As a contractor doing business with the federal government, there is often the question of whether there are breach of contract claims against the government.
However, when and how you pursue the breach claim can be tricky and costly when the Contract Disputes Act process is not followed.
Avoiding costly mistakes in litigating claims against the federal government is always the ultimate goal of any contractor.
Sample Court Decision
The Court of Federal Claims in the case of TPL, Inc. v. United States, No. 11-482 C (Sep. 16, 2014) ruled that a contractor’s failure to file their breach of contract claims with Contracting Officer precluded it from alleging government breach of contract as a defense to Government’s own breach claim.
After receiving the contracting officer’s final decision under a facilities use contract with Army, TPL, the plaintiff’s government contract attorney on appeal tried to counterclaim the Army’s demand for reimbursement for $11,958,046.72 for certain expenses.
The demand came with the contracting officer’s final decision. After the contract claims appeal was filed, the government filed a counterclaim for breach of contract, requesting damages for the above amount.
Untimely Breach of Contract Claims Against the Government Thrown Out By Court On Appeal
Contractors can lose millions of dollars if a breach of contract claims against the government are not filed at the proper time. In TPL, the Court of Federal Claims simply lacked jurisdiction because the contractor had not first raised its breach claims at the contracting officer level.
- The Contract Disputes Act sets the timeliness for filing your claims.
- Preparation and documentation are essential when submitting your package to the government.
- Consider potential counter claims by the Agency while assessing your case.
- Part of filing breach of contract claims against the government is to keep your right to appeal at the initial stages.
- You cannot raise new claims on appeal.
In TPL, the government filed a motion for summary judgment because the Court lacked jurisdiction to consider TPL’s defenses. TPL did not file a contract claim or otherwise raise the breach of contract defenses before the contracting officer.
Defending Breach of Contract Claims Against Contractors by the Government
If the government requests damages from you, the contractor, you must at least show that the government failed to reasonably mitigate its damages. This breach of contract defense is available so long as you put forth facts to support your defense.
- Just like any government breach of contract claims case, any defense to the agency’s claim for damages must also have supporting evidence.
Breach claims must be brought under the Contract Disputes Act, 41 U.S.C. §§ 7101–7109 (2012). Under that Act, presentation of a breach claim to a contracting officer is a prerequisite to the Court of Federal Claim’s jurisdiction to hear the case on appeal.
All claims by a contractor against the government shall be in writing, submitted to the contracting officer for a decision, and certified if more than $100,000). See more about board jurisdiction.
To avoid costly mistakes in breach of contract claims against the government, call our claims and disputes attorneys at 1-866-601-5518 for a free initial consultation.