[00:00:00] Speaker 03:
I knew I did.

[00:00:53] Speaker 01:
Mr. Price?

[00:00:56] Speaker 02:
Good morning, Your Honor.

[00:00:58] Speaker ?:
Good morning.

[00:00:59] Speaker 02:
Good morning.

[00:01:02] Speaker 02:
May it please the Court, I'm James Price here on behalf of the Appellant Reliant LLC.

[00:01:08] Speaker 02:
Your Honor, this appeal arises from a breach of contract that Reliant made and filed in the Armed Services Board of Contract Appeals.

[00:01:21] Speaker 02:
that arose out of a contract whereby Reliant was delivering relocatable buildings to two bases in Afghanistan for US troops.

[00:01:32] Speaker 01:
Do you argue that the delivery orders and the amendments were not integrated contracts?

[00:01:36] Speaker 02:
Yes, your honor.

[00:01:38] Speaker 01:
Show me in the record where you made that argument to the board.

[00:01:48] Speaker 02:
In the record.

[00:01:50] Speaker 02:
When we made the argument to the board?

[00:01:51] Speaker 02:
Yes.

[00:01:52] Speaker 02:
I did not specifically recall exactly how we presented that argument

[00:02:17] Speaker 02:
in the lower court in response to the motion for summary judgment.

[00:02:24] Speaker 02:
But I do believe that we pointed out that the IDIQ contract was the controlling document and therefore the delivery orders or task orders couldn't therefore be fully integrated in separate contracts.

[00:02:40] Speaker 02:
They were issued out of the IDIQ contract.

[00:02:46] Speaker 03:
The IDIQ contract was a contract, as its acronym indicates, was a contract to provide... It was not an integrated argument, so you're sort of subsumed in your argument that the IDIQ prevails at all times in all instances.

[00:03:06] Speaker 03:
Any other thing that purports to be a contract is a joke, waste of time, and not worth the paper it's written on.

[00:03:16] Speaker 03:
It's certainly not a joke, Your Honor.

[00:03:19] Speaker 03:
I mean, it's a joke because it was a waste of everyone's time.

[00:03:24] Speaker 03:
It wasn't a waste.

[00:03:24] Speaker 03:
It wasn't about wasting the government's time, wasting your client's time.

[00:03:28] Speaker 02:
It certainly would have been better practice if they were attempting to modify a term of the IDIQ contract to modify as they did in a couple of instances.

[00:03:38] Speaker 03:
The IDIQ clause that you rely on, H1, in the schedule.

[00:03:45] Speaker 03:
says that various awards will be made when the contracting officer puts out a notice of intent to make a purchase.

[00:03:56] Speaker 03:
There's a notice.

[00:03:58] Speaker 03:
And I didn't see anything in our record of one of those notices.

[00:04:02] Speaker 03:
Were any such notices of record at the trial below?

[00:04:06] Speaker 02:
No, Your Honor, they were not.

[00:04:09] Speaker 02:
And that's one of the challenging things in this instance because of the environment

[00:04:15] Speaker 02:
that it was a very challenging environment in Afghanistan.

[00:04:19] Speaker 02:
There were a lot of records that neither party was able to provide.

[00:04:24] Speaker 03:
It might have been helpful to know what was in the notice of intent, especially with regard to whether the idea would there be some more pricing conversations.

[00:04:35] Speaker 02:
Certainly, Your Honor, if that document reflected that there could be some other pricing.

[00:04:39] Speaker 03:
Well, it's not a record, and you say it wasn't involved in the case below.

[00:04:44] Speaker 03:
Also, apparently we don't know anything about the two other parties that were also hoping to engage in this commerce with the government.

[00:04:53] Speaker 02:
We do know as the.

[00:04:55] Speaker 03:
But I've record.

[00:04:56] Speaker 03:
I mean, I didn't see anything in the record about whether they were being asked as a result of notices of intent sent to them and whether they were as a course of conduct making submissions.

[00:05:08] Speaker 03:
and getting into the kind of discussions and debates that your client got into with the contracting office.

[00:05:14] Speaker 03:
So that's all off the table as well, right?

