PBS&J Constructors, Inc.

ARMED SERVICES BOARD OF CONTRACT APPEALS

Appeals of -- )
)
PBS&J Constructors, Inc. ) ASBCA Nos. 57814, 57964
)
Under Contract No. W9126G-09-C-0016 )

APPEARANCE FOR THE APPELLANT: John S. Vento, Esq.
Trenam Kernker
Tampa, FL

APPEARANCES FOR THE GOVERNMENT: Thomas H. Gourlay, Jr., Esq.
Engineer Chief Trial Attorney
Charles L. Webster III, Esq.
Engineer Trial Attorney
U.S. Army Engineer District, Fort Worth

OPINION BY ADMINISTRATIVE JUDGE SCOTT

PBS&J Constructors, Inc. (PBS&JC) appealed under the Contract Disputes Act
(CDA), 41 U.S.C. §§ 7101-7109, from the contracting officer's (CO's) denial of its
$494,962 Type I differing site conditions claim under its contract awarded by the U.S.
Army Corps of Engineers (Corps) for the design and construction of the Whole Barracks
Renewal Complex, Fort Hood, Texas (ASBCA No. 57814), and from the CO's denial of
its $368,063 claim due to the Corps' alleged unwarranted refusal to allow it to use
shallow foundations in certain areas (balcony piers claim) (ASBCA No. 57964). The
Board consolidated the appeals and held a four-day hearing in Fort Worth, Texas. We
decide entitlement only. For the reasons stated below, we deny the appeals.

DIFFERING SITE CONDITIONS CLAIM-ASBCA No. 57814

FINDINGS OF FACT

1. On 5 August 2008 the Corps issued a request for proposals (RFP) for the
subject firm-fixed-price contract for a design/build barracks project (R4, tab 3) 1 The RFP
included the Corps' August 2007 geotechnical report (GTR). PBS&JC submitted a
proposal on 24 October 2008 (R4, tabs l 5A, l 5B; see also R4, tab 3 at 1 of 39; tr. 1134 ).

1
Unless otherwise noted, "R4" refers to the Rule 4 file and the Corps' supplemental
Rule 4 file in ASBCA No. 57814. Some of those documents, e.g., the contract,
also apply to ASBCA No. 57964.
The Corps awarded it the contract on 27 February 2009, in the amount of $32,373,000. It
incorporated the RFP and GTR. (R4, tab 3 at 2, 18 of39, § 1.2., at 209 of796)

2. PBS&JC was a sister company to Peter Brown Construction (Brown). Atkins
North America, Inc. (Atkins), the parent company, had design responsibility. PBS&JC
began doing business as Brown at project start. 2 Kleinfelder Central (Kleinfelder) was
Brown's geotechnical engineer and Alliance Geotechnical Group of Austin, Inc.,
(Alliance) was its geotechnical inspector. Alliance prepared daily activity observation
reports and pier inspection reports. (R4, tabs 7B, 7C at Bates 259-394; tr. 1/36-38, 2/135)

3. The RFP incorporated the Federal Acquisition Regulation (FAR) 52.236-2,
DIFFERING SITE CONDITIONS (APR 1984) clause by reference, which provides concerning
Type I differing site conditions that the contractor is promptly to notify the CO of
"subsurface or latent physical conditions at the site which differ materially from those
indicated" in the contract. If the conditions do differ materially and increase the
contractor's cost or time in performing any part of the contract work, an equitable
adjustment is to be made. The RFP also incorporated by reference the FAR 52.243-4,
CHANGES (JUN 2007) clause. (R4, tab 3 at 6 of 39)

4. For potential time extensions, the RFP included anticipated adverse weather
delays, including four days each in January through June, September and October, and
December, and three days each in July, August and November (R4, tab 3 at 2-3 of 11 ).

5. The RFP required at§ 01 10 00, Statement of Work (SOW), that the contractor
have a licensed geotechnical engineer interpret the GTR and develop earthwork and
foundation recommendations and design parameters and that:

If any additional subsurface investigation or laboratory
analysis is required to better characterize the site or develop
the final design, the Contractor shall perform it under the
direction of a licensed geotechnical engineer .... lf differences
between the Contractor's additional subsurface investigation
and the government provided soils report or the reasonably
expected conditions require material revisions in the design,
an equitable adjustment may be made, in accordance with the
provisions of the Differing Site Conditions clause.

(R4, tab 3 at 31 of 796, ~ 5 .2.2.1.) The engineer was to prepare a final geotechnical
evaluation report, to be part of the contractor's first foundation design submittal (R4,
tab 3 at 31of796, ~ 5.2.2.2., at 108 of796, § 01 33 16, Design After Award,~ 3.5.3.).

2
Like the parties, we usually refer to appellant PBS&JC for convenience.

2
 6. The GTR included boring logs, noting that the 19 test holes were drilled in
December 2003 and January 2004, for another project at the site that did not materialize.
The logs identified the nature of the subgrade material through which the test bore was
drilled; the test bore's depth; whether the subgra<;le material caved in or blocked the test
bore; and whether water was present. Ten of the borings were drilled to depths from 21
to 49 feet; nine were drilled from 3 to 10112 feet, referred to by the Corps, although not in
the GTR, as the "deep" and "shallow" borings, respectively. The shallow borings had the
prefix "lOA," Fort Worth's traditional designation for pavement borings. (R4, tab 3 at
209 of796, tab 4 at Bates 2-3, 28-31; tr. 3/231, 241-42) The 19 borings were drilled
across a site of over 12.4 acres, of which the barracks footprint was about 1.5 acres
(tr. 1/49-50; Corps 12/19/12 resp. to app's proposed fact findings (APFF) in ASBCA
No. 57814 (Corps dsc resp.) at 7, ~ 18). The project called for more than 540 drilled
piers, each with an anticipated depth of32 feet (R4, tab 4 at Bates 12; tr. 2/99, 3/231).

7. The GTR stated:

Groundwater conditions were monitored during drilling
operations, immediately upon completion of the test holes,
and after 18-hour and 24-hour observation periods. Static
water levels were measured in six of the nineteen
borings ... with depths ranging from 11.8 feet to 28.5 feet
below existing grade. The remaining test holes were dry or
blocked.

(R4, tab 4 at Bates 3) Static water levels in the six borings were reported as follows:

Boring Static Level, feet

3ST-5440 21.5
8A4C-5445 28.5
8A-5446 11.8
3ST-5447 15.2
8A4C-5450 18.0
8A-5454 13.2

(Id.) The list did not include boring 8A4C-5443, which the log described as "DRY" but
which showed water present (finding 9).

3
 8. The GTR continued:

Subsurface conditions representative of the project site
are shown on the boring logs .... actual subsurface conditions in
areas not sampled may differ from those predicted. The
nature and extent of variations across the sites may not
become evident until construction commences, and the actual
construction process may alter subsurface conditions as well.
If variations become evident at the time of construction, [the
Corps] should be contacted to determine if the
recommendations presented in this report need to be
reevaluated.

(R4, tab 4 at Bates 6)

These discussions are provided to the Design-Build
Contractor to develop his foundation and pavement
designs .... It should be noted that the discussions presented
herein are based on the results of the Government
geotechnical field investigation and laboratory testing
program, engineering studies, and previous engineering
experience with similar structures at Fort Hood. The
Design-Build Contractor should consider the information
provided in this report and comply with the requirements and
recommendations presented herein when developing his
foundation and pavement designs. The Design-Build
Contractor may use the subsurface boring log and lab testing
data presented herein as the sole basis to formulate his
foundation and pavement designs, or, at his option, the
Design-Build Contractor may supplement the information
provided herein by his own geotechnical field investigations
and laboratory testing program.

(Id. at Bates 9)

Groundwater should be anticipated during pier
construction. Therefore, the drilling contractor shall be
required to have temporary steel casing and pumps at the job
site prior to construction of the drilled piers.

(Id. at Bates 13)

4
 9. Regarding the six borings within the building's footprint (see R4, tab 2 at 9),
the boring logs,§ 15, "ELEVATION GROUND WATER," stated:

8A4C-5443 DRY
8A-5446 AT 11.8' IMMEDIATELY
8A4C-5445 24 HR. CHECK - 28.5'
3ST-5447 AT 15.2'
8A-5448 DRY BLOCKED at 18'
8A4C-5450 SEE BELOW [showing "WATER
LEVEL" at 24 hour check at 18.0'
and open to 33']

(R4, tab 4 at Bates 29-30, Sheets B201, B202) For boring 5443, which came within the
building's footprint when PBS&JC added exterior walkways and balconies to its design
(tr. 1157, 60; finding 54), despite the "DRY" note in§ 15, the log described the "WATER
LEVEL" at the 24 hour check as at 13.5' and the hole as "BLOCKED" at 21.0' (R4, tab 4
at Bates 29, Sheet B201). Although boring 5448 showed no static water level, and
indicated "DRY" in§ 15, it also described the soil as "slightly moist" and "very moist"
(id. at Bates 30, Sheet B202). For boring 5450, the log indicated that there was no
sloughing above 30' (R4, tab 4 at Bates 30, Sheet B202; Corps dsc resp. at 21-22, ii 44).

10. PBS&JC admits groundwater was detected from 11.8' to 28.5' but contends
that the water at 11.8' was not an intrusion but "perched" water (app. 1/28/13 dsc. resp. to
Corps 12/19/12 dsc br. (app. dsc resp.) at 9, ii 24). Wayne A. Eddins, Alliance's project
manager (tr. 2/29-30), who was not an expert witness, described perched water as:

[U]sually ... when you've got a zone of clay and water migrates
down and just sits right there. It [doesn't] go any further and
it doesn't come anywhere else. It just kind of got to that layer
and stopped until it evaporates or migrates horizontally .

... [P]retty much a perched water table is something
that's seasonal, based on rainfalls.

(Tr. 2/120-21) He described "static water" as water that "reached a certain level within
the boring and it stopped" (tr. 2/54). He opined that perched water in a boring does not
indicate that casing will be required (tr. 2/121). Mr. Eddins confirmed that the GTR and
borings did not discuss the quantity of water or provide any information concerning the
type of water flow a contractor could expect to encounter (tr. 2/83).

