Under the Contract Disputes Act (41 USC 7101 en seq.), when a contractor submits a claim to the government in excess of $100,000, the claim MUST contain a certification of good faith, as follows:
For claims of more than $100,000 made by a contractor, the contractor shall certify that–
(A) the claim is made in good faith;
(B) the supporting data are accurate and complete to the best of the contractor’s knowledge and belief;
(C) the amount requested accurately reflects the contract adjustment for which the contractor believes the Federal Government is liable; and
(D) the certifier is authorized to certify the claim on behalf of the contractor.
41 U.S.C. 7103(b)(1). See also 48 C.F.R. s. 33.207(c) as to the wording of the certification.
The contracting officer is not required to render a final decision on the claim within 60 days if, during this time period, he/she notifies the contractor of the reasons why the certification is defective. 41 U.S.C. 7103(b)(3). Importantly, the contracting officer’s failure to render a decision within 60 days is deemed an appealable denial.
However, “[a] defect in the certification of a claim does not deprive a court or an agency board of jurisdiction over the claim. Prior to the entry of a final judgment by a court or a decision by an agency board, the court or agency board shall require a defective certification to be corrected.” Id.
This is important. In a recent decision out of the Federal Circuit, DAI Global, LLC v. Administrator of the United States Agency for International Development, 945 F.3d 1196 (Fed. Cir. 2019), a government contractor submitted a claim to the government with a defective certification. The contracting officer waited 70 days (not the required 60 days) before notifying the contractor that the claims did not contain the required certification. The contractor (smartly interpreting the contracting officer’s untimely notification as a denial of the claim) appealed to the Civilian Board of Contract Appeals. The Board dismissed the contractor’s claims for lack of jurisdiction claiming the contractor failed to certify the claims and the contractor’s errors in preparing the certification were not correctible. The contractor appealed to the United States Court of Appeals, Federal Circuit.
First, the appellate court held that the Contract Disputes Act states that a defect in the certification does NOT deprive a board over jurisdiction. Whether the defect is technical in nature or not is of no moment since a board is not deprived of jurisdiction if there is any defect in the certification.
Second, the appellate court held that that the contracting officer failed to timely notify the contractor of the defective certification. It was required to either issue a final decision on the claim or notify the contractor of the defective certification within 60 days. “Because the contracting officer failed to issue a decision within the statutory period [60 days], [the contractor’s] claim was deemed denied and became appealable to the Board.” DAI Global, LLC, supra.
It is always good practice to work with counsel when preparing or submitting a claim. Here, the contractor had good counsel as counsel treated the contracting officer’s untimely notification to the contractor of a defective certification as an appealable denial of the claim.
Please contact David Adelstein at firstname.lastname@example.org or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.