Appeal of
WESTON SOLUTIONS, INC.

PSBCA No. 5407

Under Contract No. 109480-05-B-0014

APPEARANCE FOR APPELLANT:
James F. Butler III, Esq.
Smith, Currie & Hancock, LLP

APPEARANCE FOR RESPONDENT:
Patrice R. Dickey, Esq.
Memphis Field Office
United States Postal Service
225 N. Humphreys Boulevard
Memphis, TN 38166-0170

OPINION OF THE BOARD

            This appeal involves the emergency cleanup by Appellant, Weston Solutions, Inc., of a postal facility in New Orleans that was damaged by Hurricane Katrina.   It raises the question of which party bears the responsibility for costs incurred in performing the cleanup that exceeded the amount identified in Appellant’s proposal and in the resulting work order issued by Respondent, United States Postal Service.  We conclude that Respondent should bear some of the excess cost, and sustain the appeal, but only to the extent indicated in this Opinion.  The parties elected to submit this appeal on the record, pursuant to 39 CFR § 955.12.  Only entitlement is at issue (Order of August 2, 2007).

FINDINGS OF FACT

            1.  Respondent and Appellant were parties to an indefinite quantity contract, Contract No. 109480-05-B-0014, for environmental consultant services (Stipulations of Fact (Stip.) 1).

            2.  The contract provided that Respondent would prepare a detailed description of the services it required and that Appellant would submit a fixed price proposal for providing the required service.  The contract contemplated negotiations to arrive at a mutually satisfactory price followed by Respondent’s issuance of a fixed price work order.  (Supplemental Appeal File Tab (SAF) E8, Section B.301, Work Orders).

            3.  The contract included a suspensions and delays clause, at section B.303, addressing claims for Respondent’s suspension, delay, or interruption of Appellant’s work: 

b.  A claim under this clause will not be allowed:  (1)  For any costs incurred more than 20 days before the supplier has notified the Contracting Officer in writing of the act or failure to act involved; and (2) Unless the claim, in an amount stated, is asserted in writing as soon as practicable after the termination of the delay or interruption, but not later than the day of final payment under the contract. 

(SAF E8, Suspensions and Delays (Clause B-15)(March 1999)).

            4.  The contract also included a changes clause.  Section B.1001 provided, in relevant part:

c.  If any change under this clause affects the cost of performance or the delivery schedule, the contract will be modified to effect an equitable adjustment.

d.  The supplier’s claim for an equitable adjustment must be asserted within thirty 30 days of receiving a written change order.  A later claim may be acted upon – but not after final payment under this contract – if the Contracting Officer decides that the facts justify such action. 

(SAF Tab E8, Changes (Clause B-2)(January 1997)).

            5.  Respondent’s Bywater Station in New Orleans, Louisiana was severely damaged by Hurricane Katrina in September 2005.  Contaminated water flooded the building to a depth of approximately 4.5 feet.  (Stip. 4, 6).

            6.  Following the hurricane, Respondent requested that Appellant perform an assessment of the condition of the Bywater Station (Declaration of D. Bright (Bright Decl.) ¶ 4).  On September 17, 2005, representatives of Appellant and representatives of Respondent jointly visited the Bywater Station to perform a damage assessment (Affidavit of E. Keeley (Keeley Aff.) ¶¶ 4-5). 

            7.  A joint facility assessment report was prepared as a result of the September 17, 2005 site visit (Appeal File Tab (AF) A, p. 34-51; Keeley Aff., Ex. A).  The report, which was based on a quick inspection, generally described the condition of the Bywater Station, and included a checklist of hazards rated as minor, moderate or severe, and a rating of the likelihood of work safety concerns.  Contents of some rooms of the facility were not seen or identified (Stip. 7).   

            8.  The joint facility assessment report concluded that all interior finishes were saturated with water and/or affected by mold growth (AF A, p. 41; Declaration of K. Gaughan (Gaughan Decl.), ¶ 16).

