Board of Contract Appeals General Services Administration Washington, D.C. 20405 ______________________ DENIED: August 20, 1998 ______________________ GSBCA 13476 GRUNLEY CONSTRUCTION CO., INC., Appellant, v. GENERAL SERVICES ADMINISTRATION, Respondent. Samuel M. Morrison, Jr. and Herman M. Braude of Braude & Margulies, P.C., Washington, DC, counsel for Appellant. Kathleen M. McCartney, Office of Regional Counsel, General Services Administration, Washington, DC, counsel for Respondent. Before Board Judges PARKER, HYATT, and DeGRAFF. DeGRAFF, Board Judge. Grunley Construction Co., Inc. (Grunley) entered into a construction contract with the General Services Administration (GSA). Grunley appeals from a contracting officer's decision denying its claim for an equitable adjustment to the contract price based upon an alleged constructive change to the fire sprinkler design criteria. The parties filed cross-motions for summary relief. We deny Grunley s motion, grant GSA s motion, and deny the appeal. Findings of Fact GSA awarded Grunley a contract for construction work at the J.W. Powell Building in Reston, Virginia. In part, the contract required Grunley to add fire sprinklers to areas in the building that did not have sprinklers. Exhibit 2. Grunley hired National Fire Protection, Inc. (NFP) to perform the sprinkler work on the project. Exhibit 59, 5. Grunley did not prepare its own estimate of the sprinkler work that would be required. Instead, Grunley relied upon NFP s estimate. Exhibit 59, 6. NFP studied and became familiar with the bidding documents and made a pre-bid site visit. Exhibit 60, 8. Among the documents reviewed by NFP were specifications and drawings (Exhibit 60, 10) which contained the following provisions. Section 15330, paragraph 1.3.D of the specifications for the sprinkler system provided: 5. Velocities in all piping shall not exceed 20 feet per second. Velocities in standpipes must be calculated based on the combined sprinkler flow and hose flow. . . . . 7. The sprinkler/standpipe risers shall accommodate both the sprinkler and standpipe hose stream flows. Each riser shall accommodate 250 gallons per minute flow for standpipe hose stream. Exhibit 2. Section 15330, paragraph 1.5.A of the specifications for the sprinkler system provided: 1. The sprinkler design shall conform to [National Fire Protection Association (NFPA)] 13 and all other requirements specified herein. . . . . 5. Hydraulic calculations shall include a hose allowance as required by NFPA 13. Exhibit 2. The notes accompanying contract drawing 2-1 stated: 1. All areas of the building not presently sprinklered shall be sprinklered under this contract. The piping arrangement, head locations and sizing shall be by the contractor in accordance with NFPA standards 13, 14, and 20, and as indicated on these drawings. The system shall be hydraulically calculated. . . . . 4. The sprinkler system shall be designed for ordinary hazard, group 2 occupancy to provide a minimum density of 0.17 [gallons per minute (gpm)] per square foot over a 3000 square foot area. Exhibit 61. Sprinkler systems are designed for certain levels, or hazard groups, of fire protection. The amount of water needed to suppress a fire in a particular hazard group is known as density, which is the number of gallons of water applied to one square foot of floor area per minute. Exhibit 60, 15. When a sprinkler system is activated, the area where the sprinklers are open and discharging water is the operating area. Exhibit 60, 16; Exhibit 63, 10 and attachment. NFPA 13 includes a graph that shows area/density curves for different hazard groups. The vertical axis of the graph contains areas of sprinkler operation ranging from 1,500 to 5,000 square feet. The horizontal axis contains densities, expressed in gallons per minute (gpm) per square foot ranging from 0.05 to 0.40 gpm/square foot. These area/density curves are used to calculate the required water supply for sprinklers by satisfying any single point on the curve for a particular hazard group. The curve for ordinary hazard group 2 slopes down from left to right across the graph. Points along the curve run from 4,000 square feet/0.15 gpm/square foot to 1,500 square feet/0.20 gpm/square foot. One point on the curve is 3,000 square feet/0.17 gpm/square foot. The only point on the graph where there is a density of 0.17 gpm/square foot for ordinary hazard group 2 is where there is an operating area of 3,000 square feet. Exhibit 12. NFP determined that a density of 0.17 gpm/square foot over an area of 3,000 square feet, coupled with the required hose allowance, would exceed a velocity of twenty feet per second in the existing standpipes. Exhibit 60, 19. NFP also determined that it would not exceed a velocity of twenty feet per second in the existing standpipes if it used another point on the ordinary hazard group 2 area/density curve in its design calculations 1,500 square feet/0.20 gpm/square foot. Because 0.17 gpm/square foot was the minimum density permitted by the specifications, NFP assumed that it could use the greater density of 0.20 gpm/square foot in its calculations. NFP based its estimate upon a design density of 0.20 gpm/square foot over an operating area of 1,500 square feet. NFP did not consider the greater operating area of 3,000 square feet set out in note 4 of contract drawing 2-1 to be the defining