5
 11. PBS&JC understood that, under the Corps' technical regulations, no more
than three inches of water could accumulate in a pier hole prior to the placement of
concrete (tr. 2/50-51, 3/235; see R4, tab 7B at Bates 166-222 ("Less than three inches of
water was present at the time of concrete placement."); see also tr. 2/20-21 ). Temporary
casing keeps the drilled pier hole dry and maintains the integrity of its sidewalls, allowing
concrete placement (see R4, tab 7C at Bates 224-27; app. dsc resp. at 17, ii 40).

12. Joseph A. Williams became PBS&JC's senior project manager in February 2010
(tr. 1133-34), about a year after contract award. On 24 February 2010 the Corps'
Administrative Contracting Officer (ACO) and Resident Engineer, Harvey B. Hammer,
rejected PBS&JC's geotechnical report as unsatisfactory (R4, tab 23; tr. 3/265-66).

13. PBS&JC submitted to the Corps a design analysis dated 2 June 2010 by
Bryan Rose, a licensed geotechnical engineer and Kleinfelder's principal project
representative. PBS&JC ultimately did not proffer Mr. Rose as an expert witness. The
parties agree that PBS&JC used the analysis, based upon the Corps' data, to estimate
soils' potential vertical movement and consolidation, foundations' bearing capacities, and
construction considerations, including deep foundations. (ASBCA No. 57964 (57964)
R4, tab 9 at 35, 58, 60-61; tr. 1/37, 2/253-54, 256, 3/48-49; Corps dsc resp. at 48, ii 131)
Regarding the GTR, the analysis stated at§ 2.4, Subsurface Water:

[G]roundwater levels were monitored during drilling,
immediately upon completion of each boring, and after
18-hour and 24-hour observation periods. Static water levels
were observed in 6 of 19 borings at depths of 11.8 to 28.5 feet
below existing grade. The remaining borings were noted to
be dry or blocked at the time of measurement.

These short-term field observations generally do not permit an
accurate evaluation of subsurface water levels at this location
and should not be interpreted as a groundwater study. It
should be noted that the observations made within the [GTR]
may not represent conditions at the time of construction and
the presence of groundwater may affect certain construction
activities and long-term performance of the foundations. The
quantity of transient water is variable and is dependent on
climatic conditions before and during construction. The
foundation contractor should check the subsurface water
conditions just prior to foundation e?'cavation activities.

6
(57964 R4, tab 9 at 66) It stated at§ 4.4 Drilled Pier Foundation Construction Criteria:

7. Zones of sloughing soils or groundwater may be
encountered within the soil, which could cause
sloughing of pier sidewalls to occur. Thus, we
recommend that provisions be incorporated into the
plans and specifications to utilize temporary steel casing
to control sloughing and/or groundwater during pier
construction should it occur.

(57964 R4, tab 9 at 82)

14. According to Mr. Rose, bore hole collapse or blockage causes include
water, drilling, excavation, and loose soils. Water and blockage indicate a potential,
but not definite, casing need. What governs casing is the relative stability of the
borehole sidewalls, and the volume of water and rate at which it is encountered.
Water in the GTR's borings did not communicate that casings had to be used because
the logs did not provide enough information to ascertain its volume or flow rate.
Mr. Rose was not suggesting that the logs were deficient. He opined that they were
largely consistent with the applicable geotechnical standard of care. (Tr. 2/266-67,
3/12, 19-20, 78, 97)

15. Per Mr. Rose, borings within a building's footprint are considered first and are
the most relevant regarding materials to be encountered, but proximity is less important
where water is concerned. Adjacent borings and any in the project's vicinity are relevant
because water moves regionally through the project site. (Tr. 3/6, 29-31, 80-82, 90) All
water shown in a boring log is relevant:

All water is relevant, whether it be a static groundwater level
table, a perched condition with sufficient quantity, even
though it's not static--it's a transient or temporary condition--
could, when drilling through it, infiltrate into the pier hole and
adversely affect construction and requir[ e] casing.

(Tr. 3/83) However, he opined that, while borings might alert a contractor to the
possibility of encountering water during construction, they do not provide enough
information to ascertain how much will be encountered (tr. 3/7, 79).

16. Mr. Rose, who was experienced with the subsurface conditions at Fort Hood
and its vicinity, found the conditions disclosed in the GTR to be generally consistent with
the two or three previous reports he had done at Fort Hood and with the geological profile

7
one would expect in that region. Kleinfelder did not see anything indicating that it might
need to do a supplemental investigation. (Tr. 2/260, 262-63)

17. According to Ronald Harris, the Corps' supervisor of materials quality
assurance testing at Fort Hood, if a drill hole is blocked, it indicates that the sidewall has
been compromised and, in 99% of the cases, water is involved, usually the reason for the
blockage. He found that every project boring hole from 20-40' showed water, blockage,
or both. In a 1July2010 preparatory meeting with PBS&JC and subcontractors on drilled
piers he advised that they needed casing on site for each anticipated diameter size hole so
they would be ready. (Tr. 3/205, 211-14, 216-17, 233)

18. The parties agree that PBS&JC began drilling and pouring concrete piers on
about 11August2010. Its project superintendent, Ron Hartshorn, arrived on site in late
August 2010. (R4, tabs 7B, 7C at Bates 226, 395; tr. 1/37, 3/115, 118; app. dsc resp. at
17, il 42; app. 1/28/13 balcony piers reply (app. hp reply) at 17, il 89).

19. On 7-8 September 2010 a severe storm occurred. PBS&JC's Quality Control
Reports (QCRs) referred to "extreme weather conditions" (R4, tab 12 at 605, 607), and
recorded a total of 8.25" of rain on the project site (id. at 604-05). Mr. Williams
described it as a "tropic storm" like "a one-in-50-year event" (tr. 1/78). He believed that,
in connection with compaction problems he attributed to a prior contractor, the heavy
rainfall in a short period created unsuitable material that directly related to the amount of
water encountered during drilling. He thought that the effect on the subgrade material
could have resulted in a French drain that impacted 305 drill holes that had immediate
water and were cased and another 239 that were cased although no water was visible at
first (see finding 20). Only four holes did not contain water. (R4, tab 12 at Bates 604-05;
app. 2nd consol. supp. R4, tab A-021 at 1; ti'. 1/63-64, 68, 70-74, 78-79, 175; Corps dsc
resp. at 7, il 17)

20. Most often when drilling began water would start coming in the pier sidewalls
at differing rates and elevations. In the 305 holes where water was present, casing was
required because it was coming in "so fast" according to Alliance's Mr. Eddins (tr. 2/49).
In the 239 holes where no water was present initially, after one to five hours, there were
saturated soils and sidewalls and water at the bottom of the pier that could not be pumped
down to an acceptable level. Terry Herzog, of Herzog Foundation Drilling (Herzog), a
subcontractor to PBS&JC's subcontractor Gibson Concrete (Gibson), was the project's
drilling superintendent. Herzog pumped out the holes the first day or so but thereafter did
not try pumping because "the water was coming in too fast and caving off the sides"
according to Mr. Herzog (tr. 2/9). Herb Morgan, the Corps' quality assurance inspector,
recommended that even the holes that initially did not contain water be cased. PBS&JC,
Gibson, Alliance and Herzog all concurred. PBS&JC ultimately had to case most of the
pier holes because of significant groundwater intrusion, unstable subgrade materials, or

8
both. (Tr. 1143-44, 66-67, 2/5-10, 24-26, 44-45, 49-51; app. dsc resp. at 18, ~ 44; see also
R4, tab 7C at Bates 395-96)

21. PBS&JC's QCRs mentioned groundwater at times (R4, tab 12 at Bates 543,
546,548,553,556,558,560,563,566,569,572, 574,577,580,583,587,589, 592,595,
598). Gibson's daily reports, under "PROBLEMS/UNUSUAL CONDITIONS," mention
water or casing on 12, 13, 17 and 18 August 2010 but do not mention groundwater
concerning pier drilling thereafter, through 16 November 2010 (R4, tab 7A at Bates 62,
63, 65-130). Alliance's daily reports for 13 August 2010 through 16 November 2010
regularly state that "groundwater infiltration was observed" in the piers being drilled
(e.g., R4, tab 7B at Bates 162, 222). They do not mention the amount, the infiltration
rate, or the elevation at which water was encountered. None of these documents
characterize the groundwater as immediate, massive or continuous.

22. By letter of 11 January 2011 to the Corps' project engineer, Andy Heinchon,
PBS&JC submitted a $494,962 request for equitable adjustment (REA) alleging a Type
I differing site condition regarding the drilled piers. It did not request more time. By
letter of 28 January 2011 to ACO Hammer, it converted its REA into a CDA claim,
which it certified on 4 February 2011. (R4, tab 7C at Bates 224, 227-28, tabs 8, 10;
tr. 4/86)

23. According to PBS&JC's claim, the GTR and RFP "clearly state that a deep
foundation system will be required" and the GTR, "while limited," provided 19 borings to
depths of up to 49' (R4, tab 7C at Bates 224). The GTR indicated that ground water was
in 6 of the 19 borings, from 11.8' to 28.5', and "it was reasonable to infer that
groundwater was present to some extent" (id.). Nine of the borings were "within the
consideration limits for the proposed building location" and they were evaluated (id. at
Bates 225). Those were 1OA-5442, 8A4C-5443, 1OA-5444, 8A4C-5445, 8A-5446,
3ST-5447, 8A-5448, lOA-5449, and 8A4C-5450 (tr. 11118). PBS&JC alleged that, while
there was groundwater in four of the nine borings, this did not indicate that measures
beyond pumping would be required. Further study to determine the type of material at the
groundwater's depth was needed. Conditions affecting drilling included "quality of
material..., cave-in considerations, dynamic versus static pressure of groundwater.. .,
season of borings, and condition of groundwater (perched or aquifer)" (R4, tab 7C at
Bates 225). The borings were in December 2003 and January 2004, which PBS&JC
alleged to be two of the wettest months and considered the groundwater conditions
encountered then to be a ''worst case scenario" (id.).

