Government Unsuccessful in Attempt to Characterize Contractor’s Putative Contract Claims as Tort Claims; Appeal of ASCT Group, Inc., ASBCA No. 61955

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Government’s motion to dismiss contractor’s appeal for lack of jurisdiction is denied. The government argued that instead of a contract claim, the contractor’s complaint essentially asserted tort and Fifth Amendment takings claims over which the board lacked jurisdiction. The board, however, found that the contractor had effectively asserted claims arising out of an implied in fact contract. While the complaint contained language that appeared to broach tort and takings claims, that language was relegated to the factual allegation and were not the real basis of the contractor’s claims.

The Army Corps of Engineers had a contract with the Advanced Contractors International, LLC for construction of a police training center in Afghanistan. ASCT Group was one of Advanced’s subcontractors on the project.

The Corps terminated the contract with Advanced for default and transferred the project to the Afghan government. ASCT attempted recover materials it had left on the site but was prohibited from removing the materials by the Afghan government. Thereafter, ASCT filed a claim with the Corps seeking to recover damages for materials left on the site and for materials that it bought for the project but never used. For the most part, the Corps denied ASCT’s claim. ASCT then appealed to the ASBCA.

The Corps moved to dismiss ASCT’s appeal, arguing that the complaint essentially asserted a tort-based or takings-based theory of belief. The Corps pointed to allegations that indicated the government was liable for converting ASCT’s property or by taking it without just compensation in violation of the Fifth Amendment. The Corps identified other allegations that alleged that ASCT’s loss had been caused by the government’s negligent supervision of the prime contractor.

The board, however, found that ASCT’s complaint adequately alleged the required elements of an implied in fact contract. The tort and just compensation language that the government identified appeared to have been in the factual allegations. The board read the complaint as seeking relief either arising out of an implied in fact contract or for breach of that contract.

ASCT is represented by David J. Muchow of Muchow Law. The government is represented by Michael P. Goodman, James D. Stephens, and Rebecca L. Bockmann of the Army Corps of Engineers.

ASBCA - ASCT Group