U.S. Government Printing Office
Contract Appeals Board

Lawrence Kennelly, Member
Jay E. Eisen, Member

Appeal of Information Systems, Inc.
CA 78-11
January 18, 1979

Motion to Dismiss

The appellant made a claim against the United States Government
for an alleged breach of contract that was entered into between
the United States Government Printing Office and Information
Systems, Inc.  This claim was denied by the Contracting Officer
and an appeal was made to the Board.  The Respondent has made a
Motion to Dismiss this claim on the basis that this Board has no
jurisdiction to hear this claim.  The Appellant has opposed this
Motion.

The contract entered into was a "requirements" contract that
required the Appellant to produce hard copy prints (drawings) on
furnished Aperture Cards.  These were to be produced for the Air
Force.  The contract provided that while no specific number of
orders could be guaranteed, it was anticipated that approximately
two orders per week would be placed during the term of the
contract (March 1, 1977 to February 28, 1978).  The total
quantity estimated during the term of the contract was 8,000
prints with an order averaging approximately 25 Aperture Cards
(75,623 items).  The Appellant was low bidder and bid $67,913.82
for the production of the items that were to be produced on
specific orders.

During the term of the contract, the Appellant was asked to
produce only 134 items for a total cost of $1,558.51.  On May 28,
1978, the Appellant made a claim for $52,297 alleging the
Government had not complied with the specifications in the
contract.  This was arrived at by totalling the anticipated
profits of $19,700 and $32,597 for expenses incurred in obtaining
the necessary equipment to produce the work.

The claim was denied by the Contracting Officer on the basis that
the amounts set forth in the contract were estimates and they
were not to be construed as a guarantee of the volume of work
which may be ordered under the contract.

The appellant appealed and alleged there was a breach of contract
and requested relief for "the material breach of the contract and
the inequitable burden imposed on the contractor by that breach."

The Respondent moved for a dismissal on the grounds that this
Board lacks jurisdiction to decide questions involving breach of
contract.  The Respondent based its position on U.S. v. Utah
Construction and Mining Co., 384 U.S. 394 (1966); Jack Clark ,
ASBCA No. 333672 (1957), 57-2 BCA  1402; Alco Lumber Co., Inc.,
ASBCA No. 9641 (1964), 1964 BCA  4349;  E & E.J. Pfotzer, Eng.
BCA No. 2656 (1965), 65-2 BCA  5144; Harbor Printing & Copy
Service, GPO CAB CA 77-5 (1977).

The Appellant responded by opposing the granting of the motion on
the basis that there are a number of factual issues to be
decided.

The Appellant also claims in the alternative that the
contractor's claim had followed the roadways in the "Disputes"
clause, and if the contract was ambiguous and permitted either
party to misdirect a claim through the "Disputes" procedure, the
burden of the ambiguity must be borne by the Government as the
drafter of the contract.  The Appellant cites Bennett v. U.S.,
371 F.2d 857, as authority that the parties cannot deny the
applicability of the "Disputes" procedure after they had followed
it on any matter which could be resolved within the procedure.
The Appellant cited H. L. Yoh Co., Inc. v. U.S., 153 Ct. Cl. 104,
288 F.2d 493 (1961), as an example of a dispute similar to the
one involved here.  That one travelled through the conduct of the
"Disputes" clause to the Armed Services Board of Contract
Appeals.

In the H.L. Yoh  case, there was a claim made by a contractor
under a "time and materials" contract.  The Government reduced
the number of drawings the contractor was to work on in the
Detroit Arsenal.  The contractor appealed to the Secretary of the
Army and the appeal was heard by the Armed Services Board of
Contract Appeals.  The appeal was denied.  The Appellant
petitioned the Court of Claims and it upheld the appeal.  The
court held:

". . . where a time and materials contract did not specify the
number of drawings and lists to the changed and converted but the
parties contemplated a total job and the rate to be charged for
overhead was computed on that basis, a change order calling for
selective rather than total conversion was a change increasing
the contractor's overhead expense."  153 Ct. Cl. 104 at 104.

The important thing to note in that case is that it is a time and
material contract.  In the case we are considering it is a
"requirements" contract and the H. L. Yoh  case is
distinguishable on that basis; also there was no change order
required or issued under the terms of the contract.

The other case cited by the Appellant is Bennett v. U.S., 371
F.2d 859 (1967).  In that case, we had a contractor suing the
Government for additional compensation for extra work in
excavating a river levee.  The Court of Claims held that the
contractor's interpretation of the specifications which fixed the
distances was reasonable and thus the contractor was entitled to
receive additional compensation.  The court found there was an
ambiguity and the burden of that ambiguity falls on the party who
drew the specifications. 371 F.2d 859 at 861.

The ambiguity the Appellant is alleging in the contract we are
considering is in the "Disputes" clause.  The Appellant claims he
has followed the road map laid down by the Government; when he
has done this, the Government cannot now claim there is no
dispute under the contract that can be heard by the Appeals
Board.  We think there is a distinction between a substantive
portion of the contract and an administrative portion.  We see no
ambiguity in the "Disputes" clause nor do we consider that the
Contracting Officer waived the right of the Government to move to
dismiss when he denied an appeal and suggested moving to the next
step.  Therefore, we do not think Bennett v. U.S., 371 F.2d 859,
is applicable.