24. The claim alleged that, based upon the RFP, "it was concluded that casing
would be required at a ratio of 2 holes per 9 drilled, or 22.2% of the drilled pier
locations" (R4, tab 7C at Bates 225). It alleged that, while PBS&JC had made a 22%
pier casing estimate, starting on 16 August 2010, casings in all piers were required due

9
to groundwater levels and apparent instability of the shaft walls at depth. While the
2 June 2010 Kleinfelder report had discussed potential groundwater and made
recommendations should temporary casing be required, "no extraordinary geological
conditions were noted or implied ... that would have changed [PBS&JC's] assumptions at
bid time" (id. at Bates 226). It developed that PBS&JC had to case 97% of the drill
holes (tr. 1145).

25. The claim included what PBS&JC described as its "notes relative to the
evaluated borings" upon which it relies in support of its alleged pre-proposal 22% casing
estimate (R4, tab 7C at Bates 225). The handwritten notes are undated, unsigned and
anonymous (id. at Bates 256-57). Mr. Williams, who authored and signed the REA,
speculated that they were from its preconstruction department, which put its proposal
together, but he was not involved in the casing estimate, could not recall any
communications with its creator(s), and did not know who had arrived at the estimate or
when (tr. 1/46, 117, 119-22, 201-02). He acknowledged:

Again, that would be a question probably better, I guess,
asked of our preconstruction department. I mean, when I
came on the project, per my previous testimony, was in
February 2010, and the project was already awarded.

(Tr. 11124)

26. The contractors on the project did not give Alliance or Mr. Eddins a project
casing estimate and, prior to the hearing, he never saw the handwritten notations on the
boring logs that PBS&JC contend were made by its preconstruction department in
reaching a casing estimate (tr. 2/62-63, 95, 124).

27. Mr. Rose of Kleinfelder was never asked to provide any casing estimate and
was not involved in any 22% casing estimate by the contractor (tr. 3/75, 79).

28. Although the annotations on the boring logs reflect a 22% casing estimate,
they also note that "our driller assumed" that 30% of the drill holes would have to be
cased, without identifying the driller or when the alleged assumption was made
(R4, tab 7C at Bates 257). There is no evidence t~at any driller had been selected prior
to PBS&JC's proposal. According to the project's drilling superintendent, Terry Herzog,
it is normal and customary for the driller and the concrete subcontractor to bring casings
and pumps to a project in case of groundwater. He was not involved with any pier
casing estimate for the project. His father took care ofHerzog's bid estimates.
Terry Herzog was unaware of any 30% casing estimate. He never saw the boring logs.
He did not know PBS&JC's senior project manager Williams. (Tr. 2/16-18, 22, 24-25)

10
 29. Without explanation, PBS&JC did not call anyone to testify who was involved
in reaching the alleged 22% estimate. There is no contemporaneous evidence that the
notes were prepared pre-proposal or of PBS&JC's pre-proposal assumptions concerning
site conditions. Thus, we find that PBS&JC has not substantiated its claim that it
reasonably interpreted and relied upon the GTR and boring logs, and arrived at a 22.2%
casing estimate, prior to its submission of its proposal to the Corps.

30. The claim alleged that an attached Alliance letter supported PBS&JC's
"pre-proposal assumptions" (R4, tab 7C at Bates 226). The claim appears to have
included two Alliance letters on geotechnical and differing site conditions issues
(findings 31, 32), but, ultimately, PBS&JC did not proffer anyone from Alliance as an
expert witness (tr. 2/31-32). As with Kleinfelder's various reports, we have considered
Alliance's letters but do not deem them to be expert opinions.

31. A 21 December 2010 letter to Mr. Williams from Mr. Eddins, prepared by
Alliance's project engineer, pertained to geotechnical conditions during the drilled pier
installation, based upon Alliance's review of the RFP, GTR and boring logs and
interviews with its inspectors. Alliance stated, inter alia, that only 2 of the GTR's
19 borings were within the structure's footprint, of which only 1 documented
groundwater and that, based upon the GTR, about 31 % of the borings indicated water.
However, in most cases, temporary casing was necessary to stem the water flow and/or
prevent further sidewall sloughing and to limit water accumulation to 3" or less. The
stabilization effort began on about 23 August 2010. Mr. Eddins acknowledged at the
hearing that two borings within the building's footprint contained water, not one.
(R4, tab 7C at Bates 395-96; tr. 2/43, 52-53, 103-04)

32. The claim also included a 7 January 2011 letter to PBS&JC from Mr. Eddins,
stating that there had been a differing site condition, based upon Alliance's review of the
RFP, the GTR, the boring logs and the 2 June 2010 Kleinfelder report, and that:

In our professional opinion, it is reasonable to assume that the
anticipated subsurface conditions re~ating to groundwater
issues and casing requirements were substantially different
than those encountered during the installation of drilled piers
for the project.

The conditions described in the above referenced documents
would lead to a reasonable expectation of encountering
groundwater in less than [30%] of the drilled piers and even
fewer indications of potential side-wall instability. Based
upon the conditions encountered during the drilled pier
operations, and as presented in the documentation generated

11
 during the full-time observation and reporting of the
operations, casing was required in over [90%] of the piers due
to either excessive groundwater intrµsion, side-wall instability
and/or a combination of both conditions.

(R4, tab 7C at Bates 258)

33. PBS&JC alleged at the hearing and in briefing, but did not articulate in its
claim, that a prior contractor's failures to compact soils after demolition and to remove
debris were differing site conditions (see app. 1115/12 initial post-hearing br. at 10-12,
APFF 65-76; finding 19). However, Mr. Eddins acknowledged that he could not say that
debris and soils that were not as dense as others affected drilling or caused or contributed
to the water encountered. He confirmed that the soils at the lower depths were competent
enough to pour a pier and were as represented in the GTR and that the subgrade materials
were what the boring logs indicated. In his view, the water caused the soil to become
incompetent. (Tr. 2/48-49, 85, 94)

34. Alliance had several Fort Hood projects involving pier installation. In a
November 2010 geotechnical report for one of them, contractors were told to anticipate
groundwater and to assume that about 100% of piers must be cased. In Mr. Eddins' view,
if there is no direction about the number of piers to be cased, a contractor must arrive at a
number but "you never know until you drill the hole" (tr. 2/58-59, 112). The record is
unclear but he apparently believed that a 22%-38% casing estimate would have been
reasonable for the subject project, based upon the GTR. (App. 2nd consol. supp. R4,
tab A-018 at 19; tr. 2/57, 64-65, 74-76, 80, 82; app. dsc resp. at 30, if 79)

3 5. Herzog had prior experience at Fort Hood. For example, it had drilled piers in
2007 or 2008 on another barracks project a few blocks away, on the same street as the
subject project. Water was present, but it came in slowly and could be pumped. There
was little caving. There was a requirement to have casings and pumps on that job, but no
casings were used. (Tr. 2/11-12) Hitting groundwater on a drilling project and the use of
casings was not unusual in Terry Herzog's experience. He had extensive experience with
jobs that required casing and, at the time of the hearing, Herzog had "just started a job
that has to be all cased" (tr. 2/24). However, the amount of groundwater on the subject
project was unusual for him compared to his other jobs (tr. 2/14, 23-24).

36. According to Mr. Williams, a basis of PBS&JC's differing site conditions
claim is that it encountered a "massive amount" of water during installation of deep pier
foundations (tr. 1135) and, for 305 of the drilled piers (see finding 19), there was a "steady
and consistent" or "constant and immediate" flow, such that, as soon as holes were
drilled, it was "clearly evident" that casings were required (tr. 1156, 64-65, see also
tr. 1190, 160-61, 163, 169-70). However, he did not find the conditions encountered to be

12
different than shown in the boring logs. Rather, the logs did not quantify the amount of
water to be encountered, its flow rate into the holes, how many casings or pumps would
be required, how often the contractor would have to case or pump, or the number of holes
that could be pumped versus the number that had to be cased (tr. 1/76-77, 208-09). Under
cross-examination Mr. Williams testified:

Q Okay. And you testified, did you not, that this
was somehow different, a different condition from that which
was shown on the boring logs. Is that accurate?

A Well, I think what I said was the conditions that
we faced and the amount of water that we encountered,
there's no way to determine from the boring logs the quantity
and magnitude of the water. There was water shown in the
logs, yes, but there's no way to quantify how much water.

Q Okay. So the logs don't show the reader or
indicate to the reader how quickly that water inflow occurred.
Right? I mean, isn't that what you just- I thought that's what
you just said, that the logs don't indicate the rate of inflow of
groundwater. Is that accurate?

A Yes.

(Tr. 11170)

37. The CO denied PBS&JC's differing she conditions claim by final decision
dated 25 July 2011 and this timely appeal ensued (R4, tabs 1, 2).

3 8. The contract completion date was 31 October 2011. It was not completed on
time. Final inspection was on about 8 December 2011. The Corps did not assess
liquidated damages. (Tr. 4/143-44)

Corps' Expert Evidence on Differing Site Conditions Claim

39. Kenneth McCleskey, a registered professional geologist, with a Bachelor of
Science degree in geology and a Master of Science degree in civil engineering, prepared
the GTR in substantial part. As of the hearing, he was acting chief of the Corps'
geotechnical engineering and design section at Fort Worth and had been acting chief of
the geotechnical branch. He was offered and admitted without objection as an expert in
the area of geotechnical engineering. He submitted an expert report dated 18 July 2012.
(R4, tab 33; tr. 3/222-24, 228) We consider him to be a mixed fact and expert witness.

