[00:00:10] Speaker 02:
We will hear argument next in number 161021, Western Bean Joint Venture versus United States.

[00:00:26] Speaker 03:
If you look at Steinbeck, it's the only maintenance

[00:00:51] Speaker 02:
Mr. Payne, whenever you're ready.

[00:01:06] Speaker 04:
May I please record?

[00:01:08] Speaker 04:
This is a case that focuses on what is known in the dredging industry as maintenance dredging.

[00:01:13] Speaker 04:
And I can't emphasize

[00:01:15] Speaker 04:
more strongly to the court how important that term is to the dredging industry and how important it is to this case.

[00:01:22] Speaker 04:
Because there are two types of dredging generally.

[00:01:25] Speaker 04:
Maintenance dredging, which means removing essentially sediments or materials from a channel that's been dredged before.

[00:01:32] Speaker 04:
It's done in every navigable waterway in Harvard, virtually in the United States, to keep its authorized depth open.

[00:01:38] Speaker 04:
If it's a 50-foot channel, you have to keep dredging it to make sure it stays at 50, but it's maintenance material.

[00:01:45] Speaker 04:
Then you have new work dredging, or sometimes called construction dredging.

[00:01:49] Speaker 04:
That's where you're dredging material that's virgin, that hasn't been dredged before.

[00:01:53] Speaker 04:
Many times it's the deepening of a channel.

[00:01:57] Speaker 04:
So for example, the project to deepen New York Harbor is new work dredging and usually involves very hard material.

[00:02:05] Speaker 04:
This project was described as a maintenance dredging project.

[00:02:11] Speaker 04:
Now a dredging contractor

[00:02:13] Speaker 04:
approaching a project like this, of course, looks at the title of the project first and says, okay, it's a maintenance dredging project.

[00:02:22] Speaker 04:
What type of work is involved?

[00:02:24] Speaker 04:
What's the description of work?

[00:02:26] Speaker 04:
Well, there's a description of work clause, and it says you're to dredge sediments from the Miami River, contaminated sediments from the Miami River.

[00:02:37] Speaker 04:
All right, that provides just a little bit more information.

[00:02:40] Speaker 04:
The next place a dredging contractor looks is to the character of materials clause.

[00:02:45] Speaker 04:
What types of materials are these sediments that are being described?

[00:02:51] Speaker 04:
And in this case, the character of materials clause says that they're sand and silt.

[00:02:56] Speaker 04:
and silty sand and gravel.

[00:02:58] Speaker 03:
That's the primary... And cobbles.

[00:03:00] Speaker 03:
Cobble is a big piece of gravel.

[00:03:02] Speaker 04:
Cobble is anything from 3 inches to 12 inches in size, Your Honor.

[00:03:06] Speaker 04:
That could be 12 inches.

[00:03:08] Speaker 04:
Yes, a cobble could be 12 inches.

[00:03:09] Speaker 04:
Yes, Your Honor.

[00:03:11] Speaker 03:
And when you hit real soft limestone with a bucket and it sort of disintegrates, it breaks up into cobbles.

[00:03:20] Speaker 03:
Yes, it very well may.

[00:03:22] Speaker 03:
Some 12 inches.

[00:03:24] Speaker 03:
Yes, your honor.

[00:03:25] Speaker 03:
There certainly was a theory as to why some of these cobbles were around there.

[00:03:29] Speaker 03:
They were beat up in when the channel was made back in the thirties.

[00:03:34] Speaker 04:
Well, in part, your honor, what happened was in the 1930s, the channel was to be dredged to a depth of minus 15 feet.

[00:03:43] Speaker 04:
But the surveys that were conducted years later showed that the contractor at that time didn't achieve that depth in all cases.

[00:03:52] Speaker 03:
And in the areas of this... You shot 30% of the channel.

[00:03:55] Speaker 03:
Pardon me?

[00:03:57] Speaker 03:
You shot 28% of the channel.

[00:03:58] Speaker 03:
That's right.

[00:03:59] Speaker 04:
There was material left above grade at a depth of 14 feet and up.

[00:04:02] Speaker 04:
You figured that was in situ rock.

[00:04:05] Speaker 04:
That's right.

[00:04:05] Speaker 04:
You had in situ rock that hadn't been dredged before.

[00:04:09] Speaker 04:
Pardon me?

[00:04:09] Speaker 04:
Yeah, you thought it was in situ rock.

[00:04:11] Speaker 04:
Well, that's right.

[00:04:13] Speaker 04:
Now, the problem is though,

[00:04:16] Speaker 04:
that after you look at the character materials clause, it does say there may be some cobbles and so forth, loose cobbles along the bottom.

[00:04:25] Speaker 04:
When you look, go beyond the character materials clause to try to find out, well, where are these sediments?

[00:04:32] Speaker 04:
What's their composition?

[00:04:35] Speaker 04:
The best information is in the geotechnical information that's included with the solicitation and the contract.

[00:04:40] Speaker 04:
That's in the form of boring logs, the form of wash probes,

[00:04:46] Speaker 04:
and particularly a form of what are known as particle size distribution tests or gradation curves, where they take and test some of the material that comes out of the borings to determine its grain size.

[00:04:59] Speaker 04:
Critically, in this case, the profile of the bottom was sediment overlaying limestone.

[00:05:09] Speaker 04:
The sediments all were shown to be

[00:05:11] Speaker 04:
basically fine-grain materials, certainly not exceeding 1.5 inches in size.

