Boards of Contract Appeals (ASBCA, CBCA, PSBCA, and GAOCAB)

Jurisdiction/Standing/Timeliness/Contract Disputes Act (CDA) Issues    

        Jurisdiction

In Precision Standard, the ASBCA dismissed a claim for lack of CDA jurisdiction because it was for "at least" a specified amount, did not list the amounts requested for each separate category of recovery sought, and, therefore, was not for a "sum certain."

In Diamante Contractors, the CBCA dismissed for lack of jurisdiction a contractor's appeal (filed more than 90 days after a default termination) based on a unilateral contract modification (which was not labeled as a Contracting Officer's decision) that notified the contractor the Government might reprocure and charge the contractor's account. The Board noted that the Fulford doctrine did not apply to these facts.

In AmerescoSolutions, the ASBCA held that a delivery order issued by DESC pursuant to a DOE contract was a separate DoD contract over which the ASBCA had CDA jurisdiction on appeal.

In Green Dream Group, the ASBCA refused to dismiss an appeal, finding that an authorized individual had signed the CDA certification, which was correctable even though defective.

In HomeStar Services, the ASBCA dismissed an appeal from a default termination for lack of jurisdiction because the dissolved corporation lacked the capacity to accept the purchase order that was later terminated.

In Navigant Satotravel, the CBCA held that the Government not required to certify its CDA claim against a contractor.

The Public Warehousing Co. barely dodged the bullet when the ASBCA denied the Government's motion to dismiss the contractor's original appeal based on a theory of unjust enrichment (over which the Board had no jurisdiction) and granted the contractor's motion to amend its complaint to rely, instead, on theories of breach and constructive changes because both the original and revised complaints involved the same operative underlying facts and same requested ultimate relief.

In CME Group, the ASBCA held it lacked jurisdiction over an appeal from a termination for convenience because that termination, standing alone, is not a government claim.

The CBCA dismissed an appeal by Red Gold, Inc. for lack of CDA jurisdiction because its original letters to the Contracting Officer did not (i) state a sum certain, (ii) request a decision, or (iii) contain a CDA certification. 

In Ball Aerospace & Technologies Corp., the ASBCA held that a claim containing the following language adequately claimed a sum certain within the meaning of the CDA: "[t]his claim is for the sum certain amount of$72,730.29 relating to fiscal year . . . 2003 costs that the government has failed to reimburse, plus future costs to be incurred using the FY 2003 indirect rates at issue and interest under the CDA."

In URS Energy & Construction, the CBCA held that a party that assumed a contract by novation was the proper party to pursue the appeal.

In Alpine Armoring,  the CBCA dismissed a bid protest for lack of CDA jurisdiction.

In Tiger Enterprises, the ASBCA dismissed an appeal for lack of jurisdiction because the contractor had not submitted a  claim to the Contracting Officer requesting a decision on disputed invoices that the Government had refused to pay.

In KDI Development, Inc., the CBCA applied the CDA's statute of limitations to a government claim and held that the agency could recoup overpayments for operating costs it made to a contractor under a lease only for a period of six years prior to date the agency provided the contractor with a "claim" for such overpayments. The CDA has been in effect now for more than 30 years, and we still see language like the following in case after case because of the statute's most glaring omission: "Because the statute lacks a definition of 'claim,' one looks to language of implementing regulations, the contract, and facts."

In Trygve Dale Westergard, the CBCA denied the Government's motion to dismiss an appeal to the Board as untimely because the Government could not prove when the contractor received a Contracting Officer's decision sent to it by email.

In Zafer Taahut Insaat ve Ticaret A.S., the ASBCA denied a government motion to dismiss an appeal and held that the contractor's submission met the requirements for a CDA claim: it was certified; it requested a  Contracting Officer's decision; and it was for a sum certain.

In JM Carranza Trucking Co. , the PSBCA held it lacked jurisdiction to stay enforcement of a government claim.

In Charles Mullens, the ASBCA held that, concerning a non-CDA concession contract, the Board lacked jurisdiction over an appeal from a no-fault termination absent an underlying claim.

In Special Operative Group, the ASBCA dismissed an appeal based on a progress payment request in excess of $100,000 for lack of CDA jurisdiction because the request did not include the CDA certification and the progress payment certification it did include was not an adequate substitute.

