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UNITED STATES COURT OF FEDERAL CLAIMS

WEST COAST CONTRACTORS OF NEVADA, Plaintiff, v. UNITED STATES, Defendant.

) ) ) ) ) ) ) ) ) )

Docket No.:

05-1121C

Pages: Place: Date:

1 through 75 Washington, D.C. April 3, 2008

HERITAGE REPORTING CORPORATION Official Reporters 1220 L Street, N.W., Suite 600 Washington, D.C. 20005-4018 (202) 628-4888 [email protected]

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1 IN THE UNITED STATES COURT ) ) ) ) ) ) ) ) ) ) OF FEDERAL CLAIMS

WEST COAST CONTRACTORS OF NEVADA, Plaintiff, v. UNITED STATES, Defendant.

Docket No.:

05-1121C

Courtroom 4, Room 501 National Courts Building 717 Madison Place NW Washington, D.C. Thursday, April 3, 2008 The parties met, pursuant to notice of the Court, at 10:05 a.m. BEFORE: HONORABLE EDWARD J. DAMICH Chief Judge

APPEARANCES: For the Plaintiff: WILLIAM C. DAVIS, III, Esquire Shulman Rogers Gandal Pordy & Ecker, P.A. 11921 Rockville Pike Rockville, Maryland 20852-2743 (301) 230-5217 For the Defendant: MICHAEL N. O'CONNELL, JR., Esquire U.S. Department of Justice Civil Division Commercial Litigation Branch 1100 L Street, N.W., Room 12062 Washington, D.C. 20530 (202) 307-0282

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2 APPEARANCES: (Cont'd.)

Also for the Defendant: PAMELA NESTELL, Esquire Department of the Navy NAVFAC Litigator 720 Kennon Street, S.E. Washington Navy Yard, D.C. (202) 685-2136

22374

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3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Navy. THE COURT: MS. NESTELL: THE COURT: Welcome, Ms. Nestell. Heritage Reporting Corporation (202) 628-4888 What is the name again? Pamela Nestell. Nestell. Okay. Great. morning. THE COURT: And with you is? MR. O'CONNELL: Pamela Nestell from the Hi, Mr. O'Connell. Welcome. THE CLERK: All rise. P R O C E E D I N G S (10:05 a.m.) The United States

Court of Federal Claims is now in session, the Honorable Edward J. Damich, Chief Judge, presiding. God save the United States and this Honorable Court. THE COURT: Please be seated.

This is the case of West Coast Contractors of Nevada v. United States. Representing the Mr. Davis?

Plaintiff is Mr. William C. Davis, III. MR. DAVIS: THE COURT: MR. DAVIS: THE COURT:

Good morning, Your Honor. Welcome. Thank you. And representing the United

States is Mr. Michael N. O'Connell, Jr. MR. O'CONNELL: Yes. Thank you. Good

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4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MS. NESTELL: THE COURT: Thank you. Okay. Good morning.

This is an oral argument The

on the motion for partial summary judgment.

notice that I sent out, and my apologies that it came out so late. The way I conduct oral argument is having familiarized myself already with the briefs and discussed it with my law clerk, I like to use oral argument for clarifying the questions that are still in my mind. So rather than come to the podium and

make a presentation, what I would like to do is have you remain seated as long as you're within microphone range, because that's important for the reporter, and I will ask various questions. The questions in the order that went out give you an idea of the basic areas, but my questions will range more than just in the oral argument. I

hope that I can create actually a kind of dialogue, or maybe a trialogue, and we can all try to get to the truth of the matter, the heart of the case, and I can have in my mind a more clear view of the arguments of the parties so that I can fulfill my job as best that I can. At the end of the questions if there is anything that you feel is important and has not been Heritage Reporting Corporation (202) 628-4888

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5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 discussed then I will ask you and you can take the podium and you can make your argument, but I've found that in almost all cases doing that would be duplicative, and it saves time if you don't do that. I'm not forbidding you, but make sure that you think that there's a fundamental misunderstanding on my part that has come out in the questions, for example, and you haven't corrected in the answers. Come to the podium and say I want to reorient Your Honor because this is the real issue, et cetera, et cetera. Please feel free to do that because, as I say, what I want to do -- we all want to do here. The

whole purpose of any judicial proceeding is to try to find out what the truth is and to clarify the arguments. Okay. Now, with that perhaps too extensive

an introduction what I want to do is I want to focus in on the problems in interpretation of the contract that have been presented I think by the motion for partial summary judgment. In particular those are the questions with regard to the mechanical equipment and the grade beam elevation, which seems to be two issues that can be grouped, and then the increased design costs having to Heritage Reporting Corporation (202) 628-4888

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6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 do with Plaintiff's relationship with its design firm, Merritt & Pardini. The way I see it right now is that the parties have posed a question as to a determination regarding whether there is a design specification or a performance specification. The design specification,

if it is in fact a design specification, then it seems to me that the government is under an obligation that it be accurate. And if it's a performance specification then an objective is proposed to the contractor, and the contractor is supposed to meet that objective and is given leeway to meet that objective. Therefore, if it

doesn't meet that objective then it seems to me the risk, fault if you will, is on the contractor. I guess the difficulty here is that with regard to the mechanical equipment and the grade beam elevations in the RFP we have some rather specific descriptions. requirements. government. And the question of course is are they design specifications that the Plaintiff had to follow and the Plaintiff, in trying to comply with those and fulfill the performance objective of the contract, Heritage Reporting Corporation (202) 628-4888 We're not going to call them Rather specific descriptions from the

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7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 discovered that it simply wouldn't work and had to make modifications, and this of course entailed more money. Otherwise you wouldn't be here. Okay. The first question that I have I

guess is I'm not sure what your position is, Mr. Davis, is it? MR. DAVIS: THE COURT: Yes, Your Honor. Mr. Davis. Regarding what I

should look at to get to the ultimate conclusions here. The government I think has argued pretty clearly that what I have to do is I have to look at the contract as a whole in interpretation of whether or not what appeared in the RFP and is alluded to in the contract, how to interpret that, which seems to be almost kind of black letter law, boilerplate. learned this in law school. Is that correct? everything? MR. DAVIS: Yes. I'm certainly not going to We all

You have an objective. I should look at

argue that the Court should ignore any part of the contract. THE COURT: Okay. Great. I just wanted to

make sure that was clear. Your position I presume is as I stated it? Heritage Reporting Corporation (202) 628-4888

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8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 O'Connell. MR. O'CONNELL: THE COURT: Yes. Great. That's Mr.

