When a "Claim" is Not a "Claim"

In 2014, the Army Corps of Engineers issued a fixed price task order to HCJ (a joint venture) to repair the roofs of two buildings. We don't know what happened in the meantime but two and a half years later, HCJ filed a REA (Request for Equitable Adjustment) for $225 thousand because it also had to remove, dispose, and replace rain gutters on the building.

The Corp of Engineers denied the contractor's REA and informed it of its right to submit a claim requesting a contracting officer final decision. Sometime after that, the contractor contacted the contracting officer by phone stating that it wished the REA to be treated as a claim. The contracting officer, citing the telephone conversation, proceeded to deny the claim and informed the contractor of its appeal rights.

The contractor appealed to the ASBCA (Armed Services Board of Contract Appeals). The result was surprising.

The Contract Disputes Act (CDA) provides that each claim shall be submitted to the contract officer for a decision. FAR defines a claim as a written demand or written assertion by one of the contracting parties seeking, as a matter of right, the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief arising under or relating to the contract. Moreover, a claim exceeding $100,000 must be certified.

For the ASBCA to have jurisdiction under the CDA, the contractor must submit a proper claim, an element of which is a request for a contracting officer's final decision. The request for a final decision however, must be in writing and the contracting officer cannon waive this requirement by issuing a final decision.

The contracting officer's "final decision" was not issued in response to a written claim by the contractor and thus, there is no contracting officer decision from which an appeal could be take to the ASBCA.

The appeal was dismissed, not because the claim lacked merit, but because there was no written request for a contracting officer final decision.

You can read the full ASBCA decision here.