The ASBCA dismissed the appeal of Broadway Consolidated Companies because the company was in Chapter 7 bankruptcy and lacked standing to pursue the appeal.

In Endless Gutter & Sheet Metal Co., the CBCA held it lacked jurisdiction over an appeal from a claim denial that was not issued by the Contracting Officer.  

In Office Automation & Training Consultants, the ASBCA held, in part, that it lacked jurisdiction over a theory of recovery first presented to the Board as part of the contractor's motion for reconsideration of a prior decision and never presented to the Contracting Officer.

In Sharp Electronics Corp., the ASBCA held it lacked jurisdiction over an appeal because the original claim should have been submitted to the Contracting Officer for the GSA schedule contract rather than to the CO of the agency placing a delivery order under the schedule contract.  In Harry Richardson, the same Board reached the same conclusion because no claim at all had been claim submitted to the Contracting Officer.

In American General Trading & Contracting, the ASBCA held that, although it lacked jurisdiction over a claim for extraordinary contractual relief under FAR Part 50, it had jurisdiction over the alternative claim theory of breach of an implied-in-fact contract.

Changes/Constructive Changes/Contract Interpretation/Breach/Authority

In Serco, Inc., the CBCA held that, pursuant to the "Payments Under Time and Materials Labor Hours Contract" clause, the contractor was entitled to reimbursement only for the amounts it actually paid subcontracted employees as opposed to the direct labor rates it billed for its own employees.

In Healthcare Technology Solutions International, the contractor in a services contract signed a bilateral modification (absent any duress) pursuant to which it paid the Government rent to occupy a space for many months and then claimed (unsuccessfully, of course) that the modification was a cardinal change or evidenced a differing site condition. 

In A To Z Wholesale, the CBCA denied a claim for based on a violin (which the buyer did not inspect) and its case purchased at an "As Is" auction that conformed to their description in the auction catalogue, even though the violin in the case did not turn out to be the valuable item the name on the case indicated it would be.

In Office Automation & Training Consultants, the ASBCA granted the Government's motion for summary judgment denying the contractor's claim for reformation on the basis of unilateral mistake, in part because the contractor failed to inquire about a DOL wage determination it now alleges was missing from the solicitation, which the Board said would have been a patent error creating a duty to inquire.

In another AECOM Government Services decision, the ASBCA held that the contractor was not entitled to recover F.I.C.A. taxes on offshore subsidiaries first imposed by the HEART Act six months after a fixed-price contract award on the basis of the contractor's theory reformation based on mutual mistake. Last year, the Board had rejected the same claim but made on a theory of breach of the implied warranty of good faith and fair dealing.  

In Singleton Enterprises-GMT Mechanical,  the CBCA held that the VA changed a construction contract by directing the contractor to attach insulation to the roof in a manner different from that stated in the specifications.

In Revenge Advanced Composites, the ASBCA granted the Government's motion for a summary judgment denying contractor's claim for extra work under the Changes clause because the contract's performance specification required the contractor to provide the navigation system at issue in the appeal.

Walsh/Davis Joint Venture won its CBCA appeal related to constructive changes required by the project architect. Subsequently,  the CBCA denied the GSA's request for reconsideration. In a subsequent decision involving the same contractor, the CBCA denied the Government's motion for summary judgment because the contractor presented evidence that the parties did not intend a seemingly unambiguous general release to cover the subcontractor claim at issue in the Government's motion.

In In-Finn-Ity Geotech Service , the CBCA held the Government breached the implied covenant of good faith and fair dealing by refusing to allow the contractor to use a method of performance permitted by the specifications.

In General Dynamics Ordnance and Tactical Systems, the ASBCA denied the Government's motion for summary judgment in part because the record was not yet sufficiently developed to determine whether the appeal involved a requirements contract or a BOA.

In  DeLeon Industries, the CBCA granted a portion of the Government's motion for summary judgment and held that the Government's breach of one contract did not entitle the contractor to lost profits on other contracts it might have received if it had not lost bonding capacity due to the breach. The Board denied the Government's motion as to other matters, and, in doing so, addressed issues of contract interpretation, course of dealing, and the Government's attempt to enforce a requirement it previously had waived.

In WestWind Technologies, the ASBCA interpreted FAR 52.216-8 ("Fixed Fee") to allow the Government to withhold the stated reserve amount on each, individual task order, rather than just once on contract as a whole.