[00:05:18] Speaker 04:
Easily dredgable and easily processable.

[00:05:22] Speaker 04:
And I must mention here that that's another critical distinction in this case from the typical dredging case.

[00:05:28] Speaker 03:
The 12-inch cobble would be easily processable?

[00:05:31] Speaker 03:
No, it would not, Your Honor.

[00:05:33] Speaker 03:
But you had to bring up the 12-inch cobble.

[00:05:35] Speaker 04:
Well, now that's part of the issue.

[00:05:39] Speaker 03:
How do we know in this case how much of the rock you brought up that couldn't be swallowed or couldn't be processed were 12-inch cobbles that existed originally as opposed to 12-inch cobbles that got busted off as a result of your dredging machine?

[00:05:54] Speaker 04:
Well, the contractor in removing the material

[00:05:57] Speaker 04:
separated materials and there were stockpiles.

[00:06:00] Speaker 03:
You're going along and you hit some of this loose stone limestone and you knock it and it creates a 12 inch cobble.

[00:06:09] Speaker 03:
That 12 inch cobble is lying right next to one that's been there since 1930.

[00:06:12] Speaker 03:
You bring them up, how do you know which one is old and which one is new?

[00:06:16] Speaker 04:
Well, the contractor can keep track of what elevation he's dredging.

[00:06:21] Speaker 04:
And we had a profile from the boring and the wash probes as to where this line was.

[00:06:27] Speaker 04:
Well, we can prove how much material was below this sharp interface between the sediments and the limestone because that profile was drawn and there was no disagreement between the parties as to where that was.

[00:06:44] Speaker 04:
The material that was above that line is a little bit more difficult

[00:06:50] Speaker 03:
But the court below didn't even want to consider it, because the court below found that since you knew there was some rock, it's all... Your view is that the 15-foot dredging limit doesn't apply to two quality of stone.

[00:07:07] Speaker 03:
In situ stone, the stuff you couldn't dredge up, but it also doesn't apply to dredgeable stone.

[00:07:14] Speaker 03:
It doesn't apply... Because a maintenance contract never digs up virgin material.

[00:07:20] Speaker 04:
Yes.

[00:07:20] Speaker 04:
And it doesn't apply to material that is not sediment as described in all of the clauses in this contract, which have to be read in harmony.

[00:07:29] Speaker 03:
Cobbles or sediment?

[00:07:31] Speaker 03:
Cobbles are not sediment, Your Honor.

[00:07:32] Speaker 03:
But then you have to bring up the old cobbles.

[00:07:35] Speaker 03:
We took the position that you did not.

[00:07:39] Speaker 03:
Yeah, you have to bring up the cobbles.

[00:07:41] Speaker 03:
The old cobbles.

[00:07:44] Speaker 04:
Character Materials Clause warned the contractor that there may be some loose cobbles along the bottom.

[00:07:52] Speaker 04:
And Weston Bean... Can you just leave them there, the old ones?

[00:07:54] Speaker 04:
No.

[00:07:55] Speaker 04:
Weston Bean, to be safe, even though there was no information provided in the plans and specs to allow this number, said, we're going to assume there's 3% to 5% of oversized material.

[00:08:06] Speaker 04:
Not the 30% that it encountered, but 3% to 5%.

[00:08:09] Speaker 04:
So yes, their honor,

[00:08:11] Speaker 04:
Your honor, they certainly allowed for some of that.

[00:08:14] Speaker 03:
It seems to me that the linchpin hinge in there that your argument turns on is that maintenance contracts never bring up virgin material.

[00:08:24] Speaker 03:
It's not that they never bring it up, your honor.

[00:08:27] Speaker 04:
The question is, does it entitle you to additional compensation under either the constructive change theory or the differing psych conditions theory?

[00:08:38] Speaker 03:
What do you do with the contract in Stuyvesant Dredge?

[00:08:41] Speaker 03:
that you cited that case for a different proposition.

[00:08:44] Speaker 03:
It was a maintenance contract, the only one I could find in our circuit of a maintenance contract.

[00:08:50] Speaker 03:
And it clearly required for the excavation of some virgin material.

[00:08:57] Speaker 04:
Yes.

[00:08:57] Speaker 03:
And I think that was laid out that way in that particular contract.

[00:09:01] Speaker 03:
So I mean, that means it's quite possible that you can have a maintenance contract

[00:09:06] Speaker 03:
where you're going to have to dredge virgin material?

[00:09:10] Speaker 04:
If that is the plan going in, Your Honor, and it's rare that it happens, there would be dual funding.

[00:09:18] Speaker 04:
Because the Corps of Engineers is only permitted to use operation and maintenance funding for maintenance dredging, and they're not allowed to use that funding for new work dredging.

[00:09:27] Speaker 04:
They have to use construction general funding.

[00:09:30] Speaker 04:
This project was funded entirely by operation and maintenance.

[00:09:34] Speaker 04:
And the other important thing is, Your Honor, that unlike a typical dredging case... They could get the money back from you because it was wrongly paid to you?

[00:09:43] Speaker 04:
No.

[00:09:44] Speaker 04:
You don't think they could?

[00:09:47] Speaker 04:
Get it back from us?

[00:09:48] Speaker 04:
No, because they didn't pay us, Your Honor, for

[00:09:51] Speaker 04:
for the part that we're talking about.

