“And You Could Have It All, My Empire of Dirt”: Claimant Misread Contract as Requiring Agency to Provide a Soil Disposal Area; Baldi Bros., Inc. v. United States, COFC No. 16-536

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Government’s motion for partial summary judgment is granted. The contractor alleged the contract required the government to provide a soil disposal and the failure to provide this disposal area was a constructive change. The court rejected the contractor’s interpretation, reasoning that the contract plainly disclaimed any obligation to provide a soil disposal area. Even if the contractor’s interpretation of the contract had been reasonable, it would have resulted in a patent ambiguity. Because the contractor never inquired about the ambiguity, it was resolved against the contractor.

Background 

Baldi Bros. had a contract to replace an aircraft ramp at an Air Force base. The contract provided that Baldi was responsible for the disposal of excess soil. The contract further stated that the base did not have a soil handling area, so Baldi had to take soil to an off-site disposal facility. But the contract also stated that excavated soil may be accepted at a clean soil holding area on the base.

Baldi interpreted the contract as requiring the government to provide a soil handling area on the base. The government denied any such obligation. Baldi submitted claims, alleging that the failure to provide a solid handling area was a constructive change. The government denied the claims. Baldi filed suit with the COFC

Legal Analysis

  • Contract Didn’t Obligate Government to Provide a Soil Handling Area — The contract stated that Baldi was responsible for removing soil, and that the base did not have a soil handling area. The plain language did not obligate the government to provide a soil area. While the contract stated that soil “may be accepted” at a handling area on the base, this merely denoted that the government had discretion to accept soil at the base; it was not an explicit requirement to provide a solid handling area.
  • Baldi Had Duty to Inquire About a Patent Ambiguity — Even if the court were to find Baldi’s interpretation of the contract reasonable, it would have resulted in a patent ambiguity. A patent ambiguity is an ambiguity so glaring a contractor must ask the agency about it. Here, any reasonable contractor believing the contract required the government to provide a soil area would have identified glaring inconsistencies in the contract’s language. When a contractor doesn’t inquire about ambiguities, the ambiguities are resolved against the contractor.

Baldi is represented by William Johan Braun of Braun & Melucci, LLP. The government is represented by Vijaya Surampudi of the Department of Justice.

COFC - Baldi Bros