[00:00:00] Speaker 03: Mr. Saltzman. [00:00:02] Speaker 03: Thank you, Your Honor. [00:00:08] Speaker 02: May it please the Court. [00:00:10] Speaker 02: This Court should reverse the decision of the Court of Federal Claims and reform Mr. Airman's contract because an executive agency cannot legally contract in contravention of the express intent of Congress, either by choosing not to incorporate a directly applicable statute [00:00:29] Speaker 02: covering the manner of contracting into the contract or pursuant to regulations that contravene congressional intent. [00:00:37] Speaker 02: Here we have an agency that deliberately reduced the payments to contractors provided for by the statute in order to allow more producers to participate in the CSP program. [00:00:48] Speaker 03: Can I ask you just about the process here? [00:00:50] Speaker 03: Why isn't it proper to dismiss your breach of contract claim [00:00:55] Speaker 03: and require that you bring a reformation claim. [00:00:58] Speaker 03: That's really what you're saying. [00:00:59] Speaker 02: Well, I believe that we did bring a reformation claim below, and it was stated in the Court of Federal Claims proceedings. [00:01:07] Speaker 02: And as Williston states, in section 70 at 60, it is entirely proper to bring both a reformation and a breach of contract claim in the same action. [00:01:19] Speaker 03: And what happened to the reformation claim? [00:01:21] Speaker 02: Well, first it would be the reformation, much as occurred, [00:01:24] Speaker 02: in the beta systems case and others, the surplus ship cases, that with the reformation and then the decision, which is almost pro forma, that the agency did not follow the reformed contract. [00:01:37] Speaker 02: So it does make sense to bring of them jointly, and there is precedent for it, Your Honor. [00:01:43] Speaker 03: Is it your view that the government, is your theory that the government didn't have authority to contract these provisions because they violated the statute? [00:01:53] Speaker 02: Yes, Your Honor. [00:01:54] Speaker 02: The regulations are invalid because they did not follow the provisions of the statute. [00:02:00] Speaker 03: Wait, the regulations are invalid? [00:02:01] Speaker 03: The regulations are invalid. [00:02:03] Speaker 03: But your claim is that the contract was breached. [00:02:07] Speaker 02: That's right. [00:02:08] Speaker 02: This is a claim for... The contract incorporated the regulations. [00:02:13] Speaker 02: And that set the payment terms. [00:02:16] Speaker 02: And those were invalid because the regulations were invalid. [00:02:21] Speaker 03: And why, therefore, if you are correct, that isn't the result that the contract is just void? [00:02:30] Speaker 02: No. [00:02:30] Speaker 02: As I said, in cases like Beta Systems and Labarge, they said that in those instances where there is an invalidity of the regulation, the court is entirely appropriate to reform the contract [00:02:43] Speaker 02: and incorporate the appropriate provisions generated by the statute into the contract. [00:02:50] Speaker 01: But if the regulation is contrary to the statute, then the regulation is more than invalid. [00:02:55] Speaker 01: It's null and void at initial. [00:02:57] Speaker 02: That's true, Your Honor. [00:02:59] Speaker 01: So you're asking us to enforce an illegality. [00:03:03] Speaker 02: No, I don't want you to enforce an illegality. [00:03:06] Speaker 02: To the contrary, I want you to excise the illegality and insert [00:03:13] Speaker 02: the appropriate clause through reformation, the correct payment terms as required by Congress. [00:03:20] Speaker 02: After all, the intent of Congress has set forth in the statute and its legislative history is what must govern here. [00:03:29] Speaker 04: But it would seem to me that the real problem is that the appendix to the contract itself seems to contemplate that there could be a statutory change that could affect the entire relationship. [00:03:43] Speaker 02: It does indicate that, Your Honor, but there was no statutory change with regard to the payment terms whatsoever. [00:03:53] Speaker 02: Now, with regard to the right of renewal, yes, there was a statutory change in 2008. [00:04:01] Speaker 04: That's the problem, isn't it, Jim? [00:04:04] Speaker 02: That's right. [00:04:05] Speaker 02: We believe, Your Honor, that the statute, because it required that the right of renewal to be in the contract on day one, [00:04:13] Speaker 02: It should have been in