            9.  Respondent’s project manager for cleanup of the Bywater Station was a contracting officer (Gaughan Decl. ¶¶ 2-3).

            10.  Because of the emergency situation in New Orleans, Respondent did not utilize the usual contractual mechanisms specified in the indefinite quantity contract (Finding 2).  Rather, on September 26, 2005, Respondent’s project manager transmitted an email to Appellant requesting submission of a proposal under Appellant’s indefinite quantity contract to clean up the Bywater Station, as well as other postal facilities (Stip. 8; AF D161).  The September 26, 2005 email generally described that the requested cleanup would be in accordance with the September 17, 2005 joint facility assessment report, and would require power washing of flooded parking lots and paved areas; collection, double bagging and labeling of mail in the facility; and wiping down of all horizontal surfaces.  The email indicated that a postal inspector would be present during the collection and bagging of the mail.  (AF D161; Gaughan Decl. ¶ 8; Bright Decl. ¶ 8).

            11.  The parties expected Respondent to retain another contractor to renovate the Bywater Station after Appellant completed its cleanup work (AF D153; Gaughan Decl. ¶ 14).

            12.  Appellant subcontracted with SET Environmental, Inc. (SET), to perform the majority of the cleanup work at the Bywater Station (Stip. 9).

            13.  Respondent tasked its contract architect, Morton Verges Architects (MVA), to conduct oversight of the cleanup work on behalf of Respondent, and to submit project update reports to Respondent (Stip. 19).  MVA was not authorized to make changes to the project (Bright Decl. ¶ 18).

            14.  In response to Respondent’s September 26, 2005 emailed request, on September 28, 2005, Appellant submitted a preliminary proposal, and asked to revisit the facility to finalize the proposal (AF D158; Gaughan Decl. ¶ 8; Bright Decl. ¶ 4). 

            15.  On September 29, 2005, Appellant, SET and MVA, accompanied by postal inspectors, visited the Bywater Station to obtain information necessary for Appellant to submit a final proposal for the cleanup work (Stip. 10; Affidavit of C. Tameling (Tameling Aff.) ¶ 4; Affidavit of J. Olander (Olander Aff.) ¶ 6).  Due to security considerations and travel restrictions in New Orleans in the aftermath of Hurricane Katrina, Appellant was only allowed thirty minutes in the facility on that date, and was unable to access the entire facility (Stip. 10; Tameling Aff. ¶ 6). 

            16.  On September 30, 2005, Appellant submitted a revised proposal for cleanup of the Bywater Station.  The proposal was transmitted by email and the cover note asked Respondent for an emailed authorization to proceed, with hard copy paperwork to follow as soon as possible.  (Gaughan Decl. ¶ 8; Olander Aff. ¶ 9; Stip. 11; AF D153).

            17.  Although its indefinite quantity contract required fixed price work orders (see Finding 2) Appellant’s proposal purported to be on a time and materials basis but stated the work order total to be $324,394.85.  Appellant’s proposal also identified that amount as a “not to exceed” total.  (AF D153).

            18.  Appellant’s proposal generally identified as its scope of work removal of water, sediment and sludge; removal of damaged building components, equipment and debris; collection of the mail; and cleaning of the facility.  Appellant’s proposal also identified the purpose of the work to be performed:

This proposal specifically addresses the cleanup work necessary for the inside of the building and outside areas of the property prior to any renovation work that will be undertaken by USPS to make it habitable.

(AF D153, p. 2).  Appellant’s proposal was based on eighteen assumptions therein, and provided that any additional services or unanticipated conditions outside those identified assumptions might require additions to the price anticipated to be included in a resulting work order (AF D153).  Assumption 6 provided, in relevant part:

Site work at this location needs to be completed within a short timeframe.  Therefore, it is believed that the cleanup activities will require 12 to 16 hour work for up to 6 days (estimated) based on site location/distances, time spent at the site and security checks to enter the area.

            19.  An hour after receipt of the proposal, Respondent’s project manager transmitted an email to Appellant, instructing it to proceed with preparation to start the following week, and noted Respondent would issue something formal the following Monday, October 3, 2005 (AF D152; Stip. 14; Olander Aff. ¶ 10).  Based on that email, Appellant mobilized its work force and that of its subcontractor, SET (Stip. 14; Olander Aff. ¶ 10; AF D152). 

            20.  Appellant began work at Bywater Station on October 4, 2005, and completed the work on October 29, 2005 - a period of 26 days (AF D24; D26; C).

