FAR Contract Disputes Clause – Government Contracts Claims Certification Language – FAR 52.233-1

Theodore P Watson, Government Contract Disputes Act Lawyer. The FAR Disputes Clause in government contracts is incorporated into your contract, FAR 52.233-1, implements the Contract Disputes Act (CDA) FAR certification requirement and prescribes limited government claims CDA certification language when you submit a contract claim against the federal government.

When you submit a contract claim against the federal government, the last thing you want is to have to spend a substantial amount of lawyer fees on technical issues instead of the merits.  Unfortunately, many cases are litigated on the legal and procedural issues and not the merits.

After the contracting officer makes an adverse decision (complete or partial denial of your claim,) you want to pay attention to the deadlines provided for you to take the next step. The appellate process is a method used to resolve FAR claims against the federal government.  How you proceed to the appellate level is very important.   Although having the proper contract dispute certification language in your claim is a clear requirement, many federal contractors end up violating this important requirement.

The bottom line is that if the certification language in your contract claims does not meet the Disputes Clause or FAR certification requirements, you will run into a jurisdiction problem on appeal. Appellate courts must have subject matter jurisdiction to hear your appeal case. 

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Why Does the Certification Language Matter Under the Contract Disputes Clause?

The most important answer is that the FAR  52.233-1 statute requires it. Nothing else matters. There are plenty of cases out there where companies have to spend tens of thousands of dollars litigating motions to dismiss for lack of subject matter jurisdiction. This is true at the various boards of contract appeals and the US Court of Federal Claims.

• A thorough understanding of the legal implications of the Government Disputes Clause can save you thousands of dollars in unnecessary litigation.

Having the required certification language under the FAR Disputes Clause in Government Contracts and required wording is essential because if the contracting officer denies your claim, and if the proper language was not present in your claims submission, an appeals court will probably deny your case for lack of jurisdiction.

• This can be an expensive fight that can be avoided.

The Contract Disputes Act Certification Language

If your claim exceeds $100,000, FAR 33.207(c) requires this exact statement. A claim submitted without it, or with it altered, is not a valid certified claim.

“I certify that the claim is made in good faith; that the supporting data are accurate and complete to the best of my knowledge and belief; that the amount requested accurately reflects the contract adjustment for which the contractor believes the Government is liable; and that I am duly authorized to certify the claim on behalf of the contractor.”

Two things contractors get wrong here. The first is who signs it — it must be someone duly authorized to certify on behalf of the company, and a project manager usually is not. The second is treating it as a formality. Certifying a claim you have not verified carries real exposure under the False Claims Act, which is a much larger problem than the money you were trying to recover.

What You Can Recover

• Direct costs of the changed or extra work — labor, materials, equipment.
• Impact costs — the loss of productivity the change caused on work that was not itself changed. This is where the largest amounts usually are and where claims most often fail for lack of proof.
• Extended field overhead — the cost of keeping the site staffed and supervised through the delay period.
• Unabsorbed home office overhead — where you can establish the required conditions.
• Subcontractor pass-through costs — their impacts, properly documented and passed up.
• Profit on the added work — at a reasonable rate.
• Interest — running from the date a certified claim is received by the contracting officer.

 Four Things That Can Kill Otherwise Good Contract Disputes Act Claims

1. No contemporaneous record. A claim reconstructed from memory eighteen months later loses to a claim built from daily reports, dated emails and time records made at the time. Government auditors are trained to spot the difference immediately.
2. A release signed on a modification. Most contract modifications contain broad release language. Signing a modification for the direct cost of a change, without reserving your rights to the impact costs, can extinguish a substantial portion of your claim. Read the release language on every modification before signing.
3. The total cost method. “Here is what we spent, here is what we bid, pay us the difference” is the weakest way to present a claim and is accepted only in narrow circumstances. Segregate the costs of the changed work.
4. Missing the six-year window. Under FAR 33.206(a), a claim must be submitted within six years after it accrues. Accrual is earlier than most contractors assume — usually when the events giving rise to liability were known or should have been known, not when the project finished.

You Get No Breaks Because You Don’t Have an Attorney

For government contracts for small businesses without legal counsel, the appellate courts do not give any preference because you do not understand the rules. Courts do not have much discretion to change the court rules. This is important when the Agency issues a Contracting Officer’s Final Decision, and you want to appeal a Board of Contracts Appeal or Court of Federal Claims.

