Hawaiian Dredging Construction Company, Inc. v. United States

N OTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
HAWAIIAN DREDGING CONSTRUCTION
COMPANY, INC.,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
______________________
2023-1909
______________________
Appeal from the United States Court of Federal Claims
in No. 1:22-cv-00339-CNL, Judge Carolyn N. Lerner.
______________________
Decided: February 19, 2025
______________________
MICHAEL ZISA, Peckar & Abramson, P.C., Washington,
DC, argued for plaintiff-appellant.
RUSSELL J AMES U PTON, Commercial Litigation Branch,
Civil Division, United States Department of Justice, Wash-
ington, DC, argued for defendant-appellee. Also repre-
sented by BRIAN M. BOYNTON, MARTIN F. HOCKEY , J R.,
P ATRICIA M. MC CARTHY .
______________________
Case: 23-1909 Document: 70 Page: 1 Filed: 02/19/2025

-- 1 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 2
Before D YK, CLEVENGER , and P ROST , Circuit Judges.
P ROST , Circuit Judge.
Hawaiian Dredging Construction Company (“HDCC”)
appeals a decision from the United States Court of Federal
Claims (“CFC”) granting the government’s Rule 12(b)(6) of
the Rules of the CFC (“RCFC”) motion to dismiss HDCC’s
complaint for failure to state a claim upon which relief can
be granted. See Hawaiian Dredging Constr. Co., Inc v.
United States, No. 22-339, 2023 WL 1979542 (Fed. Cl.
Feb. 14, 2023) (“Opinion”). For the reasons that follow, we
agree with the CFC’s conclusion that HDCC has not pled
sufficient facts to demonstrate excusable delay regarding
its retaining wall construction, but disagree that the al-
leged government delays regarding the Rights of Way
(“ROWs”) delivery and utility relocation related claims, as
well as HDCC’s repayment claim, are ripe for granting the
government’s motion to dismiss under RCFC 12(b)(6). We
also conclude that HDCC’s claim that the final ROWs de-
livered by the government differed from the ROWs as
stated in the request for proposals should not have been
dismissed. We thus affirm in part, reverse in part, and re-
mand for further proceedings.
BACKGROUND
The United States Department of Transportation, act-
ing through the Federal Highway Administration, Central
Federal Lands Highway Division (“the agency”), selected
HDCC as a general contractor for the Lahaina Bypass 1B-
2 design-build construction project in Lahaina, Maui, Ha-
waii (“the Project”). The Project was to relocate the termi-
nus of the Lahaina Bypass, which included roadway
extensions, overpass, culvert construction, and the instal-
lation of road and bridge safety features. On June 3, 2016,
the agency awarded HDCC a firm fixed-price contract to
complete the Project and issued a notice to proceed (“NTP”)
on June 29, 2016, to begin work.
Case: 23-1909 Document: 70 Page: 2 Filed: 02/19/2025

-- 2 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 3
While HDCC’s contract work was substantially com-
pleted by July 24, 2018, on July 17, 2020, HDCC filed a
Contract Disputes Act (“CDA”) claim requesting an “equi-
table adjustment for various delays and increased costs
during its [c]ontract performance.” Opinion, 2023 WL
1979542, at *3. HDCC alleged that it required final ROWs
from landowners near the highway, relocation of overhead
utilities, and construction permits; and the government’s
“failure to secure the ROWs in a timely manner,” and dif-
ferences between the final ROWs and the ROWs proposed
in the request for proposals (“RFP”), caused HDCC to suffer
construction delays and increased costs. Id. HDCC also
alleged that it experienced excusable delays due to govern-
ment changes and additions to the contract work relating
to the retaining wall construction.
On March 30, 2021, the contracting officer (“CO”) is-
sued its final decision denying HDCC’s CDA claim.
J.A. 53–146. On March 29, 2022, HDCC filed its complaint
at the CFC, followed by an amended complaint, seeking
$6,576,968 in damages and specific costs, 190 compensable
and excusable days of delay, and 482 days of excusable de-
lay.
The government moved to dismiss the amended com-
plaint under RCFC 12(b)(6) for failure to state a claim upon
which relief may be granted because “HDCC bore the risk
of increased costs” under the terms of the contract.
J.A. 1622. The CFC found that HDCC “failed to plausibly
allege that there were [g]overnment directed changes to
the [c]ontract” because “[w]hat HDCC interprets as
changes are, in fact, obstacles that arose during contract
performance which deviated from assumptions HDCC held
at the time of its bid.” Opinion, 2023 WL 1979542, at *10.
The CFC concluded that the amended complaint does not
state a claim upon which relief may be granted and granted
the government’s motion to dismiss without prejudice. Id.
at *11.
Case: 23-1909 Document: 70 Page: 3 Filed: 02/19/2025