there in 2005. [00:04:14] Speaker 02: 2008, Congress came along and removed the right of renewal. [00:04:21] Speaker 02: That matter needs to be remanded to the court of federal claims to decide whether or not the government actually breached the reformed contract. [00:04:30] Speaker 02: So we're not asking this court to decide that ultimate question. [00:04:33] Speaker 02: I think that needs to be tried. [00:04:35] Speaker 02: It was not briefed by the parties below. [00:04:37] Speaker 03: I don't understand. [00:04:39] Speaker 03: I mean, if the, if the contract is clear that any [00:04:42] Speaker 03: change in the statute in the interim would make the change in the contract language is clear. [00:04:48] Speaker 02: It is not clear, Your Honor. [00:04:49] Speaker 02: It is not clear. [00:04:51] Speaker 02: It was not decided by the court below. [00:04:54] Speaker 02: It was not raised in the court below. [00:05:00] Speaker 02: That matter, the court below decided that the right of renewal never was in the contract. [00:05:07] Speaker 02: We believe that is erroneous. [00:05:09] Speaker 02: Once that error is corrected, then the question comes, did in fact the United States, did Congress breach the contract by removing it in 2008? [00:05:19] Speaker 02: And that needs to go to trial. [00:05:22] Speaker 04: This seems to be that this is not the usual kind of contract provision. [00:05:27] Speaker 04: In the event the statute is enacted, which certainly plans to cede, that there was even then consideration being given that [00:05:39] Speaker 04: it might have to be changed or for whatever reason that the foundation, including the right of renewal. [00:05:48] Speaker 04: It does, Your Honor. [00:05:49] Speaker 04: And so that's actually made part of the contract. [00:05:53] Speaker 02: That was drafted by the agency, yes. [00:05:56] Speaker 02: There was no legislative history at the time to indicate that the right of renewal, there was any contemplation that the right of renewal would be removed. [00:06:05] Speaker 02: And I think this matter [00:06:06] Speaker 02: on the matter on the right of renewal needs to go back for trial to determine whether or not there was a breach. [00:06:12] Speaker 01: The right of renewal was amended, but still the producers, the former in this case, still had the option to terminate the contract or continue. [00:06:24] Speaker 01: So there's still an option there. [00:06:25] Speaker 02: They didn't have an option to continue because Congress in 2008 removed that. [00:06:31] Speaker 02: And so they were never presented. [00:06:33] Speaker 01: I'm not talking about renewal. [00:06:34] Speaker 01: I'm talking about just to continue the contract. [00:06:36] Speaker 01: Oh, to continue, yes. [00:06:37] Speaker 01: Or to terminate it. [00:06:39] Speaker 02: Yes. [00:06:40] Speaker 02: But this was a contract where Mr. Airman and others were being paid by the government to do certain conservation practices. [00:06:51] Speaker 02: It incurred to the benefit of both parties to continue the contract. [00:06:55] Speaker 02: And Mr. Airman continued the contract until it terminated in 2014. [00:07:01] Speaker 03: I'm still a little unclear. [00:07:03] Speaker 03: In 2008, Congress enacted a provision that said that prohibited producers from entering any new contracts. [00:07:11] Speaker 03: That's correct. [00:07:13] Speaker 03: You referenced that we don't know the legislative history. [00:07:15] Speaker 03: I mean, the statutory provision seems clear. [00:07:18] Speaker 03: And in the contract, they have provisions saying if there's a subsequent intervening action by Congress that does such a thing, then there's no renewal. [00:07:30] Speaker 03: Why isn't that answer clear? [00:07:32] Speaker 02: I don't think that that provision that Your Honor is referring to is as clear. [00:07:37] Speaker 03: The provision in the contract or the provision in the statute? [00:07:39] Speaker 02: The provision in the contract that says that when there is a change in the law, it doesn't say that the contract will terminate when there is a change in the law. [00:07:50] Speaker 02: It says that the parties may enter into some additional agreement, whether that is in effect [00:07:56] Speaker 02: a termination or a termination for convenience clause, as I said, needs to be ventilated before a trial court. [00:08:03] Speaker 03: Well, what it says is, Section 10 says the CCC may terminate this contract in whole or in part without liability if they