In Ali Fawzi Gomme, Co-Owner, d/b/a Areebel Engineering & Logistics, the ASBCA dismissed a claim over the contractor's objections because it was clearly covered by a settlement agreement between the parties.

In The Boeing Co. (which involves claims by the contractor for indemnification for the costs of  (i) the investigation and remediation of ground water pollution and (ii) toxic tort litigation), the ASBCA denied the contractor's motion for summary judgment with regard to the Government's affirmative defense that the individual authorizing use of an indemnification clause in one of the subject contracts lacked authority to do so; but granted the contractor's motion with regard to the Government's affirmative defense that the contractor had misrepresented whether it had obtained certain required insurance.

In General Construction Services, the ASBCA granted the Government's motion for summary judgment because the appellant failed to establish that (i) it had a contract with the Government, (ii) the individual who allegedly committed the Government to a verbal agreement had the authority to do so, or (iii) the Contracting Officer ratified the alleged agreement.

In  BECO Construction Co., the ASBCA held the contractor was entitled to compensation for work it was required to perform in a larger area than was indicated in the contract's specifications and drawings.

In COSTAR III, LLC, the ASBCA held that the contractor was not entitled to reimbursement for health and welfare benefit cost increases in (i) the base year of the contract (because it modified its CBA to effectuate such increases after the beginning of the base year and the applicable contract clause did not provide for base year adjustments) or (ii) in the option years (because the option year mods constituted an accord and satisfaction and did not provide for such increases).

In Eyak Technology, the CBCA held the Contracting Officer lacked the authority to impose the reporting requirements of the American Recovery and Reinvestment Act of 2009 on a contractor midway through its contract by unilaterally inserting FAR 52.204-11 in the contract.

In Minute Man Properties, the PSBCA held that the Government, by holding over, did not constructively exercise a lease renewal option, which required written notice of its exercise.

In Tip Top Construction , the PSBCA held that (i) the contractor could recover its consultant costs incurred up to, but not after, the Government's approval of substitute equipment associated with a change; and (ii) attorney fees incurred in trying to convince Contracting Officer of the amount claimed by contractor for the change were not recoverable.

In D. J. Miller & Assocs., the Board denied a contractor's claim that the Government had breached its requirements contract by diverting work to other entities.

Usually, a forum denies a motion for summary judgment because there are disputed facts that require further development in the record. In Trace Systems, however, the ASBCA denied the Government's motion after the Board found there were no disputed facts and held that (i) the contract contained a latent ambiguity concerning whether R&R travel expenses were reimbursable and (ii) the contractor's interpretation that they were reimbursable was reasonable. 

In  Merchant's Automotive Group, the CBCA held a contractor's unilateral, unfounded error in judgment not communicated to the Government prior to award was not sufficient to entitle it to relief from the terms of a vehicle lease.

In Merlin International, the same board held that the Government did not breach a contract by failing to exercise an option.

In CTI Global Solutions , the CBCA summarily dismissed most of contractor's claims for increased labor rates resulting from increases in DOL wage determinations because the contractor and the agency had agreed on the rates to be paid to the contractor after the revised wage determinations were issued.

In DG²¹, LLC, the ASBCA denied a claim because, in advancing theories of misrepresentation and superior knowledge, the contractor did not establish that (i) it was misled by, or relied on, a misstatement in the solicitation that there was no historical information available, or (ii) it did not have independent knowledge of that historical information.

In Janssen Contracting, Inc., the CBCA held the contractor had failed to establish any of the elements required to justify reformation of its contract based on a mistake in bid.

Terminations/Liquidated Damages  

In Lasmer Industries, the ASBCA dismissed an appeal over the contractor's objections since the Government's issuance of a no-cost termination "because of the impossible specification" provided all the relief originally requested by the contractor.

In Genome-Communications, the ASBCA granted the contractor's motion for summary judgment that the Government failed to pay for contractually compliant training materials and improperly terminated the contract for cause due to a failure to comply with a cure notice that imposed extra-contractual requirements.

In Fit-Net International Corp., the ASBCA upheld a termination for cause due to late delivery of nonconforming supplies. In New Era Contract Sales, the ASBCA held that the Government properly terminated fixed-price delivery orders for default after the contractor refused to perform because subcontract prices had increased by an amount the contractor considered unacceptable.

