Afterthoughts: Good Faith & Fair Dealing

What responsibilities are included in the duty of good faith and fair dealing/ what should be included? The Restatement of Contracts lists some examples but without trying to go into the specifics of that list, I always said that the duty of good faith and fair dealing was at the center a requirement that the two parties would reasonably respond to each other’s problems. If you go back to the Civil War and look at the case law, we talked about the duty of cooperation and the duty not to hinder contractor’s performance. Those were the original duties that our legal background is full of. When we started to talk about the broader duty of good faith and fair dealing, these two duties, the duty … Continue reading

Allowable Legal Costs

By Darrell Oyer, Darrell J. Oyer & Co.:  The U.S. Court of Appeals for the Federal Circuit has affirmed a Civilian Board of Contract Appeals ruling that Boeing Co. (successor in interest to Rockwell International Corp) could recover costs related to its defense of a False Claims Act (FCA) lawsuit [Chu v. Boeing Co., Fed. Cir., No. 2011-1304, -1317] In 1989, a relator brought an FCA lawsuit in U.S. District Court alleging that Rockwell had false claims and statements regarding certain environmental matters.  A jury awarded the plaintiff a $4.1 million judgment that a Circuit Court affirmed. However, the Supreme Court found that the District Court lacked jurisdiction to enter judgment in favor of the relator because the relator was not an original source under … Continue reading

Will the Government Pay for Your Lawyer, Accountant or Consultant Costs

Recently, in Tip Top Const., Inc. v. Donahoe, Postmaster Gen., (Fed. Cir. No. 2011-1509, Sept. 19, 2012), the Federal Circuit reiterated its earlier position that although professional fees incurred in connection with prosecution of a Contract Disputes Act (“CDA”) claim are not recoverable, the costs of such professional fees incurred in connection with the administration of a contract are recoverable.  What’s the difference? The Federal Circuit has previously held that there are “three distinct categories” of legal and consultant costs in the cost principles of the FAR: “(1) costs incurred in connection with the work performance of a contract; (2) costs incurred in connection with the administration of a contract; and (3) costs incurred in connection with prosecution of a CDA claim.” Bill Strong Enterprises, … Continue reading