parameter. Exhibit 60, 20, 24, 25, 26. After contract award, when GSA learned that NFP had based its design calculations upon a density of 0.20 gpm/square foot over an operating area of 1,500 square feet, GSA directed Grunley and NFP to use 3,000 square feet as the operating area. In other words, GSA wanted a design based upon the sprinklers being open and discharging water over an area twice as large as the area used by NFP in its calculations. In an affidavit submitted by Grunley in support of its motion for summary relief, NFP s president says that when Grunley and NFP informed GSA that a density of 0.17 gpm/square foot over an operating area of 3,000 square feet would exceed a velocity of twenty feet per second in the existing standpipes, GSA waived the velocity requirement. Exhibit 60, 26, 27. In an affidavit submitted by GSA in opposition to Grunley s motion, the chief of GSA s Fire Protection Engineering Branch says that he does not recall GSA waiving the velocity requirement. He recalls that GSA approved a design that resulted in the velocity in certain small areas exceeding the twenty feet per second requirement by a small amount because it was not worth arguing over those small areas and amounts. In addition, he says that the velocity requirement applied only to new work and not to existing pipe in the building. Exhibit 63, 7, 8. Grunley considered GSA s direction to use a 3,000 square foot operating area to be a constructive change to the contract s requirements, because it meant that NFP could use only one point on the NFPA 13 area/density curve the point where 3,000 square feet of operating area intersects a density of 0.17 gpm/square foot when it designed the sprinkler system. Grunley claimed that NFP incurred additional costs due to this constructive change. The GSA contracting officer issued a final decision denying Grunley's claim, and this appeal followed. Discussion Summary relief is appropriate when there are no genuine issues of material fact in dispute and when the moving party is entitled to relief as a matter of law. A fact is material if it will affect our decision. An issue is genuine if enough evidence exists such that the fact could reasonably be decided in favor of the non-movant at a hearing. Celotex Corp. v. Catrett, 477 U.S. 317 (1986); Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574 (1986). The facts set out above were put forward by the parties in support of their positions, and are supported and not contradicted by the record. Although both parties asked us to find additional facts, all of the facts that are material to the resolution of this appeal are set out above. There is one fact in dispute, and that is whether the velocity requirement applied to existing standpipes. As discussed below, this fact is not material because even if we assume that the dispute of fact would be resolved in favor of Grunley, we conclude that GSA, and not Grunley, is entitled to relief as a matter of law. Grunley's motion Grunley's first argument is that note 4 to contract drawing 2-1 is clear and not ambiguous. The note states, The sprinkler system shall be designed for ordinary hazard group 2 occupancy to provide a minimum density of 0.17 gpm per square foot over a 3,000 square foot area." Because the note clearly states that the system had to provide a "minimum" density of 0.17 gpm/square foot, Grunley says that it was free to design the sprinkler system by using any point on the ordinary hazard group 2 area/density curve, regardless of the operating area, so long as it provided a density of 0.17 gpm/square foot or greater.[foot #] 1 We do not agree with Grunley's reading of the note because it runs afoul of established precedent that requires us to give reasonable meaning to all contract provisions and to leave no provision meaningless. Fortec Constructors v. United States, 760 F.2d 1288, 1292 (Fed. Cir. 1985). Grunley's position is that the note, by using the word "minimum," clearly permitted it to move along the NFPA 13 ordinary hazard group 2 area/density curve, so long as it moved to a point where it was providing a density greater than 0.17 gpm/square foot. Grunley's position, however, enables it to satisfy only the minimum density provision set out in the note, and requires it to disregard the operating area provision. Although the provision for a 3,000 square foot operating area is as much a part of note 4 as is the provision for a minimum density of 0.17 gpm/square foot, Grunley's interpretation of the contract reads the words "over a 3,000 square foot area" completely out of note 4, and gives them no meaning whatsoever. We cannot read the 3,000 square foot operating provision out of the contract, and so Grunley is not entitled to relief as a matter of law based upon its argument that the note's terms are clear. Grunley's second argument is that if note 4 is susceptible of more than one interpretation, then we should apply the rule of contra proferentem and construe the note against GSA as the drafter, because Grunley's reading of note 4 is reasonable. Grunley's argument presumes that the note contains an ambiguity and that the ambiguity is latent, because the rule of contra proferentem applies only when a contract is susceptible of two different interpretations, each of which is consistent with the contract language, and only when the two different