In  Free & Ben, Inc. the ASBCA upheld a default termination of a contractor who did not deliver trucks to Iraq because, after award, it requested an End-User Certificate, which the Government refused to issue because the contract did not require it to do so. The Board found, inter alia, (i) that the contractor did not prove such certificates were required by Japan (where the trucks were manufactured) and (ii) that the contractor had not checked this issue prior to bidding. 

In Sundt Construction, the ASBCA held that, under a construction contract task order modification, which established two separate completion dates, the Government could properly assess liquidated damages for the portion of work covered by one of the two dates, which already had passed when the modification was signed.

In FastLinks, the ASBCA upheld a default termination despite the contractor's contention that the specified part could not perform properly, because the reprocurement contractor installed the same part without incident.

In Advance Construction Services, the same board upheld the propriety of another default termination before a cure period had expired because the contractor had no reasonable prospects of finishing the job by the conclusion of the cure period.

In Tawazuh Commercial and Construction Co. Ltd., the ASBCA upheld a default termination because of defects in road construction work despite the contractor's contention that the Government did not inspect the work promptly.

In Matrix Research, Inc., the ASBCA upheld a default termination because the contractor inexcusably failed to deliver the final 15 items under the contract, and its problems were due to actions of its subcontractor, not those of the Government's inspectors.

In upholding a termination for cause in Ryll International, the CBCA wrote in part as follows:

We conclude that [the] CO . . . had a reasonable, contract-related basis to support termination for cause. Ryll failed to complete the contract despite the CO’s best efforts to mediate negotiations between appellant and its subcontractors. It is notable that in Ryll’s . . . letter . . . requesting a termination for convenience with costs, the contractor wrote that its "financial difficulties have been caused by the apparent collusion of certain companies and are not the fault of the government."

In two cases, the Government was denied recovery of excess reprocurement costs after a valid default termination simply because it neglected to present any evidence on the subject of the similarity of the reprocurement contract to the terminated contract. In Odessa R. Brown, for example, the PSBCA wrote: "Respondent did not submit into the record a copy of the replacement contract or any other evidence which could establish the type, frequency or timing of the service required by the replacement contract." Similarly, in  Gordon T. Smart, the PSBCA noted that the Government failed to present any evidence that the reprocurement contract was for the same, or similar, services.  

In Roger W. Holcombe, the PSBCA held that a default termination was justified by a contractor's failure to disclose on a pre-award form negative employment history of prior bad acts, even though the Government did not discover this omission until after it had terminated the contract on other grounds.

In Environmental Safety Consultants, the ASBCA converted a default termination to a termination for convenience because (i) the Government "dallied" for 11 months after the contract completion date before terminating, demonstrating that time was not the essence, and (ii) the Government, therefore, should have established a new completion date before terminating.  

In Data Integrators, Inc., the GAO's Contract Appeals Board denied the contractor's appeal from a default termination by the Government Printing Office because the contractor failed to complete a preproduction test within the allotted time, despite being given two chances to do so. 

Delay

In The Davis Group, the ASBCA denied the contractor's claim for an extension of the performance period because the contractor's own delays were primarily responsible for the delay in the Government's approval of the contractor's  submittal.

Costs and Cost Accounting Standards (CAS)

In The Boeing Co. v. DOE, the CBCA granted the contractor's motion for summary judgment that it was entitled to the costs of defense of qui tam suit (in which it was ultimately found not liable) from the time the suit was originally filed until the Government intervened as plaintiff.

In SRI International, the ASBCA held that the costs of maintaining a standby Letter of Credit (LOC) under several contracts  over two fiscal years in order to guarantee the contractor's ability to repay the entire amount of its long-term debt in two years were allowable costs for the following reasons:  

First, FAR 31.205-20 is inapplicable to disallow the LOC costs because SRI treated the full amount of its long-term . . .[b]ond debt as a part of its "[c]urrent liabilities" not as its "long-term liabilities," and the government has failed to show this treatment is inappropriate. Second, paying an annual fee (the LOC costs) for a one-year bank LOC for the purpose of collateralizing or guaranteeing its ability to repay the full amount of its long-term . . . [b]ond debt in the short-term (one year) qualifies as administrative costs for short-term borrowing for working capital allowable under FAR 31.205-27(a)(3). Third, the LOC costs in dispute are not fixed and upfront costs and are therefore different in kind from the typical costs of financing.