[00:05:16] Speaker 02:
There are no, again, no documents that we have from the contracts with the other contractors who were ultimately awarded delivery orders under this same... I don't know whether any of them even got a delivery order, right?

[00:05:28] Speaker 02:
Yes, we do.

[00:05:29] Speaker 02:
In fact, if you look... Does it have record?

[00:05:32] Speaker 02:
That's something that the government acknowledges, Your Honor, on page

[00:05:43] Speaker 01:
Are you referring to the appendix or a brief?

[00:05:46] Speaker 02:
In its brief on page 3, the government acknowledges that at least two other entities, EODT and PPI, did in fact receive awards of delivery orders, and that was also noted in the board's opinion on page 2.

[00:06:06] Speaker 03:
But again, the facts and circumstances, because part of what the government is

[00:06:11] Speaker 03:
for taxing you with is the course of dealing, the course of dealing here.

[00:06:16] Speaker 03:
Why would your client have engaged in these different pricing negotiations and the delivery orders and then revise the original IDIQ on price if that wasn't going to be something that was permissible?

[00:06:34] Speaker 02:
Your Honor, if the

[00:06:36] Speaker 02:
Parties, I think, knew what would ultimately happen if they conducted themselves the way they did.

[00:06:41] Speaker 02:
They would have thought differently about how they conducted themselves, what we're left with.

[00:06:48] Speaker 03:
The course of conduct is of interest to me.

[00:06:50] Speaker 03:
And then the government cites nations, which are, as you know, Ralph and the other guy who have been around for a long time.

[00:06:58] Speaker 03:
And they have a whole section in their treatise that talks about this and says pricing

[00:07:04] Speaker 03:
changes in delivery orders is quite common under IEIQ contracts.

[00:07:10] Speaker 03:
And I didn't see you coming back and countering that statement as a practice by saying, yes, that's so, but they were all in different circumstances than these.

[00:07:22] Speaker 02:
And to speak to that briefly, you're right, we didn't, but that's a treatise rather than any case law that we had to rely upon, and we frankly

[00:07:34] Speaker 02:
aren't aware of any cases that have disposed of that issue.

[00:07:39] Speaker 01:
Was your offer, your client's offer of a 5% discount a deviation from the IDIQ?

[00:07:49] Speaker 02:
It certainly would have been a deviation from the IDIQ contract.

[00:07:53] Speaker 01:
So it was then contemplated that there would be deviations from the IDIQ, right?

[00:08:03] Speaker 02:
Well, certainly, Your Honor, they offered it.

[00:08:06] Speaker 02:
Whether they contemplated that that was something that they had the right to do, they did it.

[00:08:13] Speaker 02:
In hindsight, should they have done it differently?

[00:08:16] Speaker 02:
Certainly.

[00:08:17] Speaker 02:
That should have been something that they made as an amendment to the IDIQ contract rather than something that got haphazardly incorporated into a delivery.

[00:08:28] Speaker 01:
Offered and accepted, yes.

[00:08:33] Speaker 02:
what was offered and what ultimately was accepted, I think, is a material fact in dispute.

[00:08:41] Speaker 02:
I think it's clear from the email that Mr. Biles sent that the offer was contingent upon two contingencies, Your Honor.

[00:08:50] Speaker 02:
One that they would be, because they would be allowed to... You're arguing economies of scale.

[00:08:56] Speaker 02:
That's one of the

[00:08:57] Speaker 02:
one of the contingencies, but the second is that all of the delivery orders were to be awarded to Reliant.

[00:09:06] Speaker 01:
Others were offering discounts as well, were they not?

[00:09:09] Speaker 02:
We don't know with certainty whether that was true or not, Your Honor.

[00:09:13] Speaker 02:
What we know is that Reliant was not awarded all of the DOs.

[00:09:22] Speaker 02:
As I said, the government has acknowledged that there were others who were awarded DOs.

[00:09:26] Speaker 02:
So the second contingency was not met either.

[00:09:29] Speaker 02:
And therefore the discount should not have been applied.

[00:09:35] Speaker 03:
The basic contract looks like it was modified seven times because we have P0001 and P0007 that we know about in the record.

