How to File a Claim on a Government Contract and Protect Your Rights for a Potential Appeal
Did you know that you should file a claim against the government with the contracting officer before filing an appeal with the Armed Services Board of Contract Appeals? The formal dispute resolution process commences when a contractor submits contract claims to the contracting officer in accordance with the Contract Disputes Act of 1978 (the “CDA“), 41 U.S.C. section 601 et seq. The claim, in writing, must demand money, the adjustment or interpretation of contract terms, or other relief arising under or relating to the contract (see FAR Clause 52.233-1, Disputes). Read about Apparent Authority In Government Contracts.
To preserve government contract claims for appeal, you must also request the contracting officer for a final decision. On claims exceeding $100,000, there must be a good faith certification the accuracy and completeness of the supporting data. A voucher, invoice, or other routine request for payment is not a claim under the CDA until the Government disputes the request either as to liability or amount, or it is not acted upon in a reasonable time. Once the submission is deemed a claim, interest begins to accrue on the claim at the rate established by the Secretary of the Treasury pursuant to Pub. L. 92-41 (85 Stat. 97). See 41 U.S.C. section 611. See also information about government contract claims certification language.
Moreover, the clock begins to run concerning the time in which the contracting officer must issue a final decision. Once the contracting officer issues a final decision, the contractor may appeal the decision to either the U.S. Court of Federal Claims or the applicable board of contract appeals.
Do you have a right to appeal contract claims? Simply because the government agency may act adversely does not always give you the right to appeal the Armed Services Board of Contract Appeals (ASBCA) or Court of Federal Claims. Many attorneys, not experienced in government contracting and administrative law, forget that a contractor must fully exhaust administrative remedies before running to ASBCA or Court of Federal Claims to appeal a contract claim. See information about government contract claims release.
- To file a government contract claims appeal there must a final agency decision.
- There must be a denial of the claim by the agency to create jurisdiction for the ASBCA.
When deciding how to file a claim on a government contract, the issue usually becomes: what is a final agency decision? The safest way to address this concern is to have a government contracts attorney file a claim on your behalf.
Preserving your rights to a government contract claims appeal. It is not to say that a contractor cannot file a claim on its own behalf. Instead, there should be more of a focus on preserving the contractor’s rights for appeal. This is why having a contract claims attorney can be beneficial. An example of what could happen in the event that a contract claim is not file with the agency is the recent appeal of Connectec Company, Inc., ASBCA No. 57546.
In that case the government unilaterally cancelled a purchase order. The government won its motion to dismiss by arguing that that:When the Government cancels a unilateral purchase order, that action is not a Government claim or final decision, thus the Appellant is required to file a claim with the contracting officer, and receive a contracting officer’s decision, 41 U.S.C. § 7103(a) or a deemed denial.
Because the Appellant failed to submit a claim, the contracting officer never had the opportunity to finally decide the matter in accordance 41U.S.C. § 7103(c) thus no factual or statutory basis exists that is necessary for the Board to have jurisdiction to hear the matter. Contract claims jurisdiction for ASBCA comes from the Contract Disputes Act (41 U.S.C. § 7103(a)). In this case there was no final denial of the claim from the agency. FAR Subpart 33.2 also addresses federal contract claims. See information about Excusable Delays and Eichleay Government Claims.
Can Subcontractors File a Government Contract Claims Appeal to ASBCA?
Generally no. Contractors that try to handle litigation on their own sometimes lose big in the court system. Even though a claim may have been filed with the contracting officer, and denied, one must ask whether the claim filed with the agency is legitimate. Generally ( with limited exceptions) a subcontractor cannot file a claim directly with the agency. If this is so, then a claims appeal to ASBCA will definitely be dismissed for lack of jurisdiction. See Appeal of Montano Electrical Contractor, ASBCA No. 56951.
When filing government contract claims to the agency, there are sometimes disputes to what is a sufficient claim. Generally, you are only required to submit “adequate notice of the basis and amount of the claim.” Contract Cleaning Maintenance, Inc. v. United States, 811 F.2d 586, 592 (Fed. Cir. 1987). This should be accompanied with any supporting details to show bad faith.
The bottom line is that before you file a claims appeal to ASBCA make sure that you have a final denial of the claim from the contracting officer. Anything short of that will get the case dismissed. Consider retaining government contract claims services and appeals lawyer to help you from the beginning to end. The goal is to protect and preserve your rights for appeal.