interpretations were not obvious and glaring at the time of contracting. Community Heating & Plumbing Co. v. Kelso, 987 F.2d 1575 (Fed. Cir. 1993). We reject this argument for several reasons. We do not see how note 4 is susceptible of two different interpretations that are consistent with the note's language or, if it is so susceptible, how the ambiguity is latent, or if there is a latent ambiguity, how Grunley's reading of the note is reasonable. Note 4 to contract drawing 2-1 says that the sprinkler system shall be designed for ordinary hazard group 2 occupancy to provide a minimum density of 0.17 gpm per square foot over a 3,000 square foot area. Grunley says that the word "minimum" means that a density greater than 0.17 gpm/square foot would be acceptable, and so interprets the note as permitting it to ----------- FOOTNOTE BEGINS --------- [foot #] 1 We realize that NFP, and not Grunley, prepared the estimate for the fire sprinkler portion of the contract work. Grunley is, however, responsible for the actions of its subcontractor. ----------- FOOTNOTE ENDS ----------- provide a density greater than 0.17 gpm/square foot. Grunley finds the note ambiguous because GSA reads it to say that the design had to cover a 3,000 square foot operating area, which means that a density greater than 0.17 gpm/square foot was not acceptable because moving along the NFPA 13 ordinary hazard group 2 area/density curve to a density greater than 0.17 gpm/square foot means moving to a point where the operating area is smaller than 3,000 square feet. The note is ambiguous only if there are two interpretations that are consistent with its terms. GSA's reading of the note is consistent with its terms. A "minimum" density of 0.17 gpm/square foot includes a density of precisely 0.17 gpm/square foot, and the area/density chart contained in NFPA 13 shows that the ordinary hazard group 2 curve contains one point that meets precisely this density and complies with the 3,000 square foot operating area provision. GSA's interpretation of the note gives meaning to all of the note's terms because it requires a system that will provide a density of 0.17 gpm/square foot over an operating area of 3,000 square feet, which is the amount of water needed to suppress an ordinary hazard group 2 fire, according to the NFPA 13 area/density chart. Grunley's reading of the note is not consistent with the note's terms, because it permits Grunley to design a system that will provide the required density for the specified hazard group, but over an operating area smaller than the specified 3,000 square feet. Grunley has not established that the note is ambiguous because it has not shown that the note is susceptible of two interpretations which are both consistent with the note's terms. Even if the note were ambiguous, the ambiguity should have been patently obvious to Grunley. If Grunley read note 4 to say that it could move to any point on the ordinary hazard group 2 area/density curve with a density greater than 0.17 gpm/square foot, Grunley should have immediately realized that it would not be possible to provide the greater density over the 3,000 square foot operating area specified in note 4 and remain on the area/density curve. A quick glance at the curve makes this clear. An ambiguity that is so glaring and so easily detected is patent, not latent. Finally, even if the note were ambiguous and if the ambiguity were latent, Grunley's interpretation of the contract language is not reasonable because it effectively eliminates the provision for a 3,000 square foot operating area. Grunley's second argument does not entitle it to relief as a matter of law because note 4 is not ambiguous as it is not susceptible of two different interpretations, each of which is consistent with the contract language; because even if the note were ambiguous, the ambiguity is patent; and because even if the ambiguity were latent, Grunley's reading of the note is not reasonable. Grunley's third, and final, argument is that its reading of the contract creates harmony among all of the contract's terms. Grunley says that only its interpretation of the contract language gives meaning to the word "minimum" contained in note 4, and also applies the maximum velocity requirement contained in section 15330, paragraph 1.3.D of the specifications. The premise for Grunley's argument is that it is impossible to design a sprinkler system for ordinary hazard group 2 occupancy to provide a minimum density of 0.17 gpm/square foot over an operating area of 3,000 square feet, to meet the required hose allowance and to meet, at the same time, the contract's velocity requirement in the existing standpipes. Material to Grunley's position is the fact that the velocity requirement applied to the existing standpipes, and GSA effectively put this fact in contention with the affidavit from the chief of GSA's Fire Protection Engineering Branch. Because there is a genuine issue concerning a fact that is material to Grunley's position, we cannot grant Grunley's motion. Further, as we discuss below in assessing GSA's argument, even if this fact were not in dispute, Grunley is not entitled to relief as a matter of law. GSA's motion GSA's first argument is that the language of note 4 to contract drawing 2-1 is clear. As we discussed above, note 4 to contract drawing 2-1 requires that the sprinkler system