What is the Contract Disputes Act?

It’s understood today that a contractor can sue a public entity, such as a federal government agency, for breach of contract. But that wasn’t always so; until the mid-19th century, a contractor could not sue the government over a contract dispute.

In 1863, Congress passed laws allowing judgments against the federal government. Then, in 1978, Congress passed the Contract Disputes Act (CDA), which attempts to resolve most contractor disputes stemming from appropriated funds contracts.

Contract Disputes Act Overview

Congress passed the Contract Disputes Act of 1978 to establish a statutory scheme to resolve claims by government contractors. The CDA outlines a framework to handle contractor or government entity claims.

The US Court of Federal Claims must handle all disputed contracts under the Contract Disputes Act or by an administrative board of contract appeals. The Armed Services Board of Contract Appeals (ASBCA) or the Civilian Board of Contract Appeals oversees most board cases. The ASBCA usually deals with appeals from contracting officers’ decisions in these agencies:

  • Department of Defense
  • Department of the Navy
  • CIA
  • Department of the Army
  • NASA

The CBCA oversees disputes from most executive agencies, including the US Postal Service, Tennessee Valley Authority (TVA), and the Postal Rate Commission.

Claims Handled Under the CDA

The Contract Disputes Act deals with monetary claims (post-award), including:

  • Breach of contract
  • Claims involving an implied-in-fact contract involving a contractor and the US government
  • Non-monetary claims, such as interpretation issues involving a specification or a claim for time

Claims Not Handled Under the CDA

Several types of claims can arise between a contractor and the US government that the CDA doesn’t cover. For example, if you have a claim for prevailing wages under the Davis Bacon Act, the CDA does not apply. This is because the CDA disputes process does not govern disputes or claims that another federal entity is charged to handle.

Furthermore, a claim that does not involve an implied-in-fact contract or contract between the contractor and the US government isn’t covered by the CDA. Also, remember that the Contract Disputes Act is only involved with post-award disputes. Thus, pre-award claims, including bid protests, aren’t governed by the CDA.

Who Can File a CDA Claim?

Government contractors and the US government can file CDA claims. A government claim, including default termination claims or liquidated damages, can be filed under the CDA. A government entity can file them against the contractor after a contracting officer has made a decision on the claim.

In most cases, the contracting officer’s final decision is required for the government to bring a claim or counterclaim against the contractor. But there is one key exception: The contracting officer’s decision isn’t necessary for the government to bring a counterclaim against the contracting person or entity under the False Claims Act (FCA).

In most cases, only parties in the contract can file a claim under the CDA – these are the primary contractor and the government. Note that a subcontractor cannot file their own claim against the government entity under the Contract Disputes Act. But the main contractor can file a pass-through claim for the subcontractor against the government.

How Do You File a CDA Claim?

You aren’t required to file in a particular way. However, the claim must meet the following criteria for it to be a valid CDA claim:

  • The federal contractor must compose an assertion or written demand. Notifying the contracting officer of a problem is insufficient to make a CDA claim.
  • The assertion or written demand must request payment in a sum certain or another form of relief relating to the contract between the federal contractor and the government entity. Note: Asserting for payment using language such as ‘over’ or ‘approximately’ is not a valid CDA claim.
  • All claims that are more than $100,000 have to be fully certified by the federal contractor. However, claims that the government asserts do not require certification. If the claim is more than $100,000, the contractor must state they are making a claim in good faith. There also must be supporting data that is complete and accurate, and the amount asked for must be accurate.
  • The claim under the Act must be made within the statute of limitations of six years.
  • You must make the claim to a contracting officer. Submitting the request to a field officer or administrative official is insufficient.
  • You must ask for a final decision or otherwise indicate that you want a final decision to be made by the contracting officer.

A commercial and business litigation attorney at Nix Patterson can assist you with understanding the CDA filing process.

Contact a Contract Disputes Attorney Today

Do you think you have a claim against a government entity as a contractor? You have legal options, and Nix Patterson can assist you. Contact us today for a complimentary consultation about your contract dispute case.

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