[00:09:54] Speaker 04:
Well, listen, if the Corps of Engineers did something internally that was improper, I would assume they'd have to answer to an inspector general or someone like that.

[00:10:05] Speaker 04:
That's something that we obviously don't have any, my client has no power to address.

[00:10:10] Speaker 04:
But the important thing is, your honor, that this material, unlike a typical dredging contract, had to be processed.

[00:10:18] Speaker 03:
The problem wasn't dredging, the problem was processed.

[00:10:21] Speaker 03:
That's right.

[00:10:22] Speaker 03:
You had no trouble digging the stuff.

[00:10:24] Speaker 04:
That's right.

[00:10:25] Speaker 04:
And that's what made the proper description of the materials to my client so critical.

[00:10:30] Speaker 03:
And I suppose your argument would be if you'd only known earlier, you would have hired the right processing machine to start with, and you would have processed it all and everybody would be happy.

[00:10:40] Speaker 04:
That's right.

[00:10:41] Speaker 04:
Because what the processing equipment that we had was quite capable of handling the sediments that were described in the classification.

[00:10:50] Speaker 03:
I didn't understand what the processing machine does.

[00:10:53] Speaker 03:
Does it beat it all up into gravel and the sand?

[00:10:56] Speaker 04:
No, Your Honor.

[00:10:57] Speaker 04:
The material after it's mechanically dredged from the river, it's placed in the barges and then is offloaded.

[00:11:04] Speaker 04:
And there's a separation, old tires and things like that are taken out.

[00:11:07] Speaker 04:
And there are a series essentially

[00:11:10] Speaker 04:
of grizzlies or conveyor belts that separate the material into various sizes.

[00:11:15] Speaker 04:
It's a very large and interesting and complicated process.

[00:11:20] Speaker 04:
And of course, these were to be contaminated sediments, so polymers were added so that when you were to end up with something that was dry and that was contaminant free, that could be taken to a disposal site.

[00:11:33] Speaker 03:
So given your take on the contract, and given the government's take on the contract, why wasn't there a patent ambiguity up front?

[00:11:42] Speaker 03:
I mean, you look at the contract and you say, maintenance.

[00:11:45] Speaker 03:
There's 30% of that down there is going to be rock.

[00:11:48] Speaker 03:
We don't have to dredge it.

[00:11:50] Speaker 03:
We don't know whether it's real undredgeable, but we don't have to dredge the dredgeable rock.

[00:11:57] Speaker 03:
And the government is saying, you've got to go to 15 feet, period.

[00:12:01] Speaker 03:
Your honor.

[00:12:02] Speaker 03:
Why isn't there a patent ambiguity on this issue?

[00:12:05] Speaker 04:
Because my client sent a memo to the Corps of Engineers.

[00:12:09] Speaker 04:
It's found at pages appendix 1186 to 1189.

[00:12:13] Speaker 04:
It was addressing this very issue informing the Corps of Engineers that we felt that there was going to be

[00:12:23] Speaker 04:
less sediment that actually would be removed under this contract than was... About 1186 or 1386?

[00:12:31] Speaker 04:
Let me double check here.

[00:12:35] Speaker 04:
I'm sorry, 1386 to 1389, you're correct, Your Honor.

[00:12:40] Speaker 03:
And it was advised... 30% was rocky, wouldn't happen directly.

[00:12:43] Speaker 04:
Right.

[00:12:44] Speaker 04:
So we did give, to the extent that this part of it was apparent,

[00:12:49] Speaker 04:
We warned the Corps of Engineers before bidding that this is what we suspected.

[00:12:54] Speaker 04:
And the response was, well, unless you have different geotechnical information than we have, you just bid it as you see it, or bid it according to the specs.

[00:13:02] Speaker 04:
There was no way that our client, or I believe any reasonable dredging contractor, would have thought that in a maintenance dredging contract where the materials are described as contaminated sediments,

[00:13:15] Speaker 04:
that materials below that sediment line, which were clearly virgin materials, would have to be dredged and disposed of.

[00:13:23] Speaker 04:
The more logical assumption would be we either leave it, or if you really want us to remove it, you've now constructively changed this contract, and we want to be compensated for it.

[00:13:35] Speaker 00:
There is a specific provision that you have to dredge down to the minus 15 foot.

[00:13:41] Speaker 04:
There was a requirement to dredge to minus 15 feet, Your Honor.

[00:13:46] Speaker 04:
That's in materials that were described as sediments.

[00:13:51] Speaker 04:
And everything was described as either sediments or below this line, virgin material.

[00:13:57] Speaker 04:
If the material below that sharp interface line is not a sediment, then it's not maintenance material.

[00:14:05] Speaker 04:
And yes, you can be required to dredge down to that line, but it becomes a constructive change to the contract.

[00:14:13] Speaker 04:
because that's not the material that's maintenance material that was the purpose of this contract.

[00:14:18] Speaker 04:
And the interesting irony here is, you know, we're dealing with a 15-section acceptance section project.

[00:14:26] Speaker 04:
Our claim is for sections 1 through 6.

[00:14:29] Speaker 04:
There was an 18-month delay for funding reasons when they resumed for 7 to 15.

[00:14:34] Speaker 04:
7 to 15, the Corps of Engineers decided to relax its position because we didn't want to dredge down to minus 15.

[00:14:42] Speaker 04:
We continually asked for permission to stop as we hit harder stuff in 1 through 6, and the Corps said, no, no, you take it down to minus 15 unless you can show it's massive monolithic in situ rock.

