A contract is a contract. It should say what it means and means what it says. A release is construed like a contract. A change order or bilateral modification is construed like a contract. The decision out of the United States Court of Federal Claims, B.L. Harbert International, LLC v. US, 2025 WL 914388 (Fed.Cl. 2025), serves as a case on point.
In this case, the contractor had a claim related to a bilateral modification (i.e., change order #1) on a federal project which included a two-month extension of time to complete the contractor’s work. The modification stated the contractor and the contractor’s subcontractors waived the right to seek compensation for any other delays relating to the work. “When a contractor signs a general release, it is barred from seeking damages for the events connected to and contemplated by the release.” B.L. Harbert International, supra, at *4. Thus, the contractor’s claims related to this modification were waived.
The contractor also had claims related to two other bilateral modifications (i.e., change orders #2 and #3). The modification #3 left open any time extension due to the changed work and costs associated with the time extension because it was uncertain whether such work would result in a delay. However, the work did NOT cause a delay. The contractor accelerated its subcontractor and had the work completed ahead of schedule. The contractor claimed it was entitled to the additional costs associated with the acceleration. But the acceleration is NOT a time extension or delay. “[The contractor] could have negotiated with the Corps to cover acceleration costs that would prevent any further extensions of time, but it is too late to make that change to the contract after the fact.” B.L. Harbert, supra, at #4. In other words, modification #3 resolved the contractor’s costs for additional work other than a time extension and costs associated with a time extension. But a time extension was never needed. Thus, the contractor waived any costs for acceleration.
The contractor made another argument to counter the specific language in the modifications. It argued mutual mistake.
The contractor argued that the parties understood that the modifications did not cover the contractor’s additional costs as reflected in letters the contractor sent the government prior to the modifications. Therefore, the contractor claimed there was no meeting of the minds if the government’s position is different.
Under universal contract interpretation and each executed modification is a contract, “when contract provisions are clear and unambiguous, they must be given their plain and ordinary meaning.” B.L. Harbert, supra, at *5 (internal quotation and citated omitted). The modifications were clear and unambiguous.
Next, the contractor never presented its request for contract reformation due to mutual mistake to the government’s contracting officer, and the court can only review claims presented and certified to the contracting officer under the Contract Disputes Act. Regardless, the contractor couldn’t satisfy the requirements of mutual mistake. “To show a mutual mistake, [the contractor] must meet four elements by clear and convincing evidence, including demonstrating that ‘the parties to the contract were mistaken in their belief regarding a fact … [and] the contract did not put the risk of the mistake on the party seeking reformation.’” B.L. Harbert International, LLC, supra, at *5 (citation omitted). The contractor had to show that “the parties shared a mutual mistake,” which it could not factually demonstrate. See id.
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