shall be designed for ordinary hazard group 2 occupancy to provide a minimum density of 0.17 gpm per square foot over a 3,000 square foot area. A "minimum" density of 0.17 gpm/square foot includes a density of 0.17 gpm/square foot and, according to the NFPA 13 area/density chart, providing this density over a 3,000 square foot operating area will provide the amount of water needed to suppress an ordinary hazard group 2 fire. We do not see anything unclear or inconsistent about the requirements set out in note 4. Grunley says that GSA's view of note 4 gives no meaning to the word "minimum." We disagree. It is permissible for GSA to read the word "minimum" as including precisely 0.17 gpm/square foot. Grunley asserts that if GSA wanted to make the note clear, it should have said that the provision for a 3,000 square foot operating area was the controlling factor. GSA's position is not that the provision for a 3,000 square foot operating area is controlling, any more than the provision for a minimum density of 0.17 gpm/square foot is controlling. Each provision is just as much a part of the note as is the other. As explained earlier, Grunley has not established that the note is ambiguous because it has not shown that the note is susceptible of two interpretations which are both consistent with its terms. GSA's second argument is that even if the contract's terms were ambiguous, the ambiguity was patent and so Grunley is not entitled to recover because it did not bring the ambiguity to GSA's attention before submitting its bid. Grunley suggests that the contract is ambiguous because the provision for a 3,000 square foot operating area contained in note 4 conflicts with the maximum velocity requirement contained in section 15330, paragraph 1.3.D of the specifications. Grunley says that when it prepared its estimate and its bid, it determined that covering an operating area of 3,000 square feet at the specified minimum density, coupled with the required hose allowance, would exceed a velocity of twenty feet per second in the existing standpipes.[foot #] 2 Rather than ask GSA for a clarification of two fire sprinkler system requirements that it could not reconcile, Grunley simply read note 4 as if the provision for an operating area of 3,000 square feet were irrelevant. Assuming that the contract contained an ambiguity created by the provision for a 3,000 square foot operating area and the maximum velocity requirement, this ambiguity was patent. A patent ambiguity is one that is "an obvious omission, inconsistency, or discrepancy of significance." Beacon Construction Co. of Massachusetts v. United States, 314 F.2d 501, 504 (Ct. Cl. 1963). Grunley read the contract as containing an obvious inconsistency or discrepancy between the provision for a 3,000 square foot operating area and the maximum velocity requirement, and this discrepancy is significant. The 3,000 square foot operating area provision is one of only three requirements the other two being density and the specified hazard group set out by GSA in order to define the level of fire protection provided for the inhabitants and contents of the building. Assuming that the conflict Grunley saw between this important provision and the maximum velocity provision created an ambiguity, the ambiguity was so glaring that Grunley could only resolve it by reading the 3,000 square foot operating area provision out of the contract. Such an ambiguity is patent. Because any ambiguity was patent, Grunley had an obligation to bring it to GSA's attention before Grunley submitted its bid. The law establishes this obligation in order to ensure that the Government will have the opportunity to clarify its requirements and thereby provide a level playing field to all competitors for the contract, and to avoid litigation after the contract is awarded. A contractor proceeds at its own risk if it relies upon its own interpretation of contract terms that it believes to be ambiguous instead of asking the Government for a clarification. Community Heating & Plumbing Co. v. Kelso, 987 F.2d 1575 (Fed. Cir. 1993). Therefore, if the contract contained an ambiguity created by the provision for a 3,000 square foot operating area and the maximum velocity requirement, GSA is entitled to relief as a matter of law because the ambiguity was patent and Grunley did not inquire about the ambiguity before submitting its bid. GSA has established that it is entitled to summary relief. There are no genuine issues of material fact in dispute. GSA is entitled to relief as a matter of law because note 4 to contract ----------- FOOTNOTE BEGINS --------- [foot #] 2 We assume, for the sake of argument, that the velocity requirement applies to existing standpipes, so there is no dispute as to a material fact in considering GSA's motion. ----------- FOOTNOTE ENDS ----------- drawing 2-1 is not ambiguous, and because if there is an ambiguity created by note 4 and the maximum velocity requirement, Grunley had an obligation to call this to GSA's attention before submitting its bid. Decision Grunley's motion for summary relief is DENIED. Respondent's motion for summary relief is GRANTED. The appeal is DENIED. ___________________________________ MARTHA H. DeGRAFF Board Judge We concur: ____________________________ __________________________________ ROBERT W. PARKER CATHERINE B. HYATT Board Judge Board Judge