The Respondent has cited U.S. v. Utah Construction & Mining Co,
384 U.S. 394 (1966).  This case hold that Government contract
"Disputes" clause does not extend to breach of contract claims
not redressable under other clauses of the contract.  What does
the court mean when it states "not redressable under other
clauses of the contract?"

The court discusses this when it states:

"An illustration of the disestablishment of breach of contract
claims through the fashioning of additional contract adjustment
provisions is provided by contractual provisions designed to deal
with just such claims for delay damages as are presented here."
384 U.S. 394 at 415.

An example of this is given:

". . . A more extensive clause for 'Price Adjustment for
Suspension, Delays, or Interruption of Work,' . . . was
promulgated in 1961 for optional use in Department of Defense
fixed-price construction contracts."  384 U.S. 394 at 416.

The Court also pointed out:

". . . An Interagency Task Group is currently reviewing the
clauses in the standard contract forms, including the Changes,
Changed Conditions and Suspension of Work clauses, to determine
whether they should be expended in coverage to prevent
fragmentation of remedies . . . .  While in one respect it can be
said that clauses broadening remedies under the contract have
been adopted in response to restrictive interpretation of the
disputes clause and express dissatisfaction with the
unavailability of an administrative remedy, the fact that the
response has taken this measured form has manifested the parties'
reliance on the prior interpretation and has properly tended to
reinforce it.  As the ASBCA remarked in Simmel-Industrie, supra,
'[i]t is noteworthy that when it is intended to provide an
administrative remedy for Government delays, specific contract
clauses have been developed and are set forth for that purpose,'
. . . ." 61-1 BCA  2917 at 15,234.

Therefore, what the court is saying is unless there was specific
language in the contract to convert what would otherwise be
claims for damages for breach of contract into claims payable
under such contract, and hence to be regarded as "arising under
the contract," the Appeals Board does not have authority to
entertain a breach of contract case.

There is no provision in the contract in this case that would
give the parties the right to convert a pure breach of contract
claim for failure to order the total number of hard copy prints
that were estimated.  Therefore, this case comes squarely under
the rule set down in U.S. v. Utah Construction & Mining Co., 384
U.S. 394 at 412 where it states:

"Thus the settled construction of the disputes clause excludes
breach of contract claims from its coverage, . . . ."

The other cases cited by Respondent will be discussed seriatim.

Jack Clark , ASBCA No. 3672 (1957), 57-2 BCA  1402:  The Appeals
Board in this case said:

"In our opinion both items of this claim are beyond the
jurisdiction of the Board.  The claim for water damage to the
matarials [sic] stored in the assigned area, alleged to be
situated in low ground, is one for damages for breach of contract
and is clearly not within our power to adjudge. . . .  We can
find no clause, nor have we been referred to one, providing for
payment or adjustment under the circumstances asserted."  57-2
BCA  1403 at 4617.

In Alco Lumber Co., ASBCA No. 9641, 1964 BCA  4349, we had a
case where there was a motion to dismiss an appeal because the
Government failed to order the minimum quantity of lumber
specified in an indefinite quantities contract.  The Board found
in the absence of a contract provision for an adjustment to
dispose of the Government's liability for failure to order, the
appeal was beyond the cognizance of the ASBCA.

In E. & E.J. Pfotzer, BCA No. 2656 (1965), 65-2 BCA  5144, the
Board found:

"To the extent that Claim 0 is promised on a breach of contract
by the Government, it is well settled that neither the
Contracting Officer nor the head of the department has
jurisdiction to decide the matter in the absence of an agreement
between the parties, . . . ."

In Harbor Printing v. Copy Service, GPO CAB CA 77-5, the GPO
Contract Appeals Board dismissed a claim for a breach of contract
on the basis the Board had no jurisdiction to decide such a
claim.

We have reviewed the "Disputes" clause in this contract, and the
one in U.S. v. Utah Construction & Mining Co., supra, and find
there is no substantial difference between them.

The Appellant claims there are a number of fact questions to be
decided.  If this Board had the authority to grant equitable
relief, these might be of some importance.  It has been
established that Boards of Contract Appeals do not have the right
to grant equitable relief.  See, Astronetic Research, Inc., 1963
BCA  3794; International Dairy Supply Co., ASBCA No. 6150, 61-1
BCA  2873; Baldwin Lima Hamilton Corp., 61-1 BCA  3018.

In all of these cases the Board has ruled that Boards of Contract
Appeals have jurisdiction to award relief based on the terms of
the contract and which, therefore, are legal in nature and not
equitable.

Therefore, we see no need to go into the questions raised by the
Appellant.

Therefore, in view of the above, there is no appropriate question
of fact before this Board and we have reached the conclusion that
this motion should be granted and the appeal dismissed.