ONE TRUTH ABOUT THE TRUTH IN NEGOTIATIONS ACT

The Truth in Negotiations Act (“TINA”) requires that contractors furnish cost or pricing data before an agreement on price for most negotiated procurements of more than $750,000. Cost or pricing data mean all facts that a prudent buyer or seller would reasonably expect to significantly affect price negotiations, and that were available at the time the contract price was agreed to. This data (which is factual and verifiable, such as vendor quotes, nonrecurring costs, unit cost trends—but not estimates or projections) must be certified by the contractor as “accurate, current and complete.” The government uses the data to determine price reasonableness, and you can easily see how a contract price that relied on a subcontractor quote could be significantly reduced, based on the contractor’s furnishing … Continue reading

CONSTRUCTIVE ACCELERATION

Constructive acceleration occurs when the government demands the contractor’s compliance with an original contract deadline even though there is excusable delay. This is precisely what happened in IAP Worldwide Svcs, ASBCA no. 59397 et al, May 17, 2017. A contractor is entitled to compensation for additional costs that result from the constructive acceleration. In IAP, the Army Corps of Engineers issued three delivery orders to provider power plants at forward military bases in Pakistan. The delivery orders incorporated IAP’s proposal which made it clear that IAP would ship the power plants via surface transportation, using what was called the “Pakistan route.” Before the shipments were due, in response to U.S. combat operations, Pakistan closed the Port of Karachi and the land routes from that city … Continue reading

CONTRACTOR CAN SEEK PAYMENT FOR WORK THAT WAS INVOICED AND ACCEPTED PRIOR TO DEFAULT TERMINATION

Claude Mayo Construction Company, Inc. (“Mayo”) had a contract with the General Services Administration (“GSA”) to renovate a U.S. Attorney’s Office in Syracuse, NY. Before Mayo completed the project, GSA terminated the contract for default. Mayo sought to overturn the default, which is not the subject of this appeal. However, Mayo also sought damages for a breach of contract because GSA, without basis, failed and refused to pay Mayo for work completed and accepted by GSA prior to the default termination. Claude Mayo Const. Co., Inc., No. 15-1263C (Fed. Cl. June 23, 2017). GSA sought to dismiss the breach of contract, asserting failure to state a claim. The government alleged that Mayo failed to identify a duty arising from the contract or a breach of … Continue reading

MUST YOUR CLAIM BE CERTIFIED BY THE PERSON WHO SIGNED YOUR CONTRACT?

The Civilian Board of Contract Appeals (“CBCA”) recently set forth the requirements for a person who signs a contractor’s certification of its claim. AMX Veterans Spec. Servs., LLC v. Dept of Veterans Affairs, CBCA 5180, August 9, 2016. As readers of this blog know, any claim over $100,000 must be certified stating that: • the claim is made in good faith, • the supporting data are accurate and complete to the best of the contractor’s knowledge and belief • the amount requested accurately reflects the amount the government owes • the certifier in authorized to certify the claim on behalf of the contractor. 41 U.S.C. §7103(b). The Federal Acquisition Regulation (“FAR”) states that for requests over $100,000, whatever the contractor submits “is not a claim…until … Continue reading

DEMYSTIFYING APPEALS BEFORE THE BOARDS OF CONTRACT APPEALS

This blog frequently discusses appeals before the Armed Services Board of Contract Appeals (“ASBCA”) and the Civilian Board of Contract Appeals (“CBCA”). Although appeals may appear to be complex, there is generally a regular order of procedure that is followed. Typically, in a complete appeal to either board, there will be 12 different procedural steps. The following is an explanation of each of these procedural steps. 1. Notice of Appeal. Appellant files Notice of Appeal (sometimes this may include a complaint but that is not required). 2. Docketing. The Recorder assigns a docket number and notifies the parties in writing. 3. Appeal File, known as the “Rule 4” or R4” File. The Government assembles and transmits an appeal file to the Board and the appellant … Continue reading

THE GOVERNMENT CONTROLS THE OPTIONS

Virtually all government contract options (for more quantities of goods, or for an extension of services), are generally priced unilateral options which the Government may exercise or not exercise at the Government’s discretion. When it does exercise an option, the Government must follow the requirements in the option clause, but contractors may not successfully complain about the failure of the Government to exercise that option. JRS Management v. Dept of Justice, CBCA 3288 (May 28, 2014) is an excellent example of the Government’s discretion. The JRS contract was for culinary arts instructor services to the Department of Justice for a base year running through Aug. 7, 2012, with four option years. The contract specified certain experience and qualification requirements for each of the instructors. The … Continue reading

A TALE OF TWO APPEALS

This blog discusses two contractors who sought to appeal a contracting officer’s final decision on their claims, which final decisions were defective in not advising of the contractors’ appeal rights. In one case, the appeal date was tolled because the contractor detrimentally relied on the omission of appeal rights. Access Personnel Servs., Inc., ASBCA No. 59900, June 15, 2016. In the other case, the defective appeal notice did not cause prejudice to the contractor, who had actual knowledge of its appeal rights, and a late filed appeal was dismissed for lack of jurisdiction. Mansoor Int’l Dev. Servs., ASBCA Nos. 59466 et al. May 19, 2016. The Contract Disputes Act requires that a contracting officer’s final decision on a claim state the reasons for the decision … Continue reading

POSTAL SERVICE CONTRACT BOILERPLATE MAY BE UNENFORCEABLE AND CONTRARY TO PUBLIC POLICY

In a recent decision by the Court of Federal Claims, the Court refused to dismiss a case over a terminated U.S. Postal Service (“USPS”) delivery contract, holding that three provisions in the contract were likely contrary to public policy. Tabetha Jennings v. United States, No. 14-132C (Fed. Cl. May 26, 2016). The Court ordered the USPS to show cause why three boilerplate sections should not be deemed unlawful and unenforceable, and ordered the General Counsel of the USPS to appear at a hearing on this matter. Tabetha Jennings appealed the default termination of her $34,000 per year contract to deliver mail. The Contracting Officer found that Ms. Jennings had conducted herself in an unprofessional manner and disrupted mail processing operations, and then permanently denied Ms. … Continue reading

CLAIM DOES NOT ACCRUE UNTIL “SUM CERTAIN” IS KNOWN BY CONTRACTOR

The Federal Circuit recently clarified that a contractor’s claim does not accrue until the exact amount (“sum certain”) of the claim is known to the contractor. Kellogg Brown & Root Serv., Inc. v. Murphy, No. 2015-1148 (Fed. Cir. May 18, 2016), 2016 WL 2893218. This case is important because any dollar claim that fails to include a “sum certain” should be dismissed by the contracting officer and the courts. First, a brief discussion of accrual of claims, and definition of a claim. The Contract Disputes Act provides that a claim “shall be submitted within 6 years after the accrual of the claim.” 41 USC § 7103(a)(4)(A). The FAR defines accrual of a claim as follows: “the date when all events, that fix the alleged liability … Continue reading

DON’T BECOME A VOLUNTEER WHO ISN’T PAID FOR YOUR WORK

Do you know what a government contract volunteer is? A volunteer is someone who embarks on duties of their own free will and without any expectation that they will be paid for their work. A contractor who elects to perform work not required by a contract without a formal change order is considered to be a volunteer who will not be paid for the services. [1] Is it not only small businesses that fall into the trap of becoming an unpaid volunteer. Even one of the largest aerospace companies in the U.S. (Boeing) became a volunteer and failed to get paid for subcontractor work.[2] Boeing had a cost plus award fee contract to perform engineering assignments as ordered by the government. The contract included FAR … Continue reading