ARMED SERVICES BOARD OF CONTRACT APPEALS
Appeal of -- )
)
Thunderstruck Signs ) ASBCA No. 61027
)
Under Contract No. FA4855-15-P-0136 )
APPEARANCE FOR THE APPELLANT: Mr. Jason Mock
President
APPEARANCES FOR THE GOVERNMENT: Jeffrey P. Hildebrant, Esq.
Air Force Deputy Chief Trial Attorney
Lt Col Nathaniel H. Sears, USAF
Trial Attorney
OPINION BY ADMINISTRATIVE JUDGE WOODROW
This appeal arises from a contracting officer's termination for cause for a contract
between appellant Thunderstruck Signs and the government to manufacture and deliver
facility signs to Cannon Air Force Base, New Mexico. The parties have elected to
proceed under the Board's Rule 12.3 Accelerated Procedures and also to waive a hearing
and submit its case upon the record pursuant to Board Rule 11. The only matter before
the Board is whether the Air Force's termination of the contract for cause was proper.
SUMMARY FINDINGS OF FACT
I. The Contract
1. The United States Air Force (Air Force or government) awarded a firm-fixed-
price, commercial item contract, No. FA4855-15-P-0136, to Thunderstruck Signs
(appellant or Thunderstruck) on 16 September 2015 for $47,791.16. The contract
required Thunderstruck to supply six facility signs to Cannon Air Force Base (AFB).
(R4, tab 3 at 3) The contract specified a delivery date of 16 October 2015 (id. at 6).
According to its proposal, Thunderstruck would remove and dispose of the existing signs
and supply and install the new signs (id. at 3).
2. The contract incorporated by reference the standard commercial item contract
clause, Federal Acquisition Regulation (FAR) 52.212-4, CONTRACT TERMS AND
CONDITIONS-COMMERCIAL ITEMS (MA y 2015) (R4, tab 3 at 8).
3. Paragraph (f) of the clause, entitled Excusable delays, states in relevant part
that the contractor:
[S]hall be liable for default unless nonperformance is caused
by an occurrence beyond the reasonable control of the
Contractor and without its fault or negligence such as, acts of
God or the public enemy, acts of the Government in either its
sovereign or contractual capacity, fires, floods, epidemics,
quarantine restrictions, strikes, unusually severe weather, and
delays of common carriers.
4. Paragraph (m) of the clause addresses termination for cause, and permits the
government to "terminate [the] contract, or any part hereof, for cause in the event of any
default by the Contractor, or ifthe Contractor fails to comply with any contract terms and
conditions." Paragraph (m) also provides that if it is "determined that the Government
improperly terminated [the] contract for default, such termination shall be deemed a
termination for convenience."
II. Performance Period
5. On 8 October 2015, eight days prior to the contract delivery date,
Thunderstruck emailed the Air Force stating that "[w]e will need artwork for all signs to
be sent at your leisure. These signs generally take 5-7 [sic] to manufacture and install."
(R4, tab 4 at 1) The Air Force did not provide the artwork by 16 October 2015, nor did
Thunderstruck deliver the signs by that date.
6. On 26 October 2015, Thunderstruck again requested the Air Force to "send us
the artwork for the signs as construction is progressing nicely" (R4, tab 5 at 1).
7. On 5 November 2015, the Air Force provided the artwork to Thunderstruck
(R4, tab 7 at 1-2).
8. On 12 January 2016, the Air Force contacted Thunderstruck and requested an
"update on the timeline for the outdoor signs," and asked, "When will we expect an
installation date?" Thunderstruck responded the same day that "the third of six cans" was
completed and the fourth "almost complete." (R4, tab 8 at 1-3)
III. Initial Show Cause Notice
9. On 28 January 2016, the Air Force issued a Show Cause Notice informing
Thunderstruck that the Air Force was considering terminating the contract for cause.
Additionally, the Show Cause Notice requested that Thunderstruck submit a "detailed
timeline for installation" and stated that "[t]he Contractor should install the signs that are
currently available within two weeks from today." (R4, tab 9 at 1-2)
2
10. On 4 February 2016, Thunderstruck responded to the Show Cause Notice stating
that the "response to the RFQ on the quotation from our business clearly stated each can
takes 4 to 6 weeks to construct" (R4, tab 13 ). Attachment 1 to the Show Cause response is
Thunderstruck's response to the RFQ, titled: "Quotation & Purchase Contract," dated
12 September 2015. The final sentence in the section titled "Description" states that "Each
can takes 4 to 6 weeks." (R4, tab 12 at 1)
11. Thunderstruck further indicated the signs would be "finished within the
timeframe originally bid (24 weeks)" and that all the work would be "complete[d] by
April 13 2016" (R4, tab 13 at 1).
12. On 17 February 2016, the Air Force again requested Thunderstruck to provide
a detailed timeline for the installation of the signs and to install all signs "currently
available" by 24 March 2016 (R4, tab 14 at 1).
13. On 29 March 2016, Thunderstruck told the Air Force that "Four signs are
complete" and the remaining two signs would be complete in "5 to 6 week turns each," or
"between June 7-15th" (R4, tab 17 at 6-7).