[00:14:54] Speaker 04:
So we were constantly bringing up this material and having to process it.

[00:14:59] Speaker 04:
In 7 to 15, the Corps of Engineers allowed the contractor basically to leave that material.

[00:15:06] Speaker 04:
But because they left that material, they had an underrunning quantity.

[00:15:11] Speaker 04:
So the contractor under the variation estimated quantities clause said to the court, we didn't get enough revenue because of this under running quantity.

[00:15:20] Speaker 04:
You should pay us some extra money.

[00:15:22] Speaker 04:
The court agreed and paid them an extra $4 million in area seven through 15.

[00:15:27] Speaker 04:
The irony is that they were paid an extra $4 million to leave material that was not sediment.

[00:15:36] Speaker 04:
When in one through six, when they removed it, they were paid nothing.

[00:15:40] Speaker 04:
And that's what this claim is all about.

[00:15:45] Speaker 02:
You have used all of your time including here.

[00:15:48] Speaker 03:
When you said got paid, not that you got paid, you didn't get paid the extra cost associated with bringing it up.

[00:15:54] Speaker 03:
That's right.

[00:15:56] Speaker 03:
Right.

[00:15:57] Speaker 03:
You got paid for every pound or cubic foot of what you brought out.

[00:16:00] Speaker 04:
We got paid for cubic yardage of material on the contract, but not for the true cost of having to process it when it was either differing site condition material

[00:16:09] Speaker 04:
or constructive change material.

[00:16:14] Speaker 02:
Thank you, Your Honor.

[00:16:15] Speaker 02:
We will restore your rebuttal time.

[00:16:19] Speaker 02:
You may have your rebuttal time back.

[00:16:21] Speaker 04:
Thank you very much, Your Honor.

[00:16:34] Speaker 01:
May I please the court?

[00:16:35] Speaker 01:
The decision of the Court of Federal Claims should be affirmed because the trial court correctly determined that the contract documents required Weston Bean to dredge all material in the dredging template except for massive monolithic in situ rock.

[00:16:48] Speaker 01:
The court also correctly found that Weston Bean was not required to perform any work beyond the requirements of the contract.

[00:16:57] Speaker 01:
Further, the court correctly found that the conditions indicated in the contract documents did not differ materially

[00:17:04] Speaker 01:
from the conditions actually encountered, and that the conditions that Weston being actually encountered were reasonably foreseeable.

[00:17:13] Speaker 01:
Weston being focuses on the title and description of work clause, but asks this court essentially to disregard the plain language of the character of materials to be dredged clause and other contract provisions.

[00:17:26] Speaker 01:
But as Weston be concedes, the contract must be read as a whole and in a manner that gives meaning to all of its provisions.

[00:17:34] Speaker 01:
The character of materials to be dredged clauses the only contract provision that describes the materials required to be dredged.

[00:17:42] Speaker 01:
In fact, the phrase to be dredged was required specifically to inform potential bidders that those are the types of materials that would be required to dredge.

[00:17:52] Speaker 01:
It's unclear whether Weston Bean believes it was only required to dredge sediments or also required to dredge limestone, gravel, and cobbles along portions of the channel bottom and side slopes.

[00:18:04] Speaker 01:
In any event, the contract is very clear.

[00:18:07] Speaker 01:
It was required to dredge all materials other than massive modeling in the template.

[00:18:19] Speaker 03:
And as the trial court correctly found, all materials is your characterization of the clause.

[00:18:26] Speaker 03:
The contract doesn't say dredge all material.

[00:18:29] Speaker 01:
Those words aren't in the contract.

[00:18:33] Speaker 01:
The contract clause, the character materials to be dredged clause, lists five types of materials and states that only massive monolithic in situ rock is not required to be dredged but shall be accurately located in the location reported to the contracting officer.

[00:18:49] Speaker 01:
So all of the other types of materials listed are required to be dredged pursuant to the doctrine that the exclusion of one thing

[00:18:56] Speaker 01:
It's the exclusion of one.

[00:19:01] Speaker 01:
Excuse me, the expression of one thing implies the exclusion of all.

[00:19:05] Speaker 03:
In your view, it expressly calls for bringing up limestone, hard limestone rock?

[00:19:15] Speaker 01:
It expressly requires soft to moderately hard limestone rock to be dredged.

[00:19:20] Speaker 01:
Yes, your honor.

[00:19:22] Speaker 01:
But massive models can sit to rock need not be dredged.

[00:19:26] Speaker 03:
Isn't that in the definition of sediment?

[00:19:30] Speaker 01:
Gravel is in the definition of sediment, your honor, as well as sand, silty sand, clay and silt.

[00:19:36] Speaker 01:
So those are the materials that the court found are required to be dredged.

[00:19:40] Speaker 03:
When the materials, character of materials clause refers to

[00:19:49] Speaker 03:
sediments overlying soft and moderately hard limestone rock.

[00:19:54] Speaker 03:
That means hard limestone rock is dredgable, is in the dredgable material.

[00:20:01] Speaker 01:
Yes, Your Honor.

[00:20:02] Speaker 01:
That is our interpretation of the contract, that soft and moderately hard limestone rock is dredgable.

[00:20:07] Speaker 01:
And the court found that such rock was dredgable.

[00:20:11] Speaker 01:
So that, again, the only type of material that was not required to be dredged of these five types was massive monolithic in situ.