            21.  During performance of the Bywater Station cleanup work, on October 6 and on October 13, 2005, Appellant requested the formal work order (AF D113, D84).  On both occasions the project manager responded the same day that Respondent was working on the paperwork (AF D112, D81).

            22.  Respondent issued contract Work Order 15.00 for the cleanup of the Bywater Station on November 8, 2005 - after the work it required had been completed (Olander Aff. ¶ 18; AF B4).  The November 8, 2005 work order was received by Appellant on November 11, 2005 (Stip. 18, 20). 

            23.  Although the twenty-six day period of actual cleanup work by then had been completed, the November 8, 2005 work order, accompanied by a notice to proceed, identified a start date of November 3, 2005 and a duration of fourteen days, for a price of $324,387.35.  It identified the September 30, 2005 proposal submitted by Appellant as its primary scope of work.  (AF B4).

            24.  Appellant’s manager for the Bywater Station project (Olander Decl. ¶ 3), signed the November 8, 2005 work order on November 17, 2005 (AF B4).

            25.  Four days after Appellant executed the work order, on November 21, 2005, Appellant submitted a modification request (Stip. 26).  This modification request was later divided, at Respondent’s request, into three parts, two of which were paid by Respondent (Stip. 26-29).  Respondent paid a claim for a standby day before cleanup work began due to the absence of postal inspectors, and paid a claim for Appellant’s additional efforts for storage, handling and transportation of accountable materials (Stip. 27-28).

            26.  Change Order Request 3, which was part of Appellant’s modification request and is the subject of this appeal, was in the amount of $172,221.04.  The modification request was resubmitted as a certified claim on October 13, 2006 (AF, Claim Tab).  The claim sought compensation for additional costs allegedly incurred in the following general categories of work:  locked and inaccessible rooms; presence of postal inspectors; removal of screws and nails; and extra drywall removal due to continuing deterioration, latent conditions, additional segregation and disposition of items.

            27.  On December 21, 2006, Respondent’s contracting officer denied the claim in a final decision (Stip. 30; AF, Final Decision Tab).  Appellant timely appealed (Stip. 30-31).

Locked rooms.

            28.  Prior to submission of the September 30, 2005 scope of work, Appellant was not provided access to several locked rooms in the Bywater Station, and was unable to determine the contents of those rooms for several days after the work began (Stip.12; Keeley Aff. 9; Olander Aff. ¶ 14; Tameling Aff. ¶ 7).

            29.  During the September 29, 2005 site visit, a representative of Appellant asked the attending postal inspectors and the MVA representatives about the contents of the locked rooms.  They both responded that they had no information about the contents, but a representative of MVA told Appellant to assume that the locked rooms contained standard office equipment.  (Tameling Aff. ¶¶ 8-10).

            30.  When the cleanup work began, Respondent attempted to locate keys needed to open the locked rooms and initially directed Appellant not to destroy the doors (Stip. 24).  After several days, Respondent directed Appellant to break the remaining locks or knock down the doors (Stip. 24; Tameling Aff. ¶ 11).

            31.  The locked rooms were not opened until October 12, 2005 (AF D26, p. 26-27 (MVA reports of October 11, 2005, and October 12, 2005); Affidavit of D. Bareiss (Bareiss Aff.) ¶ 13).

            32.  The locked rooms contained office equipment, supplies and furniture that required removal as part of the cleanup (Stip.13).  Some of the rooms were filled from floor to ceiling with materials (Tameling Aff. ¶ 12; Bareiss Aff. ¶ 23; AF D26, p. 29 (MVA report of October 19, 2005, describing large amounts of damaged loose contents in the locked rooms); Affidavit of M. Uncaphor (Uncaphor Aff.) ¶ 7).  The contents of the locked rooms were substantially different from, and required more effort to clean than those in the unlocked rooms (Tameling Aff. ¶ 13).

            33.  Respondent required Appellant to consult with it as to the required treatment of the contents of the locked rooms (Uncaphor Aff. ¶ 7; Bareiss Aff. ¶¶ 24-25).  Respondent took between one and three days to issue instructions (Bareiss Aff. ¶¶ 26-27).

Presence of postal inspectors.

