Contractor’s motion to amend its complaint is denied. As the contractor was in the process of losing its claim on summary judgment, it filed a motion to amend it complaint. In its motion, the contractor dropped its previous breach claim and asserted five new causes of action. The court, however, denied the motion finding that the contractor’s new causes of action were futile, failed to state a claim, or outside the court’s jurisdiction.
HCIC Enterprises had a contract with the Federal Bureau of Prisons (BOP) to replace roofs at a federal correctional facility in South Carolina. The period of performance was extended four times, but HCIC still did not complete its work by the deadline. Instead, HCIC filed a claim for an equitable adjustment with the contracting officer, requesting another contract extension. The contracting officer denied the claim.
HCIC then filed suit with the Court of Federal Claims, alleging that the government breached the agreement by failing to allow it access to all roofs designated in the statement of work. Two months after HCIC filed suit, BOP terminated the contract for default.
HCIC moved for summary judgment in the COFC. The court denied HCIC’s motion due to a failure to identify undisputed facts. The BOP also moved for summary judgment on the issue of contract interpretation. The court granted that motion, which would have effectively ended the case.
But a day before the court issued its opinion on the cross-motions for summary judgment, HCIC filed a last-ditch motion to amend its complaint. In its motion, it dropped its breach of contract claim and added five new counts: (1) denial of HCIC’s request for a contract extension was factually and legally flawed, (2) CO’s assessment of liquidated damages against HCIC was flawed, (3) decision to terminate was made in bad faith, (4) the government’s claim against HCIC’s performance bond was based on false facts, and (5) HCIC should be entitled to rescind its previous waiver of a potential claim for additional costs.
The court found that all of these proposed new counts lacked merit. As to the first count concerning contract extension, it appeared that HCIC was proceeding on the mistaken premise that the court would review the agency’s decision to determine whether it was arbitrary and capricious. But in a claim under the Contract Disputes Act, the court does not review the agency decision; rather, it conducts a de novo review of the claim. In any event, the court found that contract extension count did not contain sufficient factual allegations. The new count was based on the same allegations underlying its previous breach of contract claim. The court had already determined that BOP was within its contractual rights when it denied that claim.
The court found the second count concerning liquidated damages was not ripe. The government had not assessed any liquidated damages against HCIC. There was nothing for the court to review relating to liquidated damages.
With regard to third count, HCIC alleged the government had terminated the contract in bad faith. The court noted that government officials are presumed to discharge their duties in good faith. A contractor must meet clear and convincing evidence to overcome this presumption. HCIC’s allegation did not approach this high threshold.
On the fourth, performance bond, count, the court found that HCIC lacked standing to challenge the BOP claim on the bond. A performance bond is a contract between the government and a third party, not the contractor.
Finally, the court found that it lacked jurisdiction to consider HCIC’s final count on rescinding its waiver of a claim for additional costs. HCIC had never filed a claim with the contracting officer seeking to rescind its previous waiver. Absent an underlying claim, the court could not consider this count under the Contract Disputes Act.
HCIC is represented by Frank V. Reilly. The government is represented by Robert C. Bigler, Steven J. Gillingham, Robert E. Kirschman, Jr., and Joseph H. Hunt of the US Department of Justice.
