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Floorpro, Inc v. United States

May 31, 2012


Appeals from the United States Court of Federal Claims in case no. 09-CV-651, Senior Judge Loren A. Smith.

The opinion of the court was delivered by: Mayer, Circuit Judge.

Before PROST, MAYER, and WALLACH, Circuit Judges.

The United States appeals a judgment of the United States Court of Federal Claims awarding FloorPro, Inc. ("FloorPro") damages for breach of a government contract. See FloorPro, Inc. v. United States, 98 Fed. Cl. 144 (Fed. Cl. 2011) ("Federal Claims Decision II"); FloorPro, Inc. v. United States, 94 Fed. Cl. 775 (Fed. Cl. 2010) ("Federal Claims Decision I"). Because FloorPro's suit was filed outside of the six-year limitations period set out in 28 U.S.C. § 2501, its claim is time-barred. We therefore vacate and remand with instructions to dismiss for lack of jurisdiction.


On February 6, 2002, the United States Navy awarded Contract No. N62467-02-M-2013 to G.M. & W. Construction Corporation ("GM&W") for the installation of floor coating in several warehouse bays at a military base. GM&W subsequently entered into a subcontracting agreement with FloorPro, pursuant to which FloorPro agreed to perform the floor-coating work for a sum of $37,500.00. FloorPro completed the work on February 27, 2002, and promptly submitted an invoice to GM&W.

On March 8, 2002, the Navy informed GM&W that the floor-coating work had been completed satisfactorily. On April 17, 2002, FloorPro contacted the Navy's contracting officer, stating that it had not been paid by GM&W. The contracting officer then contacted GM&W to inquire why FloorPro had not been paid for the floor- coating work. GM&W informed the contracting officer that there were several claims pending against it, and that it was not sure whether any funds that the Navy directly deposited into its bank account would be available to pay FloorPro. Accordingly, on April 22, 2002, the Navy and GM&W entered into a contract modification ("Modification P00001"), which provided that the Defense Finance and Accounting Service ("DFAS") would not pay GM&W directly, as required by the original contract, but would instead pay for the floor-coating work by issuing a hard-copy, two-party check payable to GM&W and Floor-Pro. Modification P00001 further provided that the Navy would mail the check directly to FloorPro.

Notwithstanding Modification P00001, on July 17, 2002, the DFAS paid GM&W directly by an electronic fund transfer to its bank account. On July 18, 2002, the contracting officer informed FloorPro that DFAS had "ignored" Modification P00001 and "did not issue the two-party check as [Modification P00001] had directed." FloorPro responded by sending a letter, dated July 23, 2002, asking the contracting officer "[w]hat exactly is being done by [the Navy] to process a payment to us for our work?" On August 9, 2002, Captain B.M. Scott, a Navy acting commander, sent FloorPro a letter confirming that the government had paid GM&W in full on the contract. Scott asserted that "[a]s the Government does not possess privity of contract with FloorPro, Inc., or any other subcontractor," payment to GM&W had "fulfill[ed] the extent of the Government's obligations" under the contract. Scott informed FloorPro that its only recourse was to seek payment "from GM&W through the civil court system." Scott stated, moreover, that GM&W's failure to pay FloorPro "ha[d] been referred to the Naval Criminal Investigative Service for investigation."

On December 5, 2002, FloorPro submitted a claim to the Navy's contracting officer, asserting that the Navy had failed to pay it for the floor-coating work it had performed. Two weeks later, the contracting officer wrote FloorPro a letter stating that she could not issue a final decision on its claim because the government did "not have a contract with FloorPro."

On March 27, 2003, FloorPro filed an action against the Navy at the Armed Services Board of Contract Appeals ("ASBCA"). Relying upon this court's decision in D & H Distributing Co. v. United States, 102 F.3d 542, 546-48 (Fed. Cir. 1996), the ASBCA determined that it had jurisdiction over FloorPro's claim because FloorPro was a third-party beneficiary of the contract between the Navy and GM&W. See In re FloorPro, Inc., No. 54143, 2007 ASBCA LEXIS 38, at *31-36 (June 27, 2007). It determined, moreover, that FloorPro was entitled to damages of $37,500, plus interest, for the government's breach of Modification P00001. Id. at *36.

On appeal, this court reversed. See Winter v. Floor-Pro, Inc., 570 F.3d 1367 (Fed. Cir. 2009). We held that under the Contract Disputes Act of 1978 ("CDA"), 41 U.S.C. §§ 7101-7109, the ASBCA has no jurisdiction over a claim brought by a subcontractor who is a third-party beneficiary of a contract between the government and the prime contractor. Winter, 570 F.3d at 1371-73. We explained that the CDA applies only to "contractors," and parties-such as subcontractors-who are not in privity of contract with the government generally have no right to "avail themselves of the CDA's appeal provisions." Id. at 1370-71 (citations and internal quotation marks omitted). We observed, however, that the grant of jurisdiction to the Court of Federal Claims under the Tucker Act, 28 U.S.C. § 1491(a)(1), "is broader" than the jurisdiction of the ASBCA under the CDA, and can potentially extend to an intended third-party beneficiary of a government contract. Winter, 570 F.3d at 1372; see D & H Distrib., 102 F.3d at 546-48 (concluding that a third-party beneficiary of a government contract had the right to enforce a contract provision in the Court of Federal Claims).

On October 2, 2009, FloorPro filed suit against the government in the Court of Federal Claims. The government moved for summary judgment, arguing that Floor-Pro's claim was time-barred because it was filed more than six years after it first accrued. In response, FloorPro argued that its claim did not accrue until October 5, 2004, "at which time the Navy filed a brief at the [ASBCA] contending that FloorPro had no enforceable rights under [Modification P00001]." Federal Claims Decision I, 94 Fed. Cl. at 778. FloorPro asserted "that until October 5, 2004, the Government had not refused to enforce the Modification, and not until the Government's brief was filed did the Navy assert that the Modification would not be honored." Id.

The Court of Federal Claims agreed with FloorPro that "the facts and the law" supported an October 5, 2004 accrual date for its claim. Id. The court determined, however, that it should not resolve the timeliness question "solely base[d] . . . on which date [was] proper to start the running of the statute of limitations." Id. Because FloorPro "did not sleep on its rights," but instead had diligently pursued its claim by filing suit at the ASBCA, the court concluded that barring FloorPro's claim as untimely would "lead to an unjust result." Id. at 779. The court determined, moreover, that FloorPro was an intended third-party beneficiary of Modification P00001 and that it was entitled to damages of $37,500 for the government's breach of that provision. See Federal Claims Decision II, 98 Fed. Cl. at 147-48. The government then filed a timely appeal with this court.


"Whether the Court of Federal Claims possesses jurisdiction over a claim is a question of law subject to de novo review." Navajo Nation v. United States, 631 F.3d 1268, 1272 (Fed. Cir. 2011). Every civil action against the United States is barred unless the complaint ...

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