            34.  The scope of work required the presence of postal inspectors during collection and bagging of the mail, and Appellant expected postal inspectors to be present during the cleanup.  Because of the presence of mold, some of Appellant’s and SET’s employees wore respirators during portions of the cleanup.  (Uncaphor Aff. ¶ 9; Tameling Aff. ¶ 18; Stip. 15). 

            35.  Between October 8 and October 20, when cleanup work involving collection and bagging of the mail took place, the presence of postal inspectors caused Appellant to alter its cleanup efforts to protect the inspectors, who were not equipped with respirators (Uncaphor Aff. ¶ 9).

Removal of screws and nails.

            36.  The scope of work required removal of damaged building components, equipment and debris, and cleaning of the facility, but did not specifically address the removal of drywall screws and nails where damaged drywall was removed (Stip. 22).

            37.  When submitting its proposal, Appellant expected to remove and dispose of all damaged or contaminated drywall, and to wipe down any drywall left in place (Uncaphor Aff. ¶ 12).

            38.  Respondent required Appellant to remove screws and nails from the support structure of the facility in places where damaged drywall was removed (Stip. 23).

            39.  As required by Respondent, Appellant removed all such screws and nails, which was time consuming (Uncaphor Aff. ¶ 12; Olander  Aff. ¶ 16; Tameling Aff. ¶ 22; Bareiss Aff. ¶ 15).

Extra drywall removal due to continuing deterioration; latent conditions; additional segregation and disposition of items.

            40.  The continuing growth of mold during performance of the cleanup work resulted in removal of a greater amount of drywall than Appellant anticipated prior to the start of work (Uncaphor Aff. ¶ 13; Bareiss Aff. ¶ 15). 

            41.  Appellant discovered mold behind urinals and floor tiles in the bathrooms, which it was required to clean (Tameling Aff. ¶ 20).

            42.  Appellant remediated damaged structural support beams.  The damaged condition of the beams was not visible during site inspection.  (Tameling Aff. ¶ 21).

            43.  Appellant removed additional layers of drywall at a firewall location, which it did not identify during its site visits (Tameling Aff. ¶ 23; Bareiss Aff. ¶ 16).

            44.  During performance of the cleanup, Respondent required Appellant to segregate certain damaged items in the facility for inspection by postal personnel before disposition of the items (Stip. 21; Uncaphor Aff. ¶¶ 8, 11). 

            45.  Respondent and MVA were frequently consulted during the cleanup regarding the required disposal of material (Stip. 25).

            46.  The one-to-three day time period between Appellant’s requests for instructions as to disposition of items and resulting instructions (see Finding 33) affected completion of the work for an unspecified duration (Tameling Aff. ¶¶ 15-17, 19, 26; Bareiss Aff. ¶¶ 25-28; Stip. 21).

DECISION

           Throughout this dispute, during the claims process and in their arguments here, both parties have considered the work order to be fixed price, and we analyze the claims on that basis.^[1]

            The parameters of the work required by the work order are primarily those established by Appellant’s proposal because the mutually executed work order specifically adopts the proposal’s scope of work as did the email exchange on September 30, 2005 (Findings 16-19, 21, 23-24).  Appellant claims that it performed in excess of this scope of work, and argues that its actual period of performance so far exceeds the six day estimate in its proposal (Findings 18, 20) that additional compensable work has been proved to have been performed.

            Appellant bears the burden of proving entitlement for each of its four categories of claims for constructive changes that it posits should result in equitable adjustments.  See Teledyne McCormick-Selph v. United States, 588 F.2d 808, 810 (Ct. Cl. 1978).  To satisfy this burden, Appellant must prove that work it performed was beyond the requirements of the contract, and was performed because of an order from Respondent, or through the fault of Respondent.  See International Data Products Corp. v. United States, 492 F.3d 1317, 1325 (Fed. Cir. 2007).

            Appellant identifies four grounds for recovery under this doctrine:  (1) locked rooms; (2) the presence of postal inspectors; (3) the removal of screws and nails; and (4) delaying elements involving extra drywall removal due to continuing deterioration; unexpected latent conditions; and delayed instructions resulting in additional segregation and disposition of items.

Locked rooms.

            Appellant claims that it performed additional compensable work caused by locked rooms in the Bywater Station.  It argues that delays in being provided access to the locked rooms altered its sequence of performance.  It also argues that the contents of the rooms exceeded what it expected, and what reasonably should have been expected, resulting in removal of debris and a cleanup in excess of the work order’s scope of work.

