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BUILDING SOLUTIONS The newsletter of Watt, Tieder, Hoffar & Fitzgerald, LLP visit us on the web at www.wthf.com Inside... Can A Contractor Sue Its Own Surety In Tort For Breach Of Fiduciary Duty And Bad Faith? Page 2 New Past Performance System Requires Prompt Contractor Response Page 3 The Scope Of The Government’s Duty Of Good Faith And Fair Dealing Under Federal Contracts Page 5 Don’t Jump To Conclusions: Termination For Default Federal Project Options And Issues Page 7 All “Reasonably” Quiet On The Western Front – Estonia Page 9 Firm News Page 14 Summer 2014 Attorneys at Law

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Page 1: Inside · merged into the Contractor Performance Assessment Reporting System (CPARS). CPARS is available at . Previously, CPARS, ACASS, and CCASS contained different evaluation forms,

BUILDING SOLUTIONS

The newsletter ofWatt, Tieder, Hoffar & Fitzgerald, LLP

visit us on the web atwww.wthf.com

W

Inside...• Can A Contractor Sue Its Own Surety InTort For Breach Of Fiduciary Duty AndBad Faith?Page 2

• New Past Performance System RequiresPrompt Contractor ResponsePage 3

• The Scope Of The Government’s Duty OfGood Faith And Fair Dealing UnderFederal ContractsPage 5

• Don’t Jump To Conclusions: TerminationFor Default Federal Project Options AndIssuesPage 7

• All “Reasonably” Quiet On The WesternFront – EstoniaPage 9

• Firm NewsPage 14

Summer 2014Attorneys at Law

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On June 11, 2014, the U.S. Court of Appealsfor the Third Circuit issued a decisionaddressing the ugly situation when a contractorand its surety find themselves at odds, and thecontractor seeks to avoid the consequences ofhaving executed a typical general agreement ofindemnity (“GAI”) by suing the surety in tort.

The typical GAI not only requires theprincipal/contractor to indemnify the surety, butalso provides a relatively broad panoply of otherrights to the surety to allow it to protect itsinterests. Although the principal’s and thesurety’s respective interests are often aligned,when these parties become adverse, thesurety’s exercise of its rights under the GAI canlead to disputes and litigation. In this situation,the GAI, like any other contract, determines theparties’ respective contractual rights. Given thestrength and leverage of the surety’s positionthrough the terms of a typical GAI, the principalmay find itself surprisingly unable to operateindependently or to exercise its own judgmentabout how to handle bond claims and tocomplete bonded projects. After reviewing theGAI – which is a contract – the principal maylook outside the contract to the body of tort lawin an effort to exercise extraneous rights toavoid the limitations of a breach of contractclaim founded on the GAI.

In Reginella Construction Co., Ltd. v. TravelersCasualty & Surety Co. of America, thePennsylvania-based contractor employed justsuch a tactic. The contractor/plaintiff allegedthat it had been in business for more than 25years, and had successfully performed millionsof dollars of work on public constructionprojects. In 2010 and 2011, the contractor hadseveral bonded contracts, and it had previouslyexecuted a GAI with the defendant/surety.

In the Fall of 2011, the contractor beganencountering a variety of challenges thatspiraled out of control rapidly. On one bondedproject, it terminated a subcontractor, and thesubcontractor filed a mechanics’ lien. As aresult, the public owner withheld payment in theamount of the lien, and the contractorattempted to bond off the lien. The suretyrefused to provide such a bond, and ultimately

the owner terminated the contractor on May 22, 2012.

In the meantime, on April 26, 2012, the suretywrote to the owner of one of the other bondedprojects and demanded that payments that wereotherwise due to the contractor be directed tothe surety. The surety exercised this right underthe GAI because it believed that the contractorwas in default to a number of its subcontractorswho had asserted payment bond claims on theproject. The contractor alleged that the suretytold the subcontractors that the contractor wasgoing to be terminated, causing itssubcontractors to slow down and assertadditional and inflated claims. When the ownerrefused to make further payment, the contractorelected to terminate its performance on thisproject on June 11, 2012.

Blaming its suddenly deteriorating financialsituation on the surety, the contractor promptlyfiled a complaint against its surety in the U.S.District Court for the Western District ofPennsylvania. More specifically, the contractorasserted a variety of tort claims, includingintentional interference with contract, breach offiduciary duty, and bad faith. Conspicuous byits absence, however, was any claim for breachof contract, or even a reference to the existenceof the GAI.

The surety moved to dismiss, and the DistrictCourt found that there was no fiduciaryrelationship between the surety and theprincipal, such that the breach of fiduciary dutyclaim failed as a matter of law. The DistrictCourt addressed the fundamental nature ofsuretyship, and expressed skepticism “that asurety could ever assume a fiduciary-in-factposition towards its principal, a sophisticatedcommercial entity who is aware at the outsetthat the surety is contractually vested with theright to take steps against its (the principal’s)interests if certain contingencies occur.”

In that regard, because the PennsylvaniaSupreme Court had never explicitly decidedwhether the surety/contractor relationship couldgive rise to a fiduciary relationship, the DistrictCourt had to predict how the Pennsylvania

uu R E C E N T D E V E L O P M E N T S tt

Can A Contractor Sue Its Own Surety In Tort For Breach Of Fiduciary Duty And Bad Faith?

by Kevin J. McKeon, Partner

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Supreme Court would rule on the issue. Notingthat the surety/contractor relationship is“riddled with conflicting interests and splitloyalties,” it predicted that the state SupremeCourt would hold, as a matter of law, that asurety does not owe a fiduciary duty to aprincipal.

Although not raised by the surety’s counsel indefense, the District Court appliedPennsylvania’s gist-of-the-action doctrine inanalyzing the other tort claims. The doctrine isnot necessarily unique to Pennsylvania, but isbased on maintaining the fundamentaldistinction between contract claims (where theduties allegedly breached arise out of acontract) and tort claims (where the dutiesallegedly breached arise out of social policy ora general duty of care). Thus, if the true “gistof the action” arises out of a contractualrelationship, the doctrine will bar tort claimsunless they are unrelated to the contract.

In this case, the District Court dismissed all ofthe other tort claims because they arose out ofthe contractual relationship created by the GAI,and were simply breach of contract claims re-cast as tort claims. While the contractor arguedthat it had pleaded facts about the surety’sconduct that would justify its tort claims for badfaith and intentional interference (“entirelywithout justification,” “arbitrary,” “unreason-able,” “capricious,” “vexatious,” “self-serving,”“wrongful,” “improper,” “wanton,” “outrageous,”“shocking to the conscience,” and even“overmastering”), the District Court wasobviously unimpressed and concluded thatthese were not facts, but simply “adjective-laden editorial embellishments that the Courtwas obligated to cast aside.”

