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No. 01-542C (Judge Lawrence J. Block) ______________________________________________________________________________ IN THE UNITED STATES COURT OF FEDERAL CLAIMS ______________________________________________________________________________ L. W. MATTESON, INC., Plaintiff, v. THE UNITED STATES ARMY CORPS OF ENGINEERS, Defendant. ______________________________________________________________________________ PLAINTIFF L.W. MATTESON'S OPPOSITION TO DEFENDANT'S MOTION FOR SUMMARY JUDGMENT ______________________________________________________________________________

MILLER LAW FIRM, P.C. Stephen R. Miller Mo# 33344 Michael T. Metcalf Mo# 45304 4310 Madison Avenue Kansas City, Missouri 64111 Telephone (816) 531-0755 Facsimile (816) 561-6361 ATTORNEYS FOR PLAINTIFF

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TABLE OF CONTENTS TABLE OF AUTHORITIES ......................................................................................................... iii INDEX TO PLAINTIFF'S APPENDIX ....................................................................................... vi STATEMENT OF THE CASE....................................................................................................... 1 STATEMENT OF FACTS ............................................................................................................. 1 ARGUMENT.................................................................................................................................. 6 I. II. STANDARD OF REVIEW. ................................................................................... 6 BREACH OF CONTRACT CLAIMS (COUNTS I, V, VI & VII)........................ 8 A. B. Count I (Breach of Contract for Failure to Pay). ........................................ 8 Count V (Breach of Implied Duty of Cooperation and Good Faith/Superior Knowledge)................................................................................................. 9 1. Factual issues exist as to both the Corps' knowledge and Matteson's knowledge of Wabasha County's intention to apply the Shoreland Protection Act to temporary pipe running across shoreland property to restrict or prohibit the use of any alternative disposal site, and the existence and extent of local opposition to the dredging disposal. ......................................................................... 10 Factual issues exist as to whether the Corps violated its duty to cooperate and exercise good faith in assisting to secure the availability of the Saunderson site. ............................................... 16

2.

C. III. IV. V. VI.

Counts VI and VII (Breach of Warranty and Failure to Disclose). .......... 17

DIFFERING SITE CONDITION (COUNT II).................................................... 21 CARDINAL CHANGE (COUNT III).................................................................. 24 COMMERCIAL IMPRACTABILITY (COUNT VII)......................................... 30 MUTUAL MISTAKE (COUNT IX). ................................................................... 35

CONCLUSION............................................................................................................................. 38

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TABLE OF AUTHORITIES Cases Advance Bank, F.S.B. v. U. S., 52 Fed. Cl. 286, 287-88 (Fed. Cl., 2002) ..................................... 7 Air-A-Plane Corp. v. United States, 408 F.2d 1030, 1033 (Ct. Cl. 1969) .................................... 26 Alliant Techsystems, Inc. v. United States, 178 F.3d 1260, 1276 (C.A. Fed. 1999)............... 25, 27 Allied Materials & Equipment Co. v. U. S., 569 F.2d 562, 563-64 (Ct. Cl. 1978)........... 25, 27, 30 American Dredging Company, 72-1 BCA ¶ 9316 .................................................................. 22, 23 Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) .. 7, 8 Barnhart-Morrow Consolidated Mono Belting Div., 78-1 BCA ¶12,962 ................................... 31 Celeron Gathering Corp. v. United States, 34 Fed.Cl. 745, 753 (Fed. Cl., 1996)........................ 16 Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) .................. 7 Cities Service Helex, Inc. v. United States, 543 F.2d 1306, 1313 (Ct.Cl. 1976) .......................... 26 Contact Intern. Inc. v. Windall, 106 F.3d 426, 426 (C.A. Fed. 1997) .......................................... 26 D.L. Auld Co. v. Chroma Graphics Corp., 714 F.2d 1144, 1146-47 (Fed. Cir. 1983)................... 7 Delta Equipment and Const. Co. v. United States, 122 Ct.Cl. 340, 104 F.Supp. 549, 551-552 (1952)...................................................................................................................................... 15 Design and Production, Inc. v. United States, 18 ___ 168, 198 (Cl. Ct., 1989)........................... 19 Discount Co., Inc. v. United States, 554 F.3d 435, 440 (Ct.Cl. 1977).......................................... 22 Fehlhaber Corp. v. United States, 151 F.Supp. 817, 825 (Ct. Cl. 1957 ................................. 17, 21 Florida Power & Light Co. v. Westinghouse Elec. Corp., 826 F.2d 239, 262 (4th Cir. (Va.) 1987) (quoting 6 CORBIN ON CONTRACTS, § 1331)........................................................................... 31 General Dynamics Corp. v. United States, 585 F.2d 457, 462 (Ct. Cl. 1978).............................. 26 Giesler v. United States, 232 F.3d 947 (Fed. Cir. 2000)............................................................... 12 Guy H. Briscoe v. United States, 442 F.2d 953 (Ct.Cl. 1971) ................................................ 22, 24

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H.N. Bailey & Assocs. v. United States, 449 F.2d 376 (Ct. Cl. 1971) .......................................... 12 Hardeman-Monier-Hutcherson v. United States, 458 F.2d 1364, at 1371-1372 (Ct. Cl. 1972) ... 9 Helene Curtis Indus., Inc. v. United States, 312 F.2d 774, 160 Ct.Cl. 437 (1963)......................... 9 Hol-Gar Mfg. Corp., 360 F.2d 634, 637 (Ct. Cl. 1996)................................................................ 17 J. A. Jones Constr. Co. v. United States, 390 F.2d 886, 182 Ct.Cl. 615 (1968) ................. 9, 10, 15 Jay v. Secretary of DHHS, 998 F.2d 979, 982 (Fed. Cir. 1993) ..................................................... 8 Johns-Manville Corp. v. United States, 12 Cl. Ct. 1 (1987) ......................................................... 37 Kansas State Bank in Holton v. Citizens Bank of Windsor, 737 F.2d 1490, 1497-98 (8th Cir.1984) ................................................................................................................................. 38 Massman Contracting Co. v. United States, 23 Cl. Ct. 24 (1991)................................................ 12 Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) ................................................................................................................... 7 McDowell Stone Co. of Blackwater, BCA No. 285 (1943) .......................................................... 21 National Presto Industries, Inc. v. United States, 338 F.2d 99, 167 Cl. Ct. 749 (1964) ........ 36, 37 Natus Corp., 371 F.2d at 456........................................................................................................ 31 Northrop Grumman Corp. v. United States, 42 Fed. Cl. 1, 7 (Fed. Cl., 1998).............................. 8 Raytheon Co. v. White, 305 F.3d 1354, 1367 (Fed. Cir. 2002)............................................... 35, 36 Rumsfeld v. Freedom NY, Inc. , 329 F 3d 1320 (Fed. Cir. 2003) ..................................... 26, 27, 30 Safina Office Products v. General Services Admin., 93-1 BCA ¶ 25,485 .............................. 32, 36 SRI Intern. v. Matsushita Elec. Corp. of America, 775 F.2d 1107, 1116 (Fed. Cir. 1985) ............ 7 Stuyvesant Dredging Co. v. United States, 834 F.2d 1576, 1581 (Fed. Cir. 1987) ...................... 17 T & M Distributors, Inc. v. U. S., 185 F.3d 1279 (Fed. Cir. 1999.................................................. 7 T.L. Roff & Associates Construction Co. v. United States, 52 Fed. Cl. 572, 577-78 (1993)........ 39

