting officer had been
substantially involved in that civil matter and had
throughout the case opposed the contractor's right to any
recovery; and (c) the contracting officer was familiar with
the substance of the claim. Under these circumstances, the
contractor believed that 30 days was more than sufficient
time for the contracting officer to issue a final decision,
particularly since the claim and the court complaint were
substantially the same. EPCo Associates, supra, Sl. op. at
2. In essence, because everyone involved in that proceeding
knew the contracting officer's views, and it was clear to the
Board that his decision would be a mere formality, it
asserted jurisdiction over the appeal. As the Board pointed
out, while a final decision from the contracting officer is
normally a prerequisite to an appeal, that "does not mean,
however, that a contracting offcer can frustrate the appeals
process by refusing to issue a final decision." Id., at 3.
On the other hand, for the sake of the record, the Board
exercised its option under its rules and asked the
contracting officer to provide it with a final decision,
giving him 60 days to do so, and stayed further proceedings
pending its receipt. Id., at 3-4. Board Rules, Rule 1(d).
Accord, Emerson Electric Company, supra, 86-2 BCA ¶ 18,979
(although the contractor's appeal was technically premature,
the board took jurisdiction because the government had
already expressed its position on the claim so that the
matter was clearly ripe for adjudication).
13 The Board's rules allow a contractor 90 days from the date
of receipt of a contracting officer's final decision to file
an appeal. Board Rules, Rule 1(a). This time limit is
jurisdictional; i.e., an appeal filed more than 90 days after
receipt of the contracting officer's final decision is
generally not considered by the Board. See, Ace Duplicating
Company, GPO BCA 44-92 (February 1, 1993). However, there is
a critical distinction between the Board's practice and the
90-day rule followed by Executive Branch boards under the
CDA. See, 41 U.S.C. § 606. In that regard, under the CDA
the 90-day time limit is strictly construed because the right
to appeal a contracting officer's decision is a waiver of
sovereign immunity by the United States. See, Elden-Rider,
Inc., GSBCA No. 8643, 90-2 BCA ¶ 22,878; Avon C. Brown, Inc.,
DOT CAB 1082, 80-1 BCA ¶ 14,399. The Board normally applies
its 90-day filing rule strictly as well. See, Ace
Duplicating Company, supra. See also, Moore Business Forms &
Systems Division, GPO BCA 3-86 (February 25, 1987). But, the
Board sees nothing in the legislative history of 44 U.S.C. §
502 to indicate that by authorizing the Public Printer to
contract out printing, binding, and blank-book work, Congress
thereby also intended to waive the Government's sovereign
immunity with respect to his settlement of contract claims
against the United States. See, The Wessel Company, Inc.,
GPO BCA 8-90 (February 28, 1992), Sl. op. at 44.
Accordingly, the Board believes there is a measure of
flexibility in its 90-day rule, and it will exercise its
discretion to allow an otherwise late appeal if good cause is
shown for the delay. See, e.g., McDonald & Eudy Printers,
Inc., GPO BCA 06-91 (May 6, 1994) Sl. op. at 2, fn. 2.