On June 6, 2018, the Civilian Board of Contract Appeals (“Board”) denied the VA’s motion to strike certain counts of a contractor’s complaint challenging a termination for default. The contractor had previously filed a Contract Disputes Act claim alleging that the VA acted in bad faith, delayed and prevented contract performance and repudiated the contract. The contractor appealed the contracting officer’s final decision denying its claim. The contractor then filed a complaint at the Board of Contract Appeals, asserting among other things, that the VA breached its duty of good faith and fair dealing by failing to give the contractor a fair opportunity to compete for additional work. The VA moved to dismiss the contractor’s claim based on the violation of the duty of good faith and fair dealing because this legal theory was not included in the contractor’s CDA claim.
The Board set forth the following standard of review to resolve this dispute:
The Board may not consider new claims a contractor failed to present to the contracting officer. Lee’s Ford Dock, Inc. v. Secretary of the Army, 865 F.3d 1361, 1369 (Fed. Cir. 2017) (citing Santa Fe Engineers, Inc. v. United States, 818 F.2d 856, 858 (Fed. Cir. 1987)). “A claim is new when it ‘present[s] a materially different factual or legal theory’ of relief.” Id. (quoting K-Con Building Systems, Inc. v. United States, 778 F.3d CBCA 5907 3 1000, 1006 (Fed. Cir. 2015)). A claim before the Board is not required to rigidly adhere “to the exact language or structure of the original administrative CDA claim” presented to the contracting officer. Scott Timber Co. v. United States, 333 F.3d 1358, 1365 (Fed. Cir. 2003). It is enough that the claim to the contracting officer and the claim before the Board “arise from the same operative facts, claim essentially the same relief, and merely assert differing legal theories for that recovery.” Id. “Materially different claims ‘will necessitate a focus on a different or unrelated set of operative facts.’” Lee’s Ford, 865 F.3d at 1369 (quoting Placeway Construction Corp. v. United States, 920 F.2d 903, 907 (Fed. Cir. 1990)).
Applying the above rule of law, the Board denied the VA’s motion to strike and found that the claim based on breach of the duty of good faith and fair dealing arises from the same operative facts as the breach of contract claim. The Board also noted that the contractor is seeking the same monetary damages as in the CDA claim. The Board therefore found that it had jurisdiction.
Walker Development & Trading Group, Inc. v. Department of Veterans Affairs, CBCA 5907 (June 6, 2018)
Posted in Appealing Final Decision, Termination for Default
In the Appeal of CTA I, LLC, we filed a petition requesting that the Civilian Board of Contract Appeals direct the Contracting Officer to render a final decision under the Contract Disputes Act (“CDA”). CTA filed a CDA claim on February 15, 2017 for delay, labor inefficiencies, and related costs. The Contracting Officer was supposed to issue a final decision within 60 days, but stated that “due to the size and complexity of the claim documentation, our office will respond to your request for a Contracting Officer’s final decision by 10 July 2017.” That did not happen. Just prior to July 10th, the Contracting Officer stated that “to allow the claims consultant adequate time to assess the validity of the claim, I will respond to your request for a Contracting Officer’s final decision by 8 September 2017.”
CTA filed a petition with the Board of Contract Appeals because it lack confidence that the Contracting Officer would issue a final decision by September 8, 2017. In its petition, CTA stated that “the VA is engaged in bad faith delaying tactics” and is causing CTA and it subcontractors financial harm. The Board explained that under the Contract Disputes Act, the Contracting Officer could only give himself one time extension to issue a final decision. If a final decision is not issued by that extended deadline, he cannot give himself another time extension. The Board therefore held that CTA could immediately file an appeal based on a deemed denial. CTA did so the next day.
Does this case sound familiar? Often times, Contracting Officers will delay issuing a final decision. Meanwhile, the contractor must carry the financial burden of fronting the cost of additional work and delays. This case sends a clear message to Contracting Officers that they cannot give themselves multiple extensions of time in which to issue a final decision. Hopefully, this will help reduce the time it takes to adjudicate claims under the Contract Disputes Act.
CTA I, LLC v. Department of Veterans Affairs, CBCA No. 5800 (August 22, 2017)
Posted in Appealing Final Decision
Contractor’s claim under Contracts Disputes Act is timely even though not filed at Armed Services Board of Contract Appeals within 90 days after issuance of the Contracting Officer’s Final Decision. Generally speaking, if a contractor does not appeal within 90 days after issuance of a Contracting Officer’s Final Decision, it is out of time. However, the appeal would still be timely if the contractor can establish that it relied upon actions of the government that “actually prejudiced its ability to prosecute its timely appeal.” (more…)
Posted in Appealing Final Decision
