Contractor’s Qualification of Its Damages Claim with the Words “At Least” Precludes the Amount From Being Considered a Sum Certain; Appeal of Odyssey International, Inc., ASBCA No. 62062

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Government’s motion to dismiss contractor’s appeal for lack of jurisdiction is granted in part and denied in part. The contractor asserted a claim for “at least” $15 million of consequential damages arising from delay and differing site conditions. The board found that because the contractor had qualified the amount with the phrase “at least,” it could not be considered a sum certain. The claim for consequential damages was thus dismissed. The contractor also asserted the government was liable under various contract theories. The board dismissed some of these theories, finding that they were based on facts that had not been presented to the contracting officer as part of the underlying claim.

Odyssey International, Inc. had a construction contract with the Army Corps of Engineers. The contract required Odyssey to use micropiles—a foundation system involving drilled holes into bedrock. The solicitation had informed bidders to assume that 60 micropiles would be required.

Shortly into performance, Odyssey raised issues with the Corps’ mircropile assumptions. The Corps instructed Odyssey to submit an RFI regarding the issue. Odyssey submitted an RFI calling for 80 micropiles to be installed at a greater depth than specified in the solicitation. The Corps issued an RFP for the additional costs of new micropile design. Odyssey submitted a response. The government approved Odyssey’s design.

But before the parties had executed a modification to the contract, the contracting officer’s representatives told Odyssey to begin work on the mircropiles. Odyssey installed the micropiles. Shortly, thereafter, however, the Corps canceled the contract modification. Instead, the parties entered a different modification that compensated Odyssey for only 8 micropiles. Odyssey submitted requests for equitable adjustment to recover the costs of the additional micropiles it had installed, but the Corps, for the most part, denied the requests.

Odyssey submitted a claim for the additional time and costs it spent installing the micropiles. The Corps denied the claim. Odyssey appealed to the ASBCA. The Corps moved to dismiss the appeal for lack of jurisdiction.

Odyssey’s complaint asserted a claim for consequential damages of “at least 15,033,862.” The Corps alleged the claim for consequential damages should be dismissed as speculative. The board agreed, noting that qualification of a numerical amount prevents the amount from being considered a sum certain. Indeed, board precedent holds that a claim prefaced by the phrase “at least” fails to state a sum certain.

Odyssey also asserted a claim for breach of contract. The claim contained five theories of breach. The Corps urged dismissal of the claim arguing that the Odyssey had failed to present its breach theories to the contracting officer for a final decision, which meant that the board lacked jurisdiction.

The board noted that it possesses jurisdiction over an appeal when the theory of recovery is different from the theory presented in its claims, so long as they are both based on the same operative facts. The board thus examined each of Odyssey’s theories to determine whether they arose out of the same operative facts. The board found that two theories—failure to adjust for increased costs and failure to issue a contract modification—arose out of facts asserted in Odyssey’s claim. But three other theories—failure to pay invoices, failure to issue an RFP, and frustrated performance—were not presented to the contracting officer. The board thus dismissed those theories.

Odyssey’s complaint also asserted a count for breach of an implied-in-fact contract to compensate the company for additional micropiles, to pay Odyssey’s invoices, and to timely respond to the RFI. The board found that Odyssey had presented its claim for compensation for the additional micropiles to the contracting officer, so it denied the government’s motion as to that theory. But Odyssey had not presented the other implied-in-fact theories, so those were dismissed.

Finally, Odyssey asserted a claim for breach of the covenant of good faith and fair dealing. Odyssey alleged that the Corps breached the covenant by not fairly compensating Odyssey for the costs of the micropiles design and delays. While this legal theory had not been presented to the agency, the board found that the facts supporting this count were asserted in the underlying claim. The board therefore denied the government’s request to dismiss that count.

Odyssey is represented by Brian C. Johnson, H. Burt Ringwood, and Spencer W. Young of Strong & Hanni Law Firm. The government is represented by Michael P. Goodman and Scott C. Seufert of the Army Corps of Engineers.

ASBCA - Odyssey International