Okay.

I have to make sure I mention the names. Okay. What I want to focus on then is, as I

said in my notice for oral argument, in the contract itself Section 01112. General Design and Construction

Criteria is the title for this section, and then we move to Part 1, General, and then under Part 1, General, we have Section 1.1.1. contracts. I love these

That is labeled Contractor's Design It's amazing, isn't it, how detailed Okay.

Responsibility.

everything is and we still have lawsuits.

What I said in my questions here, and I want to parse this because I find this at least to be very important as a starting point for interpretation of the contract. It says: This RFP includes a

preliminary design package developed by the government. Okay. I'm going to go through this and tell

you what I think it means, and then I'm going to ask you. Preliminary design package developed by the

government, so right away a little lightbulb -- not a 70 watt, but a 25 -- goes up and says this is a design package by the government. specification. Heritage Reporting Corporation (202) 628-4888 Maybe it's a design

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9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Then it says: The preliminary design

package consists of partial design in architectural and engineering disciplines -- and I must say that it's somewhat unclear what in architectural and engineering disciplines means; I suppose it means in terms of those arts -- and material specifications. Okay. So what I see here is a distinction.

We have a preliminary design package, and we have a partial design and material specifications. Okay.

Now, when I see partial design of course what I think is well, there must be some leeway here because it's only a partial design. On the other hand, though,

partial design seems to be contrasted with, separated from, distinguished from material specifications. I see the word specification, and that makes me think well, this is definite so there's something which is a partial design which by virtue of being partial has some leeway. Then there's material

specifications, which seems to me well, this is not really subject to negotiation. These are perhaps

design specifications, although it doesn't say that. The partial designs, which again is contrasted with material specifications, are in various stages of development. It even underscores The use of

the fact that partial design is not set. Heritage Reporting Corporation (202) 628-4888

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10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 the government's applicable portion of the preliminary design is required -- and I'm completely lost at what the government's applicable portion of the preliminary design is required -- unless it is specifically modified below, and that's important, so what it says really is it is required, but then it really isn't because it cannot be melded with, blended with I guess what is below. Additional design requirements are contained in this section of the RFP, so we have more, and these are called requirements. The final design developed

by the contractor shall combined -- we all know that must be combine -- the requirements in this section, meaning 01111.2 (sic), I presume, with the preliminary design to produce the complete design package suitable for construction, so it does seem as if the government is not insisting on everything. It says you've got to

be creative in making this combination. The material and related specifications define the minimum acceptable quality of the materials and construction. Okay. Now, here when it says the

material and related specifications, and I had contrasted that with the partial design because this paragraph does. Define the minimum acceptable quality of the Heritage Reporting Corporation (202) 628-4888

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11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 materials and construction, which makes me think well gee, despite the fact that the material specifications were somewhat distinguished from this partial design which is in flux, the fact that these are only minima must mean that they're also in flux as well because why would they just be minima. you can change them. Okay. Where am I? Define the minimum They must mean that

acceptable quality of the materials and construction. The contractor is solely responsible for the final design of the facility, so that I think is perhaps the only thing that is completely clear in that particular paragraph. Okay. Where am I going with this? What I'd

like to find out is what is wrong with my interpretation? Let me give you where I guess it kind

of leads me, and that is that the partial design seems to be in flux. Material specifications which seem to

be contrasted with material design and in flux I think was put in flux again by the statement that they were just minimum, you know. So then I think well, they may have been specifications to some degree, but the government clearly thought that they might change, and then I'm completely open because I have no real idea what it Heritage Reporting Corporation (202) 628-4888

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12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 means to say the use of the government's applicable portion of the preliminary design is required. The

preliminary design means this partial design plus the material specifications. Now, let me go to the government first instead of the ones that filed the motion. O'Connell? MR. O'CONNELL: Well, there's one piece of Mr.

history that maybe I could fill in here. THE COURT: After all that I missed it. Which is that Amendment 4,

MR. O'CONNELL:

which is what we're looking at, to the RFP -THE COURT: Yes. -- gave the contractor A later amendment

MR. O'CONNELL:

Division 1 to the specifications.

provided the contractors with Divisions 2 through 15. Divisions 2 through 15 provide a lot of information which I thought wasn't in dispute. If the Court would like, I could certainly file it with the Court, but typically in a government contract, just sort of talking about it in the generic sense, you'll look at the drawings and you'll see -THE COURT: Excuse me. What you're talking

about then are things that were later added to the contract? Heritage Reporting Corporation (202) 628-4888

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13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 though? MR. O'CONNELL: THE COURT: of this, Mr. Davis? MR. DAVIS: the appendix. THE COURT: MR. DAVIS: Yes. I'm not sure that I agree with Well, I'm aware that it's not in It's not in the appendix. All right. You're aware MR. O'CONNELL: THE COURT: Yes. Right.

And what prompted that? Well, even in Amendment 4 In a

MR. O'CONNELL:

they noted that we're giving you Division 1 now.

later amendment we'll give you Divisions 2 through 15. THE COURT: Okay. I'll talk about it sort of

MR. O'CONNELL:

on the generic level and then on the specific level if I could. THE COURT: And what you're saying is that

this is the first time the Court has been made aware of Divisions 2 through 15? MR. O'CONNELL: Well, it's identified in the

amendment, but we certainly didn't talk about it in our briefs. THE COURT: Okay. Is it part of the record,

Okay.

the government that it has any particular relevance to Heritage Reporting Corporation (202) 628-4888

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14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 the issue presented in the motion. THE COURT: Okay. All right. It would be

nice if you had included this in your brief. MR. O'CONNELL: I tend to agree with Mr.

Davis that I don't think it directly bears on -THE COURT: All right. I'm just trying to give you

MR. O'CONNELL:

a little history that might be helpful. THE COURT: All right. I'm sorry.