The contractor sought leave to amend tosomehow further amplify its pleading, but theDistrict Court found that amendment would befutile and reward delay, such that leave wasdenied. The contractor appealed even thoughit was already pursuing breach of contractcounterclaims in a prior state court proceedingin which the surety was the named plaintiff.

On appeal, the Third Circuit affirmed in allrespects. First, the appellate court noted thatthe contractor had not appealed the DistrictCourt’s prediction that the PennsylvaniaSupreme Court would find no fiduciary dutyarising out of the contractor/surety relationship,so the contractor could not state a valid claimfor breach of fiduciary duty. Next, the ThirdCircuit found that the gist-of-the-action doctrinewas properly applied to bar the other tort claimsbecause they were all dependent upon theterms of the GAI. Finally, the appellate courtagreed that it was within the District Court’sdiscretion to deny leave to amend, becausegranting leave would only cause delay andencourage “wait-and-see” tactics.

Notably, the Reginella case is described as “notprecedential,” but since Federal Rule ofAppellate Procedure 32.1 (prohibiting FederalCircuit Courts from restricting citation to anytype of opinion issued after January 1, 2007)was adopted in late 2006, the case may be citedand provides valuable insight into the ThirdCircuit’s view of both the typical GAI and thenature of the surety/principal relationship. Thepractical take-away from the case will bedifferent depending on one’s role in thatrelationship, but it does reflect a relatively clearrespect for the rights and obligations negotiated,documented and agreed to in the typical GAI. t

...continued on page 4

If you are a federal contractor, you know theimportance of past performance reviews onyour business. Past performance evaluationsare required for any service contractexceeding $150,000, any constructioncontract exceeding $650,000, and anyarchitect-engineering contract exceeding$30,000. See 48 CFR § 42.1502. The federalgovernment relies on these reviews to awardnew work, and a negative evaluation couldhave a detrimental effect on your bottom line.Understanding the evaluation process is,

therefore, critical to successful completion ofany federal contract.

On July 1, 2014, the federal governmentimplemented new policies and procedures forpreparing and submitting past performancereviews. See 48 CFR § 42.1503, 79 Fed. Reg.31197. These changes modified existingevaluation criteria and significantly altered acontractor’s deadline for challengingperformance reviews. The government

New Past Performance System Requires Prompt Contractor Response

by Scott P. Fitzsimmons, Partner

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executed these changes after a GovernmentAccountability Office (“GAO”) report found thatpast performance evaluations were not beingprepared consistently or timely throughoutagencies in the federal government. GAOReport 09-374, Better Performance InformationNeeded to Support Agency Contract AwardDecisions (Apr. 23, 2009). Congressionalpressure to make the evaluation system moreeffective resulted in changes introduced throughthe 2012 and 2013 National DefenseAuthorization Acts. See Pub. L. 112-81, Pub. L.112-239.

As a first step to achieving efficiency, thegovernment merged multiple rating programsinto a single system. The Architect-EngineerContract Administration Support System(ACASS) and the Construction ContractorAppraisal Support System (CCASS) are nowmerged into the Contractor PerformanceAssessment Reporting System (CPARS).CPARS is available at www.cpars.gov.Previously, CPARS, ACASS, and CCASScontained different evaluation forms, ratingelements, and workflow processes. The newCPARS program eliminates inconsistencies andevaluates all contractors on the same factorsincluding: (1) Quality, (2) Schedule, (3) CostControl, (4) Management, (5) Utilization ofSmall Business, and (6) RegulatoryCompliance. Agencies also are now required toprovide a written narrative for each factor.Requiring written justification for each scoreeliminates scenarios where a contractorreceives a low mark without any reasonwhatsoever. Notably, however, a contractor nolonger receives an “Overall” rating for eachcontract, potentially making the review of pastperformance more difficult during contractsolicitation and bid evaluation.

By merging to a single program, thegovernment hopes to achieve uniformevaluations throughout the federal government.Several agencies have issued guidance on howthese new evaluation criteria should be used.See US Army Corps of Engineers, Engineeringand Construction Bulletin No. 2014-13, CPARSTransition Guide (May 22, 2014). Contractorsare highly encouraged to seek out this guidanceand understand how agencies will interpret andimplement the new CPARS evaluation criteria.

In addition to changing the evaluation factors,the new regulations revise existing deadlines forcontractors to respond to an agency’s draftevaluation. Understanding these changes iscritical. Under the old rules, a contractor had30 days to submit comments, rebuttingstatements, or additional information to thegovernment in response to a past performancereview. Under the new guidelines, thecontractor’s response time is cut in half. Acontractor is provided only 14 days to respondto the government’s review once the evaluation

is submitted in CPARS. See 48 CFR §42.1503(d). On the 15th day, whether thecontractor has responded or not, the evaluationautomatically posts to the Past PerformanceInformation Retrieval System (PPIRS). PPIRS isavailable at www.ppirs.gov. Once on PPIRS, theevaluation is available for viewing by all sourceselection officials throughout the federalgovernment. The 14-day timeline could,therefore, have significant ramifications for acontractor who receives a negative or unjustifiedevaluation. It also emphasizes the need forcontractors to diligently pursue their right torespond to an agency’s evaluation.

Historically, contractors who disagreed with agovernment evaluation would request to meetwith the Contracting Officer to discuss theirscores and provide feedback or justification fortheir performance. No requirement exists for thegovernment to meet with the contractor.However, if a contractor requests a meeting, thegovernment may accept the request. Any suchmeeting, though, does not alter the requirementthat an evaluation be posted to PPIRS within 14days. The reason for this policy is to ensure thatsource selection officials have access to timelyand relevant past performance reviews and toavoid delays in reporting performance on acompleted federal contract.

Even though a past performance review mustbe posted within 14 days, several avenues stillexist for the contractor to influence the review.First, the contractor may submit commentsafter the 14-day period expires and the reviewhas been posted to PPIRS. Under the newregulations, the contractor’s late commentsmust be posted to PPIRS; however, thegovernment’s original report will still beavailable to all source selection officials.Although authorized, an agency is not requiredto modify its evaluation based upon acontractor’s comments. Second, a contractormay appeal its review to one level above theContracting Officer. Again, the appeal does notstop the 14-day reporting period and theoriginal evaluation will be posted on PPIRS.