-- 3 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 4
HDCC timely appealed. We have jurisdiction under
28 U.S.C. § 1295(a)(3).
D ISCUSSION
“We review the Court of Federal Claims’ legal conclu-
sions de novo and its factual findings for clear error.” Shell
Oil Co. v. United States, 896 F.3d 1299, 1306 (Fed. Cir.
2018). Contract interpretation is a question of law that we
review de novo. Pac. Gas & Elec. Co. v. United States, 536
F.3d 1282, 1284–85 (Fed. Cir. 2008) (citing Winstar Corp.
v. United States, 64 F.3d 1531, 1540 (Fed. Cir. 1995) (en
banc), aff’d, 518 U.S. 839 (1996)). “We review a grant of a
motion to dismiss for failure to state a claim de novo. To
withstand a motion to dismiss under Rule 12(b)(6) of the
RCFC, a complaint must contain ‘enough facts to state a
claim to relief that is plausible on its face.’” Frankel v.
United States, 842 F.3d 1246, 1249 (Fed. Cir. 2016) (quot-
ing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
“In deciding a motion to dismiss, a court is required to ac-
cept as true all factual allegations pleaded.” Id.
On appeal, HDCC argues that the CFC erred in (1) dis-
missing HDCC’s amended complaint under RCFC 12(b)(6),
(2) dismissing a portion of HDCC’s claims that were not
subject to the motion to dismiss, and (3) denying its motion
for reconsideration of and/or relief from the order of dismis-
sal and its motion for leave to amend. We address each
argument in turn.
I
HDCC alleges that because it “experienced numerous
impacts and delays that were caused by the [g]overnment,”
it may seek to recover time and costs associated with gov-
ernment impacts and delays. Appellant’s Br. 5. Specifi-
cally, HDCC argues that the CFC erred in granting the
government’s motion to dismiss because the CFC did not
accept all of HDCC’s well pled factual allegations as true
in the light most favorable to HDCC, including that the
Case: 23-1909 Document: 70 Page: 4 Filed: 02/19/2025

-- 4 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 5
government caused project schedule delays which pre-
vented HDCC from timely completing the contract with re-
gard to (a) work requiring ROWs, (b) utility relocation, and
(c) retaining wall construction. J.A. 29–32.
A
Turning to the work requiring ROWs, HDCC argues
that the government “failed to timely provide the final
ROW for the Project,” and “when the [g]overnment finally
provided the final ROW four months after issuing the NTP,
it was materially and unforeseeably different from the
ROW that was included in the RFP and upon which HDCC
had based its bid and developed its design.” Appellant’s Br.
13. Such “failure to timely secure and provide the final
ROW,” according to HDCC, “constituted a constructive
change because it forced HDCC to perform additional work
and caused delays to HDCC’s performance.” Id. at 23.
The government argues that “HDCC failed to point to
any provision of the [c]ontract requiring the agency to
timely secure the final ROWs by any particular date cer-
tain, and also failed to identify any changes to ROWs.” Ap-
pellee’s Br. 31–32. Additionally, the contract incorporated
Federal Acquisition Regulation (“FAR”) 52.236-7, which
states:
The Contractor shall, without additional expense to
the Government, be responsible for obtaining any
necessary licenses and permits, and for complying
with any Federal, State, and municipal laws, codes,
and regulations applicable to the performance of
the work.
Id. at 5 (emphasis in original); see also Opinion, 2023 WL
1979542, at *2; J.A. 1473. The government contends that
the contract “required HDCC to ‘[p]repare [ROW] plans
and any legal description[] documents to facilitate the final
acquisition of the design and permanent right of way to ac-
commodate the maintenance and operation of the facility
Case: 23-1909 Document: 70 Page: 5 Filed: 02/19/2025

