_______________________________________________ DENIED: January 23, 1996 _______________________________________________ GSBCA 13295 NVT TECHNOLOGIES, INC., Appellant, v. GENERAL SERVICES ADMINISTRATION, Respondent. Jeffrey A. Lovitky, Washington, DC, counsel for Appellant. Adele Ross Vine, Office of Regional Counsel, General Services Administration, Kansas City, MO, counsel for Respondent. BORWICK, Board Judge. This appeal involves a claim for extra expenses incurred by appellant, NVT Technologies, Inc. (NVT), in connection with a contract awarded by respondent, General Services Administration (GSA), to repair and maintain heating, ventilation and air condi- tioning (HVAC) systems at the Kansas City Federal Office Building (KFOB), Kansas City, Kansas. NVT repaired two chillers which suffered rupture of chiller disks and the consequent loss of refrigerant. About two months before the accident, NVT had drained water from, and closed valves for, the chiller coils for the winter. NVT, however, failed to disconnect associated water pumps. The chiller disks failed when, during an unusually warm federal winter holiday, the energy management system (EMS) for the building, supposedly programmed for holiday, shut down, and let the air conditioning system operate. The water pumps gener- ated heat; since water could not circulate in the chiller coils, the heat built up pressure. The pressure ruptured the chiller disks and caused loss of refrigerant. The repairs cost NVT $16,949.40, or $8,474.70 per chiller. GSA contends that repair of each chiller is a separate job which is NVT's contractual responsibility as a "maintenance repair" costing less than $10,000. NVT argues that the repair should be considered together as a "minor repair" and that it is owed $6,949.40, the difference between $16,949.40 and the $10,000 contractual threshold. NVT urges special consideration because the accident was not its fault. We agree with GSA that repair of each chiller was a "mainte- nance repair" and NVT's contractual responsibility. We disagree that NVT should be given special consideration. NVT must bear part of the responsibility for the accident. NVT failed to take the common-sense precaution of completely isolating the chilled water loop for the winter season, when it drained the chilled water coils. It relied on the EMS to keep the air conditioning equipment shut down, rather than make the extra effort to elec- trically disconnect the water pumps. The automation failed, resulting in damage to the chillers. As others have done to their sorrow, NVT relied too heavily on automation, for something it could have accomplished through its own effort. The appeal is denied.[foot #] 1 Findings of Fact Contract provisions The contract required NVT to provide all administration, management, supervision, labor, materials, supplies, repair parts, tools and equipment and to plan and coordinate and ensure effective and economical completion of all mechanical maintenance work and services for the Kansas City, Kansas, Federal Office Building (KFOB), located at 500 State Avenue, Kansas City, Kansas. Appeal File, Exhibit 1 at 1, 7 ( C.1.a.) The equipment and systems to be serviced and maintained included those for air conditioning, air handling and building automation. Appeal File, Exhibit 1 at 22 ( C-2.1.a). The contract required the contractor to develop and submit a building operating plan. Id., Exhibit 1 at 7 ( C.1.i). The contract also required that "during nights, weekends, and holidays, particular attention shall be given to ensure that equipment is shutdown to the maximum extent possible." Id. As part of the services to be provided under the contract, NVT was responsible for maintenance repairs, defined as "work required to prevent a breakdown of equipment and/or system or to put it back in service after a breakdown or failure where the cost for labor, materials and parts is expected to be $10,000 or less." This dollar threshold "applie[d] to each individual repair job that may be required." Appeal File, Exhibit 1 at 36 ( C-2.13.a). The contracting officer or his representative could also direct NVT to perform minor repairs, defined as "unscheduled work required to prevent a breakdown of a piece of ----------- FOOTNOTE BEGINS --------- [foot #] 1 NVT elected the small claims procedure for claims of $50,000 or less as provided by Rule 13. Pursuant to Rule 13, this decision has no value as precedent and is unappeal- able in the absence of fraud. The parties submitted their dispute on the record pursuant to Rule 11. ----------- FOOTNOTE ENDS ----------- equipment or a system or to put it back in service after a breakdown or failure where the expected cost is between $10,000 and $25,000 for labor materials and parts." NVT was responsible for the first $10,000 of costs for minor repairs, with reimburse- ment on a time and materials basis for costs above $10,000. Id., Exhibit 1 at 36 ( C-2.13.b.(1)) and 38 ( C-2.13.f.