[00:09:47] Speaker 03:
As 2345 and six are immaterial for purposes of this appeal.

[00:09:51] Speaker 02:
for purposes of the appeal, they are immaterial, your honor.

[00:09:56] Speaker 03:
And then in seven, you agreed to a whole lot of unit price changes, which I think you would agree are appropriate because that's changes in the IDIQ.

[00:10:07] Speaker 02:
Those exactly.

[00:10:09] Speaker 03:
So that looked to me like most of your monetary claim is stacked up on delivery order one.

[00:10:15] Speaker 03:
Is that right?

[00:10:18] Speaker 02:
The dollar value certainly is on... On the others, it's got to be the 5%.

[00:10:23] Speaker 03:
That's correct.

[00:10:24] Speaker 03:
That's all you're talking about because you agree to those other prices whether they're higher or lower or whatever.

[00:10:30] Speaker ?:
Yes.

[00:10:31] Speaker 02:
We're not arguing about the pricing.

[00:10:32] Speaker 03:
So the game is essentially on your legal argument based on delivery order one with regard to DO1 and then the 5%.

[00:10:40] Speaker 03:
That was applied to delivery orders too.

[00:10:43] Speaker 03:
If we disagree with you on the 5%, the

[00:10:47] Speaker 03:
harmed you from your view on the other delivery orders goes away.

[00:10:51] Speaker 03:
That's correct.

[00:10:57] Speaker 03:
So I think it's... Were these things manufactured in Turkey?

[00:11:01] Speaker 03:
And that was the original idea, wasn't it?

[00:11:03] Speaker 02:
That was the original idea, Your Honor.

[00:11:05] Speaker 02:
The difficulty became is that after manufacturing had been going on for almost a year, there was a conflict in the

[00:11:16] Speaker 02:
the approvals that my client had.

[00:11:19] Speaker 02:
They received approval for first article testing, which is something we tried for three days back in February on the consolidated claims that are not part of this appeal.

[00:11:32] Speaker 02:
The first article testing granted our clients approval for the units they produced.

[00:11:41] Speaker 02:
They produced that had laminate boards, but then a

[00:11:47] Speaker 02:
captain at one of the locations said that wasn't good enough despite the first article testing, which put them in a real conundrum.

[00:11:54] Speaker 02:
And so they decided that we can't get around the captain to get this done, so we're going to have to start manufacturing units with drywall and we can only do that if we move to Afghanistan, which is one of the reasons that they weren't able to gain the efficiencies that they intended to gain.

[00:12:11] Speaker 03:
So they would have had to ship a constructed, were these things broken down in modules or something, and they can ship a constructed unit from Turkey to Afghanistan?

[00:12:21] Speaker 02:
Yes.

[00:12:21] Speaker 02:
In the form of a Connex.

[00:12:25] Speaker 02:
Yes, and so you have shipping containers, and you think of one shipping container, but a building in this instance was about a hundred shipping containers, a pretty sizable structure.

[00:12:38] Speaker 02:
And so to have to move

[00:12:39] Speaker 02:
Those from Turkey to Afghanistan alone was a arduous and expensive task, but then also to find the materials within Afghanistan to be able to outfit those units once they were delivered.

[00:12:54] Speaker 02:
And the manpower with the skill to do it was also very challenging.

[00:13:00] Speaker 02:
So as Judge Prouty said at the end of the trial and the other appeal,

[00:13:08] Speaker 01:
He understood why my client was upset with the way the government treated my client.

[00:13:34] Speaker 00:
May I please the court, the ASPCA correctly concluded that the IDIQ contract and delivery orders at issue in this case were not ambiguous, that the government's interpretation of those documents is correct, and that reliance interpretation is not reasonable.

[00:13:50] Speaker 00:
The Army's interpretation is consistent with and harmonizes all of the terms of both the umbrella IDIQ contract as well as the delivery orders that were placed thereon, which reflect the party's intent and understanding of the contract

[00:14:04] Speaker 00:
because of the price that deviates from the IDIQ contract.

[00:14:08] Speaker 01:
Well, you also have a course of conduct as well as a course of negotiations.