The changes implemented for the new pastperformance reviews are significant. Federalcontractors should be aware of theserequirements and make every effort tounderstand the government’s expectations.Engaging the contracting officer early,understanding their expectations, asking for adraft evaluation, and seeking timely con-structive feedback are all methods a contractormay use to gauge its performance. Because anegative past performance evaluation couldadversely impact future business, governmentcontractors should be aware of the newevaluation criteria, immediately review anyevaluation, be prepared to substantivelyrespond to a past performance review, and becognizant of the new 14-day rule. t

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...continued on page 6

Like all contractingparties, the federalgovernment is boundby an implied duty of

good faith and fair dealing in all of itscontractual undertakings. Contractorscommonly rely on this implied duty as a basisfor seeking additional compensation where thegovernment’s representatives have hinderedperformance under a contract withoutbreaching one of the contract’s expressprovisions. Historically, the United States Courtof Appeals for the Federal Circuit applied a“reasonableness” test in assessing allegationsthat the government breached this implied duty,finding a breach of this implied duty where thegovernment’s actions were considered to beunreasonable under the specific circumstancesof a particular contract.

In 2010, however, the Federal Circuit articulateda more stringent test for assessing allegationsthat the government breached this implied dutyin Precision Pine & Timber, Inc. v. United States,596 F.3d 817 (Fed. Cir. 2010). In that case, thegovernment had allegedly frustrated theplaintiff’s performance by suspending thecontractor’s operations. The evidence producedat trial reflected that the express terms of thecontract at issue contemplated suspension ofthe contractor’s operations under certaincircumstances and, further, that the governmentwas compelled to suspend the contractor’soperations by a court order issued in anunrelated third-party litigation. In its analysis ofthe plaintiff’s allegations that the governmentbreached its implied duty of good faith and fairdealing, the Federal Circuit chose not to rely onthe “reasonableness” test, and instead utilizedthe “specific targeting” test. Applying that test,the court found that the government had notbreached its duty of good faith and fair dealingbecause the government’s actions were not“specifically targeted at the plaintiff[s] contractrights” and “did not reappropriate any ‘benefit’guaranteed by the contract.” The courtreasoned that there could not have been abreach because the implied duty of good faithand fair dealing “cannot expand a party’scontractual duties beyond those in the expresscontract or create duties inconsistent with thecontract’s provisions.”

Following Precision Pine, there was muchconfusion and debate regarding whether the“specific targeting” test had displaced the“reasonableness” test. Many, including thegovernment, interpreted the Federal Circuit’sruling in Precision Pine as narrowing the causeof action against the government for breach ofthe duty of good faith and fair dealing tosituations where a contractor could prove thatthe government breached an express contractprovision with the intent to deprive thecontractor of the intended benefit of the parties’bargain.

In Metcalf Construction Company, Inc. v. UnitedStates, the United States Court of Appeals forthe Federal Circuit (“Federal Circuit”) revisitedthe issue and clarified the standards applicableto allegations that the federal governmentbreached its duty of good faith and fair dealing.

Background

In October 2002, Metcalf ConstructionCompany, Inc. (“Metcalf”), a small businessbased in Hawaii, was awarded a $48 millioncontract for the design and construction of 212housing units for the U.S. Navy on a MarineCorps base in Hawaii. Metcalf alleged that itsperformance under the contract was hinderedand delayed by unanticipated soil conditionsand other issues that were exacerbated by theNavy’s failure to administer the contract fairlyand according to its terms. By the time theproject was finally accepted as complete,Metcalf was nearly two years behind scheduleand had incurred additional costs allegedlytotaling $27 million. After the Navy’sContracting Officer denied a certified claim forthe increased costs, Metcalf appealed to theUnited States Court of Federal Claims to recoverits losses, contending that the Navy’s conductamounted to a breach of the Navy’s impliedduty of good faith and fair dealing under theparties’ contract. The Navy denied theallegations and counter-sued Metcalf forliquidated damages based upon Metcalf’s delayin completing the project.

uu C A S E U P D A T E tt

The Scope Of The Government’sDuty Of Good Faith And Fair DealingUnder Federal Contracts

by Robert G. Barbour and Vivian Katsantonis, Senior Partners

Robert G. Barbour____________

Not Pictured: Vivian Katsantonis

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The Lower Court Ruling

The Court of Federal Claims denied Metcalf’sappeal in large part, granting the Navy’s claimfor liquidated damages and ruling that the Navydid not breach its duty of good faith and fairdealing. With specific regard to the latter, theCourt of Federal Claims’ decision rested on avery narrow view of the government’s impliedduties. Specifically, relying almost entirely onPrecision Pine, the Court of Federal Claims heldthat “a breach of the duty of good faith and fairdealing claim against the Government can onlybe established by a showing that it ‘specificallydesigned to reappropriate the benefits [that] theother party expected to obtain from thetransaction, thereby abrogating the govern-ment’s obligation under the contract.’” Furtherhighlighting its narrow view, the Court of FederalClaims added that “incompetence and/or failureto cooperate or accommodate a contractor’srequest do not trigger the duty of good faith andfair dealing, unless the Government ‘specificallytargeted’ action to obtain the ‘benefit of thecontract’ or where Government actions were‘undertaken for the purpose of delaying orhampering performance of the contract.’”

The Federal Circuit’s Rejection Of The LowerCourt Ruling

Metcalf appealed the Court of Federal Claim’sruling to the Federal Circuit, arguing that the“specifically targeted” standard articulated inPrecision Pine applies only in limited factualcircumstances, where acts of a separategovernment agency or authority, like a courtorder issued in a separate case, impact thecontract at issue. Metcalf asserted that in thespecific circumstances presented, where theconduct of the government’s representativesadministering the contract formed the basis ofthe alleged breach, the Court of Federal Claimsshould have applied the “reasonableness”standard. The Federal Circuit agreed withMetcalf and held that the Court of FederalClaims misread the standard articulated inPrecision Pine. The court went on, in twoimportant ways, to resolve the confusion thePrecision Pine decision had created.