(1)). Again, the dollar threshold applied to each individual repair job that might be required. Id. The contract did not require NVT to perform major repairs. Appeal File, Exhibit 1 at 37 ( C-2.13.c). NVT, however, was responsible for the full cost of major repairs (and for that matter minor repairs) if it was determined that the repair was necessary due to NVT's error or negligence. Id., Exhibit 1 at 38 ( C-2.13.d). Building mechanical and energy management systems The EMS for the KFOB turned HVAC equipment on and off at pre-set times, adjusted opening of dampers based on signals received from thermostats, and activated alarms if equipment failed. Appeal File, Exhibit 2 at 2. NVT's subcontractor for operation and maintenance of the KFOB EMS was Landis & Gyr Power (L & G). Id., Exhibit 4 at 2. The KFOB EMS is linked by leased- line modem to a computer command center at the Kansas City, Missouri Federal Office Building (MFOB). Appellant's Record Submission, Exhibit 1 at 2. The KFOB could exchange commands for operation of the EMS with the computer command center at the MFOB. Id. The computer command center is only used by GSA personnel for monitoring purposes and not for entering programs or time of day schedules for operation of the HVAC systems at the KFOB. Appeal File, Exhibit 4 at 2. NVT and its subcontractor L & G have the ability to change commands in the KFOB EMS. Id., Exhibit 6. One GSA employee at the MFOB computer command center has the level of access to the computer that would enable him to change commands affecting the KFOB EMS; that employee, however, only monitors the functioning of the equipment and never has changed commands for the EMS. Id., Exhibits 2 at 9, 6. Incident that resulted in accident and required repair On December 28 and 29, 1994, NVT drained and closed the valves for the chilled water coils, but did not disconnect electricity to the water pumps. Appeal File, Exhibits 2 at 7 and 4 at 1, 5. NVT drained the chilled water coils to prevent them from freezing during cold weather. Id., Exhibit 2 at 7. GSA's field office manager noted that: [NVT] failed to disconnect the chilled water pump (electrically) at the same time the rest of the chilled water loop was disabled, thereby creating the problem. In other words, [NVT] drained the system but did not disconnect the power to the pump. Id. On February 20, 1995, a Federal holiday[foot #] 2, the ambient air temperature in Kansas City, Kansas, reached seventy-five degrees. Appeal File, Exhibit 4 at 5. The EMS, which should have been programmed to shut down the air condition- ing system for the holiday, allowed the air conditioning system, including the water pumps, to operate. Id., Exhibit 2 at 7. The operation of the water pumps caused the water to heat; the heat could not be discharged because the water could not circulate through the drained and closed chilled water coils. The resul- tant pressure from the build-up of heat caused a rupture of disks in the two air conditioning chillers manufactured by the York Corporation (colloquially called "York chillers") and a loss of refrigerant. Id. at 8. In an inspection of the KFOB EMS and computer command center on March 10, 1995, it was found that communications between the KFOB EMS and the MFOB computer command center were disrupted; upon restoration of communications, the computer command center at the MFOB downloaded a temporary time of day schedule to the KFOB EMS computer. Appeal File, Exhibit 3 at 4. Repair, claim and contracting officer's decision NVT repaired the chillers. On February 28, NVT submitted a claim to the contracting officer of $14,474 "plus other cost of the repair," based on a quote from York for the repairs of $7,237 per chiller. Appeal File, Exhibit 2 at 10. NVT stated: February 20, 1995, was a federal holiday and according to a building automated system printout supplied by GSA, the building automated system was put in a holiday schedule. As evident from the records, a temporary schedule was programmed into the controlling computer which activated the values and pumps on that day. NVT received no request for overtime services and therefore did not enter this temporary schedule into the computer to override the pre-programmed holiday shutdown sched- ule for that day. Since the security of the computer command center is not in NVT's hands, we cannot be held liable for the actions of others who have access to the system's control. Id. ----------- FOOTNOTE BEGINS --------- [foot #] 2 February 20 was President's Day and fell on a Monday. ----------- FOOTNOTE ENDS ----------- On March 24, NVT amended its claim to seek $16,949.40 ($8,474.70 per chiller), which was comprised of $13,780 plus a twenty-three percent mark-up of $3,169.40. Appeal File, Exhibit 3 at 1. On May 5, the contracting officer denied the claim. He concluded that the mis-programming of the KFOB EMS was due to the fault of NVT or L & G, since "a thorough check of GSA personnel established that no GSA employee