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United States v. Shah, 44 F.3d 285, 292 -293 (5th Cir. 1995)...................................................... 38 Western Contracting Corp. v. United States, 144 Ct. Cl. 318 (Ct. Cl. 1958)................................. 8 Statutes Minn. St. § 103G.005.................................................................................................................... 11 Other Authorities Corbin On Contracts, § 610 .......................................................................................................... 37 G.W. Galloway Co., 73-2 BCA 48,500........................................................................................... 9 R.A. Heintz Construction Co., 74-1 BCA ¶ 10, 562 ..................................................................... 22 Restatement (Second) of Contracts, § 151, Comment b............................................................... 39 Sundex, Ltd., 93-2 BCA ¶ 25,626 ................................................................................................. 21 Thomas S. Rhoades & Stephen L. Schluneger, 95-1 BCA ¶ 27,375............................................... 9 Rules CFR § 52.236-7............................................................................................................................. 36 RCFC 56(c)................................................................................................................................. 6, 7

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INDEX TO PLAINTIFF'S APPENDIX Document Deposition of Daniel J. Krumholz (excerpts) Deposition of Larry W. Matteson (excerpts) Deposition of Lawrence W. Matteson (excerpts) Deposition of Steve Tapp (excerpts) Deposition of Melissa Gulan (excerpts) Deposition of James C. Nordstrom (excerpts) Deposition Exhibit 25 ­ April 27, 1998 memo from CEMVP to Grand Encampment Team re: Disposal Site Issue Deposition Exhibit 73 ­ Affidavit of James C. Nordstrom Deposition Exhibit 74 ­ June 15, 1983 letter from James C. Nordstrom to the Corps of Engineers re: Army Acting Without A Permit Deposition Exhibit 84 ­ August 19, 1987 letter from Peter Ekstrand to the Corps of Engineers re: Concerns and Complaints Regarding Army Dredging Wabash County Zoning Ordinances Deposition Exhibit 49 ­ September 24, 1996 letter from Wabasha County to L.W. Matteson re: Land Use Permit Deposition of Larry W. Matteson (excerpt) Pl. App. Pages 0001-0059 0060-0098 0099-0127 0128-0132 0133-0136 0137-0226 0227-0228 0229-0232 0233 0234-0235 0236-0242 0243-0244 0245

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS L. W. MATTESON, INC., Plaintiff, v. UNITED STATES ARMY CORPS OF ENGINEERS, Defendant. ) ) ) ) ) ) Case No. 01-542C ) (Judge Lawrence J. Block) ) )

PLAINTIFF L.W. MATTESON'S OPPOSITION TO DEFENDANT'S MOTION FOR SUMMARY JUDGMENT STATEMENT OF THE CASE The present action arises out of a contract awarded by the Corps of Engineers for the dredging of portions of the Mississippi River. In the action, the contractor, L.W. Matteson, Inc., seeks an equitable adjustment for considerable increased costs incurred by it as a result of being precluded from utilizing alternative dredge disposal sites as represented in the invitation for bids and in statements made by Corps personnel, and instead having to use a disposal site that was much farther away than planned. On July 31, 2000, Matteson submitted its claim for equitable adjustment, seeking a total of $1,111,227.51 in compensation for the additional expenses incurred as the result of its inability to dispose of dredge material in the vicinity of the project. The contracting officer denied Matteson's claim on November 17, 2000. STATEMENT OF FACTS1 On July 10, 1996, the Corps issued an invitation for bids for a dredging project generally referred to as the Grand Encampment Excavation. (Def. Proposed Facts, ¶ 7). The contract included dredging of the Alma Marina in Alma, Wisconsin, and an island in the Mississippi
Matteson sets forth here a limited statement of the material facts, and refers the Court to its Separate Statement of Undisputed Facts as well as its Response to Defendant's Statement of Facts for a more complete summary of facts relevant to this matter.
1

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River upstream from Alma. (Def. Proposed Facts, ¶ 7). The contract specifically allowed the contractor to utilize any suitable disposal site, except for one site that was identified and required. (Pl. Statement of Facts2, ¶¶ 4-5). Because hydraulic dredging was not feasible with the disposal sites identified in the contract, Matteson was not certain whether a bid based on hydraulic dredging would be considered to be responsive to the bid request. (Pl. Statement of Facts, ¶ 12). Matteson contacted the Corps by telephone and asked if the Corps would accept a bid based on hydraulic dredging. (Id.). In response, the Corps not only approved of Matteson's submission of a hydraulic

dredging bid, but encouraged Matteson to submit such a bid as that method offered substantial potential savings over mechanical dredging. (Id.). The Corps told Matteson that if it located a disposal site, the Corps would come out and do a pre-bid site inspection. (Id.). Thereafter, Matteson identified three potential disposal sites: the Saunderson property, the Braun property and the Guza property. (Pl. Statement of Facts, ¶ 14). As a part of its investigation of these sites, Matteson asked the Corps to examine the sites to determine their suitability. (Pl. Statement of Facts, ¶ 15). The Corps had facilitated similar site inspections with other contractors. (Pl. Statement of Facts, ¶ 16). The purpose of these meetings was for the

Corps "to put the contractors in touch with the officials that would be involved in reviewing and evaluating and potentially permitting a site." (Id.). Matteson believed that the officials that were invited were the ones required to obtain all necessary permits and that the Corps, which was familiar with the state and local permitting process, would have contacted other officials had they been required. (Pl. Statement of Facts, ¶ 17).

References to Plaintiff's Separate Statement of Proposed Findings of Uncontroverted Fact are denoted as "Pl. Statement of Facts."

