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FEDERAL BOARDS OF CONTRACT APPEALS

Section of Public Contract Law

American Bar Association

Judge Carol N. Park-Conroy

2011-2012 Section Chair

Editor-in-Chief

Judge Candida S. Steel, CBCA

Editors

Judge Elizabeth M. Grant, ASBCA

Judge Patricia J. Sheridan, CBCA

Authors

Judge William A. Campbell, PSBCA

Judge Elizabeth M. Grant, ASBCA

Judge Martin J. Harty, ASBCA (Ret.)

Paul F. Khoury, Wiley Rein, LLP

Stephen J. Kiraly, LitCon Group, LLC

Judge Peter F. Pontzer, PSBCA

Judge Patricia J. Sheridan, CBCA

Judge Candida S. Steel, CBCA

Oliya S. Zamaray, Holland & Knight, LLP

2012 American Bar Association.

ACKNOWLEDGEMENTS

This project was initially undertaken in 2002 by the Pro Bono Committee of the Section of

Public Contract Law of the American Bar Association, under the excellent supervision of the late

Judge Eileen P. Fennessy. The purpose of the 2002 edition of the manual was to aid contractors

in pursuing claims without benefit of counsel (pursuing the appeal as a pro se litigant). To that

end, clerks and judges of the various boards of contract appeals (BCAs) made the manual

available, free of cost, to pro se litigants. The manual has also been used by many in the

government contracts legal community as a primer for lawyers new to the Contract Disputes Act

process, as well as a refresher for more experienced public contract law litigators. Most BCAs

connected to United States civilian agencies were consolidated in January 2007 into a single

Civilian Board of Contract Appeals (CBCA). 41 U.S.C. § 7105(b)(1). Thus, the Section of

Public Contract Law has determined that it is time to issue a revised edition of the manual. With

many thanks to the authors and editors listed on the title page for their enthusiastic and

thoughtful attention to their task, the Section provides this revision.

As was true with the first edition, as a public service, the BCAs are encouraged to make this

manual available to litigants without charge. This manual may be updated from time to time if

changes are made in BCA procedures. The latest version is available for downloading on the

resource page of the ABA Section of Public Contract Law website, at:

http://www.americanbar.org/groups/public_contract_law/resources.html

The fact that a BCA makes the manual available does not imply any authorship, official

endorsement, or responsibility for any errors contained herein, on the part of the BCA.

This manual does not substitute in any way for a BCA’s own rules. The rules for the

CBCA may be found at 48 C.F.R. [Code of Federal Regulations] parts 6101 through 6105,

or on its webpage at www.cbca.gov. The rules governing procedure at the Armed Services

Board of Contract Appeals (ASBCA) are located at Appendix A to Chapter 2 of 48 C.F.R.,

or on its webpage at www.asbca.mil. The rules for the Postal Service Board of Contract

Appeals (PSBCA) can be found at http://about.usps.com/who-we-are/judicial/boardcontract-appeals-decisions/welcome.htm.

The authors and editors listed on the title page deserve primary credit for this revision. We wish

to give special thanks to Oliya S. Zamaray, Esq. of Holland & Knight LLP, who coordinated the

many drafts leading to this final product. The Section also wishes to thank the Chairman of the

Armed Services Board of Contract Appeals, Paul Williams, and the Chairman of the Civilian

Board of Contract Appeals, Stephen M. Daniels, for their encouragement and advice in the

course of this revision, as well as the recorders and clerks of the ASBCA and CBCA who help

disseminate this information. Finally, we wish to thank the following individuals for their varied

assistance: Judge Richard C. Walters; David S. Black, Esq.; Daniel P. Graham, Esq.; Rachel A.

Alexander, Esq.; and Barron A. Avery, Esq. We hope that the BCA system, the parties, their

counsel, and the BCA judges who hear these cases, will benefit directly from the wisdom

imparted in these pages.

2012 American Bar Association

May be reproduced and distributed without charge.

TABLE OF CONTENTS

INTRODUCTION..........................................................................................................................1

II.

PREREQUISITES OF AN APPEAL...........................................................................................3

III.

IV.

VI.

VII.

The Claim and Certification .............................................................................................3

The Contracting Officer’s Final Decision........................................................................4

BEGINNING AN APPEAL ..........................................................................................................6

Appeal from a Contracting Officer’s Decision................................................................6

Appeal from a Contracting Officer’s Failure to Issue a Decision .................................7

THE PRELIMINARY PHASE.....................................................................................................8

The Notice of Docketing ....................................................................................................8

Representation before a BCA and the Notice of Appearance........................................8

Service of Documents.........................................................................................................9

Private or Ex Parte Communications...............................................................................9

Board Orders and Extensions of Time.............................................................................9

The Appeal File ................................................................................................................10

ELECTION OF PROCEDURES ...............................................................................................12

The Traditional Litigation Procedure – A hearing.......................................................12

The Small Claims Expedited Procedure – A decision within 120 days.......................13

The Small Claims Accelerated Procedure – A decision within 180 days....................13

Submission on the Record ...............................................................................................14

Separate Decisions on Entitlement and Quantum ........................................................14

ALTERNATIVE DISPUTE RESOLUTION (ADR) AND SETTLEMENT

NEGOTIATIONS ........................................................................................................................16

ADR Procedures...............................................................................................................16

Settlement Procedures .....................................................................................................17

PLEADINGS ................................................................................................................................19

The Complaint..................................................................................................................19

The Answer.......................................................................................................................19

VIII. DISCOVERY................................................................................................................................21

Description, Purpose, and Scope ....................................................................................21

Discovery Obligations ......................................................................................................21

Board Rules Governing Discovery ........................................................................21

Preservation............................................................................................................21

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IX.

