Appeal of the agency’s denial of claims seeking monetary relief on a construction contract is (1) granted in part where the contractor’s expert testimony on a highly technical requirement was more compelling than the lay opinion of the agency’s construction control representative, and (2) denied in part where the contractor’s interpretation of another requirement—and agency conduct that was consistent with the contractor’s interpretation—contradicted the plain language of contract.
Mare Solutions Inc. appealed two claims to the CBCA arising out of contract to build a parking garage for the Department of Veterans Affairs. The first claim concerned a dispute over whether Mare was required to install expansion coupling on an electrical conduit. The conduit installed in the garage had buckled. VA contended that the buckling had been caused by Mare’s failure to install required expansion couplings, which would have allowed for movement of the conduit. Mare, however, believed couplings were not required under the contract. With the parties at loggerheads, Mare sought a declaration from the CBCA on whether the coupling was required.
The second claim involved a dispute over “head-end” equipment, which would allow VA’s analog security system to interface with the garage’s digital closed-circuit television system. Initially, VA had indicated that it was responsible for the head-end equipment, but when the construction was almost completed, VA determined that Mare was responsible for the equipment. Mare installed the head-end equipment, but believing the equipment was not a contract requirement, the company sought reimbursement. VA denied the claim, and Mare appealed to the CBCA.
As to the first claim, the board found that the contract specifications only required expansion couplings in three situations: (1) where conduit crossed an expansion joint, (2) where couplings were shown in the drawings, and (3) as required by the National Electric Code. Almost all the witnesses agreed that the first two situations were inapplicable: none of the conduits crossed expansion joints, and the drawings did not show any expansion couplings.
Thus, the only basis for requiring couplings was compliance with the National Electric Code. Mare presented expert testimony from two highly qualified engineers, both whom testified that couplings were not required by the National Electric Code. In response, VA did not present any experts but instead relied on the observations of the agency’s construction control representative. The representative—who acknowledged “I’m not an expert on [expansion couplings], but I know what I see”—believed that the buckling was caused by thermal expansion and that the couplings would have prevented this problem.
The board determined that this was a highly technical issue best suited to experts. Accordingly, CBCA found Mare’s experts far more persuasive on this issue than the VA’s construction representative. The board concluded that Mare’s position—i.e., couplings not required—was consistent with the terms of the contract.
Turning to the head-end equipment, the board found that the contract required Mare to install “a complete Video Surveillance System.” Additionally, the specifications stated that “if using a camera as part of CCTV network, a video encoder shall be used.” The board concluded that there could be no dispute that Mare was required to install head-end equipment.
Mare, however, argued that it was not required to provide the equipment because the contract drawings did not include head-end equipment. The board dismissed this argument, noting that the drawings Mare relied on were for another project and had been mistakenly included the parking garage drawings. Indeed, VA had informed all bidders about the mistake in questions and answers before award. Mare should have been on notice that it could not rely on those drawings. What’s more, if Mare had concerns about ambiguities in the contract, it should have raised them prior to bid closing.
Mare also contended that VA’s actions during performance were consistent with Mare’s interpretation of the head-end requirement. VA had indicated early on that it would furnish the head-end equipment, and the agency had even sought quotes for the equipment. While acknowledging VA’s missteps in handling the issue, the board noted that absent a formal modification, the agency’s actions did not change the contract requirements. The board refused to consider extrinsic evidence of agency conduct where the terms of the contract were unambiguous. Therefore, the board granted Mare’s expansion coupling claim but denied the claim on head-end equipment.
Mare is represented by James R. Mall of Meyer, Unkovic & Scott LLP. The government is represented by Neil S. Deol, Office of General Counsel, Department of Veterans Affairs.