2

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On August 5, 1996, Corps officials Dan Krumholz, Steve Tapp and Dennis Anderson, together with the Corps' invited representatives from the U. S. Fish and Wildlife Services and the Minnesota Department of Natural Resources, examined two or three sites. (Pl. Statement of Facts, ¶ 18). Matteson informed the Corps of the Saunderson site at the time that they examined the Guza and Braun sites. (Id.). To further ensure that the Saunderson site was suitable prior to submitting the bid, Matteson contacted Krumholz, the Corps' Operations Manager for the Channels and Harbors Projects, by telephone and specifically discussed the Saunderson site. (Pl. Statement of Facts, ¶ 22). In discussing Matteson's proposed use of that site, Krumholz expressed familiarity with the site. (Id.). Mr. Krumholtz also stated that the Corps would need to perform a "cultural resources investigation" of the site and "obtain water quality certification from the MPCA for the effluent," but otherwise indicated that the site would be suitable for the placement of dredged sand and gravel. (Id.). The Corps later confirmed that the site was suitable and noted in a memorandum that "resource agencies . . . agreed that there is no reason from a resource management perspective that the site should not be used." (Pl. Statement of Facts, ¶ 26). Matteson's reliance on the Corps' approval of the site was consistent with the Corps' intentions in conducting disposal site investigations prior to bidding because the Corps expected contractors only to have satisfied themselves that "they were going to get approval to use the site." (Pl. Statement of Facts, ¶ 23-24). The Corps did not expect bidders to have actually had the reviews completed and final permits issued prior to bidding. (Pl. Statement of Facts, ¶ 24). The bids were opened on August 29, 1996. Matteson's bid of $1,693,000 was the lowest bid. ((Def. Proposed Facts, ¶ 29). Matteson's initiative in locating an alternative disposal site

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resulting in its bid of $1,693,000 resulted in a savings of $1.6 million over the government's estimate. (Pl. Statement of Facts, ¶ 28). On September 18, 1996--after Matteson had verified its bid, but prior to the award of the contract--the Corps was informed by Wabasha County "that homeowners downstream of Wabasha [were] concerned about dredged material being placed in the vicinity" and that Wabasha County believed that the local Shoreland Protection Act was applicable to and would prohibit the running of temporary dredge pipe to reach the Saunderson property. (Pl. Statement of Facts, ¶ 32). The Shoreland Protection Act was widely known in the counties with river shorelines. (Pl. Statement of Facts, ¶ 33-34). Krumholz and other Corps officials had routinely appeared at local meetings at which the Shoreland Protection Act was discussed. (Pl. Statement of Facts, ¶ 35). As far back as 1983, there have been numerous disputes between localities and the Corps as to whether the Corps was required to comply with local permit requirements under the Shoreland Protection Act and other local ordinances. (Pl. Statement of Facts, ¶ 36-37). Matteson was not

aware of the degree of community opposition to the Corps' dredging projects. (Pl. Statement of Facts, ¶ 44-50). However, he Corps would have been aware of this opposition by its attendance at numerous meetings and receipt of letters concerning dredging issues over the years. (Pl. Statement of Facts, ¶ 47), and because there was significant community opposition to the Corps' dredging activities dating back at-least to the 1980s. (Id.). Not only was the Corps aware of the Shoreland Protection Act, in 1987 the Corps had been informed of at least one municipality's opinion that the Shoreland Protection Act applied to the placement of temporary dredge pipes on shoreland areas. (Pl. Statement of Facts, ¶ 38). There is, however, no published decision, that Matteson could have obtained, interpreting the

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Act to apply to temporary dredge pipes running across the shoreland protection zone. (Pl. Statement of Facts, ¶ 40). On September 20, 1996, after having received information from Wabasha County concerning potential problems in utilizing the Saunderson site, but without informing Matteson of this information, the Corps awarded the contract to Matteson. (Def. Proposed Facts, ¶ 31). Although the Corps apparently gave Matteson's telephone number to the Wabasha County Attorney when he called, Matteson received no communication from Wabasha County officials prior to the award of the contract to inform Matteson that the Shoreland Protection Act applied to its running of pipe. (Pl. Statement of Facts, ¶ 42). Matteson first become aware of Wabasha County's position that it was applying the Shoreland Protection Act to require Matteson to obtain a permit to run temporary pipes across the shoreland protection zone when Matteson received a letter dated September 24, 1996. (Pl. Statement of Facts, ¶ 44). Once Matteson was informed of Wabasha County's position that the Shoreland Protection Act required permission from the County to run temporary dredge pipes across the river shoreline, Matteson submitted an application for a land use permit on October 2, 1996. (Pl. Statement of Facts, ¶ 45). Matteson did not become concerned about obtaining a permit because it was not aware of the intensity and breadth of the community's opposition to the Corps' dredging activities. (Pl. Statement of Facts, ¶ 46). Not until Matteson personnel began attending meetings concerning its permit application did Matteson discover that the opposition to the Corps' dredging projects was "very violent and very outspoken." (Pl. Statement of Facts, ¶ 50). The opposition of the community in this case did not concern opposition by private landowners concerning the running of temporary pipelines

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over their property, but rather was opposition to the disposal of dredged material at all anywhere in the vicinity of the project due to the Corps' prior performance. (Id.). The County refused to issue a permit for disposal on the Saunderson property. (Pl. Statement of Fact ¶ 51). Once it became apparent that Wabasha County would not approve of any disposal site, Matteson began to attempt locate some site that would not be subject County approval. Matteson located and obtained the rights to utilize a site that was owned by the United States Fish & Wildlife Service that was not subject to Minnesota or Wabasha County jurisdiction. (Pl. Statement of Facts, ¶ 53). The Fish and Wildlife site was not in the vicinity of the project and thus required Matteson to pump dredged material a considerably greater distance. (Pl. Statement of Facts, ¶ 54). Use of the Saunderson property would have required Matteson to pump dredge material only 9,000 feet. (Id.). The U.S. Fish and Wildlife parcel, on the other hand, required Matteson to pump dredge material over 26,000 feet. (Id.). At that distance, Matteson was required to utilize pumps and other additional equipment that would not have been required for the Saunderson property. (Pl. Statement of Facts, ¶ 55). Matteson's production also greatly decreased due to the greater distance. (Id.). In addition, Matteson was required to spend additional sums to acquire other property to trade for the U.S. Fish & Wildlife property. (Id.). Although the Corps did help to secure the Fish and Wildlife site, it did not take action to purchase or lease the property and right of way to be able to utilize the Saunderson site regardless of Wabasha County permitting requirements. (Pl. Statement of Facts, ¶ 52). ARGUMENT I. STANDARD OF REVIEW Under Rule 56(c) of the Rules of the United States Court of Federal Claims, a motion for summary judgment will be granted if there is no genuine issue as to any