First, the appeals court made clear thatPrecision Pine did not establish a new rule thatprecludes a contractor from establishing abreach of the government’s implied duty ofgood faith and fair dealing unless it candemonstrate that the government’s conduct was“specifically targeted” to reappropriate benefitsfrom the contractor. The Federal Circuit foundthat the Court of Federal Claims had erred byimposing such a standard based upon itsreading of Precision Pine, noting that that case“does not impose a specific-targetingrequirement applicable across the board,” and“does not purport to define the scope of good-faith-and-fair-dealing claims for all cases, letalone alter earlier standards.” The FederalCircuit went on to make clear that PrecisionPine’s “specific targeting” analysis applies onlyin the rare circumstance where a contractingagency’s ability to facilitate a contractor’sperformance is at odds with “the authority ofother government entities.”

Second, the Metcalf court clarified that acontractor is not required to show thegovernment’s breach of an express contractprovision to prevail on a claim that thegovernment breached its duty of good faith andfair dealing. The government raised thisargument at the Court of Federal Claims, citingas support Precision Pine’s statement thatimplied duties “cannot expand a party’scontractual duties beyond those in the expresscontract.” The court rejected that argument,explaining that “a breach of the implied duty ofgood faith and fair dealing does not require aviolation of an express provision of thecontract.” Instead, it simply requires evidencethat the government has violated a reasonableexpectation of the contractor that is rooted inthe original contract bargain.

Overall, the ruling in Metcalf has been hailed asa victory for contractors. The Federal Circuit’sdecision in Precision Pine has not beenoverruled, however, and that decision may stillbe cited by the government’s attorneys incertain situations in an effort to limit thegovernment’s exposure to claims that it hasbreached its implied duty of good faith and fairdealing. t

All of our newsletters, past and present, are posted on our website,www.wthf.com, under the News, Publications Tab. If you would liketo receive an electronic copy of our newsletter, please contactCindy Vasko at: [email protected]

Attorneys at Law

Summer 2011

Inside...• Contracting Officer’s Abdication Of

Responsibility Renders Final Decision A

NullityPage 2• Suppliers Beware! Don’t Let The Miller Act

Trap You On The Scaffolding

Page 3• A FAR Sighted Approach To OCI ? –

Proposed Rule Heralds Novel Treatment Of

Organizational Conflicts Of Interest

Page 5• Work Or Walk Away? What Should You Do

When An Owner Or General Contractor

Declares Bankruptcy?

Page 7• False Or Exaggerated Bond Claims: What

Can A Surety Do To Combat This

Increasingly Prevalent Practice?

Page 10• New Laws For Public Works In Virginia

Page 12• Firm NewsPage 13

BUILDING SOLUTION

The newsletter of

Watt, Tieder, Hoffar & Fitzgerald, LL

visit us on the web atwww.wthf.com

CHAMBERS USA2011 Award for Excellence

in Construction LawGoes To

Watt, Tieder, Hoffar & Fitzgerald, L.L.P.

We are pleased to announce that on June 9, 2011,

Chambers USA presented its national Award for

Excellence in Construction Law to Watt, Tieder,

Hoffar & Fitzgerald, L.L.P. This is our second

national Award for Excellence in Construction Law,

the prior Award being for 2009.

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...continued on page 8

Once a surety receives a declaration of default,show cause notice or even a letter of concern, itis imperative that the surety take immediateaction to best prepare and position itself shouldthe government terminate the surety’s principalon the project. A declaration of defaultoftentimes is a result of an acrimoniousrelationship between the contracting officer andthe surety’s principal. This can lead thegovernment to quickly terminate for default,and more importantly, a demand to the suretyto complete the project. Obviously, atermination for default is a serious step that canhave long term consequences for a contractor.Courts consider a default termination a drasticmeasure and place the burden on thegovernment to demonstrate the validity of thedefault termination.

If the government does terminate for default, thesurety has numerous options, such as tenderingthe penal sum of the bond, executing a takeoveragreement, tendering a new contractor,financing the surety’s principal, or doingnothing. However, before default-terminationoccurs and the surety selects one of its rights,there is a brief, yet important, period of timewhen options are available that may avoid atermination for default.

This article focuses on the alternatives a suretyand the government, as well as the contractor,should examine in order to avoid the costly andcontentious default-termination process asprovided in the Federal Acquisition Regulation(“FAR”). The FAR is intentionally vague andthere is little to no case law interpreting thealternatives provided in lieu of termination. TheFAR, however, provides alternatives in lieu oftermination for default that both minimize costsand potential losses, while at the same timeallowing for completion of the project in a timelyand efficient manner. The government, thesurety and the contractor all have an interest infully exhausting these options prior totermination.

Alternatives In Lieu Of Termination ForDefault

The alternatives in lieu of termination set forthin the FAR allow the government to choose oneof three options: 1) permit the contractor, thesurety, or the guarantor to continueperformance of the contract under a reviseddelivery schedule; 2) permit the contractor tocontinue performance of the contract by meansof a subcontract or other business arrangementwith an acceptable third party, provided therights of the Government are adequatelypreserved; or 3) execute a no-cost terminationsettlement agreement. FAR §49.402-4.

• Option 1 - Revised Delivery Schedule

In those rare instances where time is not of theessence, this may be a viable option.Notwithstanding, the government will likely notreceive a completed project in a more timelymanner should it decide to terminate acontractor for default. With this option, thesurety can submit a revised delivery schedule inorder to permit the contractor to continueperformance on the contract. If the governmentagrees to the revised delivery schedule,termination for default will be avoided. Underthis option, the government may alsoaccommodate delayed delivery of service ormaterials in exchange for a reduced price.

If the working relationship between thecontractor and the government is sound andadditional time is available, this option would bethe most appropriate option. This option alsoallows the contractor to retain control of itswork.

• Option 2 - Permit The Contractor ToContinue Performance By Means OfSubcontract

Option 2 ensures that the contract will continue,and substitutes the contractor by transferringthe work to a third party. This option isbeneficial to both the government and thesurety, because the government’s project

uu T E R M I N A T I O N F O R D E F A U L T tt

Don’t Jump To Conclusions: Termination For Default Federal Project Options And Issues

by Eric B. Kjellander, Associate

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Building Solutions | Page 8

continues with minimal interruption, while thesurety is not required to take any further action.

In LB&B Assocs., Inc. v. United States, theplaintiff contractor was required to performmaintenance and repair, including removal ofhazardous waste material, for various Navyfacilities. 91 Fed. Cl. 142, 147 (2010). Withintwo years of signing the contract, deficienciesarose concerning the maintenance, repair andhandling of the hazardous waste material. Id. at148-49. Instead of immediately terminating fordefault, the government attempted to avoidtermination by allowing the contractor tocontinue performance through a subcontractorfor a certain portion of the work. Id. at 150. Thegovernment informed the contractor of thefailures, allowed it the opportunity to cure thedefects, and informed the contractor that defaultwould occur if the deficiencies were not fixed.The contractor subsequently filed claims foradditional costs for subcontracting thehazardous material handling.