MR. O'CONNELL:

So just again going back to

what I was going to say, on the generic level in a government contract you'll look at the drawings and you'll see windows, doors, acoustical ceiling tiles, toilet partitions, all kinds of things like that, and then you go to the specifications and the specifications will have material requirements for all of those things. You'll see if there's a steel door shown on a drawing you'll go to the specification dealing with doors and windows, and it will tell you we want doors of this type of steel and windows. It could say

something like an Anderson type window that has a wind rating of whatever X, whatever nomenclature that they use. We want toilet partitions of that type. So to a certain extent those kinds of things Heritage Reporting Corporation (202) 628-4888

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15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 but -THE COURT: little unclear. I think you are, yes. I'm a were added in Divisions 2 through 15 here. You know,

for example, there's stuff about toilet partitions and things like that, but those were not fully identified. Those were not fully developed in what the Navy gave to the bidders here. The contractor had to develop the specifications here as well, and that's actually what the third dispute is getting to, the types of specifications that had to be produced by Merritt & Pardini, West Coast's designer. The legal issues

involving that third dispute don't touch upon the substance of the dispute. I don't know if I'm making myself clear,

So what you're saying is Divisions 2

through 15 actually contain a lot of material that is relevant to the Merritt & Pardini part of our argument today. Is that correct? MR. O'CONNELL: Well, I don't know if I

would go that far, but maybe if I could just identify two pages of the appendix that might help you, Your Honor? THE COURT: What would really help me, I

guess, is to tell me where you're going with this. Heritage Reporting Corporation (202) 628-4888

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16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 says: MR. O'CONNELL: Well, I'm just trying to

tell you what the material specifications are, and the material specifications part of the contract you don't have, but I tended to agree with Mr. Davis that those Divisions 2 through 15 of the contract really are not in dispute, so just to keep things simple and only give you one phone book of documents I didn't give you Divisions 2 through 15, but I'm certainly willing to file them if the Court would like to see them. THE COURT: Hold on. The sentence here

The RFP includes a preliminary design package,

which the preliminary design package consists of partial design plus material specifications. these Divisions 2 through 15 part of the RFP? MR. O'CONNELL: THE COURT: Yes. So what you're saying is So were

Okay.

in trying to figure out what the material specification is in contrast to the partial design you're telling me now what material specifications are? MR. O'CONNELL: Right. I'm just trying to

identify to you in a general sense what material specifications are, yes. THE COURT: Okay. What I'm interested in is

of course exactly what the material specifications Heritage Reporting Corporation (202) 628-4888

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17 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 point? MR. O'CONNELL: Yes. else? were in the preliminary design package. identify those? MR. O'CONNELL: Well, those would be Can you

Divisions 2 through 15 that were added later. THE COURT: That's it? Okay. All right. And nothing

Just Divisions 2 through 15? No. I mean, the use of the

MR. O'CONNELL:

word material in front of the noun specifications, I would interpret it the way I've told you, but you could probably make an argument that what's in Section 1112 are material specifications, but I would say that the correct interpretation would be that it's what is in Divisions 2 through 15. THE COURT: You have to take a position.

What is the government's position? MR. O'CONNELL: Divisions 2 through 15. THE COURT: Okay. And so I now know from The government's position is

the government's standpoint what material specifications means in paragraph 1.1.1. right? MR. O'CONNELL: THE COURT: Yes. Good. And that's your Is that

Okay.

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18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 THE COURT: Okay. Does that lead to the

conclusion that because they are material specifications and they are separated from the partial design that these are design specifications that the government is responsible for? In other words, if Mr. Davis can prove that these were erroneous the government would be responsible for that? MR. O'CONNELL: THE COURT: Yes. Well, I don't think so Divisions 2 through 15?

MR. O'CONNELL:

because they don't have a claim based on anything in Divisions 2 through 15. THE COURT: & Pardini thing? MR. O'CONNELL: I see. Well, I guess if we That's entirely for the Merritt

got to the substance of the Merritt & Pardini dispute possibly what's in Divisions 2 through 15 could come into play. THE COURT: Okay. So where should I go with

what you told me about material specifications and coming to a conclusion whether it's a design or performance specification? MR. O'CONNELL: Divisions 2 through 15 -Heritage Reporting Corporation (202) 628-4888 Are you asking me if

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19 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 material? THE COURT: Yes. Design or performance? THE COURT: Are design specifications. -- as a whole are design or

MR. O'CONNELL:

MR. O'CONNELL: THE COURT: Yes.

MR. O'CONNELL:

I would say generally they

are performance specifications, but I wouldn't rule out the fact that there are mandatory aspects of them. THE COURT: Okay. But because we know that

this is in dispute there's no point in making that separation. Is that correct? I don't think so. All right. Let me turn

MR. O'CONNELL: THE COURT:

Okay.

to Mr. Davis and ask you my sort of parsing of that 1.1.1, whether you think that was correct. MR. DAVIS: correct, Your Honor. THE COURT: MR. DAVIS: That's amazing. Over the course of this case I I think you were 100 percent

think Mr. O'Connell and I have read that section a thousand times, and we probably come to a different conclusion eery time, but the conclusion I came to most recently last night was that you really have three things here. You have a preliminary design

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20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 package that's in the first line. THE COURT: MR. DAVIS: Yes. And then when you go down to the You have the

next line you have two parts to that. partial design. THE COURT: MR. DAVIS:

The partial design, yes. And preliminary and partial are

close words, but they are different and they have different meanings. THE COURT: MR. DAVIS: Yes. And then you have this material

specification, so I think within preliminary design package you have two parts, the partial design and the material specifications. Then when you go down to the next sentence, if I could hold in abeyance for a minute the words applicable portion -THE COURT: MR. DAVIS: Sure. -- what it says is the use of It doesn't say

the government's applicable portion. partial design.