IV. Bilateral Modification of Completion Date
14. On 4 April 2016, the parties executed a bilateral modification to the contract,
which extended the completion date from 16 October 2015 to 15 June 2016 (R4, tab 18 at 2).
15. By 15 June 2016, Thunderstruck had not delivered the signs to Cannon AFB.
16. On 17 June 2016, Thunderstruck wrote to the Air Force requesting specific
information on the pole size for one of the two signs that was still under construction
(app. supp. R4 at 1-2; R4, tab 24 at 1).
17 .. The manufacturer of the signs, located in Birmingham, Alabama, informed
Thunderstruck that the signs would be complete and ready for shipment between 10 July
and 24 July (R4, tab 24 at 1; app. resp. at 3 ).
18. On 22 June 2016, Thunderstruck informed the Air Force that it would take
approximately another two weeks to deliver the signs and that the signs would be delivered
on 11 July 2016, "[g]ive or take 3 days or so" (R4, tab 20 at 3).
19. On 12 July and on 14 July 2016, the Air Force asked about the status of the
signs. Thunderstruck responded on 14 July 2016 that it was "waiting on the
manufacturer" to provide a shipping date and that "the hold up was due to not getting the
Pole size and paint color from your side until June 2l5t." (R4, tab 20 at 1)
3
20. On 21 July 2016, the manufacturer informed Thunderstruck that delivery
would be delayed until the week of 25 July 2016 (app. resp. at 3).
21. On 21 July 2016, the Air Force requested the tracking information for the signs.
Thunderstruck responded that "the truck is not available until next week sometime." (R4,
tab 21 at 1)
22. On 25 July 2016, the contracting officer (CO) contacted Thunderstruck to
determine when the signs would be delivered and installed. The CO informed
Thunderstruck that either Thunderstruck or its subcontractor would need to be at Cannon
AFB, because it was Thunderstruck's responsibility to provide the necessary labor to
offload and install the signs. (R4, tab 24 at 2) Mr. Mock, from Thunderstruck, stated that
because he would be unavailable to meet the delivery truck at Cannon AFB that Friday,
29 July 2016, he would contact his subcontractor to reschedule delivery and send the CO
an updated delivery and installation schedule by the end of the day on 25 July (id. at 3).
23. On 26 July 2016, the CO asked Thunderstruck for an updated delivery
schedule. Mr. Mock responded that he would update the CO as soon as he had the
revised schedule. (R4, tab 24 at 3)
V. Delivery of the Signs
24. On 27 July 2016, the signs were loaded onto a freight truck at the factory in
Birmingham, Alabama (app. br. at 2).
25. Thunderstruck was informed by the Air Force that the signs could not be
shipped directly to Cannon AFB. As a consequence, Thunderstruck arranged to ship
them to an employee's residence in Clovis, New Mexico. (R4, tab 21 at 18, tab 33 at 3)
26. Appellant attached to its complaint three bills of lading. The first attachment
was a bill of lading from ABF Logistics, Inc., dated 28 July 2016, indicates that the signs
were scheduled to be delivered from Sign Builders, Inc., Birmingham, AL, to Building
1208 at Cannon AFB. The contact person for the shipment was listed as Sgt Lay. The
attachment contains a handwritten notation "shipped" at the top. (Compl., attach. 1)
27. The second bill oflading from ABF Logistics, Inc., also dated 28 July 2016, lists the
"SHIPPER" as Sign Builders, Inc., Birmingham, AL, and the destination as Thunderstruck
Signs, Clovis, NM. The contact person for the shipment is listed as Jason Mock, the owner of
Thunderstruck Signs. The copy is difficult to read, but it contains a handwritten notation at the
bottom indicating that "this is where we re-routed." (Compl., attach. 2)
28. The final bill of lading is dated 3 August 2016 and lists the shipper as Sign
Buildings, Inc., Birmingham, AL, and the consignee as Thunderstruck Signs, Clovis,
4
NM. The contact person is Jason Mock. The attachment contains a handwritten notation
stating that "this is the final delivery location." (Compl., attach. 3)
VI. Initial Attempt to Install the Signs
29. Thunderstruck made arrangements with a local electrician, 3M Electric, to
perform the installation once the signs were delivered (R4, tab 25 at 1-2, 5).
30. On 2 August 2016, the CO again asked Thunderstruck for an updated delivery
schedule. Thunderstruck responded that the signs would be delivered on 4 August 2016.
(R4, tab 24 at 4)
31. On 4 August 2016, the Air Force informed Thunderstruck that if the government
did not receive a confirmation and an installation schedule for the signs by 4:00 pm on
5 August 2016, then the Air Force would terminate the contract for cause (R4, tab 22 at 7).
32. Thunderstruck responded later that same day that "the signs are arriving
today." Thunderstruck explained that it would need to hire a crane company to complete
installation of the signs and would provide an installation schedule to the Air Force as
soon as it obtained scheduling information from the crane operator. (R4, tab 22 at 6)
33. On 4 August 2016, the Air Force then informed Thunderstruck that it had
until 4:30 pm on 5 August 2016 to provide the schedule for installing the signs or the Air
Force would terminate the contract (R4, tab 22 at 6). Mr. Mock responded that "a
schedule will be forwarded tomorrow as stated" (id. at 5).