In granting the government’s motion forsummary judgment on the claim, the court heldthat the government’s actions were permissiblein lieu of termination. Id. at 156. By providingan alternative to default-termination, thegovernment provided an option to immediatetermination and allowed the contractor to retainsome, though not complete, control over theproject.

This option can be utilized in the event therelationship between the contracting officer andthe principal is not irrevocably damaged.Perhaps the contractor underbid the project, hasmanpower issues, or just needs a portion of thescope subcontracted to a different party.Perhaps a majority of the contractor’s scope ofwork is subcontracted out to one subcontractorthat could increase its role on the project.Despite project issues, the government may notwant to lose the original contractor’s expertiseor project experience.

• Option 3 - Execute A No-CostTermination Settlement Agreement

This option would allow the parties to essentiallyrescind the contract and allow the parties to gotheir separate ways. Courts recognize that atermination for default is “the most drastic ofremedies” and a “contractual death sentence.”Pipe Tech, Inc., ENGBCA Nos. 5959, 6005, 94-2 BCA ¶26,649; Martin Constr., Inc. v. UnitedStates, 102 Fed. Cl. 562, 573 (2011).Termination should only be imposed in limitedsituations and on “good grounds and on solidevidence.” Lisbon Contractors, Inc. v. UnitedStates, 828 F.2d 759, 765 (Fed. Cir. 1987).

A termination for default remains a riskymeasure on the part of the government,

because if a court ultimately finds the defaultexcusable, a termination for default converts toa termination for convenience. DynalectronCorp. v. United States, 518 F.2d 594, 602 (Ct.Cl. 1975); FAR §52.248-10. If a defaulttermination is converted to a termination ofconvenience, recoverable damages are limitedto costs sustained before termination, areasonable profit on the work that has beenperformed, as well as other additional costs.Pinckney v. United States, 88 Fed. Cl. 490, 506(2009). However, other damages typicallyassociated with breach of contract actions maybe available if it is determined the governmentterminated the contract in bad faith. Id.

This option is more viable early in the project,especially if there are other availablecontractors that submitted similar bids. Option3 is a more likely option where the terminationfor default would be contested, additionallitigation likely, and a favorable ruling on thegovernment’s decision unclear. A surety mustalso consider the contractor’s subcontractorsand potential payment bond liability prior to theparties entering into a no-cost termination. Onefinal consideration is whether the contractordesires to bargain for an acceptable evaluationfrom the relevant agency. The FAR providesexamples of no-cost termination settlementagreements for complete or partial termination.See FAR §§ 49.603-6; 49.603-7.

The Government Is Required To Balance Certain Factors Before Termination For Default

If the government elects not to utilize one of theabove alternatives, the government mustbalance specific factors in evaluating whether toterminate for default. Importantly, the FARrequires the government to notify the surety iftermination is imminent. FAR § 49.402-3(e).Prior to any action by the surety, the suretyshould confirm that the government hascomplied with the balancing requirements fordefault-termination. Noncompliance with thesefactors may provide evidence that a contractingofficer abused his discretion in terminating acontract for default. DCX, Inc. v. Perry, 79 F.3d132, 135 (Fed. Cir. 1996). Courts review thesefactors and determine on a case-by-case basiswhether the default termination is proper.Decker & Co. v. West, 76 F.3d 1573, 1580 (Fed.Cir. 1996) (quoting Olson Plumbing & HeatingCo. v. United States, 221 Ct. Cl. 197, 602 F.2d950, 955 (Ct. Cl. 1979)).

The FAR factors include, among others, theterms of the contract, the specific failure of thecontractor and any excuses for the failure, thecontract schedule, and the work remaining onthe contract. FAR §49.402-3(f). In addition, theFAR provides the contracting officer with broaddiscretion under a catchall of “any otherpertinent facts and circumstances.” FAR

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...continued on page 10

§49.402-3(f)(7). After the contracting officerreviews these factors and determines the defaulttermination is warranted, the contracting officershall issue a notice of termination detailing,among other things, the reasons for thetermination and the contractor’s right to appeal.FAR §49.402-3(g).

Conclusion

Although a surety has numerous options andrights after the government terminates fordefault, the government, the surety and thecontractor benefit by avoiding termination. TheFAR provides alternatives in lieu of terminationin order to provide flexible options to mitigatedamages for all parties involved and deliver asatisfactory project to the government in atimely and efficient manner. t

The line between the Western and Eastern worldhas never been static. As a baby boomer, theline of which I was first aware was the IronCurtain, which cast Russia, Poland, Hungary,and even parts of Germany in the East. Havingspent some considerable time over the past fewyears between the old and the “new” lines, Ihave concluded that West and East are largelydetermined, not by political categorization orgeography, but by attitude, religious traditionand the need and respect for personal freedom.Ukraine provides a good example of this where,despite the political designation as part of theWest, significant portions of the populationconsider themselves to be Eastern. I will not tryto categorize all of the places I have visited, butcan comfortably state that, despite its years inthe Russian Empire and its Eastern location onthe map, Estonia is now and probably alwayswas part of the West. (See map).

Given Estonia’s history and the unfolding eventsin Ukraine, on my recent teaching visit toEstonia, we expected to find a high level ofconcern regarding Russia’s intentions. Whilethe individuals we met did voice some concernand held a wide range of views on the subject,the common attitude seemed to be “NATO willprotect us, so why worry?” The mostconcerned individual I talked to was one of mystudents who was a reservist in Estonia’smilitary and did not want to be called up. WhileEstonia has a significant ethnic Russianpopulation, several of the people we met withvoiced their opinion on how much better thingsare in Estonia today than they were when theSoviets ran the country.

Our 2014 teaching assignment to Estonia wasat the University of Tartu located in the city ofTartu. Estonia’s second largest city with apopulation of approximately 95,000, Tartuexists primarily as a university town. Tartu islocated in the southeast part of Estonia, lessthan 40 miles from the Russian border, and hasall the energy and charm one would expect froma city whose dominant age group is below 25.But first, a little background.

Estonia – The Place

Estonia is one of the three Baltic States, Latviaand Lithuania being the other two. Both Latviaand Estonia, despite being reasonably welldefined geographically, have spent most of theirexistence as part of someone else’s empire.