determine the continued operation will result in a violation of a federal statute of regulation or if termination decides it would be in the public interest. [00:08:19] Speaker 03: That's true, Your Honor. [00:08:22] Speaker 03: Back to the initial claim. [00:08:27] Speaker 03: If we were to conclude that we just disagree with you in terms of your reading of the statute and what the government is required to do, and therefore conclude that the regulation was proper, that ends the matter, right? [00:08:40] Speaker 02: It does. [00:08:40] Speaker 02: It does. [00:08:42] Speaker 02: Because the contract terms were based on the regulation, with regard to the payment terms. [00:08:48] Speaker 02: And as Your Honor knows, we vehemently disagree with that premise. [00:08:52] Speaker 02: We believe that the payment terms [00:08:54] Speaker 02: were at tremendous odds with what the statute required and with the legislative history. [00:09:00] Speaker 02: The base payment alone was supposed to be set based on the statute and the legislative history at the 2001 rental rate. [00:09:10] Speaker 02: And then with regard to Mr. Airman, who was a tier two contractor, he should have received 10% of that per acre for the various land uses such as cropland. [00:09:22] Speaker 02: As such, he should have received [00:09:24] Speaker 02: seven dollars and ten cents per acre for his cropland and due to the machinations that the agency did both in setting base payment too low and then creating three reduced base payments, he only received a dollar sixty. [00:09:41] Speaker 02: That difference came about solely because the agency chose to deliberately not follow the statute and the reason they did that was simply that [00:09:54] Speaker 02: They wanted to put more contractors into the program under the funding constraints they were under. [00:10:01] Speaker 01: Your complaint is not whether the Ehrman had authority to reduce, you know, the regulatory reduction factors to reduce or recalculate the rental payments. [00:10:16] Speaker 01: Your complaint is the amount that they arrive at. [00:10:19] Speaker 02: Well, I think it's one and the same, Your Honor. [00:10:22] Speaker 01: You know, one can be said that the government has no authority to do anything here, and the other is the government has the authority to engage in reduction or recalculation of the base rates, but yet they did it the wrong way. [00:10:37] Speaker 02: Well, they set the base rates improperly. [00:10:42] Speaker 02: They were improperly low because the legislative history said it will be the rock bottom is the 2001 rental rates. [00:10:49] Speaker 03: In the absence of the legislative history, there would not be an issue, right? [00:10:54] Speaker 03: Because the statute is quite clear that it's the authority. [00:10:58] Speaker 02: The legislative history is certainly critical. [00:11:01] Speaker 02: But as Your Honor knows, under the Chevron deference rules, as established by this court, in cases like Milwaukee, that's at 18 Fed 3rd, 921, if memory serves me, [00:11:18] Speaker 02: once you look at the legislative, once you look at the text of the statute and the legislative history, if the intent of Congress on a specific point is clear, that's the end of the inquiry. [00:11:28] Speaker 03: Well, but my question was, if you don't look at the legislative history, you just look at the statute. [00:11:32] Speaker 02: Well, what they did, no, the answer to your question is no, Your Honor, that's not the end of the inquiry. [00:11:38] Speaker 02: Because what the agency did, by creating these three reduced base payments based on tier, they actually [00:11:48] Speaker 02: legislated the difference between the amount of payment between contractors of different tiers. [00:11:56] Speaker 02: Congress said we are going to set a base payment and then for a Tier 1 contractor, he shall get 5 percent of it. [00:12:04] Speaker 02: Tier 2, 10 percent. [00:12:06] Speaker 02: Tier 3, 15 percent. [00:12:08] Speaker 02: The ratio was going to be 1, 2 to 3. [00:12:10] Speaker 02: Through the mathematical machinations of the agency in the regulations, [00:12:16] Speaker 02: The ratio turned out to be one to four to nine. [00:12:21] Speaker 02: Essentially, a tier three contractor, a larger, more established contractor, is going to get, under the government's regulations, they're going to get nine times more than a tier one contractor. [00:12:37] Speaker 02: Congress didn't want that. [00:12:38] Speaker 02: Congress only