PSBCA No. 6487


April 2, 2014

Appeals of

MARILYN LANEY

PSBCA No. 6487

APPEARANCE FOR THE APPELLANT
Marilyn Laney

APPEARANCE FOR THE RESPONDENT
Melissa M. Mortimer, Esq.
United States Postal Service

OPINION OF THE BOARD

Appellant, Marilyn Laney, seeks payments from Respondent, United States Postal Service, for her operation of a contract postal unit for one month at the start of the contract in 2002, and for one month at the end of the contract in 2012. She also claims a filing fee associated with a state court case. At the joint request of the parties, the Board is deciding this appeal on written submissions in lieu of a hearing. The Board directed both parties to file evidence and briefs. (September 13, 2013 Order). The Postal Service complied. However Ms. Laney did not, and has filed neither evidence nor argument. The record closed on February 26, 2014. (February 26, 2014 Order). We dismiss the appeal in part, grant the appeal in part, and deny the appeal in part. We conclude that the Postal Service must pay Ms. Laney $1,616, plus applicable interest.

We rule in Appellant's favor on the disputed date of substantial completion.  We rule in Respondent's favor in part and in Appellant's favor in part, on Respondent's liquidated damages claim, and on Appellant's compensable delay claim.  We conclude that Appellant is entitled to a net recovery of $1,223.25.

FINDINGS OF FACT

  1. Ms. Laney and the Postal Service entered into Contract No. 072368-03-B-0395 for the operation of a contract postal unit (CPU) in Lamoille, Nevada, known as the Lamoille Community Post Office (Lamoille CPU). The Postal Service awarded the contract on September 26, 2002, and its term began on October 1, 2002. The contract provided for a $19,392 fixed annual price. (AF 10; 11 at 48, 50; Corrected Declaration of L. Cooper (Cooper Decl.) ¶¶ 3-4).
  2. The contract included section C.1, Contract Duration and Termination:
    a. Duration. The contract will be for an indefinite term, subject to the rights of termination specified in b below.
    b. Termination. This contract may be terminated by either the Postal Service contracting officer or the contractor upon 60 days’ written notice. The contracting officer may terminate the contract upon one day’s written notice if necessary to protect the Postal Service’s interest.
    (AF 11 at 55).
  3. The contract also included section F.2, Payment: “Payment is made automatically, in arrears, by the St. Louis Postal Data Center in 12 equal monthly installments.” (AF 11 at 58). The Postal Service issued the monthly payments in the first week of the following month (Declaration of J. Jundt, ¶ 4; Cooper Decl. ¶ 9).
  4. On August 1, 2012, the Postal Service issued Ms. Laney the $1,616 monthly contract payment for the month of July 2012. That payment for July 2012 was the last payment made by the Postal Service under the Lamoille CPU contract. (AF 8; Cooper Decl. ¶ 9; Respondent’s Exhibit 3, Interrogatory Response 2).
  5. On August 3, 2012, the Postal Service’s contracting officer issued Modification 1. The modification stated that the Postal Service was suspending the CPU pending the outcome of an investigation relating to Ms. Laney’s contract performance. The August 3 modification stated that it was effective July 26, 2012 until further notice. It also stated that all other terms and conditions of the contract remained unchanged. (AF 9; Cooper Decl. ¶ 5).
  6. On August 10, 2012, the Postal Service’s Office of Inspector General (OIG) issued a report of its investigation concerning misconduct in Ms. Laney’s operation of the Lamoille CPU. The Postal Service’s contracting officer received the OIG’s report on August 22, 2012. (AF 7; Cooper Decl. ¶ 6).
  7. On September 13, 2012, the Postal Service’s contracting officer issued Modification 2. The modification stated, “This is your 1 day written notice that this contract will terminate in its entirety at close of business 08/22/2012. Termination is in the best interest of the Postal Service due to the results of an investigation conducted by the Office of Inspector General.” (AF 6; Cooper Decl. ¶ 7).
  8. On September 18, 2012 and October 1, 2012, Ms. Laney sent letters to the Postal Service which presented a $3,298 claim. The claim consisted of three monetary components: $1,616 for the September 2002 contract payment; $1,616 for the August 2012 contract payment; and $66 for a “filing fee.” (AF 4-5; Cooper Decl. ¶ 8; see also, AF 3; Respondent’s Exhibit 3, Interrogatory Response 4). Ms. Laney was aware of the basis of her claim for the 2002 contract payment in 2002 (Respondent’s Exhibit 3, Interrogatory Response 1; Respondent’s Exhibit 4; Complaint).
  9. On October 23, 2012, the Postal Service’s contracting officer issued a final decision denying the three components of Ms. Laney’s claim (AF 3; Cooper Decl. ¶ 9). On November 19, 2012, Ms. Laney filed an appeal with the Board (AF 2).
  10. In October 2012, Ms. Laney filed a separate small claims lawsuit concerning this dispute in the Elko County (Nevada) Justice Court, which entered a default judgment against the Postal Service. On July 18, 2013, the United States District Court for the District of Nevada vacated that default judgment. (Respondent’s Notice of Filing (August 1, 2013), Exhibit 1; August 9, 2013 Order; see also, Answer ¶ 16).