13
 40. In his expert report Mr. McCleskey stated that, per PBS&JC's REA, in
arriving at its claimed 22% pier casing estimate, it had considered groundwater and
stability conditions in nine borings it deemed to be in the area of the new facility's
construction. He noted that three of them were "lOA" borings that had only been drilled
to a depth of 1O' in areas of proposed new pavement construction for the prior project and
were not intended to be used for foundation design. Piers were to be founded at depths of
32'. Moreover, all other groundwater levels and instability noted in the borings were at
depths exceeding 10'. Static groundwater levels between 11.8' and 28.5' below grade
were measured in five of the six remaining borings. The sixth boring, 8A-5448, was
blocked at 18', indicating unsuitable material, but in the comments on the boring log
included in its claim, PBS&JC mistakenly stated that there was no cave-in. (R4, tab 4 at
Bates 30, Sheet B202, tab 33 at 1-2; see also McCleskey expert testimony at tr. 3/231,
241-42 (lOA borings drilled too short to be reasonably considered for foundation design)

41. In Mr. McCleskey's expert opinion, PBS&JC's analysis of the boring logs in
its claim was not reasonable. It did not consider all of the deep borings, including those
that were not in the building's footprint, but were close. All of the deep borings were
consistent in terms of materials and subsurface conditions observed, including the
presence and transmissibility of groundwater and the instability of subsurface materials
indicated by blockage. (Tr. 3/240-41) He concluded in his expert report that, even
considering only the borings PBS&JC used, its analysis was unreasonable:

Hence all six of the borings considered by the PBS&JC casing
analysis that were drilled to the requisite pier foundation
depth demonstrated either the presence of groundwater,
instability of subsurface materials, or both, which would
reasonably indicate the potential need for casing which should
have been accounted for in the contractor's bid. Therefore,
even considering only the borings PBS&JC used in their
casing requirement analysis, a determination that casing
would be needed in only 22 percent of the piers appears to be
inadequately and unreasonably low.

The PBS&JC pier casing analysis did not include the four
other deep (foundation investigation) borings drilled during
the [Corps] geotechnical subsurface investigation ... borings
8A-5438, 3ST-5440, 3ST-5452, and 8A-5454. These borings
should also have been considered by PBS&JC in the
subsurface information analysis due to their proximity [to] the

14
 project site. Out of the ten total deep borings, groundwater
was noted in seven of the borings, while the remaining three
were dry; blockage at various depths was also noted in the
majority of the deep borings, indicating the presence of
unstable materials. It is therefore reasonable to assume that
100 percent of piers would require casing.

(R4, tab 33 at 2; see also tr. 3/236-38, 250, 256-57 (GTR's borings demonstrated
materials' permeable nature and their ability to transmit groundwater because 7of10 of
deep borings were determined to have transmitted water and 10 of 10 indicated either
groundwater or unstable materials as reflected by blockages.))

42. Mr. McCleskey acknowledged that water's flow rate is potentially a factor in
determining whether to case a pier. The GTR showed stable water levels, but the inflow
rate could be variable. (Tr. 3/236)

43. In Mr. McCleskey's expert opinion, job site conditions during drilling were
similar to those indentified in the GTR's site field investigation (tr. 3/263-64). However,
in the nature of fact evidence, he responded to questioning by PBS&JC's counsel that site
conditions "could have been drier, but they could have been much wetter, and as we all
know now, they turned out to be much wetter at that time" (tr. 3/261). The questioning
mixed references to conditions at the time of PBS&JC's proposal compared to when the
borings were taken and changes from the time of the proposal to the time of construction
(tr. 3/259-61). We infer, in logical context, that Mr. McCleskey was referring to
conditions at the time of pier drilling.

44. Mr. McCleskey acknowledged that contractors were entitled to rely upon the
GTR's boring logs. The Corps considered the GTR's information, including the number
of borings drilled and the similarity of the subsurface conditions encountered, to be
completely adequate for contractors' use in submitting their proposals. (Tr. 3/239,
250-51, 260-61, 263-64)

DISCUSSION

As PBS&JC describes it, the "crux" of its differing site condition claim is:

[T] he difference between the type ofgroundwater found in the
borings, static water, and the immediate and continuous
significant inflow of water which was discovered in the holes
immediately upon drilling or shortly thereafter - a condition
nowhere described in the [GTR].

15
 The groundwater was a differing site condition not because it
was encountered in 97% of the holes, but because of the
immediacy, rate offlow, and quantity of the groundwater that
was encountered which resulted in 97% of the holes being
cased rather than pumped.

(App. dsc resp. at 30, ~ 79, at 31, ~ 81)

The Corps responds, inter alia, that there was no differing site condition and
PBS&JC's alleged interpretation of the boring logs was unreasonable. The three sets of
contemporaneous daily logs do not support its description of the crux of its claim.
Further, PBS&JC has not met its burden to prove reliance because it did not produce any
verifiable documentation that it evaluated the boring logs or considered the pier casing
issue before it submitted its proposal and did not produce any witness who had first-hand
knowledge of its alleged casing estimate, including who made it and when.

To establish a Type I differing site condition PBS&JC must prove that:

(1) [T]he contract contained positive indications of the
conditions at the site; (2) it reasonably interpreted and relied
upon the indicated site conditions; (3) the conditions
encountered were materially different from those indicated;
(4) the conditions encountered were reasonably unforeseeable
based upon all the information available at the time of
bidding; and (5) its injury was caused solely by the differing
site condition.

Nova Group, Inc., ASBCA No. 55408, 10-2 BCA ~ 34,533 at 170,321. The Federal
Circuit has addressed iterations of these criteria in International Technology Corp. v.
Winter, 523 F.3d 1341, 1348-49 (Fed. Cir. 2008); H.B. Mac, Inc. v. United States, 153
F.3d 1338, 1345 (Fed. Cir. 1998); Stuyvesant Dredging Co. v. United States, 834 F.2d
1576, 1581 (Fed. Cir. 1987); and P.J Maffei Building Wrecking Corp. v. United States,
732 F.2d 913, 916 (Fed. Cir. 1984). Borings are the most significant indication of
subsurface conditions. Nova Group, 10-2 BCA ~ 34,533 at 170,322.

Regarding factor (1), the GTR and boring logs contained positive indications of
site conditions. The GTR warned that "[g]roundwater should be anticipated during pier
construction" and required the drilling contractor to have temporary steel casing and
pumps on-site prior to drilled pier construction (finding 8). It listed 6 of the 19 borings at
static water levels beginning at 11.8' and stated that the rest were dry or blocked.

16
Alliance's Mr. Rose acknowledged that blockage causes include water and loose soils and
that water and blockage indicate a potential casing need. There were six borings within
the building's footprint, of which two, 8A4C-5443 and 8A-5448, were not on the static
water level list. At the logs' elevation groundwater section, 8A4C-5443 was stated to be
dry but the log elsewhere showed water at 13.5' and the hole as blocked at 21.0'. Boring
8A-5448 was indicated to be dry and showed no static water level, but the soil was
described as slightly moist and very moist. (Findings 7, 9, 14)

PBS&JC claimed that the borings were taken in two of the wettest months,
December 2003 and January 2004, and represented a "worst case scenario" for
groundwater conditions (finding 23). However, the RFP did not distinguish those months
and anticipated adverse weather in many other months as well (finding 4).

Concerning the reliance factor (2), the GTR provided, and the Corps
acknowledges, that PBS&JC was entitled to rely upon the boring logs (findings 8, 44).
However, the handwritten notes which PBS&JC cites for its alleged 22% pre-proposal
casing estimate are undated, unsigned and anonymous. PBS&JC's senior project
manager Williams speculated that they were from its preconstruction department, but he
was not on the job until after contract award, was not involved in the casing estimate,
could not recall any communications with its creator(s), and did not know who had
arrived at the estimate or when. (Finding 25) Alliance was not given any casing estimate
and, prior to the hearing, Mr. Eddins had never seen the notations on the boring logs
(finding 26). Mr. Rose of Kleinfelder was not asked for any casing estimate and was not
involved in PBS&JC's alleged estimate (finding 27). Drilling superintendent Herzog was
not involved with any pier casing estimate for the project (finding 28).

PBS&JC did not explain why it did not call anyone to testify who was involved in
reaching its alleged casing estimate, for which we draw some adverse inference. See
Maintenance Engineers, ASBCA No. 52527, 01-2 BCA if 31,472 at 155,387. There is no
contemporaneous evidence that the notes were prepared pre-proposal or of PBS&JC's
pre-proposal assumptions about site conditions. It did not substantiate its claim that it
reasonably interpreted and relied upon the GTR and boring logs, and arrived at a 22%
casing estimate, prior to its submission of its proposal to the Corps. (Finding 29)

Factor (3) requires a comparison of conditions encountered to those indicated in
the contract and a determination of whether they were materially different. First, as we
discussed under factor (1), the contract did indicate subsurface conditions. However, to
prove a Type I differing site condition, PBS&JC must show that the contract contained
some indication of the particular conditions at issue. As we have summarized:

A Type I differing site condition claim is dependent on
what is "indicated" in the contract. Foster Constr. C.A. and

17
 Williams Bros. Co. v. United States, 435 F.2d 873, 881 (Ct.
Cl. 1970) ('"On the one hand, a contract silent on subsurface
conditions cannot support a changed conditions claim.... On
the other hand, nothing beyond contract indications need be
proven."). A contractor cannot be eligible for an equitable
adjustment for Type 1 changed conditions unless the contract
indicated what those conditions would supposedly be. P.J.
Maffei Bldg. Wrecking Corp. v. United States, 732 F.2d 913,
916 (Fed. Cir. 1984); S.T.G. Construction Co. v. United
States, 157 Ct. Cl. 409, 414 (1962).

NDG Constructors, ASBCA No. 57328, 12-2 BCA ii 35,138 at 172,503.

Mr. Eddins of Alliance acknowledged that that the soils at the lower depths were
competent enough to pour a pier and were as represented in the GTR and that the
subgrade materials were what the boring logs indicated. He believed that water caused
the soil to become incompetent. (Finding 33) He also confirmed that the GTR and
borings did not discuss the quantity of water or provide any information concerning the
type of water flow a contractor could expect to en~ounter (finding 10).

Ironically, as suggested in its description of the crux of its claim, which focused
upon the rate of inflow of water, PBS&JC principally complains about the contract's
alleged lack of site condition indications rather than incorrect indications or changes in
the conditions (findings 10, 14, 15, 36). PBS&JC's counsel stressed this point in his
opening statement:

The [GTR] does not describe the water levels. It does
not state how many casings the contractor must be prepared to
use. It doesn't state the quantity or the flow rate [of] water,
and it doesn't discuss anything with respect to expected
infiltration into the site. None of that is in the [GTR].