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All “Reasonably” Quiet On The Western Front – Estonia

by John B. Tieder, Jr., Senior Partner

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Estonia borders the Baltic in the North andshares a large border lake with Russia (LakePeipsi) on the East. Roughly the size of thecombined areas of Vermont and NewHampshire, Estonia shares its non-water borderwith Russia and Latvia. More than a third of thecountry’s population of approximately 1.34million lives in the capital city of Tallinn, so thecountryside beyond is sparsely populated. Theeastern half of the country is comprised of mileafter mile farmland and pine forests and isdotted with small towns, most of which have 50or fewer houses and no commercial buildings.Roughly three quarters of the population areethnic Estonians, with the remaining quartercomprised primarily of Russians. In neighboringLatvia, by contrast, ethnic Latvians areapproaching minority status.

A side note on driving: The roads Estonia arewell-built and safe, and there is very little traffic.An international driver’s license is required, aslicenses issued by a U.S. state are notrecognized as valid. Most surprising is thescarcity of gas stations, which are few and farbetween, usually located in remote locations,and sometimes have no gas. It is important tonote that towns with gas stations are specificallyidentified on the map. If driving in Estonia – buygasoline wherever you can!

With regard to energy, Estonia is mostly self-sufficient as a result of large in-country oil shalereserves. Two power plants fueled by the oilfrom these reserves provide 90% of thecountry’s power. Several relatively new windturbines face the Baltic Sea in the North, andbiomass plants, which operate like large woodstoves, make use of the refuge of the timberindustry. Regular sized wood stoves are used inmany homes, and a neatly stacked pile of woodoutside a home is a common site. One of mystudents explained that children in Estonia aretaught to stack wood at an early age and that asloppy wood pile is a disgrace.

Estonia – The History

An active Bronze Age culture existed along theBaltic dating back to approximately 5000 B.C.By 800-900 A.D., people in what is now Estonia

were actively involved in trade with theByzantine Empire and the Arab World. Fromapproximately 1000 A.D. onward, Estonia wasa pawn in the power struggles among Denmark,Sweden, the Lithuanian–Polish Commonwealthand, later, between Russia and Germany in aseries of wars not generally addressed in collegesurvey courses of European history. Some ofthe low points (from the Estonian point of view)were the conquest by the Teutonic Knights inthe 13th Century, the Livonian War of the mid-16th century and the Great Northern Warbetween Sweden (Charles XII) and Russia (Peterthe Great) of the early 18th Century. Thepeople who had the most the most influence,however, especially from an economic andcultural perspective, were the Germans.

One of the side benefits of religion, wars and theconcentration of wealth in a few people is thegreat sightseeing opportunities they provide inlater centuries, and Estonia is no exception.Were it not for the Lutheran Church and theGerman nobility, there would be little to see asa tourist in Estonia. As a result of thoseinstitutions, large baronial estates existthroughout the country, several of which arenow in the process of being renovated to serveas hotels or resorts. We stayed in a particularlynice estate that was purchased and renovatedby an American Artist – Kau Manor. It may notbe worth a separate trip to Estonia, but if in theneighborhood, it is worth a night’s stay.

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Back to history, when Sweden lost the GreatNorthern War, Estonia became part of theRussian Empire. Germany, however, remainedthe dominant financial influence on the region.One of the most interesting developments of thisperiod was the emergence in Estonia of songfests in the early 19th century. These song festsare large gatherings where people sing aboutthe country and its culture. The traditioncontinues to this day, and we had anopportunity to attend one put on by theUniversity of Tartu student body. There isobvious reverence and pride, especially whenthe National Anthem is sung. It was, andpresumably still is, a way of celebrating theconcept of Estonia.

Though its boundaries have been reasonablywell-defined for centuries, the Republic ofEstonia was first recognized as an independentcountry by the treaty of Tartu in 1920, afterEstonians fought and won a war forindependence from Russia. Estonia’sindependence was short-lived, however, andcame to an end in 1940 when Eastern Europewas divided between Russia and Germanyunder the notorious Molotov-Ribbentrop Pact.Estonia was annexed by the Soviet Union andwas absorbed, again, into the Russian Empire.It was not until 1991, with the disintegration ofthe Eastern Bloc, that Estonia was againrecognized as an independent country. Thus,like most European countries, it took centuriesof dynastic warfare before Estonia emerged asan identifiable political entity with relativelystatic geographic borders. Estonia became oneof the first countries in the former East tobecome a full member of the European Union.

Estonia – Today

The rule of law is well established in Estonia.We had the good fortune to spend some timewith a justice of Estonia’s Supreme Court and,thus, got some real insight into the country’slegal system. The Supreme Court has a total ofseventeen justices, but most cases are heard bya panel of three. As in most civil law countries,oral argument is rare. The dominance of therule of law and the corresponding lack ofcorruption is verified by TransparencyInternational, which places Estonia 28th out of

172 countries inlack of corruption.For comparisonpur-poses, theUnited States is19th.

Another meaning-ful indication of thelack of corruptionand the corre-sponding percep-tion that a levelplaying field pro-vides a fair chance

for success in a competitive environment wasthat none of my students wants to leave Estonia.In stark contrast, my students during previousteaching assignments in Russia, Bulgaria andother places often voiced their desire to moveto the West. The retention of young people,especially of the caliber I was teaching, bodeswell for Estonia’s future.

Estonia gives the general impression of being aprosperous, if not a rich, country. TheEstonians are quite innovative and adept at hightech manufacturing. For example, Skype is anEstonian innovation, and there are free Skypestations in the Tallinn Airport. The country,perhaps attributable in part to its relatively smallgeographical size and relatively flat topography,has 100% wireless coverage. There alsoappears to be little poverty in the country. In themore rural areas, the homes seemed in goodrepair and most of the automobiles were ofrelatively recent vintage. We saw very fewhomeless people.

The population, unlike many of the other placeswe have visited, has stabilized and may even begrowing. We were told that many young people,especially those with minimal skills andeducation, immigrate to Scandinaviancountries, but that the better educated peopletend to stay in Estonia. Our anecdotalobservation was that there was something of ababy boom ongoing, as there seemed to be anunusually high number of toddlers, babycarriages, strollers, and pregnant women. Thismay be due to the fact that we were in aUniversity town with a lot of young people, butit was still extraordinary.

One of the faculty members at the law schoolhad re-emigrated from the United States. Hisparents left Estonia following WWII, but hereturned in 2004 and he is now a dual citizen,married, with two young children. Remarkably,he was able to regain title to an apartmentbuilding the Soviets had expropriated from hisfamily, though decades without propermaintenance left the apartment of little value.