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material fact and the moving party is entitled to judgment as a matter of law. T & M Distributors, Inc. v. U. S., 185 F.3d 1279 (Fed. Cir. 1999. However, there are competing considerations: "an improvident grant [of summary judgment] may deny a party a chance to prove a worthy case and an improvident denial may force on a party and the court an unnecessary trial." D.L. Auld Co. v. Chroma Graphics Corp., 714 F.2d 1144, 1146-47 (Fed. Cir. 1983). While courts have held that the "[s]ummary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed `to secure the just, speedy and inexpensive determination of every action,'" Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) (citations omitted), they also have held that a trial court should act cautiously in granting summary judgment and may deny it when there is reason to believe that the better course would be to proceed to trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A more emphatic enunciation of the need for caution in some RCFC 56(c) circumstances appears in a Federal Circuit case, which warns that, although speedy and inexpensive, summary judgment at times may be a "lethal weapon" capable of "overkill." SRI Intern. v. Matsushita Elec. Corp. of America, 775 F.2d 1107, 1116 (Fed. Cir. 1985). It also is established that, in deciding a summary judgment motion, the evidence of the non-movant must be believed and all justifiable inferences drawn in its favor, Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Advance Bank, F.S.B. v. U. S., 52 Fed. Cl. 286, 287-88 (Fed. Cl., 2002). When resolving a motion for summary judgment, the court may not weigh the

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evidence and seek to determine the truth of the matter. See Anderson, 477 U.S. at 255, 106 S.Ct. 2505. The court cannot make credibility determinations, see Jay v. Secretary of DHHS, 998 F.2d 979, 982 (Fed. Cir. 1993) (citing Anderson, 477 U.S. at 255, 106 S.Ct. 2505; Northrop Grumman Corp. v. United States, 42 Fed. Cl. 1, 7 (Fed. Cl., 1998). II. BREACH OF CONTRACT CLAIMS (COUNTS I, V, VI & VII) Counts I, V, VI and VII of Matteson's First Amended Complaint set forth, respectively, claims for breach of contract for failure to pay; breach of the implied duty of good faith cooperation for failing to disclose superior knowledge; breach of implied warranty of specifications; and a claim for specific omission. All of these claims are based in contract, and in each of them, Matteson has stated a valid cause of action and the Corps is not entitled to summary judgment. A. Count I (Breach of Contract for Failure to Pay).

In Count I, Matteson has stated a valid cause of action for breach of contract for failure to pay. Although the Corps has paid the contract price, Matteson has shown that it is entitled to an adjustment of the contract price. The Corps cannot simply rely on the payment of the contract price as a basis for summary judgment on this particular claim since Defendant has failed to pay additional sums due Matteson as an equitable adjustment. The failure of a contracting agency to pay additional sums due a contractor under a change clause or other provisions of a contract constitutes a breach of the contract. Western Contracting Corp. v. United States, 144 Ct. Cl. 318 (Ct. Cl. 1958). Matteson's claim is not for failure to pay the contract price of $1,693,000, nor does Matteson assert a breach of contract for failure to pay based on any of the written modifications to the contract. Rather, as long as Matteson demonstrates entitlement to additional money, the Corps is in breach for failing to pay. Under the Corps' rationale, it could never be

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liable for breach of contract for failure to pay as long as it has paid the price stipulated in the contract, even if a basis for an equitable adjustment is demonstrated. B. Count V (Breach of Implied Duty of Cooperation and Good Faith/Superior Knowledge).

Count V sets forth Matteson's claim for breach of the implied covenant of cooperation and good faith for failing to disclose superior knowledge. Implicit in every government contract is the duty to cooperate, which obligates the government to do what is reasonably necessary to enable the contractor to perform as planned. Thomas S. Rhoades & Stephen L. Schluneger, 95-1 BCA ¶ 27,375. This is an affirmative obligation, G.W. Galloway Co., 73-2 BCA 48,500, and includes a duty to provide information to each bidder that is reasonably required for the proper and planned performance of the contract. Thomas S. Rhoades, 95-1 BCA at 27,375. Courts examine the reasonableness of the government's actions as they relate to the particular facts and circumstances of each case. Id. Where the government fails to provide requisite information to the bidders for them to properly submit a bid, the government is responsible for the resultant loss incurred by the contractor not only for a breach of the contract, but may also be found to be negligent in discharging this duty through a lack of action. Id. "It is well settled in this court that where the Government possesses special knowledge, not shared by the contractor, which is vital to the performance of the contract, the Government has an affirmative duty to disclose such knowledge. It cannot remain silent with impunity." Hardeman-Monier-Hutcherson v. United States, 458 F.2d 1364, at 1371-1372 (Ct. Cl. 1972) (citing Helene Curtis Indus., Inc. v. United States, 312 F.2d 774, 160 Ct.Cl. 437 (1963)); J. A. Jones Constr. Co. v. United States, 390 F.2d 886, 182 Ct.Cl. 615 (1968). To establish a breach of contract by the government's failure to disclose superior knowledge, the contractor must establish that (a) the government was aware of information that would have effected the

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performance of the contract at the time that it was awarded, (b) that the contractor neither knew nor should have known of the fact, and (c) that the government was or should have been aware of the contractor's ignorance but nevertheless failed to disclose the pertinent information. J.A. Jones, 390 F.2d at 890. The facts support as to all of these elements, and summary judgment must be denied. 1. Factual issues exist as to both the Corps' knowledge and Matteson's knowledge of Wabasha County's intention to apply the Shoreland Protection Act to temporary pipe running across shoreland property to restrict or prohibit the use of any alternative disposal site, and the existence and extent of local opposition to the dredging disposal.