-- 5 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 6
by . . . [Hawaii Department of Transportation].’” Appel-
lee’s Br. 5–6. According to the government, because “the
[c]ontract was a firm fixed-price contract[,] HDCC, there-
fore, assumed the risk of any delays or increased costs, in-
cluding the risk of contractually specified liquidated
damages, in the even that HDCC failed to fulfill its obliga-
tions in the time required.” Id. at 22 (citations omitted).
In response, the CFC rejected HDCC’s argument and
found that while the contract “assigns the [g]overnment re-
sponsibility to obtain title to ROWs, it does not specify a
date by which the [g]government was required to do so.
Thus, HDCC is wrong to allege that the [g]overnment
caused unforeseeable, and therefore excusable, delays in
contravention of its express duties under the contract.”
Opinion, 2023 WL 1979542, at *6 (cleaned up). We disa-
gree that this conclusion should be drawn here on a
RCFC 12(b)(6) motion to dismiss when HDCC has pled
facts to the contrary.
When interpreting a contract, we “begin[] with the lan-
guage of the written agreement.” Bell/Heery v. United
States, 739 F.3d 1324, 1331 (Fed. Cir. 2014) (citation omit-
ted). Contemporaneous evidence of the parties’ under-
standing may also be examined to confirm the plain
meaning of the contract. TEG-Paradigm Env’t, Inc. v.
United States, 465 F.3d 1329, 1338 (Fed. Cir. 2006) (citing
Coast Fed. Bank FSB v. United States, 323 F.3d 1035, 1040
(Fed. Cir. 2003) (en banc)). And the “time, place and man-
ner of delivery, if not specified in the contract or by subse-
quent agreement of the parties, should be a reasonable
time, place and manner that enables the contractor to per-
form under the contract.” Franklin Pavkov Constr. Co. v.
Roche, 279 F.3d 989, 997 (Fed. Cir. 2002).
The government’s contract with HDCC states, in two
relevant sections, that:
The Contractor shall be responsible for all work as
described in these RFP documents. The scope of
Case: 23-1909 Document: 70 Page: 6 Filed: 02/19/2025

-- 6 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 7
work includes design, construction, maintenance
during construction, project management, project
scheduling, quality control/quality assurance for
design and construction, materials sampling and
testing, obtaining permits (see FP Section 107),
and coordination with other governmental agencies
and entities including federal, state, local govern-
ments, and communication with the public regard-
ing ongoing and upcoming construction activities.
J.A. 1448 (Contract Terms and Conditions).
Fully design the highway and construction limits
to fit within the designated right of way (ROW) and
future dedication of deed. Design the roadway in
accordance with Chapter 9—Highway Design,
2005 Project Development and Design Manual. An
initial alignment has been provided. The align-
ment, vertical and horizontal, may be altered as
long as the construction limits remain within the
ROW described for Alternative 3 and meets the
AASHTO design criteria for a Principal Rural Ar-
terial Roadway . . . .
J.A. 1528 (111.05. Geometric Requirements).
Based on the contract language, HDCC was required to
“fully design the highway and construction limits” to fit
within designated ROWs, with alignment alterations per-
mitted “as long as the construction limits remain within
the ROW described for Alternative 3.” Id. However, it is
undisputed that the contract obligated the government to
“obtain right-of-way,” not HDCC. J.A. 728. See Appellee’s
Br. 3–4. Because the timeframe for the government to pro-
cure ROWs to the contractor was “not specified in the con-
tract,” the government was still obligated to provide the
ROWs in a “reasonable time, place and manner that ena-
bles the contractor to perform under the contract.” Frank-
lin, 279 F.3d at 997–98. Here, the government provided
the ROWs four months after it issued its NTP. Whether
Case: 23-1909 Document: 70 Page: 7 Filed: 02/19/2025