[00:14:12] Speaker 00:
It is indeed, Your Honor.

[00:14:13] Speaker 00:
But in this case, and as you've seen in the briefing, my opponent argues that that course of conduct should not be considered because it's parole evidence.

[00:14:21] Speaker 00:
But in fact, in this case, it's not through parole evidence.

[00:14:23] Speaker 00:
It's part of the contract.

[00:14:24] Speaker 00:
It's the delivery orders themselves that display that course of conduct.

[00:14:28] Speaker 00:
and display that the parties usually understood the contract through section H1 to set up a paradigm where delivery order pricing was going to be negotiated among the three holders of this multiple award IDIQ contract and price competition would be maintained as the FAR requires and as the contracting system sets up a preference for it.

[00:14:49] Speaker 00:
Price and competition would be maintained at the delivery order level as well as in the initial award of umbrella contracts.

[00:14:56] Speaker 01:
Just out of curiosity, was the change from

[00:14:59] Speaker 01:
protocol board to drywall because of the result of potential impact on the exterior of that content?

[00:15:07] Speaker 00:
I don't think the answer to that is reflected in the record and I don't know it, Your Honor.

[00:15:11] Speaker 00:
But the changes that were made, as was seen through the documents in this case and the course of conduct that that reflects, shows that when changes were made to the statement of work, the ceiling pricing in the umbrella IDIQ contract was lifted as a result.

[00:15:25] Speaker 00:
But two effects there that are relevant to this case is

[00:15:28] Speaker 00:
One, it didn't retroactively then change pricing necessarily for the delivery orders.

[00:15:33] Speaker 00:
That had to be negotiated and was in many cases negotiated.

[00:15:37] Speaker 00:
And in fact, was accepted in modifications to delivery orders two, three, and four and delivery order one.

[00:15:43] Speaker 00:
But speaking of two, three, and four, were each modified at least once with no reservation of rights and in a way that maintained a deviation of price from the delivery order pricing to the IDIQ umbrella contract pricing

[00:15:57] Speaker 00:
but removed all reference to a 5% discount, much less any reference to a contingency for manufacturing efficiency which didn't appear even in the original delivery orders.

[00:16:07] Speaker 00:
So any argument that, even if there were an argument that delivery order pricing in the initial delivery orders was contingent because of language that was in the email,

[00:16:18] Speaker 00:
conveying those bids, any such contingency was clearly overtaken and waived by a mutual agreement to delivery modifications, which continued to maintain pricing that was lower than the IDIQ umbrella contract and made no reference to any contingency.

[00:16:33] Speaker 03:
The government ever, as a result of cases and arguments in courts like this, the lawyers ever go back to the agency and say,

[00:16:42] Speaker 03:
You know, we had a great big case and expended a lot of resources arguing over a question that could be very easily solved by putting a couple of words in contracts.

[00:16:53] Speaker 03:
Do you ever do that?

[00:16:54] Speaker 03:
Do you ever go back and make a suggestion to this government that serves us all that the government could improve itself?

[00:17:02] Speaker 03:
It certainly should, and in fact... Don't you think it would be easy to say here, you know, all you have to do on this IDIQ contract in H1

[00:17:09] Speaker 03:
is to make clear that the prices that are in the original idea aren't locked in.

[00:17:15] Speaker 00:
Right.

[00:17:16] Speaker 03:
It's certainly the case, Your Honor, that the... Because nation's admitting doesn't have a case to cite, right?

[00:17:21] Speaker 00:
That's correct, Your Honor.

[00:17:22] Speaker 03:
They got, you know, Ralph and his friend carrying on.

[00:17:25] Speaker 03:
They were the gurus.

[00:17:26] Speaker 03:
They knew more about government contracts than anybody else, as they would write something down.

[00:17:30] Speaker 03:
But they aren't authority, absent a case.

[00:17:34] Speaker 03:
So how do I know it's true?

[00:17:37] Speaker 03:
that in these contract cases that the IDIQ price doesn't go up.

[00:17:44] Speaker 03:
Well, the only way to... You know what I'm talking about.

[00:17:46] Speaker 03:
I'm talking about your brief.

[00:17:47] Speaker 03:
You cite me.