Many contractors’ corporate attorneys have made the mistake of overlooking the required FAR certification language with the FAR Disputes Clause in government contracts time and time again. See an example of a case illustrating this costly mistake. The result for not meeting the statutory requirement is that the case will be dismissed on appeal.

 Although the appellate process is a method used to resolve FAR claims under the Government Disputes Clause when required, your certification language must comply with the Contract Disputes Act and is a prerequisite to a Board of Contract Appeals, or COFC claims jurisdiction. See New Iraq Ahd Co., ASBCA No. 58800, 14-1 BCA ~ 35,479 at 173,953.

Rule That Is In Place But Government Still Tries to Dismiss the Case

Although case law suggests that improper claims certification language is not grounds for dismissal of the case, the reality is that agency attorneys still may file a motion to dismiss for lack of subject matter jurisdiction. Submitting defective FAR certification language does not deprive the Courts of jurisdiction, 41 USC 7103(b)(3); however, the complete absence of a certification language, where required, does dictate the dismissal of an appeal.

FAR 52.233-1 Disputes Clause in Government Contracts Claims and FAR Certification Language

For contractor claims exceeding $100,000, the Contract Disputes Act certification regulations and FAR 52.233-1 require the contractor to certify that:

(A) the claim is made in good faith;

(B) the supporting data is accurate and complete to the best of the contractor’s knowledge and belief;

(C) the amount requested accurately reflects the contract adjustment for which the contractor believes the Federal Government is liable; and

(D) the certifier is authorized to certify the claim on behalf of the contractor.

41USC  7103(b)(l).

• Under the FAR Disputes Clause in government contracts, for Contractor Certification, Courts Will Not Try to Piece Together the Required FAR Certification Language
• An argument to the Court it has jurisdiction over an appeal because certain language in your claim letter parallels some of the requirements of a proper CDA certification is not enough.

Although true that “[e]xact recitation of the CDA FAR certification language is not required, and a defect does not bar the Board from jurisdiction,” it will be risky and can cost a company millions in an otherwise justified government claim. This is one reason that companies must be careful when retaining contract claims services from firms that are not familiar with the nuances of federal government contracting.

Why have the rule?

In one case, a Board of Contract Appeals decided that “The purposes of the government contract claims FAR 52.233-1 certification requirement is to discourage the submission of unwarranted contractor claims and to encourage settlements,” Paul E. Lehman, Inc. v. United States, 673 F.2d 352, 354, 230 Ct. Cl. 11, 14 (1982); “to push contractors into being careful and reasonably precise in the submission of claims to the contracting officer,” Tecom, Inc. v. United States, 732 F.2d 935, 937 (Fed. Cir. 1984 ); and to enable the government “to hold a contractor personally liable for fraudulent claims,” Transamerica Insurance Corp. v. United States, 973 F.2d 1572, 1580 (Fed. Cir. 1992). ASBCA No. 54065, 04-1BCA~32,455 at 160,533.

• The Court simply will not try to piece together your claims letter to decide whether the Contract Disputes Act government claims certification language is proper.
• The burden of including the proper contract claims language is on you the contractor.

How We Handle Government Contract Disputes Act Claims Cases

1. Entitlement first, quantum second. Before we count a dollar, we establish that the government is liable. Claims that lead with a number and work backward to a theory do not survive.
2. Build the record from contemporaneous documents. Daily reports, RFIs, submittal logs, meeting minutes, emails with dates. We work from what existed at the time.
3. Segregate the costs. The changed work is priced separately from the base contract, so the government cannot dismiss the whole claim as a bid loss.
4. Choose the vehicle deliberately. REA or certified claim, based on the amount, the agency’s behavior, and how much time is left.
5. Negotiate before litigating. Most of these resolve at the contracting officer level when the submission is strong enough that denying it is indefensible.
6. Appeal on time if it comes to that. Boards of contract appeals and the Court of Federal Claims are where we go when the agency will not move.

Find Out Whether Your CDA Claim Is Worth Pursuing

Most contractors call us wanting to know one thing first: is this worth chasing? We can usually answer that in a single conversation, before anyone talks about fees.

Call 1.866.601.5518 — Free Confidential Case Review With Theodore Watson

No intake screener. You speak to a lawyer. Washington DC and Denver. All 50 states.: For help developing a viable contractor claim under the government disputes clause and to include proper FAR 52.233-1 certification language under the FAR Disputes Clause in government contracting, call our government contract dispute claims lawyers at 1-866-601-5518. FREE INITIAL CONSULTATION.