-- 7 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 8
that timing was “reasonable” or “foreseeable” is a fact-in-
tensive inquiry. So too was the question of whether the
final ROWs delivered by the government materially devi-
ated from those specified in the RFP. Such determinations
are not proper under RCFC 12(b)(6). See Micron Technol-
ogy, Inc. v. Rambus Inc., 645 F.3d 1311, 1321 (Fed. Cir.
2011) (“[F]oreseeability of an event is a traditional issue of
fact.”); see also Coop. Entm’t, Inc. v. Kollective Tech., Inc.,
50 F.4th 127 (Fed. Cir. 2022) (“[A] question of fact . . . can-
not be resolved at the Rule 12(b)(6) stage.”). Moreover,
“[t]he government must avoid actions that unreasonably
cause delay or hindrance to contract performance.” C.
Sanchez & Son, Inc. v. United States, 6 F.3d 1539, 1542
(Fed. Cir. 1993). We therefore reverse and remand these
issues for further proceedings.
B
Next, we address HDCC’s argument regarding the util-
ity relocation. HDCC argues that the CFC “ignored the al-
legations in the [c]omplaint” “that the [g]overnment’s
failure to timely execute agreement with utility companies
as required by the [c]ontract caused delays to HDCC’s per-
formance.” Appellant’s Br. 29. In its complaint, HDCC al-
leged that it “provided the required utility agreements to
the [g]overnment on August 3, 2017[,] but the [g]overn-
ment did not return the executed agreements until Febru-
ary 28, 2018—209 days later.” Id. at 30 (citations omitted).
In its amended complaint, HDCC alleges that the govern-
ment was responsible for the “unforeseen delay of having
to wait for the local utility service providers to approve and
perform utility relocations.” J.A. 31. Such failure and re-
sulting delay, according to HDCC, “constituted a breach of
[the government’s] express obligation under the [c]ontract”
and a “breach[] [of] the duty of good faith and fair dealing.”
Id. at 30.
The government argues that HDCC was responsible for
the utility work because the contract “also required HDCC
Case: 23-1909 Document: 70 Page: 8 Filed: 02/19/2025

-- 8 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 9
to ‘prepare utility agreements for [execution by the govern-
ment],’ and ‘[c]ooperate with utility owners to expedite the
relocation or adjustment of their utilities to minimize in-
terruption of service, duplication of work, and delays if re-
locations or adjustments are needed.’” Appellee’s Br. 6; see
also Opinion, 2023 WL 1979542, at *2; J.A. 385. According
to the government, the contract contained no obligation for
the government to compel third-party utility companies to
expedite utility relocations. See Appellee’s Br. 38. Citing
Bell/Heery, the government contends that “[w]hen consid-
ering a motion to dismiss for failure to state a breach of
contract claim, ‘the court must interpret the contract’s pro-
visions to ascertain whether the facts plaintiff alleges
would, if true, establish a breach of contract.’” Id. at 18
(quoting Bell/Heery, 739 F.3d at 1330).
The CFC disagreed with HDCC and found that “HDCC
points to no contractual provision or authority obligating
the [g]overnment to compel third-party utility companies
to complete utility relocations within HDCC’s preferred
schedule.” Opinion, 2023 WL 1979542, at *8. The CFC de-
termined that because the “firm fixed-price nature of the
[c]ontract assigned HDCC the risk of utility relocation de-
lays,” HDCC “does not allege facts demonstrating that
these delays were excusable due to the [g]overnment’s acts
or omissions in violation of the contract’s express terms or
the implied duty of good faith and fair dealing.” Id. Again,
we disagree that this conclusion can be drawn on a motion
to dismiss under RCFC 12(b)(6), particularly when the un-
derlying facts remain in dispute.
In its amended complaint, HDCC alleges that the gov-
ernment was responsible for the “unforeseen delay of hav-
ing to wait for the local utility service providers to approve
and perform utility relocations.” J.A. 31. Whether a 209-
day period to return the executed agreements was reason-
able under the duty of good faith and fair dealing, and/or
foreseeable to HDCC, is a factual determination. Further,
as noted with regard to the ROWs delivery, see
Case: 23-1909 Document: 70 Page: 9 Filed: 02/19/2025