(Tr. 1/15-16)

Regardless, Mr. McCleskey admitted that conditions were "much wetter" than they
were when the borings were taken. We inferred that "much wetter" meant at the time of
pier drilling. (Finding 43) Nevertheless, this alone does not trigger application of the
differing site conditions clause. PBS&JC itself suggested that the cause of the additional
water could be extreme weather. Drilling began on about 11August2010 and PBS&JC
began to encounter water relatively soon thereafter that pumping did not resolve (findings
18, 20), but Mr. Williams believed that a severe storm on 7-8 September 2010, in
connection with compaction problems he attributed to a prior contractor, created

18
unsuitable material that directly related to the amount of water encountered during
drilling (finding 19) However, "weather occurring during contract performance, no
matter how severe, and other acts of God alone do not fall within the provisions of the
Differing Site Conditions ... clause." Commercial Contractors Equipment, Inc., ASBCA
No. 52930 et al., 03-2 BCA ii 32,381 at 160,255. Moreover, the differing site conditions
clause protects a contractor from undisclosed or unknown site conditions that predate the
contract, not something occurring thereafter. See John McShain, Inc. v. United States,
375 F.2d 829 (Ct. Cl. 1967) (addressing predecessor changed conditions clause);
Commercial Contractors Equipment, 03-2 BCA ii 32,381 at 160,258.

Factor (4) calls for PBS&JC to show that the conditions it encountered were
reasonably unforeseeable based upon all the information available at the time of its
proposal. Drilling superintendent Herzog opined that hitting groundwater on a drilling
project and the use of casings were not unusual, but the amount of groundwater on the
subject project was unusual (finding 35). Mr. Eddins of Alliance, who was not an expert
witness, opined that less than 30% to about 31 % of the project borings indicated that
water was present, fewer indicated sidewall instability, and a 22%-38% casing estimate
would have been reasonable. According to his 21 December 2010 letter in support of
PBS&JC's claim, over 90% of the piers had to be cased due either to excessive
groundwater intrusion, side-wall instability, or both. Mr. Eddins noted at the hearing that,
in a later Fort Hood project, the geotechnical report told contractors to assume that 100%
of the piers would have to be cased. (Findings 10, 30-32, 34)

However, as we have found, there is no contemporaneous evidence of PBS&JC's
pre-proposal assumptions concerning site conditions (finding 29). According to expert
McCleskey, PBS&JC's analysis of the boring logs as presented in its claim was not
reasonable (findings 40, 41 ). Finally, although it did not specify a number of drill holes
to be cased, the GTR for the subject project alerted prospective contractors that
"groundwater should be anticipated during pier construction" and that casing and pumps
were required on-site prior to drilled pier construction (finding 8). As Mr. Eddins
acknowledged, ifthere is no direction concerning the number of piers to be cased, "you
never know until you drill the hole" (finding 34).

Thus, PBS&JC has not met the requirements to establish a compensable differing
site condition set forth in factors (1)-(4). Factor (5) largely pertains to quantum, which
we need not reach.

DECISION

DIFFERING SITE CONDITIONS CLAIM-ASBCA No. 57814

We deny the appeal.

19
 BALCONY PIERS CLAIM - ASBCA No. 57964

FINDINGS OF FACT

We incorporate our findings in ASBCA No. 57814 to the extent relevant.

45. SOW § 3 .1.1. prohibited exterior egress balconies (R4, tab 3 at 4 of 796), but
§ 6.2.1 stated: "Use of exterior wrap-around balcony is a deviation (approved by an
existing waiver) from ... [§] 3.1.1." (id. at 42 of796). SOW§§ 3.2.3.6., 6.2.3., 6.5.1. and
6.11.8. also refer to balconies for the barracks (id. at 10, 50-51, 59 of 796). Under SOW
§§ 3.1.3.1. and 3.1.3.1.(a) gross building area was measured to the outside face of exterior
closure walls. It included one half the area of exterior covered areas such as balconies,
breezeways, exterior corridors, and porches, which were measured from the face of the
enclosure wall to the edge of the covered area. (57964 R4, tab 8 at 24)

46. RFP § 00 21 00 stated that "[s]pecial foundation work is required due to
expansive soils found at Fort Hood" (R4, tab 3 at 5 of 106, if 1.1. ).

4 7. Under RFP § 00 73 00, Special Contract Requirements (SCR), the contractor
warranted that its design would meet contract requirements (R4, tab 3 at 20of39, §§ 1.7(a),
1.8). SCR § 1.11, DEVIATING FROM THE ACCEPTED DESIGN (JUN 02), stated:

(a) The Contractor shall obtain the approval of the Designer
of Record [DOR] and the Government's concurrence for any
Contractor proposed revision to the professionally stamped
and sealed and Government reviewed and concurred design
before proceeding with the revision.

( c) Any revision to the design, which deviates from the
contract requirements (i.e., the [RFP] and the accepted
proposal), will require a modification, pursuant to the
Changes clause, in addition to Government concurrence. The
Government reserves the right to disapprove such a revision.

(R4, tab 3 at 22 of 39)

48. RFP § 01 33 16, Design After Award [DAR], § 1.2., stated that the
contractor's DOR is responsible for contract compliance (R4, tab 3 at 97, 100of796).
Section 3.5.3.1. stated:

20
 The contractor's licensed geotechnical engineer shall prepare
a final geotechnical evaluation report, to be submitted along
with the first foundation design submittal. This information
should be made available as early as possible during the
over-the-shoulder progress review process. The geotechnical
report shall summarize the subsurface conditions and provide
recommendations for the design of... foundations .... The
[report] shall recommend foundation systems to be used ....

(R4, tab 3 at 108 of 796)

49. GTR § 5, "Discussions," stated:

Development of the final foundation and pavement
designs are [sic] the responsibility of the Design-Build
Contractor and shall be in compliance with the requirements
established herein. However, the Design-Build Contractor
shall provide to the Government engineering studies and
design calculations that support the· foundation and pavement
design recommendations .... The Design-Build Contractor's
foundation and pavement design recommendations shall be
reviewed for technical adequacy and compliance with the
criteria established in the [RFP], including this document.
Specific requirements for the Design-Build Contractor's
foundation and pavement design analysis are provided in
section 5.f [Emphasis added]

(R4, tab 4 at Bates 9) The referenced§ 5.f, "Requirements for the Design-Build
Contractor's Foundation and Pavement Design Analysis," stated:

(1) Recommended Foundation System(s).
A foundation system consisting of reinforced concrete
straight-shaft drilled piers shall be utilized for [the project}.
The Design-Build Contractor shall design the straight-shaft
drilled piers in accordance with the requirements and design
parameters provided in this report. :{Emphasis added]

(R4, tab 4 at Bates 24)

21
 50. GTR § 5.b, "Foundation Design Considerations, Recommendations, and
Requirements," stated:

Based on the results of the geotechnical field investigation
and laboratory testing program, and previous engineering
experience at Fort Hood for similar buildings to those of the
[project], the following recommendations, design parameters,
and requirements are provided. For the size and type of the
proposed facility to be constructed at Fort Hood as part of this
project, and the site-specific subsurface conditions present, a
reinforced concrete straight-shaft drilled pier foundation
system is typically considered best-suited foundation system
[sic]. Reinforced concrete straight-shaft piers have proven to
be a highly successful foundation system at Fort Hood. A
shallow foundation system consisting of reinforced concrete
continuous and/or spot spread footings is not considered to be
a viable alternative due to the presence of highly expansive
and compressible clay overburden soils and fill materials and
to the depth ofa competent bearing stratum beneath the
overburden soils. Therefore, shallow footing and foundations
are not allowed. [Emphasis added]

(R4, tab 4 at Bates 11)

51. GTR § 5.d(l) stated:

Pavilions and other Small Support-type Structures. Covered
Pavilions and any other small (<500 GSF) support-type
structures (if applicable) can be supported on reinforced
concrete slabs-on-grade.... It is further recommended that
subgrade preparation ... consist of providing a minimum of 36
inches of compacted nonexpansive fill below the
soil-supported slab. [Emphasis added]

(R4, tab 4 at Bates 15)

52. The barracks are modular unit structures made of wood. The exterior balconies
are described as 2- or 3-floored (balconies on second and third floors, covered walkway
underneath). (Tr. 1142-43, 2/206, 3/126, 4/31, 113; see R4, tab 35 at Bates 7, Sheet S-000;
exs. A-001, A-002) Shaddy Shafie, a lead structural engineer at Atkins, and a licensed
structural engineer in several states and Puerto Rico, was the DOR (tr. 21132-37).
Regarding G TR § 5.d(1) (finding 51 ), he acknowledged that the balconies were overall a

22
continuous system, over 500 gsf. However, for structural design loading criteria, he would
break down the system into the balconies' columns. He thus deemed that the whole balcony
system, regardless of the balconies' large size per floor, could be akin to a covered pavilion
and a small support structure. (Tr. 2/207-08) Project superintendent Hartshorn proposed at
the hearing that each column section involved about 300 square feet (tr. 3/150-51 ).
Alliance's Mr. Rose considered the GTR's provision to be ambiguous as to whether the
under 500 gsf limitation applied to covered pavilions (tr. 3/105). He stated that the balcony
system could be construed to be a covered pavilion:

Q .. .Is it your testimony that three floors of
balconies and covered walkways, consisting of thousands of
square feet of area constitute a covered pavilion?

A Again, I'm not a structural engineer, but I don't
see why it couldn't be construed that way.

(Tr. 3/106)

53. PBS&JC's proposal stated that the site preparation, "along with the foundation
work (drilled piers and grade beams)," was scheduled for completion no later than 259
days after the NTP (R4, tab 15, vol. 2, tab C, "Schedule Narratives" at 2). The parties
agree that PBS&JC's proposal specified its intent to use a drilled pier foundation system
beneath the barracks and did not indicate an intent to provide a design with exterior
balconies (app. bp reply at 7, ~~ 36, 37).

