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Placeway Construction Corp. v. United States

August 07, 1990


Appealed from: U.S. Claims Court; Judge Lydon. Previously reported at 910 F.2d 835 and withdrawn from the bound volume.

Mayer, Circuit Judge, Skelton, Senior Circuit Judge, and Michel, Circuit Judge.


MICHEL, Circuit Judge

Placeway Construction Corp. (Placeway) appeals the United States Claims Court's order of September 11, 1989, dismissing its complaint for lack of jurisdiction because, inter alia, the court concluded that the contracting officer (CO) had not made a final decision as to a government claim against Placeway. See Placeway Constr. Corp. v. United States, 18 Cl. Ct. 159 (1989). We affirm the Claims Court's dismissal of Placeway's count seeking declaratory judgment because the Claims Court is without jurisdiction to grant such relief with regard to disputes over contracts that have already been awarded. We vacate the dismissal of the remaining counts and remand for further proceedings consistent with this opinion because the CO effectively rendered a final decision on all the claims presented, and the Claims Court has jurisdiction otherwise.


In 1983 Placeway entered into a contract with the United States Coast Guard (government) to construct residential housing on Governors Island, New York. The construction was completed December 20, 1984, after the completion date specified by the contract. Appendix at 108, Placeway Constr. Corp. v. United States, No. 90-5017 (Fed. Cir. filed Feb. 23, 1990) [hereinafter App.]. Placeway asserts that it submitted a voucher to the CO on January 21, 1985, requesting payment of the remaining contract price balance, $297,226.12. Id. at 24. The balance was not paid. On May 28, 1986, Placeway submitted to the CO a written demand for payment of: (1) the contract price balance, (2) thirty-one specified adjustments for additional work, and (3) extended overhead expenses based on various delays allegedly caused by, or the responsibility of, the government. Placeway, 18 Cl. Ct. at 161. None of these claims were certified under the Contract Disputes Act, 41 U.S.C. § 605(c) (1988). On September 4, 1986, the CO denied Placeway's demands. The CO decided that the contract price balance due would not be "released" because Placeway had failed to complete the contract "in a timely manner," delaying the government in issuing start-work notices to two other contractors scheduled to do work on Governors Island who might later submit delay claims against the government. App. at 108-09. Placeway disputes any liability for these other contracts, asserting they are unrelated to its contract with the government.

On June 26, 1987, Placeway filed a complaint in the Claims Court containing six counts: Count I seeks a declaratory judgment that the government cannot withhold the contract price balance due Placeway. Count II seeks a money judgment in the amount of the contract price balance, $297,226.12, plus interest. Count III seeks an equitable adjustment of $50,000.00, plus interest, alleging underpayment of wages due to defective specifications. Count IV seeks an equitable adjustment of $27,366.00, for increased performance costs because of alleged differing site conditions. Count V seeks twenty-two adjustments, totaling $140,251.95, for additional costs incurred because of alleged change orders, constructive changes, and defective specifications. Count VI seeks extended overhead costs, totaling $119,585.91, plus interest, for several delays allegedly caused by, or the responsibility of, the government. Placeway, 18 Cl. Ct. at 162; App. at 21-30.

The government moved to dismiss for lack of certification, and the Claims Court dismissed all the counts for lack of jurisdiction. Placeway timely appealed; we have jurisdiction pursuant to 28 U.S.C. § 1295(a)(3) (1988). We review the question of jurisdiction de novo. See 41 U.S.C. § 609(b) (1988).

I. Declaratory Judgment Claim

The United States Claims Court correctly noted that its predecessor court, the United States Court of Claims, did not have jurisdiction over claims seeking relief other than money damages. See United States v. King, 395 U.S. 1, 4-5, 23 L. Ed. 2d 52, 89 S. Ct. 1501 (1969). However, when Congress created the Claims Court by enacting the Federal Courts Improvement Act of 1982, Congress conferred upon the Claims Court the power to grant equitable relief in limited circumstances. 28 U.S.C. § 1491(a)(3) (1988); see United States v. John C. Grimberg Co., 702 F.2d 1362, 1365-74 (Fed. Cir. 1983) (in banc). The Claims Court's equitable powers, including authority "to grant declaratory judgments," are limited to cases in which a "contract claim" is filed " before the contract is awarded." 28 U.S.C. § 1491(a)(3) (1988) (emphasis added).

In the instant case, Placeway filed its Complaint long after the contract with the government had been awarded. Accordingly, the Claims Court lacks jurisdiction over Placeway's claim for a declaratory judgment. Therefore, we affirm the Claims Court's dismissal of Count I.

II. Contract Price Claim

The Claims Court determined that "the Government has asserted a right of set off which is tantamount to seeking 'the adjustment . . . of contract terms . . . .'"*fn1 Placeway, 18 Cl. Ct. at 164 (quoting 48 C.F.R. § 33.201 (1988)). The Claims Court noted that this constituted a government claim. Because certification is not required for government claims, the Claims Court would have jurisdiction over an appeal from a decision of a CO, provided it is final. The Claims Court, however, concluded that because the CO had not yet ascertained the amount of the set off, no final decision was made by the CO, and thus the Claims Court had no jurisdiction to decide the dispute. Id. at 164-65. In particular, the Claims Court observed that the CO's letter contained neither the label "Final Decision" nor the notice of appeal rights that final decision letters normally contain. Id. at 165.

We agree that the set off asserted is a government claim, but we conclude that the CO effectively made a final decision on the government claim. It was undisputed that Placeway had completed performance of the contract. Moreover, the contract price for the work completed was undisputed and was due upon completion of work. Although the CO may have implied that the amount of the claimed set off would be redetermined in the future, the CO effectively granted the government's claim in the amount of $297,057.12 when he declined to pay Placeway the balance due on the contract. That the CO might ...

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