Contrary to the Corps' argument, Matteson was not aware of the public and Wabasha County's opposition to the disposal of dredge material on Corps projects, nor was Matteson aware of the County's intent to impose a unique application of the Shoreland Protection Act to prohibit the running of temporary dredge pipes across the 1,000 foot shoreland protection area. (See Generally Pl. Statement of Facts, ¶¶31-50). Further, this information was not publicly or reasonably obtainable by Matteson. (Id.). The Corps seeks to avoid liability by improperly recasting Matteson's claims by arguing that Matteson should have been aware of the existence of the Shoreland Protection Act. However, Matteson's claim actually concerns Matteson's lack of knowledge of and the Corps' failure to disclose facts about the intention or possibility of Wabasha County to utilize the Shoreland Protection Act to preclude Matteson from running dredge piping from the river and thus prohibiting Matteson from depositing dredge material anywhere on private property, even including property that was not included within the 1,000 foot shoreline "protection zone." This knowledge was contrary to representations contained in the contract documents and in discussions with Corps officials that Matteson could utilize its own disposal sites, including potentially the Saunderson or Braun properties. Matteson's claim is also based upon the Corps'
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superior knowledge concerning the local opposition to the Corps' dredging activities and disposal of dredged materials. Even assuming Matteson had a duty to examine the Shoreland Protection Act prior to bidding, nothing in that act would have alerted Matteson to the fact that Wabasha County would come up with a unique application of the Act to restrict or prohibit the placement of temporary dredging pipes across the protected zone of shoreland property, or that the County would not approve permits for such pipes, or for the deposit of dredged gravel on a suitable site. There is nothing in either the authorizing state statute, Minn. St. § 103G.005 et seq., or the Wabasha County Shoreland Regulations, (Wabasha County Ordinance, Art. 13, Sec. 17, Pl. App. 0242), that would have caused any contractor to understand that the County could or intended to use the Shoreland Protection Act to prohibit a contractor on a Corps of Engineers project from running temporary dredging pipe over private property to an inland disposal site, or even that the County would refuse to grant a permit to run pipes carrying dredged gravel to be deposited on a parcel not within the protection zone. The Corps' assertions that Matteson did not perform an investigation concerning the proposed disposal sites are erroneous. Consistent with the terms of the contract that required the Corps - not the contractor - to conduct an environmental evaluation of contractor selected disposal sites (Contract Spec. § 01000, ¶ 7.3), Matteson contacted Corps officials so that they could examine Matteson's proposed sites. (Pl. Statement of Facts, ¶¶ 15-19, 23-26). Further, the Corps invited local officials--including Officials from the Minnesota Department of Natural Resources("MDNR")--to join with the Corps to view the proposed sites. (Pl. Statement of Facts, ¶¶ 15-19). Because the MDNR maintains oversight over the administration of the Shoreland Protection Act, it was not unreasonable for Matteson to believe that the Corps had discussed any

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state and local prohibitions with the appropriate officials. (Pl. Statement of Facts, ¶¶ 16-17; 2224). Given that the contract specifications placed the duty of performing an environmental evaluation of alternative disposal sites on the Corps, not Matteson, it was not unreasonable for Matteson to believe that the Corps would identify and alert Matteson to any potential restrictions on the use of the property. Id. The Corps took on a duty to so identify and alert Matteson to potential restrictions when it assumed responsibility in its own contract to conduct an environmental evaluation of any proposed sites. The decisions relied upon by the Corps concern very different factual circumstances and issues than those raised by the Corps' arguments. For instance, in Giesler v. United States, 232 F.3d 947 (Fed. Cir. 2000), the court was concerned with a situation where the government, in performing a pre-award survey of a subcontractor failed to detect and notify a bidder that its intended supply of mixed nuts was not in conformity the contract's specifications. The court determined that the superior knowledge doctrine was not applicable because the bidder had ready access to the specifications. Id. at 877. In the case of H.N. Bailey & Assocs. v. United States, 449 F.2d 376 (Ct. Cl. 1971), the contractor alleged that the government withheld technical information that would have assisted the contractor in producing pole hooks. The court upheld the Board of Contract Appeals factual findings concluding that the government did not possess any superior information and that the information needed to manufacture the hooks was publicly available in textbooks and other scholarly works. Id. at 381-383. In Massman Contracting Co. v. United States, 23 Cl. Ct. 24 (1991), the government was not liable for the failure to disclose information concerning river flow information because the contract directed the contractor to sources from which such information could have been obtained. Id. at 32. None of these decisions concern a circumstance such as the present case in which the government fails to

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disclose a local government's unwritten, stated intention to enforce a zoning ordinance and to restrict the temporary use of pipes running over a potential area, or in which the contract placed an affirmative obligation on the government to conduct an environmental evaluation of the proposed site and identify additional requirements that may be imposed on the contractor. There are clearly issues of facts as to Matteson's knowledge. To the contrary, the Corps appears to concede, for the purpose of its summary judgment motion, that it possessed vital superior knowledge concerning the severe local restrictions that could be imposed on any alternative disposal site. (Defendant's Motion, p. 16, "even assuming, for argument's sake, the Corps was aware of local county laws and ordinances.") However, the Corps then sets forth the erroneous factual assertion in a footnote that "there is no evidence in the record to suggest that the Corps was even aware of the existence of the Shoreland Protection Act prior to Matteson's bid submission." (Def. Mot., p. 16, fn. 1). The Corps also erroneously states that "there is no evidence to support Matteson's claim that the Corps possessed any knowledge of specific opposition to use of Matteson-selected disposal sites." (Def. Mot., p. 16). These self-serving "facts" offered by Corps are belied by the evidence. At some point in September, 1996, Matteson contacted Wabasha County concerning renewing a permit to continue the ongoing clearance of trees from the Saunderson property. The issue of any permits concerning the Shoreland Protection Act was not raised by the County at that time. The permit for clearing the wood was different from the other permit that the County subsequently required under the Shoreland Protection Act. (Pl. Statement of Facts, ¶ 31). By virtue of the extensive number of dredging projects awarded by the Corps in Wabasha County, one can draw a reasonable inference that the Corps was aware of state and local laws, ordinances and land use practices, including the Shoreland Protection Act. The Shoreland Protection Act is

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a statewide act that all counties are required to adopt. The form of the ordinance is mandated by the Minnesota Department of Natural Resources, and its compliance is administered by the Minnesota DNR. (Pl. Statement of Fact, ¶ 33). The Shoreland Protection Act was widely known in the counties with river shorelines. (Pl. Statement of Fact, ¶ 34). Krumholz and other Corps officials routinely appeared at local meetings at which the Shoreland Protection Act was discussed. (Pl. Statement of Fact, ¶ 35). There have been numerous disputes between localities and the Corps as to whether the Corps was required to comply with local permit requirements under the Shoreland Protection Act and other local ordinances. (Pl. Statement of Fact, ¶ 36). As far back as 1983, the Corps has been involved in disputes with local entities concerning the Corps' compliance with the Shoreland Protection Act. (Pl. Statement of Facts, ¶ 37). In fact, correspondence from 1987 alerted the Corps not only to the Shoreland Protection Act, but also to some municipalities' application of that act to apply to the running of temporary dredging pipe over the 1,000 foot shoreland protection zone. (Pl. Statement of Facts, ¶ 38). Further, it is undisputed that the Wabasha County Attorney contacted the Corps on September 18, 1996 (subsequent to the bid openings but prior to the Corps' award of the contract) and specifically discussed the Shoreland Protection Act in conjunction with Matteson's proposed use of the Saunderson property. (Pl. Statement of Facts, ¶ 32). The attorney also informed the Corps that "homeowners downstream of Wabasha are concerned about dredged material to be placed in the vicinity." (Id.). Rather than informing Matteson of the phone call, the Corps did nothing more than provide Matteson's phone number to the County Attorney. (Def. Statement of Facts, ¶ 54; Pl. Statement of Facts, ¶ 42). Matteson was not contacted by the County Attorney or the Corps prior to the award of the contract. (Pl. Statement of Facts, ¶ 42).