It says preliminary design, so that

tells me that gets both of the things that Your Honor identified, the partial design and the material spec, and that we're required to use them unless, and I'd like to focus the Court's attention on the words Heritage Reporting Corporation (202) 628-4888

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21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 specifically modify. Specifically is in there. It doesn't mean

to our way of thinking generally modified or modified by implication or look at 100 different places and figure out that it's been modified. You know, I think

the word specifically is in there for a reason. THE COURT: MR. DAVIS: And below. Yes. Exactly. You know, our

position would be that if you have a piece of information that is part of the preliminary design package, which clearly these RFP drawings, which these big pieces of paper at counsel table are. If it says one thing, if it says, for example, 15-ton chiller, unless the government somewhere else below says no, not a 15-ton chiller -something else specifically modified -- that we were I guess entitled to rely on that information in the preliminary design package. It's got to be

specifically modified; not by implication, not by notice. The other point I would just like to make is that this contract letting didn't happen all at once. It was a process over many months. I would like to

make the distinction and hope the Court will keep this in mind that clearly we are responsible for the final Heritage Reporting Corporation (202) 628-4888

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22 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 design, but the real inquiry here is not what the cost of it was at the 100 percent design submittal at the end of the design phase after letting the contract. Really what we're talking about here, because it was a hard bid contract, is what was our obligation or where were we at the bid stage, okay, because we bid. We bid. We look at these drawings and specs.

If we get it then we go through a many month

design process, which we get paid for, and then the construction process. I think that one of the things that is getting lumped together here is where was the contractor in a design/build contract supposed to be at bid stage versus at the end of the design phase when the government was considering its 100 percent design submittal. THE COURT: MR. DAVIS: Okay. I'm not sure the contractor even

in a design/build contract has an obligation to do the entire design to satisfy itself that there are no substantive errors in the RFP drawings at the bid stage. That seems onerous and not to make much sense

because then why would you have a design phase after bid? twice. Heritage Reporting Corporation (202) 628-4888 You have the contractor doing the same thing

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23 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 THE COURT: What you're getting at here

actually is a slightly different point, and that is that if it was obvious that there were some design specifications that wouldn't work the question is at what stage would the burden of seeing those and bringing those to the government's attention fall on the Plaintiff? Is that correct? Yes. Let me be clear. When do you When

MR. DAVIS: THE COURT:

think that happens if there is a discrepancy?

was it that you say the Plaintiff at this point should have known that there was something wrong? MR. DAVIS: Well, I don't know that I can

answer the Court's question of when they should have known. I can tell the Court when they did know. THE COURT: MR. DAVIS: Okay. When?

Which was during the design

phase after contract award when they had their MEP and their design team from Merritt & Pardini and their subcontractor going through and trying to get to 100 percent design submittal. discovered. THE COURT: that point? government? Heritage Reporting Corporation (202) 628-4888 Okay. And then what happened at That's when it was

Was it brought to the attention of the

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24 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 an REA. THE COURT: There was a negotiation? Is that right? This MR. DAVIS: Yes. The contractor did submit

is when you changed the plans. MR. DAVIS:

Well, there was some

correspondence back and forth with the contracting officer. THE COURT: MR. DAVIS: Yes. And the claim was ultimately

rejected at that level, so we went ahead and built it and put in the bigger chiller, for example, and then submitted a claim for our increased cost. THE COURT: Okay. But the government must

have taken a position then before it went to the contracting officer I guess on a formal claim. MR. DAVIS: THE COURT: Yes, they did. I suppose there might have been

an admission that there was a problem, but then the follow-up with the problem was on your dollar. MR. DAVIS: Well, yes. The government's It's a design/build

general response was sorry, guys. contract.

You have the design liability. THE COURT: Okay. And then it went to the

contracting officer as a formal claim, and he agreed with the Agency's position on that? Heritage Reporting Corporation (202) 628-4888

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25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. DAVIS: THE COURT: MR. DAVIS: Yes. Okay. Let me ask. That was kind of

I'm sorry.

running down not a dead end, but a side road staying focused on your question about what does this mean. THE COURT: to understand. Actually that was helpful to me

I want you to just keep your thoughts Just go

for a moment, but keep them on the same road. off for a break.

Let me ask Mr. O'Connell if what Mr. Davis has said here is generally true about the RFP, the design phase, its discovery, the government's position. Just in general is that correct? Is that

accurate from your standpoint? MR. O'CONNELL: Well, to the extent that

he's saying that they didn't discover it until after award, I mean, I don't have any knowledge to say the west coast knew about these things before bid -THE COURT: Yes. -- and just were sort of

MR. O'CONNELL:

gaming the bid and then planning on submitting a claim afterwards. THE COURT: Yes. But otherwise I completely

MR. O'CONNELL:

disagree with everything else he said. Heritage Reporting Corporation (202) 628-4888

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26 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 there is. THE COURT: Okay. Now, is it true that THE COURT: fact thing then. Well, let me ask you about the

It's not true that after an RFP in

this kind of contract there is a design phase? MR. O'CONNELL: Oh, sure there is. Sure

during the design phase at some point the Plaintiff brought to the attention of the government that there seemed to be a discrepancy? MR. O'CONNELL: THE COURT: That's true. That's true.

And then the government

basically said well, if there is a discrepancy it's in the kind of specification that is your problem, not the government's? That happened too? Oversimplifying, yes.

MR. O'CONNELL: THE COURT: Yes?

MR. O'CONNELL:

The government felt that

this contract allocated the risk of these kind of problems to West Coast. THE COURT: Okay. All right. Good. We're

on the same page with regard to that. Let me go back to you now. You're up to the

point where the use of the government's applicable portion of the preliminary design is required, okay, so here we see the word required. Heritage Reporting Corporation (202) 628-4888

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27 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. DAVIS: THE COURT: Yes. And a suggestion that some

portion of the preliminary design is required by the government unless it is specifically modified below. MR. DAVIS: THE COURT: MR. DAVIS: Yes. Okay. Okay. Go on. It is our position

obviously that the chiller, the 15-ton chiller, that that was part of the partial design. of interesting. Again, it's kind