-- 9 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 10
Discussion I.A., caselaw supports that even silence implies
a standard of reasonableness on the government. For the
same reasons discussed above, we conclude that the CFC
erred in dismissing this claim under RCFC 12(b)(6) and re-
verse and remand for further proceedings.
C
As to the retaining wall construction, HDCC argues
that retaining wall work delays are also subject to relief
because “there was additional change order work associ-
ated with the neighboring Castleton and MECO proper-
ties.” Appellant’s Br. 31. According to HDCC, it could not
proceed with the retaining wall work on the MECO prop-
erty “until the [g]overnment issued approved contract mod-
ifications” that set forth the change order. Id. After HDCC
was not ultimately awarded the Castleton wall work,
HDCC contends that it incurred a 482-day “standby” due
to the government’s “delayed approval of the modifica-
tions.” Id.
The government responds that HDCC admitted “that
the agency ‘instructed HDCC not to perform the Castleton
wall work (and the [g]overnment awarded the work to an-
other contractor).’” Appellee’s Br. 39 (quoting Appellant’s
Br. 31). Because, according to the government, the Castle-
ton wall work was not required by the contract, it was
HDCC that “‘chose to delay’ the MECO wall work” as “an
economic decision.” Appellee’s Br. 40 (quoting J.A. 208–
09).
The CFC found that the “alleged facts, even when
taken as true, indicate that HDCC intentionally contrib-
uted to the delay and that HDCC did not continue to per-
form the contract despite its pending disputes with the
[a]gency.” Opinion, 2023 WL 1979542, at *10. Therefore,
because HDCC “chose to delay performance” and “had con-
trol over the schedule,” the CFC concluded that HDCC had
not pled sufficient facts to demonstrate excusable delay.
Id. We agree.
Case: 23-1909 Document: 70 Page: 10 Filed: 02/19/2025

-- 10 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 11
The FAR provision governing fixed-price construction
states that:
The Contractor’s right to proceed shall not be ter-
minated nor the Contractor charged with damages
under this clause, if—(1) The delay in completing
the work arises from unforeseeable causes beyond
the control and without the fault or negligence of the
Contractor. Examples of such causes include . . .
acts of the Government in either its sovereign or
contractual capacity. . . .
48 C.F.R. § 52.249-10 (emphasis added).
Here, HDCC mischaracterizes its “standby” as a gov-
ernment caused delay. Yet, HDCC admits it decided to
wait for the government issued approved contract modifi-
cations and award of the Castleton work, which HDCC ul-
timately was not awarded. Even if such event was
unforeseeable, per 48 C.F.R. § 52.249-10, such decision and
schedule was within the control of HDCC. Accordingly,
HDCC does not sufficiently demonstrate that it has a claim
upon which relief can be granted. We therefore affirm the
CFC’s decision granting the government’s motion to dis-
miss this claim.
II
Next, we turn to HDCC’s argument that a portion of its
claims were not subject to the motion to dismiss because
neither the CFC nor the government addressed these
claims. Specifically, HDCC contends that the CO’s final
decision “wrongly purported to rescind a previously ap-
proved and paid contract modification in breach of contract
without proper authority or procedure.” Appellant’s Br. 35
(quoting J.A. 31). As the government acknowledged, this
repayment claim is related to the utility-relocation work
discussed in Discussion I.B., above. See Appellee’s Br. 43–
44 (“HDCC’s repayment claim is directly related to its
claim regarding utility relocation costs.”). Given this
Case: 23-1909 Document: 70 Page: 11 Filed: 02/19/2025

-- 11 of 12 --

HAWAIIAN DREDGING CONSTRUCTION COMPANY , INC. v. US 12
acknowledgment, and based on our reversal of the motion
to dismiss HDCC’s complaint for utility delays and pay-
ment, see Discussion I.B., we also reverse and remand this
issue to the CFC.
III
Finally, HDCC argues that the CFC erred in its deci-
sion to deny HDCC’s motion for reconsideration of and/or
relief from the order of dismissal and its motion for leave
to amend its complaint. Because we reverse and remand
the CFC’s determination on the motion to dismiss, as ex-
plained above, we need not address the CFC’s denial of
these motions.
CONCLUSION
We have considered the parties’ remaining arguments
and find them unpersuasive. For the foregoing reasons, we
therefore affirm in part, reverse in part, and remand for
further proceedings consistent with this opinion.
AFFIRMED-IN-PART, REVERSED-IN-PART, AND
REMANDED
COSTS
Costs to HDCC.
Case: 23-1909 Document: 70 Page: 12 Filed: 02/19/2025

-- 12 of 12 --