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The government's failure to disclose its knowledge of the intentions of other governmental agencies that would impact the performance of a contract is a proper basis for recovery. In J.A. Jones, the failure of the Corps' and the Air Force to disclose the Air Force's intention to award numerous construction contracts was a sufficient basis for a contractor to recover its additional labor expenses resulting from the "avalanche" of contracts awarded. 390 F.2d at 886. Further, in Delta Equipment and Const. Co. v. United States, 122 Ct.Cl. 340, 104 F.Supp. 549, 551-552 (1952), the Court of Claims noted that the government had a duty to disclose to a contractor the fact that an individual landowner was disputing the government's right of way and appropriation of the land, and that the government was liable for the delays resulting from the landowner's interference with the work. In addition to its knowledge concerning the Shoreland Protection Act, the Corps was also well aware of the ferocity, breadth and depth of the community's dissatisfaction with and opposition to the Corps' dredging projects in the area. (See Generally Pl. Statement of Facts, ¶¶ 33-39, 47). Matteson was not aware of the degree of community opposition to the Corps' dredging projects, although it was aware of some isolated complaints concerning individuals on previous projects. Although Matteson had worked on two projects in the area, Matteson's work did not cause that opposition and had no way of knowing that there was any particular opposition to its proposed disposal sites. (Pl. Statement of Facts, ¶¶ 48-50). Indeed, even after Matteson became aware of the County's intention to apply the Shoreland Protection Act to require Matteson to obtain a permit to run its dredging pipes, Matteson did not become concerned about obtaining a permit because it was not aware of the intensity and breadth of the community's opposition with the Corps' dredging activities. (Pl. Statement of Facts, ¶ 46). Matteson had no idea of the breadth and degree of community opposition since the few isolated incidents of which

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it was aware had been resolved to the satisfaction of the individuals involved. (Pl. Statement of Facts, ¶¶ 48-49). Not until Matteson personnel began attending meetings concerning its permit application did Matteson discover that the opposition to the Corps' dredging projects was "very violent and very outspoken." (Pl. Statement of Facts, ¶ 50). The opposition of the community in this case did not concern opposition by private landowners concerning the running of temporary pipelines over there property, but rather concern of the disposal of dredged material anywhere in the vicinity of the project and this was due to the Corps' prior performance of projects in the area. (Pl. Statement of Facts, ¶ 50). The Corps on the other hand cannot credibly deny that it was aware of the type of opposition that Matteson could encounter. Significant community

opposition to the Corps' dredging activities dates back to the 1980s and there were numerous meetings and letters written over the years by which the Corps would have been familiar with the degree of opposition likely to be encountered. (See Pl. Statement of Facts, ¶¶ 33-39, 47). 2. Factual issues exist as to whether the Corps violated its duty to cooperate and exercise good faith in assisting to secure the availability of the Saunderson site.

As previously noted, implicit in every government contract is the duty to cooperate. Celeron Gathering Corp. v. United States, 34 Fed.Cl. 745, 753 (Fed. Cl., 1996) "A claim under the duty of cooperation concerns the reasonableness of the government's actions after considering the facts and circumstances at the time." Id. In the present case, not only did the Corps fail to disclose to Matteson its superior knowledge concerning Wabasha County's position and intentions concerning the application of the Shoreland Protection Act, it also then failed to take action to secure the Saunderson site. All that the Corps had to do was have Matteson transfer its rights to the Saunderson site and the temporary easement to access the site. Had the Corps done this, the site would not have been subject to state and local laws and ordinances (at least according to the Corps), and thus Matteson could have used the site notwithstanding the
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Shoreland Protection Act. However, the Corps determined that it would not secure the site, opting instead to have Matteson trade property with and for the benefit of the Fish and Wildlife Service. (Pl. Statement of Facts, ¶¶ 52-54). This lack of good faith and cooperation is an independent basis for Matteson's claim of breach. C. Counts VI and VII (Breach of Warranty and Failure to Disclose).

Counts VI and VII of Matteson's First Amended Complaint assert causes of action for breach of the implied warranty of the specifications and for a specific omission by failing to set forth the local restrictions that precluded Matteson from utilizing its selected disposal sites. It is settled that a contractor is entitled to an equitable adjustment for increased costs of performance due to defective government specifications. Hol-Gar Mfg. Corp., 360 F.2d 634, 637 (Ct. Cl. 1996). Breach of the implied warranty occurs if the specifications are defective. Id. at 638. The government has a duty and legal obligation to furnish the contractor with specifications sufficient for the purpose intended. Id. A successful contract bidder has the right to rely on the

government's specifications and drawings, and the government is bound by any assertions made therein, notwithstanding its statement that the data was for "information only". Fehlhaber Corp. v. United States, 151 F.Supp. 817, 825 (Ct. Cl. 1957. Recovery is warranted where a contractor shows that "it was damaged as a result of the material variation between the expected and encountered conditions." Stuyvesant Dredging Co. v. United States, 834 F.2d 1576, 1581 (Fed. Cir. 1987). In this case, the Corps' specifications contained Section 01130, a provision entitled "Environmental Protection." (Def. App. 165-166). In that section, the Corps stated that