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Lutheranism is theforemost religion inEstonia, havingbeen introduced bythe Swedes andthe Germans. Thecountryside isdominated by Lu-theran churches invarious stages ofrepair, and manyare deserted. Weattended a Luther-an service on theSaturday nightbefore Easter and there were about 40parishioners in attendance. This was in contrastto Sunday service we attended in the RussianOrthodox Church in Tallinn the next day(Orthodox and Roman Easter were on the sameSunday this year), which was well-attended. Wemet, quite by accident, an evangelical ministerfrom the United States who has been coming toEstonia for several years. While we had no wayto judge factually, he asserted that theevangelical movement is taking hold in Estonia.

Tallinn

We reached Estonia via a connecting flight fromFrankfurt that flew into Estonia’s capital city,Tallinn. Tallinn is beautiful and, for good reason,is a mandatory stop on all Baltic cruises. Its oldcity has been magnificently restored and isincluded as a UNESCO World Heritage site.After a cold, wet winter in the eastern UnitedStates, we arrived in Estonia just as spring wasarriving; the days were a little cool, and with the

exception of oneday, were beau-tifully sunny. Thedays were also long,with the sun risingby 5:00 A.M. andtwilight still linger-ing at 6:30 p.m.Spring unfoldedbefore us. The treeswere only buddingwhen we arrived butwere almost in full

leaf by the time we left.

We spent a weekendin Tallinn and optedto stay in a bed &breakfast built in the15th century. It wasan intriguing spotwith one exception —the stairway andmany of thedoorways were builtfor the average sizeperson of the 15th

century. This is also true of many of the OldTown buildings. If you are an average sizeperson of the 21st century, the difference will beclear. You will hit your head- often!

Tartu And The University Of Tartu

Tartu is a university town, and with a populationof approximately 95,000, is Estonia’s secondlargest metropolitan area. Between 18,000 and20,000 of Tartu’s residents are students. Add infaculty, other employees, associated researchfacilities, and the University is the town.

The University wasfounded by a direc-tive of King GustavusAdolphus of Swedenin 1632, at whichtime Estonia waspart of the Swedishempire. The Univer-sity runs along bothsides of the EmajogiRiver and architec-turally is quiteimpressive. Many ofthe University’s

buildings date from the early 19th Century,although a few of its buildings (including the lawfacility) date from the Soviet era and have been,thankfully, remodeled. The center of the townis a large pedestrian-only square, highlighted bythe "students kissing" statue.

Our living quarters were in an area of town inthe midst of gentrification. Our apartment was

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recently remodeled, both inside and out, andwas easily the nicest living quarters we havehad in this program. The neighborhood aroundour apartment was known as “soup town”because all the streets were named aftervegetables. Among other intriguing aspects,there was a brewery with a retail outlet a stone’s

throw from our frontdoor. Another intrigu-ing aspect of souptown was Riku, astray dog who hadbecome a favorite ofall the residents.When he died, theneighborhood com-missioned a full-sizestatue and placed it athis usual spot.

Student Days

We were extremely fortunate to be in Tartuduring student days, which were kicked off witha song fest. The next day brought a parade ofall the University’s fraternities and sororities.Although the most active portion of thesegroups is the current student body, peoplebelong and participate for life. I became friendlywith some of the members of Rotalia, which isone of the largest fraternities. The youngestmembers were 18 year-old pledges, while theoldest members were in their 80’s. Eachfraternity and sorority has a distinctive hat.They march through the campus and to thetown hall where the mayor is required to drink abeer and then turn the town over to the studentsfor the week. They next march to theUniversity’s main administration building wherethe President of the University also drinks a beerand turns over the University to the students.Finally, they march to their respective housesand party until midnight at which time theyopen the door to all comers. My Rotalia friends

encouraged us tocome, but I amafraid our postmidnight party daysare behind us.

The rest of the week-long student days isbasically a party withvarious contests,races, fireworks, a

night where everyone dresses as a witch. I didmiss a contest I wanted to see that challengedstudents to make the tallest pile of books andstand on it without it collapsing.

My Classes

I have now refined my course, which is titled"Introduction to International BusinessTransactions," to a point where I am quite proudof it. The goal of the course is to introducestudents to the world of international businesstransactions and to stress the importance ofthose transactions, especially for a smallcountry like Estonia. I had a core class in Tartuof about 16 students, with additional studentsjoining in from time to time to try out theirEnglish.

I really enjoyed them. Their English wasexcellent, and they had no problem correctingme when I made a mistake regarding the locallaws. We had an end of class oral presentationsession where the reports were concise andcreative.

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Likewise, the faculty was supportive andfriendly. They took us on many excursions,hiking in a forest preserve, visits to nearbyestates, and several lunches and dinners. Wereciprocated with a formal dinner. It was, all inall, a wonderful experience.

Afterword

It is impossible to have spent April 2014 fewerthan 50 miles from the Russian border and nothave an opinion on the events in Ukraine.Moreover, my teaching program has affordedme the opportunity to meet and talk with manyUkrainians. Rufus and I spent two weeks inDnipropetrovs'k, Ukraine, at the Academy ofCustoms in November 2010. The Customsservice is a uniformed service, and the studentsat the Academy of Customs are comparable tothe officer cadets and midshipmen at the UnitedStates service academies. Like our officercadets and midshipmen, the students in theAcademy of Customs are intelligent andpatriotic and are receiving a free education inreturn for future years of service.

We had numerous discussions in 2010 withthese students regarding the future of Ukraine.All of them were committed to the fight againstcorruption, and many were vocal that they feltmore comfortable with the Russian way of doingthings than with the Western way. Many of themhad at least one Russian parent. The east/westsplit (philosophically) was generally along theeast/west divide (geographically) of Ukraine. Iprovide this anecdotal background because therevulsion towards corruption and the east/westsplit were active topics of conversations. Thecurrent Russian administration may haveencouraged and escalated these tensions, but

they are not a pretext. I have no troubleaccepting that the “separatists” are Ukrainianswho believe in what they are saying. I quotefrom my 2010 article on Ukraine:

[Ukraine] is exciting for many reasonswhich I will try to explain, but most of allbecause it is a large, resource-rich placewhich could become one of the mostsubstantial, richest countries in Europeor dissolve into chaos and sectionalism.