wanted the ratio to be three times larger. [00:12:44] Speaker 02: What the agency has done here is effectively legislated how the money for adjusted base payments were to be distributed. [00:12:54] Speaker 02: They skewed by these regulations, they skewed the amounts that the larger, more established contractors were going to get. [00:13:02] Speaker 02: It was far different than what contracts had contemplated. [00:13:06] Speaker 03: Is there any other mechanism that you're aware of in which you could have challenged the validity of the regulation? [00:13:12] Speaker 02: I suppose, Your Honor, that an ADA procedure of some sort could have approved it. [00:13:19] Speaker 03: Well, if that's your view, if that's your position, that the regulations were completely outside the scope of what was required by the statute, why isn't that the appropriate vehicle as opposed to agreeing to incorporate the regulations in a contract and then coming in and saying the contract should be rewritten? [00:13:37] Speaker 02: Because I think the cases of this Court also provide the remedy [00:13:41] Speaker 02: of taking the contract and saying that it was inappropriate. [00:13:45] Speaker 02: And we pointed to the cases involving beta systems, the surplus ship sale cases, arts center, and they all provide a contract remedy in addition to the possibility of bringing an ADA proceeding. [00:14:03] Speaker 02: Remember, we're talking about a small contract just outside Stanton, Virginia. [00:14:09] Speaker 02: to be bringing an ADA procedure on behalf of, you know, 20,000 farmers like him, the only vehicle really that would permit that to occur would be a class action. [00:14:25] Speaker 03: And that's the route that Mr. Airman was forced to choose. [00:14:38] Speaker 00: May it please the Court. [00:14:39] Speaker 00: The Court of Federal Claims correctly held that the government did not breach any express provision within Mr. Airman's contract. [00:14:46] Speaker 00: In fact, the government met all of its obligations to Mr. Airman. [00:14:50] Speaker 00: In addition, the trial court correctly held that the CSP statute, neither its base payment provision nor its renewal provision, was incorporated into Mr. Airman's contract. [00:15:00] Speaker 00: Your Honor, its contract interpretation begins with the plain language of the contract, and there is no dispute in this case [00:15:06] Speaker 00: and Mr. Earman was paid the exact amount that he was entitled to under his contract. [00:15:10] Speaker 03: Leaving aside the merits of the underlying claim, you seem to have concede in your briefing that this statute is incorporated into the contract, or at least that the government is required to comply with the statute, right? [00:15:27] Speaker 00: Your Honor, we recognize that the government is required to comply with the statute. [00:15:32] Speaker 00: However, after reviewing the trial court's opinion, [00:15:34] Speaker 00: we recognize that the trial court got the statement of the law correct. [00:15:38] Speaker 03: And the government... Well, is there a meaningful distinction between being legally required to comply with the statute and the compliance being enforceable through a breach of contract claim? [00:15:49] Speaker 00: There is, Your Honor. [00:15:50] Speaker 00: In general terms, agencies are limited to the authority that's bestowed upon them by Congress, but it's much different in the contractual context. [00:15:58] Speaker 00: And with the exception of cases where a statute requires [00:16:02] Speaker 00: payment of a precise amount such as the surplus naval ships or the Arts Center case or the Glavie case, this court has been reluctant, looking specifically at the St. [00:16:11] Speaker 00: Christopher case, to read statutes into a contract where they're not specifically incorporated by reference, which wasn't the case there. [00:16:17] Speaker 03: Well, what other vehicle, what other ability would someone in Mr. Urban's situation, if he at least believed that the regulations were improper or not in compliance with the statute, to pursue that? [00:16:32] Speaker 00: said earlier, Mr. Rearman or another producer could have brought a challenge under the APA. [00:16:38] Speaker 00: In fact, he didn't do so. [00:16:41] Speaker 00: He brought his challenge under the context of the contract. [00:16:43] Speaker 00: But I would also note that the agency in this case didn't violate the CSP statute. [00:16:48] Speaker 00: There's no allegation that Mr. Rearman has shown