            While delayed access to a work site can provide the basis of an equitable adjustment in appropriate circumstances, see, e.g., Varaburn Ltd. & Lin Heng Engineering Ltd., Joint Venture, ASBCA No. 22177, 82-1 BCA ¶ 15,744; Rivera General Contracting, GSBCA No. 5797, 81-2 BCA ¶ 15,288, we do not find such circumstances here.  Despite only having been accorded a short period of investigation and not having been provided complete information about the contents of the Bywater Station before submission of its proposal, Appellant was aware of the locked rooms at that time (Findings 7, 15, 28-30).  Accordingly, absent a reservation in the scope of work, Appellant should have anticipated including cleanup of those rooms within the project’s scope of work.  The operative scope of work did not include an exception for the cleanup of the contents of those locked rooms (Finding 18).  Further, Appellant has not proved that delayed access to the locked rooms, the anticipated cleanup of which was included in the scope of work, actually caused it to incur additional costs nor has it proved that the delayed access delayed the project overall.^[2]

            We find merit, however, in the second part of Appellant’s argument regarding the locked rooms.  The contents of the locked rooms could not have been discovered during the site visits based on which Appellant developed its proposal, nor could they have been determined prior to Respondent’s direction, well into the performance period, to break the locks in order to access the rooms (Findings 7, 15, 28-30). 

            Under the circumstances, it was reasonable for Appellant to have anticipated debris in the locked rooms similar to that apparent in the accessible rooms of the Bywater Station, as it was told to assume during its site visit (Finding 29).  Once opened though, the locked rooms were found to contain materials requiring removal that were substantially different from and greater in volume than could reasonably have been anticipated and therefore included in the scope of work that Appellant proposed and Respondent adopted (Finding 32). 

            Appellant may recover its costs of removing the contents of the locked rooms, though not in full.  Because the required cleanup of the Bywater Station included the locked rooms, Appellant may recover only to the extent by which the actual conditions exceeded the reasonably anticipated conditions.  See, e.g., Fidelity Construction Co., Inc., DOTCAB Nos. 1113, 1219, 81-2 BCA ¶ 15,345, recon. granted on other grounds, 82-1 BCA ¶ 15,633, aff’d on other grounds, 700 F.2d 1379 (Fed. Cir. 1983), cert. denied, 464 U.S. 826 (1983) (compensation for changes limited to the extent change actually causes an increase in cost of performance).

            Respondent argues that Appellant failed to provide the contracting officer with notice of the conditions involving the locked rooms resulting in price overruns, and that Respondent would have directed the work differently had it received such notice.  Respondent therefore argues that it has been prejudiced by lack of notice, although it has not identified specific contractual notice requirements on which it relies.  We reject this argument.  Respondent was aware of the locked rooms and it knew Appellant’s work was being delayed because it could not access the locked rooms.  Further, Respondent has stipulated that it provided instructions during the cleanup efforts as to how the locked rooms should be addressed.  (Findings 30-31, 33, 45).

            Accordingly, delays in opening the locked rooms do not amount to a constructive change and we deny that portion of the claim.  However, Appellant may recover for the extra costs needed to address the unanticipated contents within those rooms.

Presence of postal inspectors.

            Appellant claims that the presence of postal inspectors at the work site constructively changed the contract because it was required to alter its method and sequence of performance resulting in delays to completion of the work.  This claim is based upon employees of Appellant and SET having worn respirators during portions of the work, while postal inspectors were not equipped with respirators.  (Findings 34-35). 

            The record is devoid of evidence as to the contemplated sequence or method of work involved, or whether or how that sequence or method of work had to change as a result of the presence of postal inspectors.  Appellant has proved neither delay nor additional costs related to this issue.  Cf., M.E.S., Inc., PSBCA No. 4462, 06-1 BCA ¶ 33,184, recon. denied, 06-2 BCA ¶ 33,430 (to warrant even a time extension, delay to a task must have done more than simply inconvenience Appellant by requiring it to shuffle the tasks to be performed; it must impact the overall progress of the contract). 