Well, I have to start completing my

thoughts before I go on to the next one. THE COURT: MR. DAVIS: Yes. I think it's clearly part of the

partial design and so therefore it's part of the preliminary design package, and therefore we are required to use it if it's an applicable portion, I guess. So then that brings us to what do those words applicable portion mean? I know the government

in their reply had made the argument that well, since you have a partial design or a preliminary design package or a partial design and specs that I think they used the word clash. If they clash or are in conflict we have to I guess make a choice and get rid of the one that Heritage Reporting Corporation (202) 628-4888

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28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 doesn't work and homogenize them or harmonize them to come up with a buildable final design. THE COURT: So what's required is your

attempt to harmonize them? MR. DAVIS: THE COURT: MR. DAVIS: Yes. Okay. And the one that doesn't work,

the one that clashes to use the word in the reply, that gets thrown out because that can't be applicable because I can't use it and harmonize it and give the government the final design that the government is looking for. I don't agree with that. I'm struggling

really, Your Honor, to figure out what that means, applicable portion. You know, certainly the Court

could say that that word is kind of I don't want to say meaningless, but just surplusage and the Court can't figure out what it means. Certainly there are contracts where we have words that really don't add anything, but I think the better interpretation and our position is this: simply to direct us to what it's talking about. It's Like

if we're trying to design the HVAC system, okay, and the partial design says use a 15-ton chiller then that is applicable to the HVAC system and we need to use Heritage Reporting Corporation (202) 628-4888

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29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 it. So I think applicable here really just has a very simple meaning that if you're designing the HVAC system and you've got something on the partial design that's part of the HVAC system like the chiller or the air handler it's applicable and you've got to use it. I mean, my reading of applicable is very, very simple. I would respectfully suggest the

government's reading of that is somewhat strained. THE COURT: I guess the problem is that your

interpretation seems to suggest then -- how would you distinguish -- it's in every specification, even if it's in the partial design in architectural and engineering disciplines, would be the government's applicable portion which was required. correct? I think what you're saying is the material specifications mean at least the mechanical equipment that you were talking about, the chiller, right? MR. DAVIS: THE COURT: MR. DAVIS: Actually, no. Oh. I think that's part of the Is that

partial design part of preliminary design package. THE COURT: specifications? Heritage Reporting Corporation (202) 628-4888 Then what are the material

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30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. DAVIS: With respect to what Mr.

O'Connell was talking about, I'm going to use Pella windows. I'm going to use a Kohler toilet. I'm going

to use Smith fixtures. You know, certainly I don't think structural concrete is a material specification. Material

specifications typically mean what kind of chair are you going to use in there. thing. Do you know where I find support for that, Your Honor? THE COURT: Excuse me. So the RFP drawings You know, it's a specific

which depicted a 15-ton chiller and a 6,500 cfm air handling unit, that's not a material specification? MR. DAVIS: THE COURT: MR. DAVIS: partial design. Where I find support for that is in that second to last sentence in the section we're looking at because it says: The material and related I don't believe it is. Okay. I think that's part of the

specifications define the minimum acceptable quality. THE COURT: MR. DAVIS: Yes. Not quantity. Again, you're

talking about am I going to put in there the expensive Heritage Reporting Corporation (202) 628-4888

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31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 windows, Pella, or am I going to put in the cheap windows off the back of the truck? That's a quantity

indicator there, not a quality indicator there. THE COURT: agree on that? Is that correct, Mr. O'Connell? agree on that? MR. O'CONNELL: Well, I agree with him to Do you Okay. And you and Mr. O'Connell

the extent that he's saying that the drawings are not material specifications. THE COURT: specification. They're design. Yes.

But the meaning of material

Does it mean this sort of almost like

brand name quality type stuff as opposed to the 15 tons and the 6,500 cfm? MR. O'CONNELL: Yes. I mean, I wouldn't

really quibble with his definition for purposes of this. I mean, I think it could be a little less specific than saying a Pella window. It could be a

Pella type window that has a wind rating of X -THE COURT: Yes. -- and glass that has a

MR. O'CONNELL:

solar rating of that, but I think we're basically on the same page. THE COURT: Okay. All right. You may

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32 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 continue then, Mr. Davis. MR. DAVIS: I don't think with regard to the

structural concrete and the chiller/air handler claim that the material specification part of the section really has any meaning. things. I think we're clearly playing on the field, if you will, of the partial design part of the preliminary design package, and I think that Your Honor is absolutely correct that we can't ignore the fact that the word design is used in this section over and over and over again. It says design. THE COURT: Yes, but on the other hand It doesn't say performance. I think that relates to other

although it says design, first of all, we have preliminary. We have partial. The final language is

the contractor is solely responsible for the final design of the facility, so that gives me pause. MR. DAVIS: word final. phase. What we're talking about here is many months before at contract award, and I think even though we are clearly responsible for the final design, but if at the bid stage we're given these RFP drawings and Heritage Reporting Corporation (202) 628-4888 Yes, as it should. Again, the

Final design is at the end of the design

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33 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 they say 15-ton chiller and we're required to use it unless specifically modified below and it's not specifically modified below, I think that we're required to use that in our bid. We're entitled to use it in our bid, and then during the design phase which comes after contract award if it later turns out to be wrong I think that we're entitled to be paid for any extra cost, if any. I think that's a very self-serving but

reasonable interpretation of how that very confusing section should be read. THE COURT: that, Mr. O'Connell? MR. O'CONNELL: couple things, Your Honor. Well, I'd like to say a I think this 1.1.1 is Okay. Do you want to respond to

densely worded, and this exercise of focusing in on it is helpful to a certain extent, but we also need to read the other parts of the contract too because the other parts of the contract help provide meaning to 1.1.1. You know, just going back to the fact that this came out in Amendment 4, Amendment 4 in Note 5, and this is page 56 of the specifications, told us that the design shown -THE COURT: Just a second. Let me see if I

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34 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 this now? with -THE COURT: Tell me. MR. O'CONNELL: THE COURT: This starts at page -Wait. Explain this. What is have it. Do I have this? THE CLERK: Of the appendix? Yes. Page 56. Oh, I see. This

MR. O'CONNELL: THE COURT:

Where is 56? Great.

is not the whole thing. I think. MR. O'CONNELL:

Finally I've got it,

So this is what comes out

Amendment 00004. Right. Is

MR. O'CONNELL: THE COURT:

And when did this come in?

this an amendment to the RFP? MR. O'CONNELL: RFP, March 19, 2001. This is Amendment 4 to the

This is what issued Division 1

of the RFP that we've been talking about so far today, okay, and it tells us in Note 5 that the design shown on the drawings included in this solicitation will require significant development based on requirements in Section 01112 before pricing can take place. So that tells you who the contract is allocating risk to and risk of problems in those drawings. Right there we're telling the design Heritage Reporting Corporation (202) 628-4888

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35 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 builders right there that they're going to bear the risk of developing that design, and we're warning them you need to develop the drawings before you develop your pricing. THE COURT: Okay. Now, this is saying in a

MR. O'CONNELL:

more direct and succinct manner everything that is said in 1.1.1. In other words, the Navy is telling people we're giving you these preliminary drawings and we're giving you the specifications, but what's really important to us is what's in those specifications because those specifications are telling you things such as we need a building that in the summertime is going to be 74 degrees Fahrenheit, and the temperature in the building is not going to vary any more than two degrees from that temperature. THE COURT: I wish the GSA had had those

specs when this place was built. MR. O'CONNELL: I'm not sure the GSA was

around when this building was built. But, Your Honor, that point is reinforced, and I can just give you a page number and you can look at it later if it's not handy, but there is an order of precedence clause which starts at page 197 and goes Heritage Reporting Corporation (202) 628-4888

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36 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 says. THE COURT: Mine says discrepancy. Sorry. Okay. Oh, In case on to page 198, and it reinforces that same notion. It tells the contractors, and again this came out at Amendment 4: In case of differences

between drawings and specifications, the specifications shall govern. THE COURT: All right. I have 197. It's FAR

MR. O'CONNELL:

The bottom of 197.

clause 52.236-21, and it carries over to the next page. The second line down: In case of differences

between the drawings and specifications, the specifications shall govern. THE COURT: discrepancy? MR. O'CONNELL: In case of difference it A discrepancy? In case of

you're in the sentence above. of difference. Go ahead.

MR. O'CONNELL:

Okay.

That again is the

same message that the specifications trump the drawings. Okay. So then we go back to Section 1112,

and several other things shed light on the meaning of paragraph 1.1.1. What I'd like to discuss is

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37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 because the one thing that's been missing from the discussion so far this morning is the fact that this is a two-story building. You know, we do have modifications to the government's design package in 1.1.2, and I'm going to be talking about page 267 through 269, Your Honor, if you have those. THE COURT: I do. Thank you.

MR. O'CONNELL:

But paragraph 1.1.2 is a

very important paragraph because this is where the government adds an additional floor to the building. The floor is either going to be a full-size basement with two stories above ground or a three-story above ground building. It goes on to page 268, and it discusses each of those buildings in turn. In paragraph (b) it

tells us some key things about the structural and mechanical systems of the building which we're talking about now. It says in (b): For the basement

structure -- I'll wait until you're there, Your Honor. THE COURT: Okay. It says: For the basement

MR. O'CONNELL:

structure -- at paragraph (b) on page 268 -- the government has not done any foundation or other design of the basement structure, and then it goes on 11 Heritage Reporting Corporation (202) 628-4888

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38 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 lines down starting over on the right. It says: The

government has not done any architectural, mechanical, electrical and fire protection safety design for the basement. It goes to paragraph (c) below that, and there's even less information for the three-story option. It says: At the contractor's option, the

contractor may propose an extension with a threestory, above ground structure to meet the minimum 2,025 square meter building footprint requirements. That building that's shown on the drawings is not a 2,025 square meter building. That paragraph concludes on page 269 with the only information that they give for this third floor. They say: Mechanical, electrical,

telecommunication data, transmission and fire protection design shall be similar to that of the preliminary design, so it tells you that there's no design for this third floor. What we're giving you is a design for a two-story building, and this is important on several levels, Your Honor, but one important thing is that maybe West Coast themselves, the people who prepared the bid, did not discover that the chiller and the grade beams were going to be a problem, but the Heritage Reporting Corporation (202) 628-4888

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39 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Exactly. THE COURT: thought was ruined. MR. O'CONNELL: That's okay. We quote at I'm sorry. I bet your train of design/build contractor who we're hiring for expertise in both construction and design can't throw its common sense out the window. THE COURT: Even if it's a Pella window? Even if it's a Pella window.

MR. O'CONNELL:

length and we've given you the deposition transcript. West Coast's designers and subcontractors knew that if you add an additional floor to the building the air conditioning system that's going to work for the twostory building isn't going to work for a three-story building unless, as the architect said, you decrease the square footage of the building by a corresponding amount. You know, I don't expect the Court or an attorney to be an expert in mechanical design systems, but we ourselves can apply our common sense to this, and anybody who has bought an air conditioner, a fan, a roof for a house, carpet, a bag of grass seed, a bag of fertilizer, knows that the more area you've got to cover the more product you've got to buy and the more money it's going to cost you. Heritage Reporting Corporation (202) 628-4888

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40 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 okay? It was not something that escaped their designers in any way that adding this third floor to the building was going to increase the requirements of the mechanical system. THE COURT: Does this kind of boil down to

that, going back to 1.1.1, and I accept your point. Our first point that we nailed down was that we should look at the contract as a whole. MR. O'CONNELL: THE COURT: Yes.

But I just wanted to say that

what that tends to prove, I suppose, is that the use of required and requirements, which we see scattered around which to an academic former professor like me actually means what required means, but looking at the contract as a whole it really sort of means required to be considered. Is that fair to say? I would say that's a fair

MR. O'CONNELL: interpretation. THE COURT: Yes.

MR. O'CONNELL:

Let's take the chiller,

You can build this building, and the 15-ton Well, then

chiller works fine to cool the building. everybody is happy.