that the agency violated either the base payment provision [00:16:53] Speaker 00: or the renewal provision in the contract. [00:16:55] Speaker 03: Well, he makes an argument, and his argument seems to be at least largely dependent or relying on the legislative history rights. [00:17:03] Speaker 00: Correct. [00:17:03] Speaker 03: The legislative history does call into question some of the stuff that's incorporated in the regulation, does it not? [00:17:09] Speaker 00: It does. [00:17:10] Speaker 00: It arguably does. [00:17:11] Speaker 03: So is it just on the principle of reading the statute? [00:17:15] Speaker 03: Statute is clear. [00:17:17] Speaker 03: You have authority under the regs. [00:17:18] Speaker 03: Ignore the legislative history. [00:17:20] Speaker 03: Is that how we get to where you want us to go? [00:17:22] Speaker 00: Well, I think that you need to look at the statutory language, and the statutory language is clear. [00:17:28] Speaker 00: The Secretary has broad discretion to set base payment limits. [00:17:31] Speaker 00: And if you look at other parts of the same CSB statute, for example, 16 U.S.C. [00:17:36] Speaker 00: section 3838 CB2, it's clear that Congress knew how to set payment limits because it did so in that provision. [00:17:44] Speaker 00: It set the maximum annual payment that a contractor could receive, and it also set the maximum annual base payment percentage that it could [00:17:52] Speaker 00: receive in a given year. [00:17:53] Speaker 00: So these contracts, they have three payment components. [00:17:55] Speaker 00: There's the base payment. [00:17:57] Speaker 00: There's the cost share payment. [00:17:58] Speaker 00: And then there's the enhancement payment. [00:17:59] Speaker 00: And Congress was clear that only a certain percentage of the total payment could be the base payment. [00:18:05] Speaker 00: And notably, they did not put any limitation into the base payment provision. [00:18:10] Speaker 00: There, they gave the secretary broad discretion. [00:18:12] Speaker 00: And the courts have been clear that courts assume that Congress meant what it says and says what it means. [00:18:18] Speaker 00: And that's what they did here in the [00:18:20] Speaker 00: in the statute, so there's no need under the canons of statutory interpretation to look at the latest... In this case, Congress identified the formula that's to be used in order to set the face payment. [00:18:32] Speaker 01: In the Glavi case, where Congress articulated the express amount that's supposed to be paid to inspectors of foreign vessels, how is this unlike Glavi? [00:18:43] Speaker 01: Well, you have a provision that expressly sets the formula to be used versus [00:18:50] Speaker 01: a dollar amount that's supposed to be paid to these ship inspectors? [00:18:54] Speaker 00: Well, Your Honor, I think if you look at the statutory text, and it's that AD 61 of the appendix in this case, I would respectfully disagree that the statute provides any sort of precise formula for calculating base payments. [00:19:08] Speaker 00: What the provision provides is that a base payment shall be, as determined by the Secretary, the average national per acre rental rate for a specific land use [00:19:18] Speaker 00: during the 2001 crop year or another appropriate rate for the 2001 crop year that ensures regional equity. [00:19:26] Speaker 01: But it said a ratio. [00:19:28] Speaker 01: The statute defines a ratio that's supposed to be applied, and a ratio is fixed. [00:19:34] Speaker 01: It seems to me that your opponents are arguing what the regulation does that changes the ratio. [00:19:40] Speaker 00: John, if the regulation doesn't change the ratio, what the regulation does is it provides a methodology for calculating [00:19:47] Speaker 00: the base payment amount, and then what the Natural Resources Conservation Service did in this case was take the amount that they calculated, the base payment amount, and then apply the statutory ratios, which are set forth in the statute for the Tier 1 contract, Tier 2, and Tier 3. [00:20:02] Speaker 00: Now, Your Honors, with regard to, Mr. Ehrman also argues that the Christian doctrine [00:20:14] Speaker 00: applies to his renewal claim that under this court's precedent for cases regarding the Christian doctrine, that the renewal provision should be read into his contract by operation of law. [00:20:24] Speaker 00: And that's simply incorrect. [00:20:26] Speaker 00: The Christian doctrine applies to mandatory