            Furthermore, the scope of work specifically required the presence of postal inspectors during the cleanup, and did not warrant that inspectors would be prepared or required to wear respirators (Findings 10, 34).  Appellant knew that postal inspectors would be present during collection and bagging of mail, and a constructive change to the work has not been demonstrated.  Appellant also claims that on unspecified dates, postal inspectors delayed its performance by their late arrival at the site.  This claim is not adequately supported by the record and is rejected for lack of proof.

Removal of screws and nails.

            Appellant claims that the contract was constructively changed because Respondent required it to remove numerous screws and nails which had connected the damaged drywall to the structure of the facility. 

            The scope of work required Appellant to remove contaminated or damaged building components from the Bywater Station (Finding 18).  There is no dispute that such required removal included damaged drywall.  However, the scope of work did not expressly specify drywall screw and nail removal for any drywall that was removed, nor did it exclude removal of the drywall screws and nails (Finding 36).  Appellant, which drafted the scope of work in this uncertain state, argues that the removal of drywall screws and nails should have been left to the succeeding renovation contractor to perform during reconstruction activities, and should be considered work outside the scope of its work order that was performed at the direction of Respondent.

            Respondent contends that the scope of work should be interpreted in accordance with an industry standard requiring removal of screws and nails as part of removal of damaged drywall.  Respondent further argues that other contractors performing cleanup work following Hurricane Katrina removed screws and nails along with the removed drywall, and that the removal of drywall screws and nails is within Appellant’s acknowledged obligation to remove the damaged and/or contaminated drywall.

            Respondent has failed to provide an adequate basis for imposition of an industry standard in this regard.  Respondent’s testimony is nonspecific, and does not cite any specific industry sources or documents.  We conclude that no such standard has been proved.  See Dave’s Aluminum Siding, Inc., ASBCA No. 47350, 98-1 BCA ¶ 29,470; Prince George Center, Inc. v. General Services Administration, GSBCA No. 12289, 94-2 BCA ¶  26,889 (use of trade practice as a significant aid to interpretation must be predicated upon proof that the alleged trade practice has become established).  Similarly, Appellant has not provided any industry standard or other reference useful to interpretation of the scope of work in this regard.

            Because the parties neither have provided sources that would aid in interpreting whether the scope of work should be construed to include the removal of screws and nails, nor brought to our attention evidence of the intentions of the parties in this regard, we have examined the record carefully in an effort to determine those intentions.  Unfortunately, the record is devoid of evidence indicating the expressed intentions of the parties.^[3] 

            The application of our common sense to interpretation of the contract results in our conclusion that the screws and nails were part of the drywall building component required to be removed.  See DeMaria Building Co., Inc., VABCA Nos. 6889-6891, 04-1 BCA ¶ 32,473 (“common sense” contract interpretation that control wiring is part of electrical transfer system).  The scope of work, without applicable restriction, identified the responsibilities of Appellant to remove damaged building components.  Our interpretation of this language is that the building component at issue is the drywall, complete with the screws and nails with which it was affixed to the building structure.  Furthermore, the parties understood that Respondent would retain another contractor to renovate the facility after Appellant completed its work (Findings 11, 18).  Consideration of the purpose of the contract, to prepare the premises for further renovation, is an appropriate interpretive aid.  See Abhe & Svoboda, Inc., ENGBCA No. 5748, 93-2 BCA ¶ 25,633 (contract interpretation proceeds in context based on the principal purpose for which the parties contracted); Produce Terminal Cold Storage Co., VABCA No. 1124, 75-1 BCA ¶ 11,225 (adopting interpretation which best serves contractual purpose).  We find removal of the drywall screws and nails to be consistent with this purpose of the contract.  A successor contractor reasonably would have expected that the studs would be free from protruding screws and nails to allow it to install drywall in its renovation effort.  In short, we interpret the scope of work to include removal of screws and nails that had attached drywall to the structure as part of the job of removing that drywall.

            Appellant bears the burden of proof to demonstrate that it performed work beyond that required, and we find that it has failed to meet that burden.  Under these circumstances, we accept Respondent’s interpretation of the scope of work drafted by Appellant and which Respondent incorporated into the resulting work order as reasonable.  Accordingly, Respondent’s direction to Appellant to remove the screws and nails from the entirety of the support structure of the facility (Finding 38) does not amount to a compensable change.

