Such extensions can avoid government claims for liquidated damages. 00, the contracting officer must issue a final decision within sixty (60) days of receipt of the claim. 101 as "a written demand or written assertion by one of the contracting parties seeking, as a matter of right, the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief arising under or relating to the contract. A common type of government claim is based upon what the government considers to be an overpayment on its part. A claim does not initially need to include supporting data, such as a detailed cost breakdown, if it otherwise satisfies the criteria of a CDA claim. This 6-year time period does not apply to contracts awarded prior to October 1, 1995.
Rather than start the running of this clock, a contractor may ask for a change order or submit an uncertified request for an equitable adjustment or REA. After a contractor receives a final decision by a contracting officer regarding its claim, the contractor may choose to appeal the final decision to the Court of Federal Claims or the BCA that has jurisdiction over its contract. The performance of any government contract by a contractor has the potential to bring certain monetary risks of a government claim against the contractor. This section requires a contract claim to be "submitted within 6 years after the accrual of the claim. The federal government and government contractors may bring claims under the CDA. Generally, only the parties to the contract—the government and the prime contractor—can bring a claim under the CDA. A "Claim" must be certified pursuant to FAR § 33. Aspen's owners soon advised the contracting officer that its vice-president was not authorized to make a change in the payment instructions. 00, the contracting officer may issue a final decision within sixty (60) days or provide to the contractor a firm date within a "reasonable time" by which the contracting officer will issue a final decision. Claims by both the government and federal contractors are subject to a six year statute of limitations which means that claims under the CDA must be submitted within six years of the time when all events establishing alleged liability for an injury were known or should have been known. The Army's failure to make payment to the account designated in the CCR file was a breach of contract. Second, the contractor's written demand or assertion must seek the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief arising under or relating to a contract between the government and the contractor. From the claims preparation stage all the way through filing an appeal of the contract claim is heavily regulated. Companies sometimes find themselves in situations when calculating the statute of limitations for filing a contract claim against the government.
The claimant must also comply with the size standards set forth in the Act. In this case, the prime contractor contacted the sub-subcontractor to ask how much it was owed on the project. A contractor's assertion for payment "approximately" or "in excess of" an amount will not constitute a claim under the CDA. But it sure makes doing so more difficult. The 6-year period shall not apply to contracts awarded prior to October 1, 1995, or to a Government claim based on a contractor claim involving fraud. Liquidated damages are a fixed amount set forth in a contract to compensate the agency for unexcused delays in the contractor's performance of the contract. Filing a government contract claim. In addition, the Government Accountability Office Contract Appeals Board handles contract disputes arising in the legislative branch, and the Office of Dispute Resolution for Acquisition handles contract disputes and bid protests arising out of Federal Aviation Administration procurements. Thus, any statement or request for monetary damages in the contractor's claim must be scrutinized carefully to ensure there is nothing in the claim that would give rise to an FCA counterclaim. This article sets forth basic information all federal government contractors should know when faced with the necessity of making or defending a claim on a federal project. It should be noted, however, that in cases where there is doubt, there is no harm in starting out with an REA. The vast majority of board cases are handled by either the Armed Services Board of Contract Appeals or the Civilian Board of Contract Appeals. A contractor is not required to submit its claim under the CDA in a particular format.
However, a written demand or written assertion by the contractor seeking the payment of money exceeding $100, 000 is not a claim under the Contract Disputes Act of 1978 until certified as required by the Act. " Such requests give the contractor and the government an opportunity to discuss and negotiate the contractor's request outside the time limits imposed by the CDA. Contract with the federal government and you are by statute and by contract required to resolve any and all disputes under the Contract Disputes Act. When a contractor appeals a CDA claim to the COFC or a BCA, sometimes an agency will determine whether it has the ability to present a government counterclaim under the False Claims Act (FCA) for false statements made by the contractor in its claim, in its billing, or some other representation to the government. Within what may seem to be small percentages, companies lose millions is denied contract claims against the government for one or more of the above reasons. Under Federal Crop Ins. If the demand letter states that it constitutes the contracting officer's final decision and notifies the contractor of its appeal rights to the Court of Federal Claims (COFC) or a board of contract appeals (BCA), it qualifies as a final decision under the Contract Disputes Act (CDA).
The contractor should review the provisions in the contract governing when and how the contractor must notify the government of any delays and also the circumstances in which a delay would be considered to be excusable. If progress is not made within a reasonable time, an REA can easily be converted to a claim under the Contract Disputes Act. In general terms, an equitable adjustment means that the contractor is entitled to his actual costs, plus reasonable profit (except for suspensions), overhead, and bond. 00 must be certified by the contractor. Or, a contractor may file an appeal with the Court of Federal Claims within twelve (12) months of receipt of the contracting officer's final decision. Third, all contractor claims exceeding $100, 000.
If a contractor's claim satisfies the six requirements set forth above, then the claim may be properly asserted under the CDA. Oftentimes, the government may try to file a motion to dismiss if can argue that the email does not meet the statutory contract claims appeal and agency notification requirement. Since the contractor did not dispute that it had received the email on the amount owed, the court found that notice was sufficient. However, an important exception to this rule is that a contracting officer's final decision is not a prerequisite to the government's assertion of a counterclaim against a contractor under the False Claims Act.
