_______________________________________________ MOTION FOR SUMMARY RELIEF DENIED: May 18, 1993 _______________________________________________ GSBCA 12031 DIPLOMATIC PAINTING & BUILDING SERVICES CO., INC., Appellant, v. GENERAL SERVICES ADMINISTRATION, Respondent. Enrique Balseiro, Bethesda, MD, counsel for Appellant. Richard R. Butterworth, Jr., Office of General Counsel, General Services Administration, Washington, DC, counsel for Respondent. Before Board Judges NEILL, HYATT, and DeGRAFF. DeGRAFF, Board Judge. Respondent, General Services Administration (GSA), moves the Board for summary relief. Appellant, Diplomatic Painting & Building Services Co., Inc. (Diplomatic), opposes the motion. Because we are not certain that all material facts have been presented to us, we cannot determine that GSA is entitled to judgment. Therefore, the motion is denied. Findings of Fact On November 9, 1990, GSA issued an invitation for bids to supply custodial services for a building located in Washington, D.C. The proposed contract was for a one-year term, with four one-year option periods. The invitation explains that the successful bidder would be required to pay its employees the minimum wages and fringe benefits incorporated in a wage determination issued by the Department of Labor, pursuant to the Service Contract Act, 41 U.S.C. 351-358 (1988). Appeal File, Exhibit 1. Section B of the invitation explains that, if GSA were to exercise any of its options, GSA would adjust the contract price pursuant to clause 552.222-43, Fair Labor Standards Act and Service Contract Act - Price Adjustment (Multiyear and Option Contracts) (June 1986). Clause 552.222-43 provides that, when an option is exercised, "[e]ighty percent of the monthly option price(s) will be adjusted upward or downward based on the percentage increase or decrease in the minimum hourly wages and fringe benefits to be paid under this contract." In order to determine the percentage increase or decrease in labor costs, the clause provides that the wage determination applicable to the initial contract period will be compared to the wage determination applicable to the option period. Finally, the clause provides that upward price adjustments are limited to no more than six percent. The clause does not contain any express limitation upon downward price adjustments. Section B of the invitation directs bidders not to include in their bids any allowance to cover increased costs for which adjustments might be made pursuant to the price adjustment clause. Clause 552.222-43 requires bidders to certify that they have not included in their bids any allowance for increased costs for which adjustment might be made. Appeal File, Exhibit 1. Diplomatic was the successful bidder and, on January 30, 1991, the parties entered into contract GS-11P-90-MJC-0071. Appeal File, Exhibit 1. During the initial year of the contract, from February 1, 1991, through January 31, 1992, wage determination 75-0098 was effective. Id., Exhibits 1, 4. On September 17, 1991, the Department of Labor issued wage determination 86-1245. GSA exercised its option for one one-year period, from February 1, 1992, through January 31, 1993, and modified the contract to incorporate the new wage determination for the option period.[foot #] 1 Id., Exhibit 2. The new wage determination required Diplomatic to pay its employees a minimum amount for wages and fringe benefits that is thirty-nine percent less than the minimum amount that wage determination 75- 0098 required Diplomatic to pay. Id., Exhibits 2, 4. On February 4, 1992, GSA notified Diplomatic that, due to the thirty-nine percent decrease in applicable minimum wages and fringe benefits, GSA was decreasing Diplomatic's monthly price in accordance with clause 552.222-43 of the contract. Appeal File, Exhibit 2. GSA decreased Diplomatic's price from $51,214.07 per month to $35,235.28 per month. Id., Exhibits 2, 4. As a result of GSA's actions, on April 30, 1992, Diplomatic submitted a certified claim to the contracting officer. Diplomatic asserted that GSA's actions were contrary to the terms of the contract which, by reasonable interpretation and by implication, contains a six percent downward adjustment ----------- FOOTNOTE BEGINS --------- [foot #] 1 The appeal file does not state the date that GSA exercised this option. ----------- FOOTNOTE ENDS ----------- limitation. Diplomatic also asserted that GSA's actions were contrary to its past dealings with the Government, and discussed the administration of a contract entered into on July 28, 1988, between Diplomatic and the National Archives and Records Administration, which contained clause 552.222-43. Diplomatic asserted that the Department of Labor's wage determination did not accurately reflect prevailing wages in the Washington, D.C. area, and requested that GSA ask the Department of Labor to revise its wage determination. Appeal File, Exhibit 3. On June 17, 1992, the contracting officer issued a decision upon Diplomatic's claim. The decision explains that the contracting officer adjusted the contract price in accordance with contract clause 552.222-43. Attached to the decision is an explanation of the contracting officer's computations. In the decision, the contracting officer states that the parties' contract contains no six percent downward adjustment limitation, and also states that a contract between Diplomatic and another government agency is irrelevant to the interpretation of a contract between Diplomatic and GSA. Appeal File, Exhibit 4. On September 18, 1992, Diplomatic filed its notice of appeal with the Board. We assume that this filing was timely, given that GSA has not argued otherwise.[foot #] 2 Discussion Summary relief is appropriate when there are no genuine issues of material fact in dispute and when the moving party is entitled to judgment as a matter of law. Rule 8(g); CRC Systems, Inc. v. General Services Administration, GSBCA 11173 (Feb. 26, 1993). Based upon the record before us, we are not convinced that all of the material facts have been presented and, as a result, we are not in a position to conclude that GSA is entitled to judgment as a matter of law. In its opposition to GSA's motion for summary relief, Diplomatic requests that it be permitted to conduct discovery concerning GSA's interpretation and application of clause 552.222-43. If Diplomatic discovers, for example, that GSA has interpreted and applied the clause as containing a limitation upon downward price adjustments, this fact would have a bearing upon whether GSA is entitled to judgment. Because no facts are currently before the Board concerning GSA's interpretation and application of clause 552.222-43 and because those facts could be material to our resolution of this dispute, it is not appropriate to grant GSA's motion until Diplomatic completes its discovery. Decision ----------- FOOTNOTE BEGINS --------- [foot #] 2 The appeal file contains no evidence to establish when Diplomatic received the contracting officer's decision. ----------- FOOTNOTE ENDS ----------- For the reasons stated above, GSA's motion for summary relief is DENIED. A new scheduling order will be issued separately. ___________________________ MARTHA H. DeGRAFF Board Judge We concur: __________________________ ___________________________ EDWIN B. NEILL CATHERINE B. HYATT Board Judge Board Judge