Summary
This Armed Services Board of Contract Appeals decision resolves a dispute between Gideon Contracting, LLC and the U.S. Army Corps of Engineers regarding two work suspensions ordered for dam water releases. The Board found that while most of the suspensions were contractually contemplated and reasonable, three days of the first suspension and seven days of the second were unreasonable, entitling the contractor to cost adjustments. Additionally, the Board ruled that the government waived its claim for liquidated damages due to prolonged silence regarding late completion after the project was finished.
Topics
Practice areas
Questions Presented
- Whether the two water‑release suspensions were of unreasonable length requiring an equitable adjustment under the Suspension of Work clause.
- Whether the government waived its claim for liquidated damages.
Holdings
- Only the three‑day period from March 22‑24, 2021, was unreasonable; Gideon is entitled to an adjustment for the increased cost of performance associated with those three days.
- The government waived its liquidated‑damages claim; the assessment of liquidated damages is barred.
Key quotations
““an adjustment shall be made for any increase in the cost of performance of [the] contract (excluding profit) necessarily caused by the unreasonable suspension, delay, or interruption, and the contract modified in writing accordingly.”” (at 134,856)
““An act of God is a particularly unusual and unforeseeable event outside the control of the parties.”” (at 186,934-95)
Factual background
Gideon Contracting, LLC performed dam‑repair work under a firm‑fixed‑price contract with the U.S. Army Corps of Engineers. The contract required the contractor to demobilize and suspend work when the Corps released water from the dam. Two water‑release suspensions occurred in 2021, lasting 20 days and 94 days respectively. The contractor claimed the suspensions were unreasonable and sought an equitable adjustment; the government also claimed liquidated damages for late completion.
Procedural history
The contractor sought compensation for two suspensions of work caused by water releases and contested a liquidated‑damages assessment. The contracting officer denied compensation and imposed liquidated damages. The contractor appealed to the Armed Services Board of Contract Appeals.
Remand instructions
The case is returned to the parties to address the quantum of the adjustments for the unreasonable days of suspension.