made this entry into the comput- er system." He also concluded that had NVT "properly disabled the equipment including disconnecting electrical power to the pumps, this system failure would never have occurred." The contracting officer determined that "the system failure is not attributable to Government action." Appeal File, Exhibit 4. A timely appeal followed. Discussion This is a straightforward matter. Under the contract, NVT is responsible for the cost of all maintenance repairs--those with an expected cost of less than $10,000--and all other re- pairs, whether major or minor, that are due to NVT's error or negligence. The question is whether these costs fall within one of these categories. First, GSA argues that since the repair cost per chiller was less than $10,000, the repair of each chiller should be viewed as "maintenance repair" which is NVT's contractual responsibility. Respondent's Record Submission at 3-4. NVT argues that the cost of repair of the two chillers should be considered together as a "minor repair," exceeding $10,000. Accordingly, NVT maintains that it is owed $6,949.40, the difference between $16,949.40 and the $10,000 threshold. Appellant's Record Submission at 2. Respondent has the better of the argument; repair of each chiller required separate installation of new disks and refrigerant for the chiller. The contracting officer reasonably treated repair of a chiller as one job and as a "maintenance repair" under the contract. NVT argues that it should not be treated so harshly because the rupture of the chillers was not its fault. The contracting officer denied NVT's claim because he thought the accident was NVT's fault. The contracting officer had two reasons for so concluding: (1) GSA personnel did not program the EMS to activate the air-conditioning system during a holiday and (2) NVT did not completely disable the chilled water loop. As to the former, GSA argues that either NVT or L & G employees at one time had pro- grammed the KFOB EMS to run on a holiday; that command was then automatically loaded into the MFOB computer command center, and upon resumption of disrupted communications between the two sites, the command remained in the computer and overrode any subsequent commands that NVT may have entered. Respondent's Reply Record Submission Memorandum at 1. As to the later, GSA argues: In this instance, NVT drained and isolated the chilled water coils, turned the power off to the York [chill- ers], and left the power on to the chilled water pumps. Because the chilled water pumps are part of the chilled water circuit, they should have been isolated as well. Failing to do so created the circumstance that led to the discharge of the refrigerant. Respondent's Reply Record Submission at 2. NVT has a different view. NVT suggests that a GSA employee must have loaded a temporary command in MFOB computer command center which downloaded the temporary command to the KFOB EMS and caused the air conditioning system to start on a holiday. Appellant's Record Submission at 1. To justify its failure to disconnect the water pumps, NVT argues: (i) the building is operated by a sophisticated and expensive Building Automation System . . . in KFOB with a backup in MFOB which system is beyond the scope of the contract; (ii) GSA cannot reasonably expect NVT to manually disconnect power to all electrical devices every time it leaves the building; (iii) disconnecting electrical power to a device at a secondary level such as a pump as impled by the [contracting officer's] expectation, is not a requirement of the contract, or a practice in the industry. Respondent's Record Submission at 2. Here, respondent has made a persuasive case that NVT's failure to disable the complete chilled water loop resulted in the accident. NVT drained chilled water coils for the winter season, without disconnecting the remainder of the chilled water loop. Had the water pump been disconnected, the heat and pres- sure build-up would not have occurred. Interestingly, the contract requires NVT to shut down equipment to the maximum extent possible "during nights, week- ends, and holidays," but is silent on what NVT was to do if it shut down equipment for the winter season. Given the contractual expectation of equipment shut down for relatively short periods of time, it is reasonable to expect that if NVT had chosen to disable the chilled water coils for the winter season, it would have disconnected the water pumps as well. This is not shutting down equipment "every time NVT leaves a building;" rather, it is a common-sense long-term precaution, much like disconnecting a car battery for extended storage of an automobile. NVT candidly states in its record submission memorandum that it relied on the "sophisticated computer system" to perform that function. Hindsight shows that its total reliance on automation was mis- placed. Decision The appeal is DENIED. ______________________________ ANTHONY S. BORWICK Board Judge