[00:20:18] Speaker 03:
What do I make of the fact that the contracting agency lacked the fiscal authority to require the dredging of the moderately hard limestone rock?

[00:20:34] Speaker 01:
Westonby provided no evidence that the agency lacked fiscal authority other than testimony of Westonby's own witnesses, perhaps a government witness.

[00:20:45] Speaker 01:
Westonby does not point to

[00:20:47] Speaker 01:
anything other than the authorization statute from 1986, it doesn't point to the appropriations acts that were the basis for the funding for this dredge.

[00:20:59] Speaker 01:
In addition, we've pointed to the dredge management materials plan, which indicated that during the 20-year period, there may be both construction and maintenance dredging.

[00:21:09] Speaker 01:
And again, Weston B. Conceded today that it does not wish for the contract to be deemed illegal in any manner.

[00:21:16] Speaker 01:
So there simply is no

[00:21:18] Speaker 01:
evidence in terms of statutes or otherwise that's been presented by Weston Bean, which has the burden that there was a lack of funding authority.

[00:21:27] Speaker 03:
And the court made no finding regarding whether this... Are you aware of so-called maintenance dredging contracts other than the one in Stuyvesant dredging that clearly called for dredging of virgin material?

[00:21:44] Speaker 01:
I'm not aware of any, and I don't believe the court made any findings regarding other dredging contracts.

[00:21:49] Speaker 03:
Well, the reason why I raise it is your adversary is making this argument in essence to say that there's just a binary difference between maintenance dredging and any other kind of dredging, and that maintenance dredging never requires dredging of virgin material.

[00:22:05] Speaker 03:
And I found Stuyvesant, which is au contraire, and I just wondered as a matter of practice whether there are other contracts that

[00:22:14] Speaker 03:
deemed dub themselves as maintenance contracts, but nonetheless require... I'm not aware of any other than the Stuyvesant case, Your Honor.

[00:22:23] Speaker 01:
And in any event, the court did find that it need not look to trade practice because there is no allegation that there is an ambiguity in the contract.

[00:22:36] Speaker 01:
And so, absent an ambiguity,

[00:22:38] Speaker 01:
The court should not look to evidence of trade practice, including various definitions of maintenance dredging, to justify a departure from the contract's terms.

[00:22:48] Speaker 01:
The court also determined, correctly, that to the extent the term maintenance dredging appears to conflict with other contract provisions, such as the character of materials to be dredged clause, those provisions control over the more general term maintenance dredging, so that the contract can be read as a whole and harmonious

[00:23:08] Speaker 01:
in a manner harmonious in giving meaning to all of its parts to require what's to mean to dredge all of the materials within the character materials for dredge clause other than massive model of the constitutive law.

[00:23:19] Speaker 02:
And just so that I understand, when you referred a few minutes ago to the definition of sediments, you mean the implicit definition in that clause?

[00:23:33] Speaker 01:
It does not use the word definition that flies around, but I'm referring to the character materials to be dredged clause, which stated that the materials to be dredged consisted of sediment, including, I believe the word was including, sand, silty sand, clay, silt, and gravel.

[00:23:53] Speaker 03:
And again, Your Honor... It starts by saying the sediments in the Miami River are a combination of...

[00:23:59] Speaker 03:
Sand, silty sand, clay, silt, and gravel, overlaying soft and moderately hard limestone.

[00:24:05] Speaker 01:
Yes, Your Honor.

[00:24:05] Speaker 01:
And the court found that those were two types of materials set forth in the Character Materials to be Dredge Clause in that single sentence, the sediments in which the court found were defined as sand, silty sand, clay, silt, and gravel, and the underlying soft and moderately hard limestone rock.

[00:24:23] Speaker 02:
I think perhaps I'm confused about this.

[00:24:29] Speaker 02:
If one read that first sentence as characterizing the sediments as the stuff on top of the soft to moderately hard limestone rock, would one still say that the dredging had to include the soft to moderately hard limestone rock just because that was not considered, even though it would not be considered sediments?

[00:24:54] Speaker 01:
Yes, your honor, because the contract did not

[00:24:57] Speaker 01:
state that soft and moderately hard limestone rock, if encountered, is not required to be dredged, it did state that for massive mylothians.

[00:25:05] Speaker 02:
Does it say somewhere else that something that does not constitute sediments has to be dredged?

[00:25:12] Speaker 02:
This is the character of materials to be dredged clause.

[00:25:15] Speaker 02:
This is the entire clause.

[00:25:18] Speaker 02:
This is the basis of your argument about what has to be dredged.

[00:25:25] Speaker 02:
There's no other

[00:25:26] Speaker 02:
sentence that says dredge to 15 feet, whether it's sediment or not sediment.

[00:25:30] Speaker 01:
No, in fact, there are several other clauses.

[00:25:32] Speaker 01:
There is the final examination of work clause, which stated that the government could require Weston B to remove any shoals, lumps, or other lack of contract debt.

[00:25:42] Speaker 01:
Continuity of work clause stating that Weston B would not be paid until the full debt required under the contract was secured unless prevented by a ledge rock, which the court

[00:25:51] Speaker 01:
correctly interpreted as massive monolithic and city rock.

[00:25:54] Speaker 01:
So ledge rock is equivalent to massive monolithic and city rock.