"environmental protection shall be as stated herein." The section thus clearly represented to all bidders the requirements for implementing a proper environmental protection plan, approval of which was represented to rest with the Corps. Section 01130 ¶ 2.3. Nothing in the Section alerts
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contractors to any provision of the Shoreland Protection Act or any laws or regulations would authorize a local county to block access to a contractor after approval of the contract. Matteson had the right to rely on the specifications as conforming to the government's affirmative duty to provide any information which would impact the feasibility of an approved method of performing the work. The Corps appears to argue that the contract documents absolve it from liability for failing to disclose applicable restrictions. To make this argument, the Corps provides a warped and incomplete view of Matteson's claims and ignores critical provisions of the contract. First, although the Corps focuses on section 01130 of the Specifications as constituting the basis for Matteson's breach of warranty and omission/misrepresentation claims, section 01130 does not contain provisions disclaiming an warranties or representations made by the Corps. In addition, Matteson's claims in Counts VI and VII are also based on Specification § 01000, ¶ 7.3, in which the Corps represents that the contractor may dispose of dredged material on private property. (Def. App. 149). The only limitations to the disposal of dredged material on private property were: approval by the Corps of the contractor's agreement with the property owner; that no material be disposed of on wetland or wooded areas; and that the contractor comply with any additional requirements to offset environmental impacts identified by the Corps in conducting an environmental assessment of the site. (Id.). The contract also provided that after filling the mandatory Buffalo County No. 1 Placement Site, "the Contractor may utilize one or more of the other indicated non-mandatory final placement sites and/or the Contractor's own selected disposal areas (placement sites), as approved." (Spec. § 01000, ¶ 12.7, Def. App. 152). Significantly, ¶ 7.3 of § 01000 imposed the duty to perform the environmental evaluation of the proposed disposal site and to identify any "additional requirements" on the Corps, not on

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the contractor. (Def. App. 149). Contrary to this specification, the Corps failed to identify the restrictions to the use of the property imposed by the Shoreland Protection Act and the County's particular application of it. By virtue of the application of the Shoreland Protection Act that the County employed (of which there is evidence the Corps' was aware-see Pl. Statement of Facts, ¶¶ 37-38), Matteson effectively could not dispose of dredged material on any private property, even though the property otherwise satisfied the criteria set forth in ¶ 7.3 of § 01000. Because the Corps knew that the Shoreland Protection Act had been applied in this manner, and previously knew about the local opposition and intention to apply the Act notwithstanding the fact that the property otherwise meet the requirements of ¶ 7.3 (See Pl. Statement of Facts, ¶¶ 3243), the Corps knew that its representations in § 01000, ¶ 73 were not accurate or complete. Further, the contract enumerated the restrictions and regulations that were applicable to the performance of the contract as follows: ("Contract Restrictions," 01000, ¶ 12; "Special Contract Requirements," § 00800; Compliance Requirements with Numerous Laws, § 07000-11; Special Use Permit for Dredged Material Placement, § 01000-8; attached letters between the Corps and the Department of Fish and Wildlife regarding applicable environmental issues, 01000-9 through 01000-13). The enumerated restrictions included the identification of state and local requirements. For example, the Contract Restrictions notes that the contractor must comply with the requirements of the Wisconsin One Call Excavation Notice System, Wis. Stat. § 182.0175. (Spec. § 01000, ¶ 12.2, Def. App. 150). "It is an established rule of contract interpretation that where several subjects of a class or group are enumerated and there are no general words to show that other subjects or items are included, it may reasonably be inferred that the subjects or items not named were intended to be excluded." Design and Production, Inc. v. United States, 18 Cl. Ct. 168, 198 (1989). By identifying particular laws, regulations and

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restrictions that were applicable to the contract, the Corps represented that no other restrictions were applicable. The Corps also seeks to avoid liability by arguing that the provisions pertaining to the contractor's submission of an environmental plan contain exculpatory provisions. Section 01130 requires the contractor to prepare an environmental protection plan. Paragraph 2.3 of that provision states that the Corps' approval of the contractor's plan "shall not be construed as relieving the Contractor of all applicable Federal, state and local environmental protection laws and regulations." Other provisions in this section note that the contractor is required to comply with all appropriate Federal, state and local laws, regulations and requirements. (Section 01130, ¶¶ 2.1(5), 4 and 5). The provision in paragraph 2.3 of § 01130 is not applicable because Matteson is not claiming entitlement to relief based on the Corps' approval of its Environmental Plan under § 01130. Further, Matteson is not claiming that it was relieved of complying with Federal, state and local environmental protection laws and regulations. On the contrary, Matteson recognizes that it was required to comply with state and local restrictions, including the Shoreland Protection Act. Therefore, the Corps should have identified that Act as a potential restriction, just as it identified other particular restrictions. Language stating that the contractor shall comply with all applicable Federal, state and local restrictions does not exculpate the Corps from its failure to identify what Federal, state and local restrictions are applicable to the project, particularly when the Corps includes sections in the contract identifying certain restrictions but conveniently leaves out other restrictions of which it has knowledge. The Corps' citation to the Permits and Responsibilities provisions of the contract is similarly inapplicable. This provision states that the contractor is required to perform the task of

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obtaining any necessary licenses and permits. (Spec. § 00700-29, ¶ 64). However, requiring Matteson to simply "perform the task of obtaining" necessary permits does not address the Corps' duties to identify what permits, laws and regulations are applicable to the project or to identify that Matteson may not be able to obtain based upon information possessed by the Corps. Nor does the simple requirement that Matteson apply for a permit (which of course Matteson did) mean that Matteson bore the risk that the permit would be denied. As admitted by the