[00:17:48] Speaker 03:
National Submitted.

[00:17:50] Speaker 03:
You don't bother to give me the text.

[00:17:52] Speaker 03:
You make me have to go look it up in the library.

[00:17:56] Speaker 03:
You really ought to put it in the text in the brief so I don't have to do that.

[00:18:01] Speaker 03:
And I read the text.

[00:18:02] Speaker 03:
I read what I said, but there aren't many cases.

[00:18:04] Speaker 00:
Indeed, Your Honor, and in fact,

[00:18:07] Speaker 00:
Understood, because I had to go to the library as well, because they're not available online.

[00:18:10] Speaker 00:
But as you recognize, this is the leading treatise in the area.

[00:18:15] Speaker 00:
But not only that, Your Honor.

[00:18:16] Speaker 03:
Look at the contract, H1.

[00:18:18] Speaker 03:
Look at it.

[00:18:19] Speaker 03:
It says here, oh, the contracting officer will fairly consider the offers received, OK?

[00:18:27] Speaker 03:
Will consider price and any other factors listed in the notice.

[00:18:30] Speaker 03:
Well, that suggests that price wasn't listed in the notice, or was price listed in the notice.

[00:18:36] Speaker 00:
The price would be offered by the offeror who's bidding on the delivery order.

[00:18:41] Speaker 00:
So the notice would go out and acknowledge that the notices in this case are not on the record, but the notice would go out asking for the offerors to provide a price as well as to detail other technical factors.

[00:18:55] Speaker 03:
You would expect the offeror to offer the price that was stated in the IDIQ, right?

[00:18:59] Speaker 00:
Could or lower.

[00:19:00] Speaker 00:
In fact... Or higher.

[00:19:03] Speaker 00:
Not under the interpretation that the government offers here.

[00:19:07] Speaker 03:
Why is that interpretation any good at all?

[00:19:10] Speaker 03:
You're saying that it was a ceiling.

[00:19:13] Speaker 03:
Why wasn't it a floor?

[00:19:15] Speaker 00:
Well, it couldn't be a floor because that would render impermissible and irrelevant the conduct of the parties in negotiating lower prices.

[00:19:23] Speaker 00:
So in harmonizing all of the documents that make up this contract.

[00:19:26] Speaker 03:
This is an after the fact.

[00:19:29] Speaker 03:
interpretation of the contract.

[00:19:30] Speaker 03:
Your interpretation of the contract doesn't depend on the code of conduct of the parties here.

[00:19:35] Speaker 03:
That's no fair.

[00:19:38] Speaker 03:
You have to consider the contract looking at the words of it.

[00:19:41] Speaker 03:
And you're saying, look at the words.

[00:19:42] Speaker 03:
Well, it means that it's a ceiling.

[00:19:45] Speaker 03:
I'm saying that's nonsense.

[00:19:46] Speaker 03:
It could equally have been a floor.

[00:19:49] Speaker 03:
Because you ignore the course of conduct for purposes of interpreting the words of the contract.

[00:19:54] Speaker 00:
Understood, Your Honor.

[00:19:55] Speaker 00:
Two points.

[00:19:56] Speaker 00:
First, the course of conduct here is demonstrated through parts of the contract because the delivery orders once issued become part of the contract.

[00:20:02] Speaker 00:
So that language then is part of the contract that this court construes altogether.

[00:20:06] Speaker 00:
I understand what you're saying.

[00:20:07] Speaker 00:
It has to reconcile itself.

[00:20:08] Speaker 03:
Okay.

[00:20:08] Speaker 03:
So you're saying, but you're also using the numbers that are in the delivery orders.

[00:20:15] Speaker 00:
Yes, Your Honor.

[00:20:16] Speaker 03:
Which is the real line.

[00:20:17] Speaker 03:
I can understand the fact of the delivery orders playing into your interpretation of the contract, but not the numbers themselves.

[00:20:26] Speaker 00:
Moreover, Your Honor, I'd like to point out that this court needn't accept that those prices in the IDIQ price list represent ceiling prices to affirm the ASPCA.

[00:20:37] Speaker 00:
Rather, all that the court must agree is that the delivery order pricing controls and may, in fact, deviate from the IDIQ.

[00:20:44] Speaker 00:
Well, no.

[00:20:44] Speaker 03:
But we have to resolve your adversaries brought forth the conflict.

[00:20:51] Speaker 03:
And the conflict is whether or not H1 trumps everything that comes afterwards.

[00:20:56] Speaker 03:
And it sounds a little preposterous in the setting of this case, but it's a pure question of law, like in Contract 101.

[00:21:04] Speaker 03:
And all I'm saying is I'm suspicious of your interpretation of the contract saying that it all works okay because it has to be a ceiling.

[00:21:15] Speaker 00:
Well, to see why a ceiling makes the most sense

[00:21:19] Speaker 00:
maybe peripheral to your question, but the parties modified the pricing structure in the IDIQ umbrella contract several times, at least twice with Modification 1 and Modification 7.

[00:21:29] Speaker 00:
That action would have no meaning if we were just talking about baseline prices, for example, if it's more of a pricing suggestion and the delivery... Yes, it would, but it's just rewriting the IDIQ.

[00:21:40] Speaker 03:
Well, when they made... The fact that you change an IDIQ price doesn't mean tell you anything other than the fact that they just rewrote the basic contract.

[00:21:49] Speaker 01:
Right, and it's an umbrella contract that Section H1... Well, you have an argument about the inherently indefinite nature of this offer to multiple contractors as to building in competition to lower the price as opposed to raise the price.

[00:22:14] Speaker 00:
Exactly right, Your Honor.

[00:22:15] Speaker 00:
And so that whole paradigm set up... They haven't made it.

[00:22:19] Speaker 00:
I think that the argument that we've made about Section H1 and its effect, maintaining price competition, as well as the argument that we've made in terms of examining the language of the contract.

[00:22:30] Speaker 00:
You made it in your briefs, young man.

[00:22:32] Speaker 00:
I understood.

[00:22:35] Speaker 00:
You examine the intent of the parties and the terms of the contract in context with the general practice in that area.

[00:22:42] Speaker 00:
And so when doing so,

[00:22:44] Speaker 00:
uh... nashin sabinic laid out but also the far itself and as far sixteen dot five oh five states that the contracting officer will consider price when awarding uh... delivery orders under and i have multiple where are you like you contract structure uh... fall apart sixteen dot five oh four uh... sets out the preference for multiple award idea to contracting for exactly this reason to maintain price competition over the the length of the duration of the idea to contract and so that whole

[00:23:14] Speaker 00:
Where is it in 505 that it says you can consider price?

[00:23:18] Speaker 00:
Your Honor, it's 504, excuse me, C1 little one.

[00:23:28] Speaker 00:
So I misspoke there.

[00:23:29] Speaker 00:
16504 is that part.

[00:23:31] Speaker 00:
The 16504 states, quote, the contracting officer must, to the maximum extent practicable, give preference to making multiple awards of indefinite

[00:23:43] Speaker 00:
quantity contracts under the single solicitation.

[00:23:45] Speaker 03:
But it's 505BE1.ie that does the trick for you, isn't it?

[00:23:51] Speaker 00:
Yes, exactly.

[00:23:52] Speaker 03:
It says the contracting officer, the word is must, under each order, did it do one of the factors?

[00:24:02] Speaker 00:
That's correct, Your Honor, and that language is reflected.

[00:24:04] Speaker 03:
Consider price or cost under each order as one of the factors in the selection decision.

[00:24:09] Speaker 00:
That's exactly right, Your Honor.

[00:24:10] Speaker 00:
And that language is reflected in section H1 of this contract, which states similar work.

[00:24:15] Speaker 03:
Well, there's a place in H1 where you can slide the regulation in if you want to.

[00:24:23] Speaker 03:
The language in H1 isn't as clear as you'd like it, right?

[00:24:27] Speaker 03:
Well, it does state, Your Honor, I'm quoting from... We'll consider pricing and the other factors listed in the note.

[00:24:33] Speaker 00:
That's correct.

[00:24:34] Speaker 03:
And so other factors... If that was perfectly accurate, it would say they must.

[00:24:39] Speaker 03:
because the regulation doesn't say May.

[00:24:41] Speaker 03:
The regulation 16505B102E says the contracting officer must consider.

[00:24:51] Speaker 00:
Correct, Your Honor.

[00:24:52] Speaker 00:
And the contract also doesn't use the word May.

[00:24:54] Speaker 00:
It uses the word will, which submitted is the same as must, and it's mandatory in the same way that must is.

[00:25:01] Speaker 00:
Well, no.

[00:25:03] Speaker 01:
The must says they have to.

[00:25:05] Speaker 01:
then the will says that they're going to follow the requirement that they must.

[00:25:11] Speaker 00:
Precisely, Your Honor.

[00:25:12] Speaker 01:
They're two different words.

[00:25:14] Speaker 00:
They are two different words.

[00:25:15] Speaker 00:
I acknowledge that, Your Honor.

[00:25:17] Speaker 00:
And either way, the FAR provisions are still mandatory from a regulatory standpoint on the contracting officer in effectuating the terms of the contract here.

[00:25:28] Speaker 00:
reading the contract in the context of all of its documents.

[00:25:31] Speaker 03:
Of course you can have a situation where under the regulation you must consider price and cost, but if the IDIQ contract itself always trumped, you would consider it.

[00:25:45] Speaker 03:
So if you're referring... The language in the regulation doesn't necessarily win the case for you, because if

[00:25:53] Speaker 03:
If the law said that the price in the IDIQ is what it is and you can't change it, then the contracting officer must consider that.

[00:26:03] Speaker 00:
If it did say that, Your Honor, I would agree.

[00:26:05] Speaker 00:
Of course, the contract does not state that.

[00:26:08] Speaker 00:
And in fact, along similar lines, the appellant's argument that the ordering clause, which the portion of the ordering clause that they quote is really a supremacy clause stating that the terms of the IDIQ umbrella contract control over the delivery orders

[00:26:23] Speaker 00:
only comes into play if there's a conflict between them.

[00:26:25] Speaker 00:
And under the government's interpretation, or even the alternate interpretations that Your Honor has suggested, there is no conflict.

[00:26:33] Speaker 03:
There's only a conflict if the pricing in the umbrella contract... It comes back to their argument, which is they say the IDIQ price always trumps and never can change it.

[00:26:44] Speaker 00:
Exactly correct, Your Honor.

[00:26:45] Speaker 00:
So their premise in that argument is required to abide... If they're right about that premise, then there is a conflict.

[00:26:52] Speaker 00:
Well, but there would also be a conflict under that interpretation, as we pointed out in our briefs, which would render all of the actions in negotiating delivery order prices, in agreeing to delivery order prices that were less than the price list, in agreeing to modifications of those delivery orders, which continue to have prices that were less than the price, all of that behavior.

[00:27:12] Speaker 00:
It would essentially be meaningless.

[00:27:15] Speaker 00:
It would be arguably prohibited by the contract.

[00:27:17] Speaker 00:
And so all of this course of conduct as reflected in contract documents that then became part of the contract would be rendered meaningless by this interpretation.

[00:27:25] Speaker 00:
And that's why the board correctly found that interpretation to be unreasonable in light of the contract read as a whole.

[00:27:33] Speaker 03:
The only explanation for the conduct would be something in the nature of a gotcha.

[00:27:38] Speaker 03:
they engage in this conversation in order to get the contracting officer to award them the prize, and then you come in later and say, but you didn't pay me enough.

[00:27:46] Speaker 00:
That makes perfect sense, Your Honor.

[00:27:48] Speaker 00:
We haven't certainly alleged bad faith in this case, nor was it before the court.

[00:27:51] Speaker 03:
No, I don't think there's any basis for bad faith here, my goodness.

[00:27:56] Speaker 00:
Subject to any further questions for these reasons and those stated in our brief, the United States respectfully requests that this court affirm the decision of the ASPCA.

[00:28:04] Speaker ?:
Thank you.

[00:28:06] Speaker 01:
Thank you, Counsel.

[00:28:07] Speaker 01:
I'll just make a comment about the English language you can sit down.

[00:28:10] Speaker 01:
And that is, when I was at Cambridge, I asked one of the officers in my college, could you do something for me?

[00:28:18] Speaker 01:
And he said, you mean would I?

[00:28:21] Speaker 01:
And I said, is there a difference?

[00:28:22] Speaker 01:
And he said, you use could to a servant, because if they can, they will.

[00:28:39] Speaker 02:
Your Honor, as you stated, the ordering clause in the IDIQ contract states that all delivery orders or task orders are subject to the terms and conditions of this contract.

[00:28:56] Speaker 02:
The IDIQ contract set fixed prices for each type of relocatable building to be constructed as there were different sizes for those buildings.

[00:29:10] Speaker 02:
If we were to take the government's argument to be valid, why did the government agree to amend delivery orders two through four to reflect the fixed prices that were set forth in the IDIQ contract, less, of course, the 5% discount?

[00:29:31] Speaker 02:
Why would they have done that if they were negotiating prices on each of the delivery orders?

[00:29:39] Speaker 01:
That's speculative.

[00:29:42] Speaker 02:
It's convenient for the government to make that argument now in hindsight, but I think the actions of the parties illustrate that both parties had a different interpretation of the contract at the time these delivery orders were issued.

[00:30:02] Speaker 02:
Further, a plain reading of the contract supports reliance interpretation.

[00:30:08] Speaker 02:
The IDIQ contract terms, including pricing, prevail over conflicting pricing terms in the delivery orders.

[00:30:18] Speaker 02:
The ordering clause does not contain any exception or qualifications related to pricing.

[00:30:25] Speaker 02:
The court below referred to the IDIQ prices as a ceiling, but there's no basis in law for that.

[00:30:36] Speaker 03:
If the difference of view between yourself and the government is so clear, then why isn't the ambiguity patent?

[00:30:48] Speaker 02:
Your honor, I think that when you look at these things in hindsight, the ambiguity that was not so clear becomes much more clear.

[00:30:59] Speaker 03:
Well, that's what I was asking because I mean, it's sort of morphed from a

[00:31:04] Speaker 03:
latent ambiguity kind of argument to the way the issue is being presented today was you knew from the get-go that the IDIQ contract prevailed and the only way it could be changed is by amending the IDIQ.

[00:31:22] Speaker 03:
The government has exactly the opposite view, which is contract was negotiable at all times.

[00:31:28] Speaker 02:
And I think that's one of the issues you often face in these situations.

[00:31:31] Speaker 02:
The lawyers

[00:31:32] Speaker 02:
recognize those things as we look at these things in hindsight.

[00:31:36] Speaker 03:
But the people on the ground... I mean, no complaint was raised at delivery order one when the numbers started shifting?

[00:31:45] Speaker 02:
There were a lot of issues surrounding that because the government had a budget constraint that required that the prices be changed in order to fit within the budget.

[00:31:54] Speaker 02:
So it was a significant discussion.

[00:31:59] Speaker 03:
But your side could have said, whoa, we don't play.

[00:32:02] Speaker 03:
Only number we play with is what's in the IDIQ.

[00:32:05] Speaker 03:
You got a budgetary problem?

[00:32:06] Speaker 03:
Find another contractor.

[00:32:08] Speaker 02:
They certainly could have, and they would have sustained a significant loss because of all of the work that they had done to get to that point.

[00:32:15] Speaker 02:
Wrap up, Counselor.

[00:32:16] Speaker 02:
Your Honor, the Board granted separate judgment on the issue of the discount to the government because the expression of the contingency in reliance written correspondence when it was offered

[00:32:30] Speaker 02:
was not ultimately incorporated in the delivery order itself.

[00:32:34] Speaker 02:
We believe this rationale fails because it improperly assumes that the delivery orders were integrated, fully integrated contracts.

[00:32:42] Speaker 02:
There's no statement in the delivery orders that contain an integration clause and other internal evidence of an integrated character.

[00:32:56] Speaker 02:
Thank you.

[00:32:57] Speaker 01:
Thank you, counsel.

[00:32:58] Speaker 01:
The matter will stand submitted.