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Government Contract Dispute Process

Almost since government contracting began, there has been a special process followed for disputes arising under a government contract between the government and the contractor. This process is codified by the Contract Disputes Act of 1978 (CDA) and applies to all disputes arising under or relating to a government contract.

Contract disputes can sometimes be both complicated and time-consuming. Bambi Faivre Walters, PC can help you evaluate your concerns about contract disputes for possible filing of a “claim”. Since the time for filing the “claim” and any subsequent “appeal” may be limited in time and because of concerns with adverse consequences, you should consider consulting with counsel if you are considering filing a “claim” or an “appeal”.

Presentation of a “Claim”

A contractor initiates the disputes process by presenting a “claim” to the CO. The “Disputes” clause defines a claim 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.” According to the clause’s definition, a claim must (1) be in writing; (2) request a “sum certain”; and (3) demand a final decision. A significant, and relatively confusing body of case law has attempted to define these elements.

If the claim is over $100,000, it must also be certified by the contractor. FAR 52.233-1(d)(2). The contractor must attest that (a) the claim is made in good faith, (b) the supporting data are accurate and complete to the best of his or her knowledge and belief, (c) the amount requested accurately reflects the contract adjustment for which the contractor believes the government is liable, and (d) the individual certifying is duly authorized to do so on behalf of the contractor.

Contracting Officer’s Decision

If the contractor and government are unable to negotiate a resolution to the dispute, the CO must issue a “final decision.” This is a written articulation of the agency’s position with respect to the claim. A contractor may not commence litigation until the CO issues such a decision or until after the passage of time, the CO fails to provide the contractor a final decision. The appeal is submitted to an administrative board of contract appeals or the U.S. Court of Federal Claims (COFC).

Appeal to a Board of Contract Appeals

There are eleven agency boards of contract appeals (BCAs). A contractor initiates an appeal to the appropriate BCA by filing a “Notice of Appeal”. The Notice must be filed with the BCA within ninety days of receipt of the CO’s final decision. Failure to file the notice within this time defeats the board’s jurisdiction to hear the case. The Notice of Appeal is usually a letter stating that the contractor is appealing the CO’s final decision. The date of the final decision and the contract number should be included in the notice.

The recorder (i.e., the clerk) of the applicable BCA informs the government and the contractor that the case has been “docketed”. Under the standard BCA rules, the contractor (now, “appellant”) must file a complaint within thirty days of the docketing notice. The Government then has thirty days to file its answer.

Litigation at the BCAs is somewhat less formal than in other tribunals. Although the BCA’s administrative judge generally follows the Federal Rules of Civil Procedure and the Federal Rules of Evidence in making procedural and evidentiary decisions, the judge need not abide by those Rules. Discovery is available in much the same fashion as before federal district courts or the COFC.

BCA judges will travel to accommodate the interests of the parties. In other words, if the circumstances of the case make it more reasonable to hold hearings away from the BCA’s offices in the Washington, D.C. metropolitan area, the parties can request the judge to hold the hearings at a different locale.

After the complaint and answer have been filed, and the discovery has occurred, a hearing will be held. Thereafter, post-hearing briefs are filed. Decisions of the BCA are rendered by a three-judge panel (although usually only one judge will preside at the hearing). The BCA’s decision may be appealed to the U.S. Court of Appeals for the Federal Circuit.

Appeal to the U.S. Court of Federal Claims

A contractor initiates a proceeding at the COFC by filing a complaint within one year after the contractor receives the CO’s final decision. Failure to file the complaint within this twelve-month period will result in dismissal, since this failure defeats the COFC’s jurisdiction to hear the case.

The government has sixty days in which to file an answer to the contractor’s complaint. The agency will be represented by an attorney from the Civil Division of the U.S. Department of Justice. Thereafter, discovery may be conducted by both parties. The COFC, like the BCAs, will also hold a trial away from its courthouse.

Unlike the BCAs, the COFC has promulgated procedural rules patterned after the Federal Rules of Civil Procedure. A decision of the COFC is rendered by a single judge. That judge’s decision may be appealed to the U.S. Court of Appeals for the Federal Circuit.

Last Modified: December 5th, 2009