Contract Disputes Act

AuthorWilliam Funk - Jeffrey S. Lubbers
41 U.S.C. §§ 601–613 (2012); 28 U.S.C. §§ 1346(a)(2), 1491(a)(2),
2401(a), 2414, 2510, 2517 (2012); 31 U.S.C. § 1304(a)(3)(C)(2012); en-
acted Nov. 1, 1978, by Pub. L. No. 95-563, 92 Stat. 2383; significantly
amended April 2, 1982, by Pub. L. No. 97-164, title I, §§ 156–157, 161, 96
Stat. 25, 47–49, Nov. 5, 1990, by Pub. L. No. 101-509, § 104, 104 Stat.
1447, and Nov. 15, 1990, by Pub. L. No. 101-552, 104 Stat. 273; Oct. 29,
1992, by Pub. L. No. 102-572, title IX, Sec. 907(a)(1),106 Stat. 4518; Oct.
13, 1994, by Pub. L. No. 103-355, title II, Sec. 2351(a)((1)), (b), (e), 2352,
108 Stat. 3322; Feb. 10, 1996, by Pub. L. No. 104-106, div. D, title XLIII,
Sec. 4321(a)(6), (7), 4322(b)(6), 110 Stat. 671, 677; Oct. 19, 1996, by Pub.
L. No. 104-320, Sec. 6, 110 Stat. 3871; Nov. 18, 1997, by Pub. L. No. 105-
85, div. A, title X, Sec. 1073(g)(3), 111 Stat. 1906; Jan. 6, 2006, by Pub. L.
No. 109-163, div A, title VIII, subtitle E, § 847(d)(1) –(4), 119 Stat. 3393;
Oct. 17, 2006, by Pub. L. No. 109-364, div. A, title VIII, subtitle E, § 857,
120 Stat. 2394; Pub. L. No. 111-350, § 3, Jan. 4, 2011, 124 Stat. 3816.
Lead Agency:
Office of Federal Procurement Policy, Office of Management and Bud-
get, Washington, DC 20503, (202) 395-5802.
Background. The Contract Disputes Act of 1978 was intended to bring
greater consistency, fairness, and efficiency to the resolution of disputes arising
out of government contracts. Before the Act’s passage, this process was gov-
erned by various contract clauses, agency regulations, judicial decisions, and
statutory provisions; procedures varied depending on the nature of the dispute
and the agency involved. The legislation reflected in large part the recommen-
dations of the Commission on Government Procurement, created by Congress
in 1969 to recommend improvements in the procurement process.
Coverage. The Act and its procedures apply to claims arising under or
relating to express or implied contracts made by executive branch agencies
for the procurement of property other than real property; services, construc-
tion, alteration, repair, or maintenance of real property; or for the disposal of
personal property. The Act does not reach bid protests or proceedings for the
debarment or suspension of government contractors.
The term “claim” is not defined by the Act; however, the Federal Acquisi-
tion Regulation (FAR), a detailed regulation establishing uniform procedures
and policies for procurement by federal executive agencies, defines it as:
Claim, as used in this clause, means 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 re-
lating to this contract. . . . A voucher, invoice, or other routine re-
quest for payment that is not in dispute when submitted is not a
claim under the Act.1
Cognizable claims include disputes arising under specific contract clauses
(for example, when the parties cannot agree on an amount of compensation
owed under clauses authorizing equitable adjustment for contract changes or
for site conditions different from those anticipated when the contract was
formed) as well as claims for breach of contract. Terminations for default are
considered claims by the government under the Act.
Notwithstanding these examples, the elements of a claim, particularly
the relationship between the “dispute” and “routine” clauses, continue to gen-
erate frequent litigation. The Federal Circuit resolved some of the uncer-
tainty in 1995, when it articulated, en banc, what has come to be known as
the Reflectone test: a non-routine request for payment can constitute a claim
under the CDA—even if it is not in dispute—if it is a written demand seeking
a sum certain (or other contract relief) as a matter of right; a “routine request
for payment,” on the other hand, must be in dispute. In 2012, however, a
148 C.F.R. § 52.233-1(c) (2012).

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT