April 7, 1999
Appeal of
GARRY J. IMAN
Under Contract No. HCR 84331
PSBCA No. 4189
APPEARANCE FOR APPELLANT:
Garry J. Iman
APPEARANCE FOR RESPONDENT:
Robert P. Faust, Esq.
OPINION OF THE BOARD
Appellant, Garry Iman, has filed a timely appeal of the decision of the contracting officer to terminate for default his mail transportation service contract with Respondent, the United States Postal Service. At the election of Appellant, the appeal is being processed under the Board’s accelerated procedures (39 C.F.R. §955.13). In addition, the parties have elected to submit this appeal on the record in accordance with 39 C.F.R. §955.12.
1. Appellant’s contract for the transportation of mail between Ogden and Huntsville, Utah was renewed on June 21, 1997, for a four-year term running from July 1, 1997, to June 30, 2001, at an annual rate of $15,572.40 (Appeal File Tab (AF) A1).
2. The contract included Basic Surface Transportation Services Contract General Provisions, Postal Service Form 7407, July 1992, which in Clause 16, TERMINATION BY THE POSTAL SERVICE FOR DEFAULT, permitted the Postal Service to terminate the contract for default if the contractor (1) failed to perform according to the terms of the contract, (2) for the contractor’s disobedience of the instructions of the Contracting Officer, or (3) if the contractor’s transportation equipment is insufficient, inadequate, or otherwise inappropriate for the service (AF A-1).
3. Paragraph 15, Vehicle Requirements and Specifications, of the contract, specified that the vehicle used in performing the contract must have a power lift tailgate with minimum dimensions of 60 inches deep and 90 inches wide, with lift capacity of 4000 pounds from ground level (AF A-1).
4. The vehicle used by Appellant did not have a lift gate. Because of the lack of a lift gate, Appellant repeatedly used or sought to use the center bays on the dock at the Ogden Postal facility to load his vehicle. These bays enabled Appellant to load his vehicle with mail without using a lift gate and without having to manually lift the mail into the vehicle. (Declarations of Jill Johnson, Scott Canfield).
5. The contract required Appellant to arrive each day for the morning run at 5:00 a.m. to pick up mail at Ogden and deliver the mail to the Eden Post Office by 6:00 a.m. and to Huntsville by 6:10 a.m. Appellant was also required to perform an afternoon run, departing Ogden at 4:30 p.m. to deliver mail to Eden by 4:55 p.m., with a return to Ogden by 5:35 p.m. (AF A-1).
6. Between July 1997 and February 1998, Appellant received 10 irregularity reports for arriving late to perform his contract. This late arrival and consequential late departure meant that the mail was not arriving at the Eden and Huntsville Post Offices at the time Postal Service employees were scheduled to arrive at work to sort the mail. As a result, mail delivery was delayed. (AF B-5; Declarations of Paula Smith and Darlene Filban).
7. Beginning in October 1997, the manager of the Ogden Postal facility instructed Appellant not to use the center bays since these bays were reserved for other trucks (Declaration of Scott Canfield).
8. Contrary to this instruction, Appellant continued to use the center bays. On several of the occasions when Appellant used the center bays without authorization, he had confrontations with a Postal Service supervisor concerning his unauthorized use in which he verbally abused the supervisor. (Declarations of Jill Johnson and Scott Canfield).
9. One such occasion occurred on February 10, 1998. After being refused permission to load his mail at one of the center bays at the Ogden Postal facility, Appellant left the facility without taking his mail for delivery. He did, however, later return and take the mail on his route after discussing the matter with his contract administrator. (Declarations of Jill Johnson and Don Young).
10. As a consequence of the February 10 incident, Appellant’s contract administrator met with him and explicitly instructed Appellant that he could not use the center bays and that he was expected to arrive on time each day to perform his contract. Appellant was informed that if he continued to arrive late, his contract could be terminated for default. (Declaration of Don Young).
11. Subsequent to the February 10 meeting with the contract administrator, Appellant was late arriving on February 14, 17, 23, 24, and 26 (AF B-5; Declaration of Don Young).
12. By letter dated February 12, 1998, the contracting officer informed Appellant that he was required to have a lift gate on the vehicle used to perform his contract. Appellant was given two weeks from receipt of the letter to comply. Appellant was further informed that his failure to comply might result in the termination of the contract. (AF B-4).
13. On February 17, 1998, and on the morning of February 18, 1998, Appellant, in his own words, went on “strike” and did not run the route. An emergency contractor was found to replace him. (Declarations of Garry Iman, Jill Johnson and Joel Roose).
14. By letter dated February 18, 1998, the contracting officer informed Appellant that unless he restored satisfactory service beginning with the 4:30 p.m. run on February 18, 1998, and maintained satisfactory service for the remainder of the contract term, his contract would be terminated for default (AF B-3; Declaration of Joel Roose). This same message was orally conveyed to Appellant on February 18 by two contract specialists who worked for the contracting officer (Declarations of Max Martinez and Tim Brockman).
15. On each of the next seven days, Appellant was late in performing his route. Appellant arrived approximately 10 minutes late on February 19; 20 minutes late on February 20, 21, 23, and 24; 35 minutes late on February 25 and one hour and 10 minutes late on February 26, 1998. (Declarations of Scott Canfield and Don Young).
16. When informed on February 26 of Appellant’s continued unsatisfactory contract performance, the contracting officer terminated his contract for default, effective close of business February 26, 1998 (AF B-2; Declaration of Joel Roose).
17. The Postal Service owes Appellant $1,109.24 for 26 days of service during February 1998, as well as $261.64 for extra trips performed by Appellant for which he was not reimbursed during contract performance (Declaration of Don Young and Joel Roose).
DECISION
Respondent argues that Appellant’s failure to perform the contract according to its terms (repeated late arrivals, leaving without the mail and going “on strike”), his failure to comply with the terms of the contract and to follow the instructions of the contracting officer to have a lift gate on his vehicle and his verbal confrontations with Postal Service employees justify the decision of the contracting officer to terminate his contract for default. In addition to arguing that the decision to terminate for default should be upheld, Respondent seeks $8,271.00 in excess reprocurement costs.
Appellant argues that he arrived late to perform his contract because the mail was never ready for him to pick up at his scheduled arrival time and that he had the approval of the contract administrator to arrive thirty minutes late each day. Appellant further argues that his decision to leave without the mail on February 10, 1998, and to “go on strike” on February 17, 1998, was justified by the Postal Service’s refusal to allow him to use the center bays. Appellant argues that the termination for default should be converted to a termination for convenience. In addition, Appellant claims that he is entitled to payment for 26 days of service during the month of February 1998 and payment for 15 extra trips he provided during contract performance.
Respondent has the burden of proving that the decision to terminate the contract for default was justified, but once having done so, the burden shifts to Appellant to present evidence of excusable causes. Patricia J. Stevens, PSBCA No. 3272, 94-1 BCA ¶ 26,419. Respondent has met that burden in this appeal.
Appellant’s failure to have a lift gate on his vehicle, notwithstanding the contract’s requirement for one, as well as the contracting officer’s explicit direction to install a lift gate (Finding of Fact Nos. (FOF) 4, 12), his verbal abuse of a Postal Service supervisor (FOF 8), and the numerous instances of late arrival or non-performance after Appellant was instructed to restore satisfactory service on the route by the contracting officer on February 18, 1998 (FOF 15), amply support the decision to terminate the contract for default. See Renato Luna, PSBCA No. 4037, 98-1 BCA ¶ 29,719.
Appellant argued in his Complaint that the contract administrator gave him permission to arrive thirty minutes later than his scheduled arrival time. However, in Appellant’s declaration submitted in this appeal, he explained that he decided on his own to arrive thirty minutes after his scheduled arrival time and that his schedule change was not authorized by Respondent’s officials.[1]
Finally, we note that Respondent’s refusal to allow Appellant to use the center bays of the Ogden Postal facility to load his mail in no way justified his decision to depart without the mail on February 10 or to “go on strike” on February 17. Appellant has not shown that he had a right to use the center bays or that if he had the proper equipment, the requirement to use the other bays would have caused a problem. However, if Appellant believed his contract allowed him to use the center bays, the correct course of action was to perform as directed; i.e., without using the center bays, and submit a request for an adjustment in compensation under his contract if his cost of performance had increased. Accordingly, the contracting officer’s decision to terminate the contract for default was proper.
In this appeal Appellant also claims $1,094.50 as compensation for unpaid service during the month of February 1998, as well as $373.20 for 15 extra trips, for a total of $1,467.70. Appellant, however, failed to offer any proof to support these claim items. Nevertheless, Respondent concedes that it owes Appellant $1,109.24 for service in February 1998, and $261.64 for previously unpaid extra trips, for a total of $1,370.88 (FOF 17). Respondent has retained this amount as an offset against excess reprocurement costs incurred as a result of the termination for default of Appellant’s contract and Respondent seeks those costs in this appeal.
Although Respondent is entitled to withhold retained funds for a reasonable period as an offset against an excess reprocurement assessment, there is no evidence that Respondent ever issued a final decision seeking excess reprocurement costs from Appellant in this appeal. A final decision on Respondent’s claim for excess reprocurement costs is a prerequisite to our authority to consider the matter on appeal. 41 U.S.C. §605; see Lacie R. McFadden, PSBCA No. 4063, 98-2 BCA ¶29,838. Accordingly, we dismiss Respondent’s claim for excess reprocurement costs without prejudice to Respondent’s right to issue a final decision seeking excess reprocurement costs.
Appellant’s appeal of the decision to terminate his contract for default is denied and Respondent’s claim for excess reprocurement costs is dismissed without prejudice.
William K. Mahn
Administrative Judge
Board Member
I concur:
James A. Cohen
Administrative Judge
Chairman