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In certain circumstances the government may waive strict compliance with construction specifications

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Many federal construction contractors have been there: it’s near the end of the project and the government raises an issue with work that was done much earlier, but is not in strict compliance with the specifications.  The contracting officer demands strict compliance with the specifications, even if it means tearing out completed work to fix the defect.  And of course, the contracting officer insists that the government does not have to pay for the additional work.  The contractor has to proceed as directed, but is the contractor actually entitled to additional compensation or not?

On December 17, 2019, the Armed Services Board of Contract Appeals handed down its decision in the Appeal of Buck Town Contractors & Co., confirming that if the government knew about the defective work during performance but said nothing, then it has constructively waived strict compliance with the contract specifications and the contractor is entitled to additional compensation.

Continue reading at:  OBERMAYER GovCon Examiner

ABSCA confirms contractors may challenge unfavorable CPARS ratings

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While you might not be able to fight City Hall, you can fight your CPARS rating.  In a short opinion published May 1st, the ASBCA confirmed it has jurisdiction to annul an inaccurate and unfair government evaluation of a contractor’s performance.  Cameron Bell Corporation d/b/a Government Solutions Group, ASBCA No. 61856 (May 1, 2019).  Though the ASBCA cannot require the government to issue a specific rating, it can remand the matter to the contracting officer with instructions to redo the evaluation ─ a perhaps imperfect, yet still potent form of relief available to contractors who believe the government has improperly rated their contract performance.

By regulation, contractors are entitled to rebut a negative evaluation of their performance in the Contractor Performance Assessment Reporting System, or CPARS.  FAR 42.1503(d).  A contractor’s rebuttal submission typically is due within 14 calendar days of the date the agency invites the contractor to respond.  See id.  If this proves unsuccessful, a contractor may challenge the CPARS rating by submitting a claim with the contracting officer under the Contract Disputes Act (CDA).  See, e.g., Cameron Bell, ASBCA No. 61856, 2019 WL 2067642 (May 1, 2019).  Then, if the contracting officer denies the claim, the contractor can appeal the decision to an appropriate Board of Contract Appeals or the United States Court of Federal Claims.

Continue reading at:  Inside Government Contracts

ASBCA voids release of government’s liability because small business subjected to duress

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As a general rule, when a contractor signs a full settlement and release with respect to a dispute with the Government, the dispute is considered settled, and the Government is released from any further liability for that particular claim.

There are, however, exceptions to the rule.

One rare exception is when the Government subjects the contractor to duress, which may render the release null and void.

In a remarkable decision, the Armed Services Board of Contract Appeals (ASBCA) recently voided a release for precisely this reason and sustained an appeal where there was evidence of a pattern of improper procurement practices, abuse of discretion in the administration of the contract, and a breach of the Government’s duty of good faith and fair dealing.

The ASBCA also made a point of scolding the procurement and contracting officials who treated a struggling small business in such an appalling manner.

Keep reading this article at: http://www.mondaq.com/unitedstates/x/747456/

Government’s delayed response breached contract, says ASBCA

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Note: Author of “The Small Business Guide to Government Contracts,” Steven J. Koprince blogged recently about a recent ruling by the Armed Services Board of Contract Appeals (ASBCA) that the government breached a contract when it waited more than three months to respond to a contractor’s request to amend the contract’s scope of work.  Here is his writing, along with a link to his post:

Here’s a situation my colleagues and I see with some frequency: a contractor, in the course of working on a government contract, submits a request of some sort to the agency.  Then waits for a response.  And waits some more.  Meanwhile, the government’s delay in responding prevents the contractor from moving forward with some aspect of the project, causing the contractor to incur costs.

For contractors faced with this type of government inaction, a recent decision by the Armed Services Board of Contract Appeals is welcome news.  In that case, the ASBCA held that the government breached its implied duty of good faith and fair dealing by waiting more than three months to respond to the contractor’s request to amend the Statement of Work – allowing the contractor to “twist in the wind” during that period.

The ASBCA’s decision in Relyant, LLC, ASBCA No. 59809 (2018) involved an Army contract for the acquisition of pre-fabricated relocatable buildings (abbreviated “RLBs” in the decision) for use at two different sites in Afghanistan.

The solicitation’s Statement of Work included certain specifications for the RLBs.  Among those specifications, the SOW required the installation of gypsum interior drywall to the interior of the shipping containers that would cover fiberglass insulation.  But in its proposal, Relyant, LLC proposed a different configuration: the use of a “sandwich panel,” including Styrofoam as the insulator instead of separate insulation and drywall.

Keep reading this article at: http://smallgovcon.com/claims-and-appeals/governments-delayed-response-breached-contract-says-asbca/

Not reading the performance work statement is a bad idea, ASBCA confirms

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Here at SmallGovCon, we often write about nuanced, complex government contracting legal issues.  This isn’t one of them.

The moral of today’s story comes straight from the personal superhero files of Captain Obvious: not reading the performance work statement in your own contract is a pretty bad idea.

The PWS at issue in Sterling Design, Inc., ASBCA No. 61099 (2017) was part of a contract between the Air Force and Sterling Design, Inc.  Under the contract, SDI was to repair a power supply unit for a fixed price of $7,395.  The contract gave SDI 30 days from receipt of the power unit to complete the repairs.  However, SDI did not complete the repairs until several months after the 30-day period had elapsed.

SDI then filed a claim for $5,925, alleging that the government had delayed SDI’s work.  The contracting officer denied the claim, and SDI appealed to the Armed Services Board of Contract Appeals.