They put in the 15-ton chiller,

and that's the end of the story. But what happened here is you can either Heritage Reporting Corporation (202) 628-4888

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41 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 have the 15-ton chiller or you can have the building that's going to be 74 degrees in the summertime. can't have both. You

If you give us the 15-ton chiller,

the building is probably going to be -- I don't know -- 85 degrees or something in the summertime, so that's not what the Navy wants. So the message that's here in going back to Note 5, develop the drawings in light of what's in Section 1112, that's what they have to do, and order of precedence clause as well. The specifications rule

over the drawings, so you've got to develop that design in light of what's shown in the specifications and knowing through your common sense as a design/ builder that the air conditioning system for a twostory isn't going to work for the three-story building. THE COURT: your turn, Mr. Davis. MR. DAVIS: Okay. Thank you, Your Honor. Okay. Sounds good. Now it's

MR. O'CONNELL: MR. DAVIS:

First off, I would just note -Let's go to page 56 of

we've got to start somewhere.

the appendix, which is that Amendment 4, Note 5. THE COURT: MR. DAVIS: Now, where are we? Page what?

Pardon me, Your Honor?

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42 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 appendix. THE COURT: MR. DAVIS: All right. I don't believe that that THE COURT: MR. DAVIS: Page 56? Yes. It's on page 56 of the

disclaimer is the type of clear alert that the caselaw requires to get the government out from under liability for design errors. The case that I think we both cited, probably for different propositions, was the Edsel case. You know, the Edsel case does talk about what

the government needs to do as far as clearly alerting bid contractors to the possibility of substantive design errors. What that case says is that the disclaimer, if you will, has to "clearly alert the contractor" that a design may contain substantive flaws. THE COURT: The government's position might

be that it doesn't contain substantive flaws; that it just simply is saying this is what we think it should look like, but we hired you to do the design so implicit is this is a kind of a wish list that you have to put together so that it actually works, and if it doesn't then you have to make modifications. MR. DAVIS: Okay. Again, at what point do

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43 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 we do that? When we're out there bidding it, or is

that what happens during the design phase? THE COURT: What about the phrase before

pricing that Mr. O'Connell pointed out? MR. DAVIS: Okay. I don't think that

sentence or that note clearly alerts the bidder that there may be substantive design flaws. I think that

that is just simply a reiteration of the fact that hey, Mr. Bidder/Contractor this is a design/build contract and you're going to ultimately be responsible for the design. The design shown in the drawings will require significant development based upon the requirements. It's not in dispute that it wasn't 100

percent designed at RFP stage and that there was going to be a design phase that would require development. I don't see anything in here that says that hey, Mr. Bidder, there may be substantive design flaws here. What the caselaw says is you have to clearly alert the bidder to that. I don't think that this

language clearly alerts the bidder to that; that there may be substantive design flaws. THE COURT: actually signed? Yes. When was the contract

Did you go through this design phase

first and then you signed the contract? Heritage Reporting Corporation (202) 628-4888

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44 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 sorry. sir. for bid. MR. DAVIS: I believe that the process was

bid, acceptance of the bid, if you will -THE COURT: MR. DAVIS: Yes. -- award of contract, then

design phase, then construction phase once the government approved the 100 percent design submittal. THE COURT: At the time you signed the

contract then you had to have a good idea, if not a precise idea, of how much this was going to cost you so that you made some money out of it? MR. DAVIS: Yes. We put the drawings out

I can't say for certain -- I don't want to

misrepresent -- whether we put the specs out for bid too, but I know the drawings were out for bid. So, yes, we did have an idea, but as Mr. O'Connell just said they changed the building, if you will, okay? This is what, a 1,500 square feet two-

story building. THE COURT: MR. DAVIS: The drawing in the RFP? The drawings in the RFP. Yes,

And then in the specs -THE COURT: MR. DAVIS: Square meters. And the specs are the --- it's a bigger building. It went from 1,500 square I'm

meters to 2,025 square meters. Heritage Reporting Corporation (202) 628-4888

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45 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 THE COURT: But on page 267 of the contract

there are two buildings mentioned, a two-story or a three-story. MR. DAVIS: Yes. That's right. There are

two ways you can get to that 2,025 square meter. THE COURT: alternatives. Oh, I see. It's not those two

It's a totally different one, a bigger

building, is what you're talking about that's not reflected in the specifications at all or in the contract? MR. DAVIS: THE COURT: MR. DAVIS: THE COURT: MR. DAVIS: out first -THE COURT: MR. DAVIS: Yes. -- and the initial notice of I think I've lost you. All right. I apologize. No. I apologize.

In these RFP drawings which came

solicitation, it was a 1,500 square meter building, two stories, and that's what these drawings show. THE COURT: MR. DAVIS: Yes. And then later in this Amendment

4 I guess the government said no, I don't want a 1,500 square meter two-story building. square meter three level building. I want a 2,000 You can put one of

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46 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 confused. increased? THE COURT: MR. DAVIS: Yes. Okay. Page 267. record? MR. DAVIS: That the building size the levels below ground or you can put all three levels above ground. THE COURT: Where does it say that in the

MR. O'CONNELL: MR. DAVIS: THE COURT: MR. DAVIS: THE COURT:

Well, 267 is the new dimension. Page 267, paragraph 1.1.2? 1.1.2. Yes, sir.

That's what I was saying.

That's what I have been saying. MR. DAVIS: Okay. Well, then maybe I was

If you go to page 1 of the appendix -THE COURT: MR. DAVIS: I have it. Okay. That is the Commerce

Business Daily notice of this project, if you will. If you go down to the last big paragraph where it says Description, if you go to the second sentence: The

building construction is anticipated to be a two-story concrete building approximately 1,500 square meters. THE COURT: MR. DAVIS: Okay. I've got it.

So the building described at

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47 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 building. THE COURT: But the government's position I page 1 of the appendix is what is depicted in the RFP drawings. THE COURT: MR. DAVIS: Okay. A two-story, 1,500 square meter

think is, if I can anticipate it, and correct me if I'm wrong. They don't dispute -- how can they dispute

because it says that, right? They don't dispute that this is in it. they say is there is sufficient language in the contract as a whole to put you on notice that that was kind of like a suggestion that you should work with in the design, and if it turned out to be more expensive you were already working so it's on your head. MR. DAVIS: I think that's a fair Again, What

characterization of the government's position. at what point do we have to do that?