A contractor may appeal the entirety of the contracting officer's final decision or some portion thereof. Unlike an REA, a claim starts the clock ticking on the time when the Contacting Officer must issue a decision (there is no time limit on an REA), and interest begins to run. The question of whether to submit a Request for an Equitable Adjustment, commonly referred to as an "REA, " or a claim, is one that clients ask on a frequent basis. Considering the time and resources required for an appeal of both a termination for default or a government claim for reprocurement costs or addressing a proposed suspension or debarment, it may be wiser to negotiate with an agency in advance to terminate the contract for convenience rather than default, which is less damaging to a contractor's reputation and future business dealings with the government. A few years ago, I did a post on whether a digital signature in a construction contract was valid. It also does not make it impossible for the government and contractor representatives to communicate by email or even to use email to modify contract requirements. Aspen's entitlement to damages arising from the breach will be addressed on remand. Lastly, it should be noted that the CDA governs only post-award disputes; therefore, pre-award claims, such as bid protest actions, are not subject to the Act. S Court of Federal Claims or to an administrative board of contract appeals. Michael H. Payne is the Chairman of the firm's Federal Practice Group and, together with other experienced members of the group, frequently advises contractors on federal contracting matters including bid protests, claims and appeals, procurement issues, small business issues, and dispute resolution. Timing may play a crucial role in a contractor's decision, but many factors, such as preference for a more—Court of Federal Claims—or less—BCA—formal set of procedural rules or the ability of the government to bring a False Claims Act counterclaim, should be weighed by a contractor in making its forum selection for its appeal.
What Happens Once a Claim Under the CDA Is Asserted? On the other hand, if there is animosity, or a clear indication in prior discussions and correspondence, that the government does not believe that the contractor is entitled to an equitable adjustment, it is best to file a claim. The USPS is served by the Postal Service BCA. A) Contractor claims shall be submitted, in writing, to the contracting officer for a decision within 6 years after accrual of a claim, unless the contracting parties agreed to a shorter time period. Within that 90-day period, the sub-subcontractor sent an email response identifying the total amount owed, as well a copies of the outstanding invoices. Nevertheless, an REA is commonly understood to be a request for compensation (time, money, or both) that falls short of a claim in terms of its procedural requirements. For instance, a prevailing wage claim arising under the Davis Bacon Act is not subject to the CDA because claims or disputes which another federal agency is specifically authorized to handle are not subject to the disputes process under the CDA. Most liquidating agreements limit the prime contractor's liability to the amount the government agrees to pay or is required to pay. Under the Contract Disputes Act (CDA), 41 U. S. C. §§ 7101-7109, there is a 90-day filing requirement for filing an appeal with an agency board of contract appeals. The contract provided for payment to be made to the account at Bank of America, which was identified in Aspen's CCR file. Under the circumstances, the Board concluded that it was reasonable to honor the vice-president's email request. Since the CCR file had not been changed, there had been no change in the account designated for payment. However, a contractor's claim should contain sufficient information to show the basis for the contractor's entitlement to the relief requested.
17% of government contract claims will be denied. However, a contractor's claim must strictly satisfy the criteria set forth below to constitute a claim under the CDA. Generally, once a contractor chooses its forum, its decision is binding, and the contractor cannot pursue its claim in the other forum. Or an agency might have paid an invoice before learning that a contractor had not, in its view, satisfied a contract requirement (such as staffing a specific number of positions for a specific number of hours per week), even when this was not the fault of the contractor, but caused by the agency. There are a number of clauses that allow an equitable adjustment to the contract if the government is responsible for additional costs, or time, and the most significant clauses are: Variation in Estimated Quantity, FAR 52. The contract claims that do get paid, however, go a little further. Fourth, the claim must be submitted within the six year statute of limitations. For instance, a contractor is required to give "prompt" written notice to the contracting officer of a differing site condition before it is disturbed. It is also important to note that the additional costs must be allowable, allocable, and reasonable. Under the Miller Act, second-tier claimants must give notice of any claim to the prime contractor within 90 days of last providing labor or materials.
What Is the Difference Between a Request for Equitable Adjustment and a Claim under the CDA? What Types of Claims Are NOT Subject to the CDA? The ASBCA is generally responsible for deciding appeals from decisions of contracting officers in the Department of Defense, the Department of the Army, the Department of the Navy, NASA, and when specified, the CIA. A subcontractor cannot bring a claim against the government under the CDA. 00, a contractor must certify that (i) the claim is being asserted in good faith, (ii) the supporting data is accurate and complete to the best of the contractor's knowledge, (iii) the amount requested is accurate, and (iv) the person asserting the claim is duly authorized to certify the claim. At the end of the day there can be no debate that when the contracting officer denies a contract claim, government contractors must follow certain statutory requirements before appealing to the Board of Contract Appeals. In United States ex rel.
There should be no question as to what the document is and what you are asking for. Government contractors should consider using a more formal method of notifying the agency. First, a contractor must make a written demand or assertion. There are still circumstances when the government may reasonably rely on the apparent authority of contractor representatives. They include clear language and explanations to show why the government should pay the claim. The Board of Contract Appeals cannot waive the Contract Disputes Act requirements or any other mandate under the statute. What Is the Contract Disputes Act? Frequently, deemed denial appeals result in an order directing the contracting officer to issue a final decision. Virtually also claims Against the federal government must be submitted in writing to the contracting officer.
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