At the ASBCA, SDI introduced a whopping 893 pages of emails with governmental officials.  The crux of SDI’s argument was that the emails represented SDI’s attempts to obtain necessary contractual information, and that the government delayed the contract either by failing to respond to these emails, or by responding late.

Keep reading this article at: http://smallgovcon.com/uncategorized/not-reading-the-pws-is-a-bad-idea-asbca-confirms/

Reminder: Certified claims must include a “signature”

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Earlier this Fall, the Armed Service Board of Contract Appeals dismissed an appeal for lack of jurisdiction because the certified claim lacked a proper signature. Appeal of NileCo General Contracting LLC, ASBCA No. 60912 (Sept. 22, 2017).

This simple oversight proved decisive. Although this case does not chart a new course in Contract Disputes Act (CDA) jurisprudence, it serves as a helpful reminder that the Board’s jurisdiction hinges on compliance with basic requirements.

Failing to meet any of those requirements could have significant consequences.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2017/11/government-contracts-101-reminder-certified-claims-must-include-a-signature/

Appeals board: Contractor wasn’t exempt from state tax

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They say that two things in life are guaranteed – death and taxes – and status as a federal contractor may not exempt one from the latter, according to a recent Armed Services Board of Contract Appeals (ASBCA) decision.

In Presentation Products, Inc. dba Spinitar, ASBCA No. 61066 (2017), the ASBCA held the contractor was liable to pay a state tax, and the government had no duty to reimburse the contractor. The problem arose from the fact that the contractor did not incorporate state tax costs into its proposed price, despite being required to pay the taxes under the terms of the contract and applicable state law.

Under the terms of the firm fixed-price contract, Presentation Products Inc. (doing business as Spinitar) was to provide the Army with installation of a video conferencing system in Fort Shafter Flats, Hawaii. The solicitation included FAR 52.212-4 (Instructions to Offerors–Commercial Items), which provides, in paragraph (k): “Taxes. The contract price includes all applicable Federal, State, and local taxes and duties.”

Hawaii places a general excise tax (or GET) on businesses rather than a sales tax on customers, which is not automatically waived when the customer is the federal government. The GET is an excise tax imposed on the gross revenues of businesses “derived from the privilege of doing business in Hawaii.” Under Hawaii’s GET, businesses are not required to collect GET from their customers, but may pass it on to customers upon agreement by the customer.

Keep reading this article at: http://smallgovcon.com/claims-and-appeals/asbca-says-contractor-wasnt-exempt-from-state-tax/

Contractor’s lackadaisical proposal preparation sinks its claim for costs

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To federal construction contractors, the true legwork may seem to begin only after the government has accepted a proposal and performance has begun. However, a recent Armed Services Board of Contract Appeals (ASBCA) decision reinforces that federal construction contractors’ work often should begin long before contract award.

In Zafer Construction Company, ASBCA No. 56769 (2017), the ASBCA rejected a construction contractor’s allegations of unilateral mistake, unconscionability, and differing site conditions (among other claims for additional costs). The problem? The contractor did not attend a government scheduled site visit, conduct an independent site visit, review technical drawings, submit any inquiries during the proposal stage, or otherwise take reasonable steps necessary to better ascertain the nature of the work prior to submitting a multimillion dollar proposal on a complex project.

By way of background, the contract in Zafer involved the U.S. Army Corps of Engineers’ procurement of renovation work at the Afghanistan National Military Hospital in Kabul, Afghanistan. In 2004, the buildings at this site had fallen into varying states of disrepair. In preparation for issuing the solicitation, the government employed an assessment team (called the Baker team) to survey the site, assess the condition of the buildings and infrastructure, and prepare a report for the government’s use in budgeting and defining the scope of work.

Keep reading this article at: http://smallgovcon.com/claims-and-appeals/contractors-lackadaisical-proposal-preparation-sinks-its-claim-for-costs/

A tale of two contract releases: One for the government and one for the contractor

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On the heels of the recent post on the subject of key takeaways from recent release of claims decisions, the Armed Services Board of Contract Appeals (ASBCA) and the Civilian Board of Contract Appeals (CBCA) have published another round of notable opinions regarding contract releases:  Supply & Service Team GmbH, ASBCA No. 59630 and ServiTodo, LLC, CBCA 5524.

Both decisions are important, albeit for different reasons.

  • The ASBCA decision demonstrates how a release provision in a contract modification providing an equitable adjustment can bar the government from processing an administrative offset against a contractor.
  • The CBCA decision illustrates the difficulties contractors face when attempting to minimize the impact of a broadly worded release of claims provision.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2017/05/tale-two-contract-releases-one-government-one-contractor/

Contractor wins claim for additional costs after partial termination by government

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It is common for government contractors to file claims on federal projects where there are government-directed changes to the contract that add time or scope.

contract-changesBut what if – instead of adding time and/or scope – the government de-scopes work from the contract by issuing a partial termination?  A recent successful claim shows that the contractor can still recover its increased costs.

In a decision by the Armed Services Board of Contract Appeals (ASBCA), the Board considered a contract for the provision of food service operations at 18 dining facilities at Fort Leonard Wood, Missouri.  After two years, the agency issued a partial termination for convenience and removed six facilities from the contractor’s scope.  The contractor continued to provide services at the remaining 12 facilities, but could not reach an agreement with the government for the cost of completing the contract.

Keep reading this article at: https://governmentcontracts.foxrothschild.com/2016/12/articles/contract-claims/contractor-wins-claim-for-additional-costs-after-partial-termination-by-government/

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