[00:25:56] Speaker 01:
There are also the estimated quantities listed in the contract, which included in the estimated quantities all materials in the dredging template, not just sediment.

[00:26:09] Speaker 01:
And that there were the contract drawings that confirmed the requirement to dredge to minus 15 feet.

[00:26:15] Speaker 01:
So these provisions taken together clearly require, Weston being, to dredge

[00:26:21] Speaker 01:
to the dimensions of the template, down to minus 15 feet, and within the drawing dimensions, the dimensions set forth in the drawing, other than massive monolithic in situ rock.

[00:26:34] Speaker 01:
And to the extent Weston Bean was uncertain what the phrase massive monolithic in situ rock meant, it was required to ask for clarification from the government.

[00:26:43] Speaker 03:
And you think its request wasn't sufficient?

[00:26:47] Speaker 01:
Weston Bean provided

[00:26:50] Speaker 01:
testimony from its own witness.

[00:26:52] Speaker 03:
I mean, you didn't make a Peyton ambiguity argument below.

[00:26:56] Speaker 03:
You just made one a second ago.

[00:26:58] Speaker 01:
No, we're not arguing that there is a Peyton ambiguity.

[00:27:01] Speaker 01:
But to the extent there is an ambiguity, it was a Peyton ambiguity.

[00:27:05] Speaker 01:
We're not arguing that there's an ambiguity.

[00:27:06] Speaker 01:
We believe the contract can be read as a whole and interpreted in a manner to give meaning to all of its parts, and that that contract required Weston B. to dredge the entire

[00:27:17] Speaker 01:
dimensions.

[00:27:18] Speaker 03:
If there were a patent ambiguity, would you agree with your adversary, the joint venture, by pointing out that 30% of the material and stuff they weren't going to dredge was sufficient to put you on notice?

[00:27:31] Speaker 01:
No, Your Honor.

[00:27:31] Speaker 01:
First of all, Western Media does not argue that there is a patent ambiguity.

[00:27:35] Speaker 03:
But the possibility of a patent ambiguity in a contract came up with oral argument today.

[00:27:40] Speaker 01:
Right.

[00:27:40] Speaker 01:
But they have not raised that argument before.

[00:27:42] Speaker 01:
They didn't raise it in the court below.

[00:27:43] Speaker 03:
I raised it.

[00:27:44] Speaker 03:
I mean, we're interpreting a contract, right?

[00:27:46] Speaker 03:
Yes, Your Honor.

[00:27:47] Speaker 03:
So it would not be, it would be a bit aggressive, but it would not be illegal if we wanted to decide there was a pain and ambiguity on this issue.

[00:27:55] Speaker 01:
It would not be illegal, Your Honor.

[00:27:57] Speaker 03:
And so all I was trying to get out of you was I raised it with your adversary.

[00:28:00] Speaker 03:
He very quickly responded and said, well, the answer to that, Your Honor, is we put them on notice.

[00:28:05] Speaker 01:
No, Your Honor, we disagree that they put the government on notice.

[00:28:08] Speaker 01:
First of all, the only indication was a single fact which stated that there's some

[00:28:13] Speaker 01:
We have determined that there's 30% rock.

[00:28:16] Speaker 03:
And they said, we're not going to dredge it.

[00:28:17] Speaker 03:
And then Larry Bove at A107 came in and said the same thing.

[00:28:24] Speaker 01:
A107, that is testimony from Larry Bove.

[00:28:26] Speaker 01:
Well, I saw it's in the record.

[00:28:27] Speaker 01:
And there was no contrary testimony provided.

[00:28:31] Speaker 01:
Westonby did not call any government witnesses to confirm the contents of this supposed conversation that occurred.

[00:28:39] Speaker 01:
And again, it's Westonby's burden to indicate what

[00:28:43] Speaker 01:
discussions may or may not have taken place.

[00:28:46] Speaker 01:
In any event, there was no indication from Weston Bean that it believed, not in the record, that it believed there was some kind of ambiguity.

[00:28:56] Speaker 03:
They said we're going to use a mechanical dredge, right?

[00:29:00] Speaker 03:
Because the dredge will only dig the refusal level.

[00:29:04] Speaker 03:
I'm just wondering.

[00:29:05] Speaker 03:
I mean, the adversary said if there was a pain ambiguity here, we put the government on notice.

[00:29:09] Speaker 03:
So that argument's neutered.

[00:29:13] Speaker 01:
The notice, Weston being alleged, is provided.

[00:29:18] Speaker 01:
Again, this is a new argument we've never heard before.

[00:29:20] Speaker 01:
There must be a different reason below.

[00:29:23] Speaker 03:
I'm the one who raised it.

[00:29:24] Speaker 03:
I know it's new.

[00:29:25] Speaker 03:
You don't have to tell me it's new.

[00:29:26] Speaker 01:
I raised it.

[00:29:38] Speaker 01:
The argument, as I understand it, is that

[00:29:41] Speaker 03:
Look at the situation.

[00:29:44] Speaker 03:
You say one guy says, you know, I don't have to take this rock up.

[00:29:49] Speaker 03:
And they tell the government, I don't have to take it up.

[00:29:52] Speaker 03:
Put you on notice.

[00:30:00] Speaker 03:
It's just a simple point.

[00:30:01] Speaker 03:
A simple point is if you hypothesize a patent ambiguity,

[00:30:05] Speaker 03:
The contractor has a burden to come in before he bids to the government and say, hey, here's my problem.