contract clauses [00:20:30] Speaker 00: that express a significant or deeply ingrained strand of public procurement policy. [00:20:35] Speaker 00: And there's no dispute in this case that this is a financial assistance contract. [00:20:39] Speaker 03: It's not a... But with respect to the renewal provision, he's got other problems, right? [00:20:44] Speaker 03: I mean, with respect to the renewal provision, he's got the provision in the contract, section 10, and another provision that kind of override that. [00:20:52] Speaker 00: Correct, Your Honor. [00:20:53] Speaker 00: And we would just point out that the CFP statute is in the 2002 Farm Bill. [00:21:01] Speaker 00: And the farm bill is enacted for a five-year period. [00:21:03] Speaker 00: So all producers were on notice that the law was going to change. [00:21:06] Speaker 00: In this case, Congress rescinded the statute, but that's what happens every five or so years so that they knew that that was going to happen. [00:21:14] Speaker 03: Is this program now non-existent or has it just been revised? [00:21:18] Speaker 00: It's essentially non-existent. [00:21:20] Speaker 00: What the 2008 farm bill provided was that the agency had the authority to honor its obligations under existing contracts, but no new contracts can be entered into or renewed. [00:21:32] Speaker 01: Does our decision in this case affect every contract that's been entered into in this program? [00:21:42] Speaker 00: Yes, Your Honor. [00:21:43] Speaker 00: I think that it does. [00:21:45] Speaker 03: Are there other cases pending that raise the same issue? [00:21:49] Speaker 00: No, Your Honor. [00:21:49] Speaker 00: Mr. Ehrman, at the trial court, he had alleged a class action, but the court didn't reach his class action claim because the court has met all of Mr. Ehrman's allegations. [00:22:03] Speaker 00: I would just also note in Mr. Ehrman's reply brief, he asserts that the government is judicially stopped from arguing that the statute is not incorporated into Mr. Ehrman's contract and just point out that that argument ignores the fact that the doctrine of judicial estoppel only applies in cases where a party successfully urged a petition. [00:22:25] Speaker 01: You did concede, though, that there's incorporation. [00:22:28] Speaker 01: We did, Your Honor. [00:22:30] Speaker 03: And your position is that that issue isn't positive here, because even if we construe the statutes being incorporated, you prevail because of the way you interpret the statute, right? [00:22:41] Speaker 00: Correct, Your Honor. [00:22:41] Speaker 00: Even if, in this case, the court decided to incorporate the base time of provision and the renewal provision, on their face, the government did not violate either of those provisions. [00:22:51] Speaker 00: And we also argue in the alternative in our brief that the regulation that Mr. Airman argues is invalid. [00:22:58] Speaker 01: is in fact entitled to deference under Chevron, and it's a reasonable... Does it matter if the incorporation of a statute, not the regulation, but if the statute is expressed or implied? [00:23:10] Speaker 00: I'm sorry, Your Honor, I didn't understand your question. [00:23:12] Speaker 01: Does it matter whether the incorporation of the statute into the terms of the contract is an expressed corporation or an implied incorporation? [00:23:21] Speaker 00: It does, Your Honor. [00:23:22] Speaker 00: As this Court said in St. [00:23:23] Speaker 00: Christopher, there is simply no Federal Circuit precedent [00:23:26] Speaker 00: holding that it is proper to read into a contract, statutes, regulations, or agency guidance when they are not incorporated explicitly by reference into the contract. [00:23:36] Speaker 00: And that's consistent with this court's holding in the Smithson case as well as the Northrop Grumman case. [00:23:40] Speaker 01: So is your argument that at most we have an implied incorporation? [00:23:44] Speaker 01: Well, you conceded incorporation. [00:23:45] Speaker 01: So I guess that leaves you with an implied incorporation. [00:23:49] Speaker 00: We conceded incorporation at the trial court and now recognize that was an incorrect concession. [00:23:55] Speaker 00: and that the trial court got it right, that there was no incorporation. [00:23:57] Speaker 00: We no longer concede that the statute was incorporated. [00:24:00] Speaker 01: You're playing both sides of the fence here, aren't you? [00:24:03] Speaker 01: You're arguing something below, and now you were