54. The Corps notified PBS&JC that its proposal was deficient due to the lack of
exterior balconies. PBS&JC stated that its interpretation had been based upon SOW,
§ 3.1.1., prohibiting exterior egress balconies (finding 45). It incorporated the balconies
into its design and submitted its best and final offer, prior to contract award on
27 February 2009. (R4, tab 16 at Bates 3-7; app. bp reply at 8, ~ 43; finding 1)

55. The Corps issued a Notice to Proceed for design work on 16 October 2009
(app. hp reply at 9, ~~ 45, 46). PBS&JC submitted an interim foundation design dated
30 November 2009. The parties agree that, under its proposal, the foundation was to be
based upon drilled concrete piers, but its submittal advocated a "screw pile" foundation
system and its drawings depicted the balconies and covered walkways supported on screw
piles. (R4, tab 15B, Schedule Narratives at 2, tab 17 at 3-4; app. bp reply at 9, ~ 48, at 10,
~~ 51-52) Steel pipe screw piles are a proprietary deep foundation system that is less
expensive than drilled piers, which are another type of deep foundation system, poured
with concrete and reinforcing steel (tr. 1/94, 2/138, 3/124, 4/128).

23
 56. PBS&JC and the Corps had several exchanges about screw piles, which the
Corps disallowed (e.g., R4, tab 19 at Bates 2, tab 22 at Bates 70, tab 23). A 9 December
2009 Kleinfelder report referred to the barracks as supported on screw piles and contained
drawings depicting balconies and covered walkways supported by them (R4, tab 20 at 2-
4, 46-47, tab 21). PBS&JC's "90% Foundation Submittal" of 27 April 2010 still had the
barracks on screw piles, said to be based on a 26 April 2010 Kleinfelder report (R4, tab
24 at 3, § 2.0 at 41). However, attached specifications covered "DRILLED CONCRETE
PIERS AND SHAFTS" (id. at 5-6, § 02 47 00) and the report stated:

3.2 Deep Foundation Recommendations

Based on the subsurface conditions encountered at the test
boring locations and the project information provided, we
recommend the proposed buildings be supported on straight
shaft drilled piers.... Design information for drilled piers is
provided in the following sections. [Emphasis added]

(R4, tab 24 at 47) The parties agree that Kleinfelder's report did not reference or propose a
shallow foundation system for any of the project work and its design drawings showed
balconies and covered walkways supported by concrete piers (R4, tab 25, Sheet Nos. S-101
through S-115; app. bp reply at 13-14, iii! 68-70).

57. PBS&JC submitted a final foundation design dated 2 June 2010, with
Kleinfelder's revised 2 June 2010 Geotechnical Engineering Study. The parties agree
that it mentioned, for the first time, the possibility of using spread footing foundations
under certain conditions ifthe subgrade were prepared properly. (57964 R4, tab 9 at 61;
app. bp reply at 15, iii! 77-78) PBS&JC did not proffer DOR Shafie as an expert witness.
According to him, the referenced subgrade preparation was required with either spread
footings or drilled piers and he understood that it had been prepared per the GTR
(tr. 2/155, 169, 178). He acknowledged that PBS&JC's previous submittals had shown
the dormitory, including balconies, supported on screw piles or drilled piers, two types of
deep foundation systems (tr. 2/203; see similarly tr. 3/68 (Rose)). There is no evidence
that PBS&JC had raised with the Corps any alleged ambiguities in the above contract
provisions that contained the words "recommended" or "recommendations" as well as
"requirements" or concerning GTR § 5.d(l)'s shallow foundation exception for small
support-type structures (see findings 49-51 ). ·

24
 58. Kleinfelder's 2 June 2010 study stated:

3.1 Expansive Soil and [C]onsolidation Considerations

[A] PVR [Potential Vertical Rise] approaching 4 inches is
expected. The estimated vertical movement [of the soil] is
greater than what most structural engineers consider
acceptable for a shallow foundation system.... [Emphasis
added]

3.2 Shallow Foundation Recommendations

We understand that spread footings will be used at select
locations within the proposed structure. This decision
depends on many factors including the magnitude of soil
movement expected, the type of structure, the intended use of
the structure, the construction methods available to stabilize
the soils, and the owner's expectations of the completed
structure's performance. However, one should always expect
a grade supported foundation to undergo some differential
vertical movements.

3.2.1 Building Pad Preparation

Provided herein are subgrade preparation recommendations
for spread footings to modify the magnitude of soil
movements beneath grade supported structures at this site to
approximately one (I) inch ....

3.2.2 Spread Footings

Shallow footings bearing on a properly prepared subgrade
may be used to support the proposed structure ....

(57964 R4, tab 9 at 67-69) However, the report's § 3.3, "Deep Foundation
Recommendations" (id. at 69), repeated the drilled piers recommendation contained in
Kleinfelder's 27 April 2010 report (finding 56). The parties agree that the drawings again
showed balconies and covered walkways supported by concrete piers (R4, tab 29, Sheet
Nos. S-101 through S-115; tr. 1/109-10, 2/135; app. bp reply at 16, ifif 84-85), and that
PBS&JC's finalized July 2010 drawings again depicted concrete drilled piers under the
covered walkways and balconies (R4, tab 35; app. bp reply at 16, if 83).

25
 59. PBS&JC's Contract Drawing Sequence No. S-001 states:

THE PROPOSED FOUNDATION DESIGN DEPICTED ON
THE PLANS AND SECTIONS IS BASED ON THE FINAL
UPDATED GEOTECH REPORT BY KLEINFELDER
DATED 0610212010 INDICATING REQUIREMENT OF A
DEEP FOUNDATION SYSTEM. THE DRAWINGS
DEPICT GRAPHICALLY THE PROPOSED LOCATION
OF DRILLED PIER. [Emphasis added]

(R4, tab 35, Soil Preparation and Foundations, Note 1)

60. On 2 July 2010 an ACO issued a Notice to Proceed, received by PBS&JC on
9 July 2010, for construction of the finalized foundation design (ex. G-1).

61. PBS&JC considered the lobby, entrance, mail kiosk, exterior walkways and
balconies to be outside the main building. It sought to use spread footing foundations
under them because it was behind schedule due to water and casing issues with the drilled
piers, wanted to avoid them, and was looking to make up time and save costs, including
potential liquidated damages. {Tr. 1/98-101, 3/195) By 14 October 2010 email to
ACO Hammer, with the stated goal of improving the schedule, Paul Cook, PBS&JC's
Director of Operations, submitted "Design Modification Request - RFI [Request for
Information]-0119," seeking the Corps' "cursory review of our alternate foundation
design intent" to remove drilled piers at the exterior balconies and replace them with
spread footers, ''with the understanding that our designers will provide complete details
and design calculations under separate correspondence for review and approval" (57964
R4, tab 10 at Bates 149). He appended an internal PBS&JC RFI which inquired whether
the change was viable or allowable. A PBS&JC structural engineer responded that it was
viable. He included part of the 2 June 2010 Kleinfelder report (finding 57) and a sketch.
(Id. at Bates 150; tr. 1/102-03) Mr. Cook told the ACO that one reason for the request
was to speed up construction, but the ACO saw no benefit to the Corps in changing the
contract (tr. 4/15, 41; Corps 12/19/12 resp. to APFF in 57964 (Corps bp resp.) at 28,
~ 271 ). There is no evidence that PBS&JC provided "complete details and design
calculations" by separate correspondence or otherwise.

62. The parties agree that the RFP had a separate design value for live loads for
exterior walkways, balconies and stairs of 100 psf and that PBS&JC's structural engineers
calculated that drilled piers under the balconies and walkways columns would carry a live
load of 600 psf (Corps bp resp. at 7, ~~ 205, 206). DOR Shafie contended in a 24 January
2012 memorandum that the foundations in the construction documents for the walkway
columns were a "significant overdesign" (57964, compl., ex. 5). However, he
acknowledged at the hearing that his firm had done the design and that load-bearing

26
capacity was not the only reason to use a drilled pier foundation system (tr. 2/227-28).
Mr. Heinchon conceded that the design could have been "overkill" regarding load bearing
issues, but he noted that the main reason for using drilled concrete piers at Fort Hood was
its expansive soil. Tied in to the main structure, balconies with spread footings would tend
to move a lot more than the rest of the structure. (Tr. 4/111, 115) Mr. Rose also
acknowledged that one consideration for using a drilled pier foundation system is that, if
properly supported, it is less likely to move than a shallow supported foundation (tr. 3/52).

63. By 15 October 2010 email, Mr. Heinchon notified PBS&JC that the Corps'
Geotechnical Section had responded that the GTR disallowed spread footings and
required drilled concrete piers. By 22 October 2010 email to PBS&JC, he reiterated the
disallowance and noted that PBS&JC's technical report had recommended straight shaft
drilled piers. He stated that there was no need for PBS&JC to speak directly to the
Geotechnical Section. (57964 R4, tabs 11, 12)

64. By letter to PBS&JC of 28 October 2010, ACO Hammer reiterated that spread
footings were disallowed and he directed PBS&JC to continue with concrete piers per its
approved foundation design. However, he stated that the Fort Worth District's
geotechnical engineer would be at Fort Hood on 1and2 November 2010 and available to
speak to PBS&JC's geotechnical engineer if it so wished. PBS&JC declined because it
felt a structural issue was involved and it proceeded with the drilled piers, which were
well underway by the time it received the ACO's letter. (R4, tab 30; tr. 1/106-07)

65. PBS&JC contends that it requested, and was denied, the opportunity to confer
with a Corps structural engineer concerning spread footings. DOR Shafie testified:

A We submitted a letter and an RFI, requesting to
use them at these locations, and requested to speak with a
member of the Corps to discuss calculations and methods for
making that system work, using spread foundations at the
balconies and walkways.

Q Were you or anybody working for you on the
structural team ever permitted or given the opportunity to
speak with a Corps structural engineer or a Corps
geotechnical engineer or otherwise provide the details and
design calculations for the use of spread footers under the
walkways and balconies?

A No.

(Tr. 2/141) During cross-examination ACO Hammer testified:

27
 Q You said a moment ago that you spoke to your
geotech section. Correct?

A Yes.

