New America Shipbuilders, Inc. v. United States
Opinion of the Court
New America Shipbuilders, Inc. (NASI) appeals the decision of the United States Claims Court, New America Shipbuilders, Inc. v. United States, 15 Cl.Ct. 141 (1988) (Robinson, J.). The Claims Court granted the government’s motion for summary judgment and dismissed NASI’s claim. We affirm.
Background
The Small Business Administration (SBA) approved NASI for participation in its program for disadvantaged persons participating in the high-tech industry. Under this program, the SBA, at its discretion, may grant Business Development Expense (BDE) funds to program participants to assist in the performance of subcontracts. 15 U.S.C. §§ 636(j) and 637(a); sections 7 and 8(a) of the Small Business Act of 1953, as amended and supplemented.
NASI entered into extensive negotiations with the SBA and the United States Coast Guard (USCG) concerning the formation of a contract for the construction of three aids-to-navigation boats, to be aided by a
Such is NASI’s case as revealed in the documents before the Claims Court and in its own arguments. On summary judgment the Claims Court made no findings of fact and neither do we. However, a summary judgment that the above-alleged facts did not occur could not be made, and if they were relevant they would have to be established by trial.
Discussion
I
If the government misconduct alleged was tortious, jurisdiction is not granted the Claims Court under the Tucker Act, 28 U.S.C. § 1491, its sole source of jurisdiction in this case. Somali Development Bank v. United States, 508 F.2d 817, 822, 205 Ct.Cl. 741 (1974). The summary judgment below in effect held that the claim as presented, essentially to enforce an implied contract having the terms of the intended express contract and award would have had, was also not maintainable. On reviewing the summary judgment material, we believe this claim, if maintainable on a contract theory at all, was so as a claim for breach of the implied contract to give all government contract bids fair and honest consideration. See NKF Engineering, Inc. v. United States, 805 F.2d 372, 375-76 (Fed.Cir. 1986); CACI, Inc.-Federal v. United States, 719 F.2d 1567, 1573 (Fed.Cir. 1983); Keco Industries Inc. v. United States, 492 F.2d 1200, 1203, 203 Ct.Cl. 566 (1974); Keco Industries Inc. v. United States, 428 F.2d 1233, 1236-38, 192 Ct.Cl. 773 (1970). If the claim belonged under this rubric, the damages would be less favorable to claimants, because they would not include anticipated profits under the hoped for contract, but only a class of expenses generally lumped as “bid preparation costs.” In City of Alexandria v. United States, 737 F.2d 1022 (Fed.Cir. 1984), this difference was held to preclude use of these cases to support a claim to the value of the lost bargain.
Appellant elected to submit without oral argument but appellee appeared before us by counsel. Although the issue mentioned in the paragraph above was not discussed
II
NASI alleged that the negotiations culminated into an implied-in-fact contract which it seeks to enforce. The Claims Court granted the government’s summary judgment motion and held that there was no implied-in-fact contract and the government is not equitably estopped from denying the contract.
To overturn summary judgment, the appellant must show that one or more of the facts that the trial court relied on was genuinely in dispute and material to the judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986); Avia Group Int’l v. L.A. Gear California, Inc., 853 F.2d 1557, 1561-62, 7 USPQ2d 1548, 1551-52 (Fed.Cir. 1988).
Many of the factual issues pertaining to the existence of the alleged implied-in-fact contract are disputed. However, the Claims Court found a number of fatal defects in NASI’s prima facie case. One defect discussed but not resolved by the Claims Court concerns the authority of the SBA official who purportedly approved the grant of BDE funds. NASI urges that SBA approval was given, and the govemment argues that it was not. Both parties recognize, however, that even if approval was given, the approval must be within the approving official’s authority in order to be operative. See Federal Crop Ins. Corp. v. Merrill, 332 U.S. 380, 384, 68 S.Ct. 1, 3, 92 L.Ed. 10 (1947). Oral assurances do not produce a contract implied-in-fact until all the steps have been taken that the agency procedure requires; until then, there is no intent to be bound. Thus, it is irrelevant if the oral assurances emanate from the very official who will have authority at the proper time, to sign the contract or grant. Empresas Electronicas Walser, Inc. v. United States, 650 F.2d 286, 223 Ct.Cl. 686, 688, cert. denied, 449 U.S. 953, 101 S.Ct. 357, 66 L.Ed.2d 217 (1980). Where an approving official exceeds his authority, the government can disavow the official’s words and is not bound by an implied contract. Id.