Extra drywall removal due to continuing deterioration; latent conditions; additional segregation and disposition of items.

            Appellant claims that it removed a greater amount of damaged drywall than it anticipated because the spread of mold during the cleanup effort further deteriorated the condition of the drywall. 

            The condition of the drywall was known by Appellant at the time it prepared its scope of work, and the removal of all damaged drywall is within that scope of work.  The Bywater Station was severely damaged by flood waters and Appellant acknowledged that all interior finishes were affected (Findings 5, 8).  Removal of all the drywall in the facility may well have been included by necessity within the scope of work.  Appellant has not demonstrated that it removed more drywall than was required by the scope of work, or that Respondent was responsible for extending the overall performance period.  We therefore deny this portion of Appellant’s claim. 

            Appellant claims that unanticipated latent conditions existing at the Bywater Station resulted in compensable additional costs.  Such latent conditions urged by Appellant include unexpected remediation in the bathrooms due to mold discovered behind urinals and floor tiles, undescribed remediation involving structural support beams which were not visible during its pre-proposal site inspections, and remediation of additional layers of drywall at the location of a firewall of which Appellant was not aware.  (Findings 41-43).   

            Such assertions of latent conditions amount to claims of differing site conditions.  Where, as here, the contract does not contain a differing site conditions clause, the risk of adverse latent physical conditions does not shift from the contractor, which normally bears such risk under a fixed-price contract, to Respondent.  See Berry and Clay, Inc., PSBCA No. 4995, 04-2 BCA ¶ 32,633; Service Engineering Co., ASBCA No. 40274, 93-1 BCA ¶ 25,520, recon. granted in part on other grounds, 93-2 BCA ¶ 25,885 (absent a risk-shifting clause such as the differing site conditions clause, the contractor bears the risk of unknown conditions).  In any event, Appellant has not demonstrated that these conditions should not reasonably have been expected or were outside the scope of work to clean the facility.

            Appellant claims that Respondent’s delays in issuing instructions as to how to handle and dispose of certain items removed from the Bywater Station during cleanup resulted in additional compensable costs.  However, Appellant has not presented evidence as to how its efforts were delayed by any such lack of direction, whether the time lag between notice to Respondent and its resulting instructions was unreasonable in these circumstances, or why Appellant could not perform other work while any such delay occurred (Findings 44-46).  Appellant’s claim in this regard fails for lack of proof.  See Interstate Construction, Inc., ASBCA No. 38745, 90-1 BCA ¶ 22,482, recon. denied, 90-2 BCA ¶ 22,709 (while government-directed change in the sequence of performing work may give rise to a compensable change, failure of proof found when proof of delay of the project was conclusory and general in nature, and not substantiated by analysis of the effect of the change on completion of the project as a whole).

CONCLUSION

            We conclude that Appellant is entitled to an equitable adjustment.  The costs Appellant expended to remove the contents of the locked rooms to the extent that those contents exceeded what reasonably should have been expected are recoverable.  Otherwise, Appellant may not recover.  The appeal is sustained to the extent indicated, and otherwise is denied.  Negotiation of quantum is left to the parties, consistent with this Opinion.

Gary E. Shapiro
Administrative Judge
Board Member

I concur:                                                                      I concur:
William A. Campbell                                                     David I. Brochstein
Administrative Judge                                                  Administrative Judge
Chairman                                                                    Vice Chairman

[1]  Upon their mutual execution of Work Order 15.00, the parties confirmed their understanding of the contracting vehicle as one of a fixed price nature, as prescribed by their indefinite quantity contract.  The record does not reflect any meeting of the minds regarding task order formation other than on the fixed price basis prescribed by the contract.

[2]  The locked rooms were opened after the date on which Appellant had planned to have completed the entire project (Finding 31).  Appellant has not presented any evidence of its planned sequence of work.

[3]  Even if Appellant intended its scope of work to exclude the removal of drywall screws and nails, it failed to reveal that intention to Respondent.  Appellant’s proposal stated that its cost was based on stated assumptions and that additional services required by Respondent or unanticipated conditions may require a price increase.  The stated assumptions did not address the removal of drywall screws and nails.  (Findings 18, 36).