[00:30:10] Speaker 03:
Here's the issue.

[00:30:13] Speaker 03:
And if they do that, then they're off the hook.

[00:30:15] Speaker 01:
Well, the burden, as stated in Blue and Gold, this course decision in Blue and Gold, is that when a solicitation contains a paid ambiguity, the offer has a duty to seek clarification from the government.

[00:30:26] Speaker 01:
And its failure to do so precludes acceptance of its interpretation.

[00:30:29] Speaker 01:
There's no evidence that Weston Bean came in and said, hey,

[00:30:33] Speaker 01:
We believe the title of this solicitation is maintenance dredging, yet we have identified some rock in the pay template.

[00:30:42] Speaker 01:
And because this is a maintenance dredging contract, we are not required to dredge it, yet in the character materials to be dredged clause and the contract, and the drawings, it looks like we're required to dredge to minus 15 feet.

[00:30:57] Speaker 01:
This appears to be negative.

[00:30:58] Speaker 01:
There was no such indication.

[00:30:59] Speaker 02:
Remind me, what was the response

[00:31:02] Speaker 02:
from the Corps to this.

[00:31:05] Speaker 02:
This is all about 1386, is that what we're talking about?

[00:31:09] Speaker 02:
Yes, I believe so.

[00:31:10] Speaker 02:
And what was the Corps' response?

[00:31:12] Speaker 01:
The Corps of Engineers' response?

[00:31:14] Speaker 01:
There was no testimony given by any Corps of Engineers' witnesses.

[00:31:18] Speaker 03:
Well, you mentioned something just a minute ago.

[00:31:20] Speaker 01:
You said something about what the Corps said, I'll go ahead and... Well, that's testimony from Weston Bean's witnesses, where the response was to

[00:31:30] Speaker 01:
uh, can go ahead and bid to the requirements in the contract so that Weston Bean was told bid as if you're going to dredge all material in the template.

[00:31:42] Speaker 01:
Do not submit a bid that indicates that you were going to exclude 30% of the area.

[00:31:47] Speaker 02:
Since, since this is, I guess, sort of newish today, but if, if, if one takes the blue and gold, you have to ask for clarification.

[00:31:57] Speaker 02:
What you just said about the Corps' response, which I think was describing what they said about the Corps' response, why is that not clarification big to 15 feet?

[00:32:09] Speaker 01:
Yes, that is clarification.

[00:32:10] Speaker 01:
So even if the court construes Weston Bean's inquiry to the Corps as sufficient under blowing gold, which it is not, the response from the government was bid to minus 15 feet.

[00:32:25] Speaker 02:
I suppose one could

[00:32:27] Speaker 02:
possibly argue that that response was itself ambiguous since there was a dispute about?

[00:32:33] Speaker 02:
If the response was follow the contract and nobody had figured out what the contract meant, maybe that's not terribly clarifying.

[00:32:38] Speaker 01:
Well, it may help to look at it.

[00:32:40] Speaker 01:
Again, this is one cited testimony, but it may help again to look at the testimony from page 107 to see exactly how Weston Bean's witness characterized the response from the government.

[00:32:51] Speaker 01:
But as I recall, the response was something to the effect that

[00:32:57] Speaker 01:
Well, OK, in fact, it is exactly at page 107.

[00:33:08] Speaker 02:
Which are the mini pages?

[00:33:09] Speaker 01:
In the mini page 255, beginning at line 17.

[00:33:12] Speaker 01:
Well, since you provided nothing materially different, please bid the specification.

[00:33:17] Speaker 01:
And that's the only testament that was provided, again, by Weston Bean's own witness.

[00:33:22] Speaker 01:
The individual who's supposedly on the other end of the phone, Wanda Cruz, was not called.

[00:33:26] Speaker 01:
Judge Kaplan has findings about this, I think.

[00:33:29] Speaker 02:
Doesn't Judge Kaplan has findings about this, or in any event, discusses it in her opinion, I think?

[00:33:36] Speaker 01:
That may be correct, Your Honor.

[00:33:37] Speaker 01:
It certainly is not something that the court ever found constituted notification.

[00:33:45] Speaker 03:
It wasn't a live issue.

[00:33:46] Speaker 01:
It was not a live issue.

[00:33:48] Speaker 01:
Again, because Wesson V did not raise the argument that there is a Peyton ambiguity and that they

[00:33:54] Speaker 03:
I apologize if I've burned up too much of everybody's time with this, but it just struck me that somebody who's not very smart walks up to this case and reads the two briefs on this particular issue and you say, these people think that this is ambiguous.

[00:34:09] Speaker 01:
But neither party has argued it.

[00:34:11] Speaker 03:
The neutral person listening to the argument says, well, there must be an ambiguity here.

[00:34:16] Speaker 03:
If there's room for these two different theories.

[00:34:19] Speaker 01:
The government's position is that there is no ambiguity.

[00:34:21] Speaker 01:
The government's position is that the title

[00:34:23] Speaker 01:
has to be read in conjunction, and it's a more general term.

[00:34:27] Speaker 02:
I think we may have gotten to the bottom of this.

[00:34:30] Speaker 01:
Thank you, Your Honor.

[00:34:31] Speaker 03:
I regret it.

[00:34:32] Speaker 03:
Yes, indeed.

[00:34:34] Speaker 03:
It's a refusal.

[00:34:36] Speaker 04:
And after.

[00:34:38] Speaker 04:
Thank you, Your Honor.