NASI argues that it received approval of the BDE grant from an official of the SBA. From the briefs, it is not clear whether the official NASI believes it received approval from is Mr. Miller Widemire, the SBA Regional Administrator, or his subordinate, Mr. Robert Funches, the Assistant District Director for Minority Small Business for the SBA District Office in Jackson, Mississippi. Possibly, NASI is arguing that Mr. Widemire approved the BDE grant by delegating his authority to Mr. Funches, who recommended approval of the grant. Writing by Mr. Funches recommending approval is actually what appellant relies on. In any event, it is clear that NASI does not allege that approval of the BDE grant was communicated to it from any official of greater rank than Mr. Widemire. Resolving the ambiguity in favor of NASI, we interpret the argument to be that Mr. Widemire approved the BDE grant to NASI by means not shown.
NASI points to the testimony of Mr. Henry T. Wilfong, Jr., the Associate Administrator for Minority Small Business and Capital Ownership Development at the time of the negotiations, to support its position that Mr. Widemire’s approval of the BDE grant was authorized. Mr. Wilfong
All appropriate regional personnel shall be advised by the regional administrator that regional approval authority for use of BDE is limited to the lesser of:
$350,000 or
15 Percent of the fair market price for price differential or funds to defray other costs
or 50% of the contract price for capital equipment.
According to the above-cited rule, Mr. Widemire’s approval authority was at most $350,000. The funds in question totaled $435,000 and any approval by Mr. Wide-mire would therefore be unauthorized if indeed such approval was given. The short of it is that on summary judgment appellant demonstrated no capacity to show that a contract implied-in-fact was made.
Estoppel is often claimed in this class of cases, as here. If a government official represents to a potential contractor that requisite steps to clear the way for the award have been taken, as in City of Alexandria v. United States, 737 F.2d 1022 (Fed.Cir. 1984), or the requisite approval necessary to form a contract has been given, the government can yet disavow the contract if steps were not taken that procedure requires or if the approval exceeded the official’s authority. Empresas Electronicas Walser, Inc. v. United States, 650 F.2d 286, 223 Ct.Cl. 686, 688, cert. denied, 449 U.S. 953, 101 S.Ct. 357, 66 L.Ed.2d 217 (1980), citing Federal Crop Ins. Corp. v. Merrill, 332 U.S. 380, 68 S.Ct. 1, 92 L.Ed. 10 (1947). Resolving all doubts in favor of NASI, we may suppose that Mr. Widemire did approve the grant of BDE funds. That approval having been made outside the scope of his authority and outside normal procedure, however, the approval was legally ineffective and does not bind the United States to an implied-in-fact contract or by estoppel.
Ill
NASI also argues that it was unable fully to prepare its opposition to the government’s summary judgment motion owing to the trial court’s suspension of discovery pending the summary judgment motion. The trial court gave NASI the opportunity to show that additional discovery was required in order to respond to the government’s summary judgment motion. However, NASI “did not even attempt to show at any time during the briefing period that discovery was necessary to respond to defendant’s motion for summary judgment.” New America Shipbuilders, supra, 15 Cl.Ct. at 145. “A party may not simply assert that discovery is necessary and thereby overturn summary judgment when it failed to comply with the requirement of Rule 56(f) to set out reasons for the need for discovery in an affidavit.” Keebler Co. v. Murray Bakery Products, 866 F.2d 1386, 1389, 9 USPQ2d 1736, 1739 (Fed.Cir. 1989). See also Avia Group Int’l v. L.A. Gear California, Inc., 853 F.2d 1557,1561, 7 USPQ2d 1548,1551 (Fed.Cir. 1988). One important advantage sought by the rules from the summary judgment procedure is to save the parties and the court the time and cost that may be wasted in pursuit of irrelevant facts by discovery. NASI having made no showing as to the need for discovery, the trial court did not abuse its discretion in staying discovery.
We have considered NASI’s other arguments concerning improper denial of BDE funds and equitable estoppel, but find them unpersuasive.
The judgment of the Claims Court is
AFFIRMED.
Reference
- Full Case Name
- NEW AMERICA SHIPBUILDERS, INC., Robert Brazier, individually and as President of New America Shipbuilders, Inc. Travis Short, individually and as Vice-President of New America Shipbuilders, Inc. and Priscilla Culberson, individually and as Vice-President of New America Shipbuilders, Inc. v. United States
- Cited By
- 21 cases
- Status
- Published