Q You never spoke to a structural engineer, did
you?

A I don't believe so. No.

Q And you never took the contractor up on the
contractor's offer to have its structural engineer speak with
your structural engineer. Isn't that right?

A I don't- there was a lot of discussion where
Paul Cook wanted- once he got our reply, what our reply was
going to be or he got our letter, he wanted to meet with our
geotech individuals. Okay. And he may have wanted to meet
with our structural. We were going to entertain that. I think
there were some emails back and forth.

Whether that meeting took place, I don't know ....

Q And you don't recall- and I can show it to you
if you don't-there was an email said, We're not going to let
you talk to our geotech section?

A Well, I -there may have been that letter, and I
don't deny that fact, but that didn't influence my decision.

{Tr. 4/39-41) As noted, the Corps did arrange for PBS&JC's geotechnical engineer to
meet with its geotechnical engineer but PBS&JC declined (finding 64). We have not
found any written request by PBS&JC to speak to a Corps structural engineer or any
corroborating evidence that the Corps denied any such request, whether written or oral.
Thus, we find that PBS&JC has not substantiated its contention that the Corps refused to
allow it to confer with a Corps structural engineer concerning its spread footings request.
Also, we find no evidence that the Corps acted in any way to hinder or delay PBS&JC or
to deprive it of the value of the contract.

28
 66. By a 5 November 2010 RFI to the Corps, PBS&JC sought to use a reinforced
concrete slabs-on-grade foundation for the mail kiosk based upon the GTR's provision
that structures less than 500 GSF could be so supported (finding 51). The Corps
responded that this was for stand-alone structures; otherwise the area must use the same
foundation system as the structure to which it was connected. The kiosk did not qualify
because it was structurally connected to the building. (R4, tab 32; see tr. 11112)
Ultimately the Corps allowed spread footing foundations under the kiosk, a single story of
qualifying small size. We are unpersuaded by project superintendent Hartshorn's
calculation at the hearing that the kiosk's gsfwas 625 square feet (tr. 3/156-159).
Regardless, the Corps essentially required PBS&JC to make the kiosk a separate structure
by adding beams that created a building joint which resulted in a discontinuity between
the two structures, and by constructing an expansion joint at the roofs interface to allow
separate movement between the buildings. PBS&JC was behind schedule and the Corps
thought this would help. ACO Hammer allowed the change without any further design
review other than by the project engineer, any contract modification, or any request for
money back from PBS&JC. (Ex. G-2; tr. 11112-13, 4/46, 72, 120, 122, 125)

67. Drilling continued into mid November 2010. A total of 584 pier holes were
drilled. (R4, tab 7B at Bates 222; app. dsc resp. at 17, ii 43)

68. There was no contention that PBS&J's original drilled pier foundation design
for the exterior balconies and walkways, which the Corps had approved, was defective.
Although PBS&JC later contended that it was an over-design, it worked as intended and
the Corps was satisfied with it. (Tr. 2/228-29, 4/118)

69. By letter of 11February2011, Mr. Williams notified the Corps that PBS&JC
would seek an equitable adjustment under the contract's Changes clause (57964 R4, tab 8
at Bates 22). It submitted a certified $368,063 CDA claim dated 2 May 2011 to
ACO Hammer, stating that its original proposal had deep foundations for the building
consistent with the RFP but the Corps changed the building thereafter from internal
corridors to an exterior balcony style building. PBS&JC alleged that, in its redesign, its
engineering team "inadvertently added drilled piers to the exterior walkways" (id. at
Bates 16), but the walkways were not an integral part of the building. They were exterior
covered areas under SOW§ 3.1.3.1.(a) (finding 45), and application of the GTR's small
structures provision (finding 51) was appropriate. PBS&JC noted that its DOR approved
changing from drilled piers to spread footings under balcony columns and alleged that
this was consistent with Kleinfelder's 2 June 2010 report concerning spread footings
(findings 57, 58) and with SCR § 1.11 concerning deviations from accepted designs
(finding 47). PBS&JC contended that its DOR's re-evaluation distinguished building and
exterior balcony foundations, for which spread footings were a viable option. It stated
that this design modification was within its contractual rights but, upon the Corps' refusal
to allow it, it had installed drilled piers at the balcony footings per its original design. It

29
sought its alleged resulting additional costs. ( 57964 R4, tab 8 at Bates 16-17) There is no
evidentiary support for PBS&JC's claim that drilled piers under exterior walkways had
been added to its design "inadvertently."

70. By final decision of 17 November 2011, the CO denied PBS&JC's claim and
this timely appeal ensued (57964 R4, tabs 1, 2).

Corps' Expert Evidence On Balcony Piers Claim

71. Zachary Gerich, a licensed professional engineer, held a bachelor's of science
degree in civil engineering and a master's degree in structural engineering. At the time of
the hearing he was a senior structural engineer in the Fort Worth District's structural
design s.ection. He was offered and admitted without objection as an expert in structural
engineering. He submitted an expert report dated 18 July 2012. (R4, tab 34; tr. 4/48-51)

72. In Mr. Gerich's opinion, GTR § 5.d.(1) (finding 51) applied to structures
under 500 gsfthat were not part of a major structure-"more of a picnic-type structure,
canopies, just anything that's not a major structure" (tr. 4/56). He described the balconies
at issue as a three-story construction of steel framing with many methods of attachment to
the building. He demonstrated that contract drawings showed that balconies and covered
walkways were structurally integrated into the barracks through interconnected columns,
beams, support angles, headed studs, and concrete decks. (Tr. 4/58-69)

73. Based upon Mr. Gerich's expert testimony, the contract drawings, and
DOR Shafie's acknowledgement that that the balconies were a continuous system over
500 gsf, we find that the balconies and covered walkways were not under 500 gsf and did
not qualify for the GTR § 5.d(l) exception to the contract requirement for a drilled
concrete pier deep foundation system (findings 51, 52, 72, 76). We find the DOR's and
Mr. Rose's propositions at the hearing that the balcony system could be akin to a covered
pavilion and small support structure (finding 52) to be unreasonable and the Corps'
interpretation to be the only reasonable one.

74. Mr. Gerich opined that use of drilled pier shafts is to minimize movement
within poor soils, such as the heave and shrinkage of the clays in the local Texas area.
Piers are the main type of foundation that will eliminate any excessive movement in a
structure. (Tr. 4/70) Corps expert McCleskey stated that the reinforced concrete straight
shaft drilled pier foundation system was a project requirement due to the facility's design
requirements, the subsurface conditions, and his and the Fort Worth District's previous
design and construction experience for similar structures. The advantages of a drilled
pier foundation system are that it extends below the soil's upper active zone that would
tend to produce heave, expansion, consolidation, or settlement with a shallow foundation

30
system, and it can be extended to a deeper, higher bearing strength formation better able
to support the anticipated design loads for the facility. (Tr. 3/243-44)

75. Mr. Gerich similarly stated in his report that the GTR did not allow shallow
foundations based upon the site's highly expansive and compressible clay soils. Potential
heave in the upper 12' zone could be 2". Drilled shaft piers reduce potential swell and
settlement to acceptable levels. Spread footings, however, will still move with the upper
active soil zone. Movement can be reduced to tolerable levels only by extensive soil
excavation and replacement with non-expansive fill. He also noted that Kleinfelder had
recognized that there had to be extensive subgrade preparation, to minimize soil
movement to about l ", if spread footings were used. However, in Mr. Gerich' s expert
opinion, given that the balconies had a 5'-4" span, even I" of soil movement could affect
their slope and function and would cause more structural issues, deterioration of the wood
structures, and maintenance problems, in the future. (R4, tab 34 at 1-2)

76. Citing contract drawings, Mr. Gerich reported that the balconies/covered
walkways were effectively integrated into the dormitory structure and that, given the
anticipated soil heave and that the balcony/walkway system was not designed to move
independently of the main structure, a common foundation system was required. In his
opinion a structural designer should not mix different structural systems within a
structure; use of different foundation types requires isolation joints at the intersection of
the different systems; and the attachment of the balcony to the building structure would
undergo severe deformations. The worst scenario would be differential settlement of the
individual footings, which would damage the balcony and building connection and the
connection between the exterior balcony columns. Mr. Gerich described in detail the
potential problems with using spread footings instead of drilled piers for the
balcony/walkways, including, inter alia, that the entire balcony structure would need to be
isolated from the building, with enough clearance to prevent interference due to
settlement and additional footings to support the balconies properly. (R4, tab 34 at 2-4)
Mr. Gerich acknowledged at the hearing that it was possible, "[w ]ith a complete
redesign," to design a separate structure for the balconies that would have allowed
differential movement between them and the building (tr. 4/82).

DISCUSSION

PBS&JC contends that the Corps improperly denied its request to use shallow
footings under the balconies and exterior walkways, which the contract allowed and was
not a design deviation, as demonstrated by the Corps' acceptance of a shallow foundation
at the mail kiosk. Alternatively, the contract was ambiguous as to whether the spread
footers could be used and it should be construed against the Corps. PBS&JC apparently
alleges latent ambiguities. Further, the Corps acted arbitrarily and capriciously and
breached its duty of good faith and fair dealing when it failed to cooperate with PBS&JC

31
in its request to use spread footings and to administer the contract in a manner that did not
hinder or delay performance or increase its cost.

The Corps responds that the contract was not ambiguous; it expressly required
deep foundation systems and disallowed shallow footings for the balconies and exterior
walkways; and the Corps was entitled to strict compliance. The Corps contends that
PBS&JC's claimed interpretations were not reasonable and it did not rely upon them prior
to contract award. Lastly, the Corps asserts that it administered the contract reasonably
and did not breach its duty of good faith and fair dealing.