[00:34:39] Speaker 04:
The judge on the appendix page 17 did acknowledge it at the bottom of the paragraph right before numeral 4.

[00:34:52] Speaker 04:
Mr. Bowe further testified that after a few minutes of silence, Mrs. Cruz came back on the line and advised them that since you provided nothing materially different, please bid the specifications and the solicitation.

[00:35:02] Speaker 04:
It's a not unusual government answer to a question.

[00:35:06] Speaker 04:
Bid it as you see it.

[00:35:07] Speaker 04:
But the thing is, our client did tell the Corps how they saw it and that this was material that wasn't maintenance material.

[00:35:14] Speaker 04:
And as I said previously, what's interesting in area seven through 15,

[00:35:19] Speaker 04:
The Corps, in fact, did in practice carry out what we thought they should have done in areas one through six.

[00:35:26] Speaker 04:
You know, in looking at what types of materials could you discern needed to be dredged based on this Character Materials Clause, all the geotechnical information, which really is paramount here.

[00:35:38] Speaker 04:
You just don't learn anything from the Character Materials Clause in and of itself.

[00:35:42] Speaker 04:
You have to look at the geotechnical information.

[00:35:45] Speaker 04:
We pointed out to the trial court below that the government estimator, looking at all the same information that's available to the bidders, classified all the material as mud, all of it, even the limestone.

[00:35:57] Speaker 04:
So the government estimate was based on mud, and mud is sediment.

[00:36:02] Speaker 04:
So they couldn't have been further off from what had to be done on this project.

[00:36:08] Speaker 04:
If it had all been mud, processing would have been very, very easy.

[00:36:12] Speaker 04:
There also was some discussion about, well, wasn't this material dredgeable?

[00:36:17] Speaker 04:
You were able to dig it.

[00:36:18] Speaker 04:
The question isn't really whether it was dredgeable.

[00:36:22] Speaker 04:
We acknowledge that it was dredgeable, but because of the need to process it in a sediment processing plant, the question is, was that

[00:36:31] Speaker 04:
dredgeable material in the case of below the sharp interface, a constructive change to the contract, because you should not have been required to remove it and certainly not to treat it in a maintenance dredging contract.

[00:36:45] Speaker 04:
And was the material above that sharp interface to the extent that there were rocks and limestone and materials embedded in that sediment something that none of the borings showed?

[00:36:56] Speaker 04:
Was that not a differing site condition?

[00:36:59] Speaker 04:
Because there you had indeed a subsurface or latent physical condition that was materially different from what was indicated in the contract.

[00:37:07] Speaker 04:
What was indicated in the contract was sediments down to that line.

[00:37:11] Speaker 04:
And the particle size distribution test showed that none of those sediments exceeded 1.5 inches in size.

[00:37:19] Speaker 04:
So the extent that you ran into 3-inch cobbles or boulders or whatever hard material was embedded in the sediment, that was a differing site condition.

[00:37:27] Speaker 04:
And I think that's fundamentally what the court below didn't really grasp, is that we really had two different types of claims with regard to this condition, a constructive change below the sharp interface and a differing site condition above it.

[00:37:44] Speaker 04:
The court below simply took the view that, look, you were required to dredge to minus 15 feet.

[00:37:51] Speaker 04:
The character materials clause says that you're not required to dredge massive monolithic rock.

[00:37:57] Speaker 04:
So everything else has to be dredged.

[00:38:00] Speaker 04:
No, because if you come to that conclusion, you're reading the changes clause and the differing psych conditions clause out of the contract.

[00:38:07] Speaker 04:
You're saying that putting aside massive monolithic rock, which we all agree doesn't need to be dredged, if there is anything else that's different from what's represented in the contract, we have to dredge it without compensation.

[00:38:22] Speaker 04:
That voids the differing psych conditions clause to the extent that it's a change,

[00:38:26] Speaker 04:
It voids the changes clause.

[00:38:28] Speaker 04:
And you certainly can't.

[00:38:29] Speaker 02:
But to the extent that what turned out to be the case was in the realm of what was not previously specified, but was within the realm of unspecified, as to which isn't the proper interpretation, if that was a risk you took rather than a risk that the government took.

[00:38:54] Speaker 04:
We don't believe, Your Honor, except to the extent of a reasonable, very liberal allowance of three to five percent of oversized material that wasn't based on really any showing of geotechnical information.

[00:39:07] Speaker 04:
Beyond that, we didn't take the risk that the Corps of Engineers would engage in a practice that was a constructive change without compensation, or that the Corps of Engineers would limit the differing site conditions clause.

[00:39:20] Speaker 04:
What the lower court's decision effectively said was,

[00:39:24] Speaker 04:
In this case, the differing site conditions clause only applies to one type of material in the universe, massive monolithic in situ rock.

[00:39:33] Speaker 04:
If you encounter any other type of material that's different or materially different from what's represented, we don't have to consider it because you were told to dredge to minus 15.

[00:39:44] Speaker 04:
That's just not the case.

[00:39:45] Speaker 04:
It's not the way dredging contracts are performed.

[00:39:49] Speaker 04:
You look at the geotechnical information, you look at the purpose of the project, and you proceed accordingly.

[00:39:55] Speaker 04:
I think your time has run out.

[00:39:58] Speaker 04:
Thank you very much.

[00:40:00] Speaker 02:
Thanks to both counsel and the cases.