DECISION

As correctly argued by the Postal Service, the Board lacks jurisdiction to consider Ms. Laney’s claim for a monthly contract payment accrued at the start of the contract in September or October 2002. The Contract Disputes Act (CDA) includes a limitation requiring all claims to be submitted within six years after accrual. 41 U.S.C. § 7103(a)(4)(A); 39 C.F.R. § 601.109(c). Ms. Laney admittedly knew about the basis for her 2002 claim in 2002 (Finding 8). Therefore, Ms. Laney was obligated to have submitted her 2002 claim no later than sometime in 2008. She failed to do so until 2012 (Finding 8), and the resulting expiration of the CDA’s statute of limitations precludes our jurisdiction requiring dismissal. See TMS Envirocon, Inc., ASBCA No. 57286, 12-2 BCA ¶ 35,084, recons. den., 13-1 BCA ¶ 35,204.

We agree with Ms. Laney, however, regarding her claim for a 2012 contract payment. The Lamoille CPU contract’s term was of indefinite duration, subject to ending when a party gave notice as provided in the contract (Finding 2). The only such notice was issued on September 13, 2012, when the Postal Service’s contracting officer provided Ms. Laney with “1 day written notice that this contract will terminate in its entirety at close of business 08/22/2012.” (Finding 7). That one-day notice would have been effective one day later, on September 14, 2012. We reject the Postal Service’s attempt to invoke an earlier, retroactive termination date as unsupported by the contract. In Hector Rivera Ruiz, PSBCA No. 1756, 88-3 BCA ¶ 20,829, a contracting officer’s representative (COR) prohibited a CPU contractor from performing his contract until a pending criminal charge against the contractor was resolved. Two weeks later, the contracting officer advised the contractor that his contract was terminated on one day’s notice retroactively to the two-week-earlier date on which the COR had prohibited performance. We found this course of action unsupportable, and concluded:
The Contracting Officer’s subsequent effort on February 24, 1987, to terminate the contract without liability retroactive to February 9, 1987, pursuant to the termination provision was ineffectual. The Termination clause required either one or thirty days notice and neither was given. Moreover, the clause did not provide for retroactive termination.

Ruiz, 88-3 BCA at 105,334. We follow our precedent, and rule that the Postal Service’s one-day termination was effective at the time it was issued, not some earlier date by retroactive action.

The Postal Service argues, however, that its previous suspension of the CPU contract (modification 1, issued August 3, 2012, but purportedly retroactive to July 26, 2012) eliminated its obligation to issue contract payments thereafter. The contract provides no such authority. See Green Shack Marketplace, PSBCA No. 4557, 01-2 BCA ¶ 31,595 at 156,156 n. 61. The contract remained in force until either party ended it by exercising the termination clause (Finding 2). The suspension modification did not purport to and failed to effectuate a termination. Because the Postal Service was obligated to issue the CPU contract payments for at least the period of time sought in Ms. Laney’s claim (the month of August 2012), we grant her claim for $1,616.2

Ms. Laney has not demonstrated that she paid a $66 filing fee, nor shown any contractual entitlement for such a fee.3 We deny that element of the claim.

CONCLUSION

We dismiss Ms. Laney’s $1,616 claim for the 2002 contract payment for lack of jurisdiction. We grant Ms. Laney’s $1,616 claim for the August 2012 contract payment. We deny Ms. Laney’s $66 claim for a court filing fee.
The Postal Service shall pay Ms. Laney $1,616 plus applicable Contract Disputes Act interest.

Gary E. Shapiro
Administrative Judge
Vice-Chairman

I concur:

William A. Campbell
Administrative Judge
Chairman

Alan R. Caramella
Administrative Judge
Board Member

1 We do not read Nova Express, PSBCA No. 5101, 2007 WL 5442323 (June 11, 2007) to the contrary as argued by the Postal Service. Without analysis on the point here at issue, the Board in Nova, a case not involving a CPU contract, credited the appellant with amounts withheld from its contract that it had earned during performance prior to suspension of its contract. We find nothing out of the ordinary in that conclusion, which did not analyze whether payment following suspension of a contract whose term is ended later is compensable. We also find unpersuasive the Postal Service’s citation to Robert A. and Sandra B. Moura, PSBCA Nos. 3460, 3622, 96-1 BCA ¶ 27,956. The Board in Moura expressly noted that the appellants suffered no monetary loss by a temporary suspension as they were paid in full during the suspension period. Moura, 96-1 BCA at 139,645.

2 We need not address whether the Postal Service was entitled to terminate the contract on one-day’s notice because that issue is not before us. The 2012 component of Ms. Laney’s claim seeks only $1,616 for the August 2012 contract installment (Finding 8). That is all we here address.

3 We presume that the filing fee Ms. Laney seeks is related to the Elko County (Nevada) Justice Court litigation, whose default judgment was vacated by a federal district court (Findings 8, 10). No evidence of Ms. Laney’s payment of a filing fee is in the record.