Regarding contract requirements for foundations, the GTR stated that the
contractor's foundation and pavement designs were to comply with the RFP's and GTR's
requirements and that specific requirements were in GTR § 5.f. That section,
"Requirements for the Design-Build Contractor's Foundation and Pavement Design
Analysis," stated under~ (I), "Recommended Foundation System(s)," that a reinforced
concrete straight-shaft drilled pier foundation system "shall be utilized" and the
contractor "shall design the straight-shaft drilled piers" in accordance with the GTR
(finding 49). GTR § 5.b, "Foundation Design Considerations, Recommendations, and
Requirements," stated that a "shallow foundation system" of "reinforced concrete
continuous and/or spot spread footings" was "not considered to be a viable alternative"
and "shallow footings" were "not allowed" (finding 50).

The GTR § 5.d(I) exception at issue applied only to covered pavilions and "any
other small (::;500 GSF) support-type structures" (finding 51). It thus equated covered
pavilions with "other" small support-type structures, all of which had to be equal or less
than 500 gsf. We have found that the balconies and covered walkways were not under
500 gsf, did not qualify for the small structure exception, and that the DOR's and
Mr. Rose's propositions at the hearing that the balcony system could be akin to a covered
pavilion and small support structure were unreasonable (finding 73).

PBS&JC's actions confirm that it interpreted the RFP to require a deep foundation
system when it submitted its accepted proposal and for a long time after contract award.
After some initial confusion on its part as to whether exterior balconies were required,
PBS&JC incorporated exterior balconies into its design prior to contract award (findings
53, 54). The accepted proposal design showed a foundation based upon drilled concrete
piers-a deep foundation system (finding 55). PBS&JC alleged in its claim that, in its
re-design, its engineers had "inadvertently added drilled piers to the exterior walkways,"
but there is no evidentiary support for the claim of inadvertence (finding 69). PBS&JC's
interim design submittal of 30 November 2009 and designer Kleinfelder's 9 December
2009 report, both post-contract award, each depicted balconies and covered walkways
supported on screw piles, another deep foundation system. Kleinfelder's 26 April 2010
report recommended a straight shaft drilled pier foundation system, did not propose a

32
shallow foundation system for any of the project work, and its design drawings showed
balconies and covered walkways supported by concrete piers. (Findings 55-57)

Kleinfelder' s 2 June 2010 geotechnical engineering study mentioned the
possibility of spread footing foundations for the first time, stating it understood they
would be used at select locations, and that they could be used on a proper subgrade.
However, the report also stated that the soil's estimated vertical movement was "greater
than what most structural engineers consider acceptable for a shallow foundation system,"
repeated the drilled piers recommendation in the 26 April 2010 report, and contained
drawings showing balconies and covered walkways on concrete piers. (Finding 58)
PBS&JC's finalized July 2010 drawings again depicted concrete drilled piers under the
covered walkways and balconies (findings 58, 59). It was not until 14 October 2010 that
PBS&JC submitted a "Design Modification Request" to remove drilled piers at the
exterior balconies and replace them with spread footers (finding 61 ).

In sum, it is apparent that the contract did not allow the use of shallow spread
footings under the exterior balconies and walkways, and that is how PBS&JC interpreted
it for much of the contract performance period.

Regarding PBS&JC's alternative ambiguity argument, a contract provision is
ambiguous only if it is susceptible of more than one different, reasonable, interpretation.
Metric Constructors, Inc. v. NASA, 169 F.3d 747, 751 (Fed. Cir. 1999); Edward R.
Marden Corp. v. United States, 803 F.2d 701, 705 (Fed. Cir. 1986). While we have found
the Corps' interpretation of the exception allowing shallow foundations for small
structures to be the only reasonable one (finding 73), even if we were to assume that there
is another reasonable interpretation, PBS&JC cannot recover because any ambiguity
would be patent and it failed timely to inquire about it. A patent ambiguity is one that
would be apparent to a reasonable person in the claimant's position. In such a case, the
contractor has a duty to inquire of the government about the provision's meaning before it
submits its bid or proposal. The issue of whether a contractor's particular interpretation is
reasonable is reached only if the ambiguity is not patent. Lockheed Martin IR Imaging
Systems, Inc. v. West, 108 F.3d 319, 322 (Fed. Cir. 1997); Newsom v. United States, 676
F.2d 647, 649 (Ct. Cl. 1982); Dick Pacific/GHEMM, JV, ASBCA Nos. 54743, 55255,
09-2 BCA if 34,178 at 168,965.

PBS&JC knew, prior to its final proposal submission, and before contract award,
that the contract included exterior balconies (finding 54). PBS&JC's alleged
interpretations and ambiguities advanced at hearing or in briefing are strained. It alleges
that there are ambiguities to the extent that any of the relevant contract provisions
contained the words "recommended" or "recommendations" as well as "requirements"
(see findings 49, 50), or that the 500 psf reference in the shallow foundation exception
could be read not to apply to covered pavilions, or not to apply when individual column

33
sections were under 500 gsf (see findings 51, 52 ). However, any such alleged
ambiguities were obvious. PBS&JC should have timely raised them and it did not
(finding 57). Therefore, the alleged ambiguities are resolved against it. P.R. Burke Corp.
v. United States, 277 F.3d 1346, 1355 (Fed. Cir. 2002). Because the ambiguities alleged
by PBS&JC were patent, we do not reach any latent ambiguity arguments.

With respect to PBS&JC's contention that the Corps acted arbitrarily and
capriciously in denying its request to use spread footings under the exterior balconies and
covered walkways, the Corps' actions were sanctioned under the contract. It required that
the contractor obtain the government's concurrence for any proposed revision to the
approved design before proceeding, and the government reserved the right to disapprove
any design revision that deviated from contract requirements. (Finding 47)

PBS&JC alleges that the spread footings change was not a deviation from contract
requirements and notes that the Corps allowed spread footing foundations under the mail
kiosk, without any contract modification. However, the mail kiosk was a single story of
qualifying small size, which PBS&JC in essence made a separate structure. (Finding 66)
Although Mr. Gerich acknowledged that it was possible to design a separate structure for
the balconies that would have allowed differential movement between them and the
building, this would have required a complete redesign (finding 76). Moreover, while the
requirement for drilled piers under the balconies "'nd walkways could have been more
than was necessary for load-bearing purposes, the main reason for using drilled concrete
piers at Fort Hood was its expansive soils. Balconies with spread footings would tend to
move a lot more than the rest of the structure to which they were tied. Mr. Rose of
Kleinfelder acknowledged that a drilled pier foundation system is less likely to move than
a shallow supported foundation. Expert Mr. Gerich confirmed that drilled piers were
used to minimize movement within poor soils, such as those in the local Texas area, and
that spread footings would move. (Findings 62, 74, 75)

The Corps was entitled to compliance with its specifications and the approved
design, and saw no benefit to it in changing. It was not obligated to approve a change,
particularly such a significant one, advanced by PBS&JC for the first time relatively late
in the project. (Findings 57, 61, 68) Thus, the Corps did not act arbitrarily and
capriciously in denying PBS&JC's request to use spread footings under the balconies and
covered walkways.

Somewhat intertwined with its contentions that the Corps acted arbitrarily and
capriciously, PBS&JC further alleges that the Corps breached its duty of good faith and
fair dealing and its duty not to hinder or delay contract performance by failing to
cooperate with it in its request to use spread footings. PBS&JC particularly stresses the
Corps' alleged refusal to allow it to confer with a Corps structural engineer.

34
 The duties to cooperate and not to hinder have been treated as aspects of the duty
of good faith and fair dealing. Metcalf Construction Co. v. United States, 742 F.3d 984,
991 (Fed. Cir. 2014). Government officials are presumed to act in good faith and it takes
clear and convincing evidence to prove otherwise. Road and Highway Builders, LLC v.
United States, 702 F.3d 1365, 1368-69 (Fed. Cir. 2012). In Metcalf, the court of appeals
discussed governmental breach of the duty of good faith and fair dealing in terms of acts
or omissions that, while not expressly proscribed by the contract, are inconsistent with its
purpose and deprive the other party of the contract's contemplated value. 742 F.3d at
991; accord Century Exploration New Orleans, LLC v. United States, 745 F.3d 1168,
1179 (Fed. Cir. 2014). The court recently summarized:

Every contract implicitly contains a covenant of good
faith and fair dealing, keyed to the obligations and
opportunities established in the contract. The covenant
imposes on each party a "duty not to interfere with the other
party's performance and not to act so as to destroy the
reasonable expectations of the other party regarding the fruits
of the contract."

Lakeshore Engineering Services, Inc. v. United States, 748 F.3d 1341, 1349 (Fed. Cir.
2014) (citations omitted).

PBS&JC stated in its 14 October 2010 request to change its approved design in
order to use shallow spread footings under the exterior walkways and balconies, rather
than deep foundation concrete drilled piers, that it would provide complete details and
design calculations. There is no evidence that it did so. (Finding 61) The Corps notified
PBS&JC that its Geotechnical Section had disallowed the change. While, at first, it stated
that there was no need for PBS&JC to speak directly to the Section, the Corps later
arranged for a meeting if PBS&JC so wished. PBS&JC declined because it felt a
structural issue was involved and it was well underway with the drilled piers at the time.
(Findings 63, 64) We found that PBS&JC did not substantiate its contention that the
Corps refused to allow it to confer with a structural engineer concerning its spread
footings request and we found no evidence that the Corps acted in any way to hinder or
delay PBS&JC or to deprive it of the value of the contract (finding 65).

In sum, there is no evidence that the Corps' actions were in any respect tantamount
to a breach of its duty of good faith and fair dealing.

35
 DECISION

BALCONY PIERS CLAIM - ASBCA No. 57964

We deny the appeal.

CONCLUSION

ASBCA Nos. 57814 and 57964 are denied.

Dated: 25 July 2014

dministrative Judge
Armed Services Board
of Contract Appeals

I concur I concur

~~44
Administrative Judge
OWEN C. WILSON
Administrative Judge
---------
Acting Chairman Acting Vice Chairman
Armed Services Board Armed Services Board
of Contract Appeals of Contract Appeals

I certify that the foregoing is a true copy of the Opinion and Decision of the Armed
Services Board of Contract Appeals in ASBCA Nos. 57814, 57964, Appeals of PBS&J
Constructors, Inc., rendered in conformance with the Board's Charter.

Dated:

JEFFREY D. GARDIN
Recorder, Armed Services
Board of Contract Appeals

36