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White v. Delta Construction International, Inc.

Board of Contract Appeals overcompensated contractor by awarding difference between dollar amount of work ordered by government and minimum dollar amount government was required to order; proper damage award was amount of loss suffered by contractor due to government's breach.

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Appealed from: Armed Services Board of Contract Appeals

In this appeal the government challenges the theory upon which the Armed Services Board of Contract Appeals (“Board”) determined the damages resulting from the government’s breach of a contractual provision obligating the government to provide a contractor with work of a specified minimum dollar amount. The Board awarded the contractor the difference between the dollar amount of work the government actually ordered and the total minimum dollar amount the contract obligated the government to order. We conclude that this was an impermissible basis for calculating damages, because it would put the contractor in a more favorable position than it would have been in if the government had performed rather than breached its contractual commitment. The proper basis for damages in this case is the loss the contractor suffered as a result of the government’s breach, not the total amount it would have received without the breach. Accordingly, we vacate the decision of the Board and remand.

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