wrong, or at least the court didn't agree with you, and now you're arguing the opposite to us. [00:24:12] Speaker 00: We're arguing the opposite to you, but also noting our earlier argument that even if this court were to find that the CFP statute was incorporated by implication into Mr. Ehrman's contract, [00:24:25] Speaker 00: that Mr. Ehrman still doesn't succeed on his claim because the agency paid him what was provided for in his contract, which was consistent with the CFP statute's base payment provision. [00:24:35] Speaker 00: And similarly, Mr. Ehrman did not, under the plain meaning of the statute, have a unilateral right to renew his contract. [00:24:44] Speaker 04: Does your position here depend on a rigorous interpretation and application of that St. [00:24:51] Speaker 04: Christopher statement [00:24:54] Speaker 00: No, Your Honor. [00:24:55] Speaker 00: If I understand your question correctly, are you asking? [00:25:00] Speaker 04: It's a difficult statement applicable in that case, undoubtedly. [00:25:05] Speaker 04: But one can argue on the principles of statutory relationships. [00:25:12] Speaker 04: And so that's really my question. [00:25:15] Speaker 04: Are you relying on the absence of federal circuit precedent of contract interpretation [00:25:24] Speaker 04: that might be specific to government contracts and perhaps nothing else? [00:25:29] Speaker 00: No, Your Honor. [00:25:29] Speaker 00: In the Northrop Grumman case, this Court did something of a survey of the precedent in other circuits noting that there wasn't very much law on incorporation in the Federal Circuit. [00:25:43] Speaker 00: And the Court's decision in Northrop Grumman as well as in Christopher is consistent with the principles of statutory interpretation that a document [00:25:51] Speaker 00: whatever it is, a statute or regulation is not incorporated into a contract unless it's done clearly, unambiguously, and explicitly. [00:26:00] Speaker 03: Well, it doesn't matter what your view is, but your position is, but it doesn't matter in this case because whether or not the statute were incorporated or not, the result would be the same because you don't think that the statute supports Mr. Ehrman's argument, correct? [00:26:15] Speaker 00: That's correct, but the government [00:26:18] Speaker 00: position is that the St. [00:26:20] Speaker 00: Christopher precedent and the similar cases are the correct statement of law. [00:26:26] Speaker 00: Unless Your Honors have any further questions, the government respectfully requests that the court affirms the trial court's decision. [00:26:42] Speaker 02: Very briefly, Your Honor. [00:26:43] Speaker 03: Yeah, I think you've got maybe a couple minutes left. [00:26:47] Speaker 03: I think you went into your rebuttal, so I think we're down to two or three minutes. [00:26:51] Speaker 02: Thank you, Your Honor. [00:26:52] Speaker 02: The government spoke about the Northrop Grumman case, as we said in our brief. [00:26:57] Speaker 02: That case stands nothing more than, if there is an incorporation by reference, it must be specific. [00:27:05] Speaker 02: The government briefly spoke about the Christian doctrine. [00:27:09] Speaker 02: Long before Christian ever came about, this court found, or its predecessor found, that [00:27:15] Speaker 02: In cases such as Eastern Building that there can be an incorporation, there was a proviso that said if a government building becomes available for a post office, the lease in question would be terminated. [00:27:29] Speaker 02: It was not in the lease. [00:27:30] Speaker 02: The predecessor court had no problem in reading that into the contract. [00:27:45] Speaker 02: There are two steps here. [00:27:46] Speaker 02: The legislative history that we talk about affected only the calculation of the base payment. [00:27:51] Speaker 02: That said, there should be a minimum of the 2001 average national rental rates. [00:27:57] Speaker 02: There's no reference in the legislative history to the ratios or the percentages to be applied to that base payment. [00:28:06] Speaker 02: The agency tinkered with the 5, 10, and 15 percent set forth in the statute by applying an additional reduction factor. [00:28:16] Speaker 02: They did not follow what Congress said. [00:28:19] Speaker 02: They came up with a different formula. [00:28:24] Speaker 02: The agency, as an executive agency, does not have the power to thumb their nose at Congress in such a fashion. [00:28:31] Speaker 03: Thank you, Your Honors.