The most disturbing aspect of the currentsituation in Ukraine is that it was allowed toreach the boiling point. Active engagement andsome reasonable solution, maybe even aplebiscite or orderly referendum and certainly amore concerted effort to change the climate ofcorruption could have led to a solution andavoided the current crisis. In my opinion, theU.S. and other Western diplomats were notpaying adequate attention to the situation.

Where To Next?

I am undecided where I will next teach mycourse. I have been asked to go back toBulgaria and may well do so, as we havedeveloped close friendships there. We wouldreally like to round out our experience in theformer Yugoslavia by going to Bosnia-Herzegovina or Montenegro. Also, teaching inRomania, Albania or Lithuania would beexciting. Perhaps most compelling, however,would be another visit to Russia. My firstassignment, almost ten years ago, was in St.Petersburg. It would be interesting to revisit thatcountry and to see how, if at all, attitudes havechanged over the past decade. t

uu F I R M N E W S tt

Honors Chambers USA Guide To America’s LeadingLawyers For Business

Watt, Tieder, Hoffar & Fitzgerald, L.L.P. isrecognized in the 2014 edition of ChambersUSA Guide to America’s Leading Lawyers ForBusiness as a Band One Construction Law Firmin the United States. Chambers and Partnershas consistently namedWTHF and its attorneysamong the top construction firms and attorneysboth nationally and regionally since 2004.

Chambers also recognized the McLean, Virginiaand Irvine, California offices as Band Oneconstruction law practices in Virginia andCalifornia. The following WTHF attorneys arerecognized as “leaders in their field forConstruction Law: Robert G. Watt, John B.

Tieder, Jr., Robert M. Fitzgerald, Lewis J.Baker, Carter B. Reid, Vivian Katsantonis,Robert C. Niesley, and Gregory J. Dukellis.

Super Lawyers

2014 Virginia Super Lawyers recognized JohnB. Tieder, Jr., Robert M. Fitzgerald, Lewis J.Baker, and Vivian Katsantonis. 2014 SouthernCalifornia Super Lawyers recognized Robert C.Niesley. Brent N. Mackay was selected as aRising Star. 2014 Washington Super Lawyersrecognized Christopher A. Wright and R. MilesStanislaw. 2014 Illinois Super Lawyersrecognized John E. Sebastian. 2014 MountainStates Super Lawyers recognized Jared M.Sechrist as a Rising Star.

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Upcoming Events

William C. Vis International Moot Team

Proving Delay in International ConstructionArbitrations – What Works Best? Secretariat,Delta Consulting; September 22, 2014; Munich,Germany. John B. Tieder, Jr. and Shelly L.Ewald to speak.

Liberty Commercial Group Seminar; September23, 2014; sponsored by Watt, Tieder, Hoffar &Fitzgerald, L.L.P., 10 S. Wacker Drive, Chicago,Illinois.

FIDIC Americas Contract Users’ Conference,October 14-15, 2014; sponsored by FIDIC andIBC Legal; Miami, Florida; John B. Tieder, Jr.and Carter B. Reid to speak on Disputes, ADRand Arbitration.

Annual Conference of the International BarAssociation, October 19-24, 2014; Tokyo,Japan; John B. Tieder, Jr. to speak on ArbitrationUnder the FIDIC Terms of Contract. t

Legal 500

Legal 500 United States recognized Watt,Tieder, Hoffar & Fitzgerald as a top tier

construction law firm for 2014. Lewis J. Bakerof the McLean, Virginia office was recognized asa Legal 500 Leading Lawyer. t

WTHF extends congratulations to the KabulUniversity Vis Moot Team of Nabila Barmaki,Rohila Burhanzoi, Arghawan Habibi, and DuniyaStanikzai on their hard work and participation inthe 11th Annual Willem C. Vis (East) InternationalCommercial Arbitration Moot in Hong Kong, aswell as the 4th Annual Vis Middle East Pre-Mootin Doha, Qatar. This was the first time thatAfghanistan has ever competed in the Vis Moot.

The Willem C. Vis International CommercialArbitration Moot began in 1994 with theassistance of the United Nations Commission onTrade Law (UNCITRAL) as an educationalcompetition to promote the use of the U.N.Convention on Contracts for the International Saleof Goods (CISG) and international commercialarbitration to settle disputes in addition to ageneral understanding of internationalcommercial law. The competition has grown tobe one of the most prestigious moots in the worldand is considered by many to be the “Olympicsof international trade law.” The Vis Moot (East)was created in 2004 to provide a more convenientvenue for teams unable to make the trip to the VisMoot held in Vienna, Austria.

Between the competitions held in Vienna andHong Kong, nearly 400 teams from over 90countries competed against each other toresolve a simulated dispute that arises out of acontract of sale between companies from twocountries that are party to the CISG.

WTHF Associate and Vis Moot Alum DanielRodriguez served as a coach for the KabulTeam along with his colleague and former VisMoot teammate Matthew Brown of the Instituteof International Banking Law and Practice.Through Skype, long-distance phone calls, andin-person meetings with the students inIslamabad, Doha, and Hong Kong, they workedwith the team to provide a foundationalunderstanding of commercial law andarbitration procedure and to provide instructionin legal research, writing, and oral advocacy inpreparation for the rigorous level of competitionof the Vis Moot.

In Doha, the team first participated in a threeday moot-workshop, along with six other teamsfrom the Middle East and North Africa,culminating in a pre-moot competition amongthe participating teams from Saudi Arabia,Qatar, Bahrain, Tunisia, Egypt, and Iraq. DanielRodriguez and Matt Brown were among theinstructors of the workshop, working with all theteams present. This provided the Kabul teamwith its first taste of international experience ona small scale before they entered the Vis East inHong Kong.

While the team did not advance to the knockoutstages in Hong Kong, they impressed everyoneas they held their own in the general roundsagainst perennial heavyweights HumboltUniversity of Berlin, Bond University (Australia),and Pace University (USA). t

Left to Right: Rohila Burhanzoi, ArghawanHabibi, Matt Brown, Daniel Rodriguez, NabilaBarmaki, Duniya Stanikzai

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The Watt, Tieder, Hoffar & Fitzgerald newsletter is published quarterly and is designedto provide information on general legal issues that are of interest to our friends andclients. For specific questions and concerns, the advice of legal counsel should beobtained. Any opinions expressed herein are solely those of the individual author.

Special Thanks to Editors, Robert G. Barbour, Keith C. Phillips, William Groscupand Heather Stangle.

This publication may not be reproduced or used in whole or part except with proper credit to its authorship.

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