contracting officer, Krumholz, it was not the intention of the Corps to ask the contractor to assume the risk that obtaining a permit could not be possible. (Pl. Statement of Facts, ¶ 24). Furthermore, the Corps' affirmative duty to inform bidders of impediments to performance of which it was aware is not vitiated by its disclaimers. Language purporting to relieve the Corps of its affirmative duty, see Section 01130 ¶ 2.3-3.0, is not binding. The contractor is not bound by exculpatory and caveatory provisions in the contract, and the government is not relieved of liability for changed conditions as the language would indicate. Fehlhaber Corp., 151 F.Supp. at 825. III. DIFFERING SITE CONDITION (COUNT II) Matteson has asserted a differing site condition claim in Count II based upon the fact that Matteson's contract called for the use of certain physical locations for disposal of dredged material. As it turned out, the sites selected by Matteson and approved by the Corps were unsuitable and unusable for the project, thus constituting a changed condition under the contract. (First Amended Complaint, ¶ 34.) The changed conditions article of a government contract does not expressly limit the changed conditions only to those caused by nature, but can include those caused by artificial means. McDowell Stone Co. of Blackwater, BCA No. 285 (1943). The changed condition must constitute a "materially different and unusual condition from what a reasonable contractor should have anticipated." Sundex, Ltd., 93-2 BCA ¶ 25,626. Furthermore,
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exculpatory language in government contract specifications does not negate the remedial provisions of the "Changes" and "Differing Site Conditions" clauses in said contracts. R.A. Heintz Construction Co., 74-1 BCA ¶ 10, 562. There is considerable authority that the contractor's reliance upon the governmentapproved use of a particular site which post-bid proves to be unusable for that purpose is the basis for a valid changed condition claim. For instance, the unsuitability of a governmentapproved borrow site, necessitating use of a different site has been held to constitute a "differing site condition" for purposes of a government contract. R. A. Heintz Construction Co., 74-1 BCA ¶ 10,562. In complying with such a change, and completing the project, the contractor does not waive its right to an equitable adjustment. Discount Co., Inc. v. United States, 554 F.3d 435, 440 (Ct.Cl. 1977). In Guy H. Briscoe v. United States, 442 F.2d 953 (Ct.Cl. 1971), the contractor relied upon availability of an underground source of water in making his bid, based upon his review of the plans and specifications and inspection of the site. Id. at 956. After the award, the landowner denied the contractor use of the water. Id. The court found that the landowner's denial of permission to use the water source constituted a `changed condition' warranting an equitable adjustment to the contractor for the increased cost of obtaining water from an alternative source. Id. at 962. Where the contractor reasonably assumes, on the basis of plans and specifications and an inspection of the site, that it will have a particular access to the site, inability to obtain such access constitutes a `changed condition' within the meaning of the term in standard form government contracts, entitling the contractor to an equitable adjustment. Id. In American Dredging Company, 72-1 BCA ¶ 9316, a contractor bid on a channel dredging operation using hydraulic means based upon pre-bid data made available to bidders, as well as its prior experience on a similar earlier job. The Board stated that such reliance on prior

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experience is initially reasonable, but required more than just a similarity of general description. Id. The Board determined that a contractor had a valid changed condition claim where the prebid information "drew a picture from which one could conclude that the job could be economically performed by hydraulic dredging equipment..." Id. It stated, "[I]f appellant had been reasonably misled...so that it properly but mistakenly anticipated that the work could be economically performed [hydraulically], we would sustain its major changed condition claim." Id. Critical information which could have been given greater stress in the pre-bid data is substantial enough to constitute a changed condition and warrant a contract adjustment. Id. On this project, hydraulic dredging required that the contractor obtain its own disposal site within the vicinity of the two project areas, an option contemplated and unopposed by the Corps. (See Pl. Statement of Facts, ¶¶ 11-14). Matteson reasonably relied upon the Corps' assurances that hydraulic dredging would be feasible and was responsive to the bid solicitation. Upon expending considerable time and resources to identifying potential sites, Matteson again sought the Corps' assurances that the sites were suitable. (Pl. Statement of Facts, ¶¶ 15-26). Krumholz, on behalf of the Corps, assured Matteson that either site could be used. (Pl.

Statement of Facts, ¶¶ 18-19, 22-23). Based upon these assurances, the bid specifications, and its prior experience on two very similar jobs in the same vicinity, Matteson proceeded to procure rights to use the sites as disposal areas. (Pl. Statement of Facts, ¶¶ 20-26). Matteson did not have the benefit of critical information, solely available to the Corps, of local opposition based on prior complaints to the Corps or previous attempts to apply the Shoreland Protection Act to prevent the running of pipes across the protected area. (See Generally Pl. Statement of Facts, ¶¶ 31-50).

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Once a changed condition is found, the allocation of blame or fault for the changed condition between a contractor and the government is irrelevant. Briscoe, 442 F.2d at 963. Upon a finding that the circumstances of its claim constitute a changed condition, Matteson is entitled to an equitable adjustment for its increased costs, regardless of any assertions by the government against Matteson for any alleged failure to search out local opposition on its own. The Corps argues that Matteson cannot state a claim for a differing site condition because the pertinent clause applies only to "physical" conditions. The Corps does correctly note that the differing site condition clause that is a part of this contract applies to "subsurface or latent physical conditions" or "unknown physical conditions at the site." Even assuming a differing site condition claim in this case is limited to a changed "physical" condition, however, the disposal sites are physical locations and conditions related to the work. Matteson ended up using a different physical location and there was a change as to where and how Matteson could physically place the dredged material. There clearly was a different physical nature of how and where the work could be performed, even though the reason why the physical nature and location of disposal changed was due to other circumstances (i.e. local opposition and enforcement of zoning laws). Matteson should not be precluded from seeking recovery on this theory. IV. CARDINAL CHANGE (COUNT III) In Count III of its First Amended Complaint, Matteson seeks recovery based on a "cardinal change" to the contract because the entire basis of its bid proposal and agreement to do the work rested upon the use of hydraulic dredging in its proposed disposal sites on private property in close proximity to the project, as allowed by and approved by the Corps. Because Matteson was not able to use those private disposal areas in close proximity to the project, and in
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fact was forced to dispose of the dredged material on public land at a disposal site that was much further away than anticipated, the nature of the work called for in the contract and for which Matteson agreed to perform was drastically altered and was outside of the anticipated scope of its obligations under the contract and for which Matteson bargained. The Corps' arguments concerning Matteson's claim based on a cardinal change to the contract do not warrant summary judgment. First, the Corps argues that "Matteson has alleged no change to the terms of the contract" and that none of the "five modifications" to the contract effected the method of performing the work or increase the fixed contract price. Matteson has never contended there were written modifications to the contract that increased the price, nor is Matteson's cardinal change claim based upon a "written change" to the "terms" of the contract. The Corps' suggestion that a cardinal change can only occur based on some written change to the contract terms is misplaced and contrary to the law. A cardinal change to a contract is such a drastic modification that it was not contemplated by the contract, and thereby constitutes a material breach of the contract, since it is not redressable under the contract. Alliant Techsystems, Inc. v. United States, 178 F.3d 1260, 1276 (C.A. Fed. 1999). See also Allied Materials & Equipment Co. v. U. S., 569 F.2d 562, 563-64

(Ct. Cl. 1978). A cardinal change is a change so drastically outside the scope of the contract that it is not authorized or contemplated by a change provision. Contact Intern. Inc. v. Windall, 106 F.3d 426, 426 (C.A. Fed. 1997); General Dynamics Corp. v. United States, 585 F.2d 457, 462 (Ct. Cl. 1978). A cardinal change occurs when the contractor is required to perform duties materially different from those it originally bargained for. Contact Intern. Inc., 106 F.3d at 426. "Generally such a change represents a large increase in the contract burdens." General

Dynamics Corp. v. United States, 585 F.2d 457, 462 (Ct. Cl. 1978). In determining whether a

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