34. On the same day, 4 August 2016, Mr. Mock informed the Air Force that the
signs arrived in Clovis, New Mexico, at 5:10 pm and "are currently being offloaded at
our install crew[']s shop" (R4, tab 22 at 5).
35. On 5 August 2016, at 4:39 pm, the Air Force notified Thunderstruck that it
would "proceed with a termination for cause" and directed Thunderstruck to "stop work
immediately" (R4, tab 23 at 1).
36. The same day, 5 August 2016 at 5:12 pm, Thunderstruck replied that "the
signs are done and ready for install they are going to be delivered to you. We can get the
crane on the 17th no sooner. So install can begin that day or we can drop the signs at the
base and submit for payment. Not negotiable." (R4, tab 23 at 2)
VII. Termination for Cause
37. At two different times on 17 August 2016, Thunderstruck requested that the
Air Force coordinate with an electrician to install the signs (R4, tab 25 at 5). The Air
5
Force responded on 18 August 2016, stating "that this contract is going to be terminated
for cause and to stop work immediately" (id. at 6).
38. On 18 August 2016, the CO, TSgt Andrea Lay, reached out by telephone to
Thunderstruck's electrical subcontractor, Mr. Matt Meyers of 3M Electric. Mr. Meyers
confirmed that Thunderstruck had contacted him about performing the installation. The
CO informed Mr. Meyers that "the Government would not be accepting the signs and we
would not be doing business with Thunderstruck Signs any longer." (R4, tab 25 at 1)
39. However, on 29 August 2016, the Air Force gave Thunderstruck a final
opportunity to perform. Through electronic and certified mail, the Air Force notified
Thunderstruck that if performance was not complete by 14 September 2016, the Air
Force would terminate the contract. (R4, tab 31 at 2)
40. Thunderstruck responded on 29 August 2016, stating "we will schedule
accordingly with each" (R4, tab 32 at 2).
41. Also on 29 August 2016, Thunderstruck expressed a concern about the
availability of a subcontractor to perform the sign installation. However, on 30 August
2016, Thunderstruck emailed the Air Force stating that the "Electrician confirmed he will
be able to install no later than the 14th." (R4, tab 32 at 6)
42. The signs were stored at a personal residence in Clovis, New Mexico, near
Cannon AFB, from 4 August 2016 until 8 September 2016 (R4, tab 21 at 18).
43. On 8 September 2016, Thunderstruck shipped the signs from Clovis, New
Mexico to a storage facility in Logan, New Mexico, approximately 65 miles away from
Cannon AFB (comp I., attach. 4 ).
44. The day before performance was due, 13 September 2016, Thunderstruck
emailed the ombudsman for this contract at the Air Force Installation Contracting Agency
(AFICA) that it needed "a few extra days to sort out the pick up of the signs" and that
Thunderstruck was "trying to find a shipping company with a fork lift to pick up."
Thunderstruck informed the ombudsman that it had "not reached a mutual agreement" with
the Air Force regarding the new delivery date, and that Thunderstruck was "having trouble
with the shipping company picking up the signs which are 60 miles north of Cannon AFB
due to the AFB not allowing delivery to the base itself." (R4, tab 33 at 2-3)
45. The ombudsman replied on 14 September 2016, stating "Please work any
issues meeting contracted terms and conditions with the contracting officer" (R4, tab 33
at 1-2). However, Thunderstruck did not contact the CO regarding the delivery of the
signs or to request a further extension.
6
46. On 14 September 2016, Thunderstruck did not deliver the signs.
4 7. On 15 September 2016, the CO initiated the process to terminate the contract
for cause and consulted with her unit's leadership as well as AFICA (R4, tab 34 at 4).
48. After consulting AFICA, on 8 November 2016, the CO executed Modification No.
P00002 terminating the contract for cause (R4, tab 34 at 7).
VIII. Appeal of CO's Final Decision
49. On 8 November 2016, the Air Force terminated Contract No. FA4855-15-P-0136
for cause. The Air Force has not accepted performance by the contractor nor paid the
contractor any amount of the contract price.
50. On 30 January 2017, Thunderstruck timely appealed the Air Force's termination
of the contract for cause with the Board seeking the full contract price of $4 7, 791.16, "plus a
25% cancellation charge" in the amount of$1 l,947.79, for a total amount of $59,738.95.
51. On I March 2017, Thunderstruck filed its complaint. The complaint indicated
that on approximately 28 July 2016, "[t]he signs were at this point ready to ship and well
ahead of the agreed Sept 14th delivery date." The complaint maintains that the signs were
"loaded into the transport truck. .. and shipped to the base on July 28th 2016." (Compl. at 1)
52. On 22 February 2017, Thunderstruck elected to use the expedited appeal
procedure under Board Rule 12.2 and on 10 May 2017 elected to convert its appeal to a
Board Rule 12.3 proceeding (Bd. order