At the bid stage, okay, we've got these drawings, and then the government hits us with these nice specifications that say oh, no. No. We've got a

bigger building by 500 square meters approximately. We've got a different building. It's not two stories.

It's three stories or two stories with a basement. Oh, by the way, going to page 268, the Heritage Reporting Corporation (202) 628-4888

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48 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 government has not done any foundation or design for the basement. Not the whole building; just the

basement, and then it says that again in (b) somewhere else. So at the bid stage what is my contractor supposed to do? The government has completely changed

the playing field, and I guess what the government will be saying is gee, we put you on notice that the design in the RFP -- not to be overly argumentative -is so wrong and so different and so bad you can't rely on it anymore at the bid stage, so it's kind of like what's a contractor to do? It sounds like what they're telling us is you have to now go through, and I can't rely on any of these drawings or any of this stuff because the government has changed it. I've got to go through and

do all that design work prebid award at the bid stage and then maybe not get the contract and not get paid for it. That's a substantial undertaking and really is I think duplicative of what a contractor is supposed to do in a design phase of a design/build contract. So, yes, the building changed, but I don't

think that this was enough to put my client on notice that gee, how do I price this thing? Heritage Reporting Corporation (202) 628-4888

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49 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 a moment. In other words, the government feels that it has a stronger argument here because it's not a matter of you having the contractor having to sort of like recognize the contract as a whole and pick out this thing and interpret it and pick out this thing, but that you had drawings before you that had this problem evident. Is that what you just said? MR. DAVIS: I will leave it to Mr. does. THE COURT: Okay. Let me ask a fundamental We haven't

question I should have asked earlier.

talked about the grade beam elevation and the pile caps. Does everything that we've talked about so far,

does that really apply to those items as well, Mr. Davis? MR. DAVIS: I think our discussion generally

I mean, you had the conflict there was not only

the drawings and the specs, but the government's position was you had I guess conflicts within the drawings themselves. You know, when you're looking at structural drawings you look at the S series, and I believe specifically what it was, Your Honor, was S-7 of the RFP drawings shows the grade beam detail. THE COURT: Okay. Let me stop you there for

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50 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 O'Connell. I will leave it to Mr. O'Connell to I would

determine whether his argument is stronger.

say that all of his arguments are really strong, but -THE COURT: Because it seems stronger to me,

doesn't it, because rather than trying to put a pastiche together to defeat the Plaintiff's position or have your position succeed, to say that all we have to do is look at one document and there's a problem, that seems like a stronger argument to me. MR. DAVIS: Simply put, without spending an

hour talking about it, although we clearly could -THE COURT: MR. DAVIS: Yes. Yes. Our client's position is

when you're bidding structural elements you look at the S drawings, and if there's a conflict between the S drawings, which is structural, and the C drawings, which are civil, the S drawings control, okay? THE COURT: MR. DAVIS: Okay. And that's what they did. The

government is saying look, if you had just looked at the C drawings, I guess specifically C-1 and following, you would see that the property slopes downward to where they were going to build the new building. Heritage Reporting Corporation (202) 628-4888

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51 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 And that should have put you on notice that you couldn't just do a pier cap slab on grade right below or a grade beam right below the slab on grade. You're going to have to build a deeper foundation because the ground sloped down. THE COURT: would prevail? Does that do it?

You just said the S drawings

Is that right? Yes. If there's a conflict between

MR. DAVIS: THE COURT: the S and C? MR. DAVIS:

Yes, because you're bidding

structural elements and the S drawings have the structural detail. THE COURT: Mr. O'Connell. Okay. All right. Let me ask I'm sure you

What is your position?

agree that your argument is stronger. MR. O'CONNELL: Well, I think that West

Coast's argument is incorrect in two respects because just as the framework of the law established by the Federal Circuit is you can't just focus in on one thing. You've got to look at the contract as a whole. But those drawings on S-7 tell them that look at the civil drawings for the elevations. There's a detail on S-7. It's Note 5. See civil So it

drawings for nominal first floor elevation. Heritage Reporting Corporation (202) 628-4888

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52 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 refers the bidders to those civil drawings for the elevations. And then again we go back to the specifications, the specifications being very important. THE COURT: Before you continue, I just want You're referring to

to make sure I have this right. is this where it says -MR. O'CONNELL: THE COURT: what it says? MR. O'CONNELL: THE COURT:

The upper right corner. Is that

-- Drilled Per Notes?

Drill Tier Notes. And then No. 5: See

All right.

civil drawings for nominal first floor elevation? MR. O'CONNELL: THE COURT: Yes. Great. Thanks.

Okay.

MR. O'CONNELL:

And just to put another

definition on the floor, I don't know if you know this but I think everybody would kind of know what the structural drawings are just hearing the name. The civil drawings, I mean they tell you things like the site topography, demolition, location of existing utilities, those kind of things, the topography being the important element here. You know, looking at the civil drawings we Heritage Reporting Corporation (202) 628-4888

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53 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 see that there is about a three to three and a half foot drop over the length of the building, and that three to three and a half foot drop apparently is the difference of $170,000 to West Coast. Number one, based on the drawings they shouldn't have assumed that the site was flat and level, but, number two, the Court in its order cited to paragraph 1.6 of Section 1112, and that's got two additional pieces of information, somewhat repetitive, but it says in paragraph (a), and I'll wait until you're there, Your Honor. appendix. THE COURT: Okay. Thanks. Okay. It's page 274 of the

MR. O'CONNELL:

It tells them that the site

shall encompass an existing graded slope created with the final grading and construction of Building 245 -that's the existing building -- in 1992. It drains nominally northwesterly away from the northwesterly end of Building 245, so it drains away from the existing building, and -- laws of gravity -- drains means it's going downhill. THE COURT: Even I can get that. And then paragraph (b). The

MR. O'CONNELL:

part about paragraph (b) which is significant is it says that the finished floor of the project building Heritage Reporting Corporation (202) 628-4888

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54 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 over here. Page 585? MR. O'CONNELL: THE COURT: Yes. going on? MR. O'CONNELL: on that, Your Honor. Well, just one other point shall be the same elevation as that of Building 245 and shall be at