Subsequently, on the Government's motion for reconsideration, the Board held that the amount due the contractor should be determined by the procedures set forth in the "Allowable Cost and Payment" clause rather than being predetermined by the Board as suggested by its prior decision. 

In Raytheon Co., the ASBCA granted summary judgment in favor of the contractor because the aggregate effect on all affected contracts of a voluntary change in cost accounting practices related to the actuarial value of pension plans did not result in increased costs to Government.

In Golden Wings, Inc., the ASBCA held that the Government was not liable for the contractor's vehicle storage costs incurred after the Government returned the leased vehicles to the contractor at the end of the lease.

In ARCTEC Services, the ASBCA held that, under both the "Service Contract Act--Price Adjustment" and "Incentive Price Revision--Firm Target" clauses of its contract, a contractor was entitled to a price adjustment for the cost of severance benefits paid to unionized employees pursuant to collective bargaining agreements following expiration of the  contract.

In Todd Pacific Shipyards Corp., the ASBCA denied the contractor's claim that it should be allowed to re-classify certain indirect costs as direct costs because it had treated the costs as indirect costs for an extended period of time and they benefited more than one contract.

In Thomas Assocs., the ASBCA discussed (a) the allowability of (i) life insurance costs for the contractor's President and (ii) the cost of a Jeep transferred to an employee and treated as fringe-benefit compensation to that individual and (b) the applicability of the penalty for expressly unallowable costs pursuant to FAR 42.709. On reconsideration, the ASBCA modified its original decision. 

In Kearfott Guidance & Navigation Corp., the ASBCA allowed reformation of several contracts because identifiable intangible asset write-up amortization costs had been mistakenly omitted from the calculation of contractor's G&A rates and FCCOM factors.

In General Dynamics Corp., the ASBCA held that the contractor's use of intra-year pension fund returns in the contractor's forward pricing estimates of pension costs violated CAS 412.

In Westech International, the ASBCA held that the contractor satisfied the requirements for reimbursement of Arizona transaction privilege taxes plus penalties and interest pursuant to FAR 31.205-41. 

In COSTAR III, LLC, the ASBCA held that the contractor was not entitled to reimbursement for health and welfare benefit cost increases in (i) the base year of the contract (because it modified its CBA to effectuate such increases after the beginning of the base year) or (ii) in the option years (because the option year mods constituted an accord and satisfaction and did not provide for such increases).

In SplashNote Systems, Inc., the ASBCA denied a contractor's appeal from a government claim for repayment of unallowable costs because (i) costs now claimed as deferred IR&D costs had not been specifically identified and authorized in the contract; (ii) the bonus paid to the contractor's owner/CEO was an unallowable distribution of profits; and (iii)  numerous local meals allegedly conducted to discuss recruiting were unallowable under several claimed costs principles, chiefly because the contractor had not presented sufficient documentation to establish their allowability. 

Quantum 

In KDI Development, the CBCA recognized the Government's right to offset amounts due it under one lease against amounts it owed under a second lease with the same contractor.

In Southwest Marine, Inc., the ASBCA determined the quantum due the Navy as a result of debt concessions made by creditors after confirmation of a Chapter 11 reorganization plan of a company in bankruptcy. The case was on remand after the original board decision was reversed by a district court whose decision was then upheld by the Ninth Circuit.

In W. G. Yates and Sons Construction Co., the CBCA denied the Government's motions to submit new evidence and to reconsider the Board's prior decision concerning the proper measure of an equitable adjustment after the retroactive correction of an erroneous Davis Bacon Act wage determination originally included in a contract.

In Raytheon Co. (on remand from the Federal Circuit), the ASBCA held that interest on the interest due the Government for CAS 413 noncompliance continues to accrue until the date the interest is paid rather than only to the date the principal is repaid (as the contractor had argued).

Discovery/Procedure

In Parsons-UXB Joint Venture, the ASBCA denied the Government's motion to compel production of documents based upon the Government's contention that the contractor had engaged in a blanket waiver of the attorney-client privilege.

In Free & Ben, Inc., the ASBCA held that a motion for reconsideration sent by email and received after Board's business hours but before midnight on the last day for filing was timely.

In W. G. Yates and Sons Construction Co., the CBCA denied the Government's motions to submit new evidence and to reconsider the Board's prior decision concerning the proper measure of an equitable adjustment after the retroactive correction of an erroneous Davis Bacon Act wage determination originally included in a contract.