XI.

Types of Discovery ...........................................................................................................22

Interrogatories ........................................................................................................22

Requests for Production of Documents .................................................................23

Requests for Admission .........................................................................................24

Depositions ............................................................................................................24

Managing Discovery ........................................................................................................25

Privilege .................................................................................................................25

Objections to Written Discovery ...........................................................................26

Protective Orders ...................................................................................................26

Motions to Compel ................................................................................................26

Sanctions ................................................................................................................27

MOTIONS AND BRIEFS ...........................................................................................................29

Discovery Conferences ..........................................................................................22

Dispositive Motions ..........................................................................................................29

Motion to Dismiss..................................................................................................29

Motion for Summary Judgment .............................................................................29

Briefs .................................................................................................................................30

Pre-Hearing Briefs .................................................................................................30

Post-Hearing Briefs................................................................................................30

Writing Motions and Briefs ............................................................................................31

Introduction............................................................................................................31

Questions Presented ...............................................................................................31

Proposed Findings of Fact .....................................................................................31

Argument ...............................................................................................................31

Conclusion .............................................................................................................32

PRE-HEARING MATTERS ......................................................................................................33

Pre-Hearing Orders .........................................................................................................33

Pre-Hearing Conference..................................................................................................33

Exhibits .............................................................................................................................34

Stipulations .......................................................................................................................34

Motions to Exclude Evidence ..........................................................................................34

Pre-Hearing Briefs or Position Papers...........................................................................35

THE HEARING ...........................................................................................................................36

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XII.

Date and Length of the Hearing .....................................................................................36

Immediately Before the Start of the Hearing ................................................................36

Failure to Appear at the Hearing ...................................................................................37

The Hearing Record ........................................................................................................37

Orderly Conduct of the Hearing ....................................................................................38

Opening Statements and Order of Proceedings ............................................................38

Testimony..........................................................................................................................39

Subpoenas .........................................................................................................................40

Direct Examination of Witnesses....................................................................................40

Cross-Examination of Witnesses ....................................................................................41

Conclusion of the Hearing...............................................................................................41

Post-Hearing Briefs..........................................................................................................41

PROOF OF DAMAGES – QUANTUM ....................................................................................43

Introduction......................................................................................................................43

Types of Damages – Direct and Indirect........................................................................44

Necessary Records ...........................................................................................................44

Presenting the Claim........................................................................................................45

Claim Pricing Methodologies..........................................................................................47

Estimates ...........................................................................................................................48

Government Audits..........................................................................................................48

Stipulating to Damages....................................................................................................49

Schedule of Costs..............................................................................................................49

XIII. THE BOARD’S DECISION AND APPEALING TO THE COURT OF APPEALS

FOR THE FEDERAL CIRCUIT ...............................................................................................51

The Board’s Decision .......................................................................................................51

Relief Granted ..................................................................................................................51

Motion for Reconsideration ............................................................................................51

Appeal to the Court of Appeals for the Federal Circuit...............................................52

Representation by Counsel..............................................................................................53

XIV. ATTORNEYS’ FEES AND EXPENSES IN BOARD LITIGATION ....................................54

The Equal Access to Justice Act (EAJA) .......................................................................54

Timeliness of EAJA Applications ...................................................................................54

Contents of Application for Award ................................................................................54

Net Worth and Size Limits..............................................................................................54

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Establishing Prevailing Party Status..............................................................................54

Government’s Position Not Substantially Justified ......................................................55

Applicant’s Burden of Proof ...........................................................................................55

Recoverable Fees and Expenses......................................................................................55

Proper Documentation ....................................................................................................55

Pro Se Litigants ................................................................................................................55

Fees Incurred before a Contracting Officer’s Final Decision......................................56

Effect of a Government Settlement Offer ......................................................................56

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APPENDICES

Appendix A: Addresses of the BCAs....................................................................................... A-1

Appendix B: Use of Sample Forms in BCA Submissions.......................................................B-1

Sample Request for Contracting Officer’s Final Decision ..............................................B-2

Sample Notice of Appeal .................................................................................................B-3

Sample Notice of Appearance .........................................................................................B-4

Sample Certificate of Service ..........................................................................................B-5

Sample Request for an Extension of Time .....................................................................B-6

Sample Complaint............................................................................................................B-7

Sample Supplement to the Appeal File............................................................................B-9

Sample Letter Submitting Discovery Requests .............................................................B-10

Sample Interrogatories ...................................................................................................B-11

Sample Request for Production of Documents ..............................................................B-16

Sample Notice of Depositions .......................................................................................B-18

Sample Request for Admissions ....................................................................................B-20

Sample Motion...............................................................................................................B-21

Sample Declaration [Affidavit]......................................................................................B-22

Sample Request for Hearing or Submission on the Record...........................................B-23

Sample Pre-hearing Disclosure of Exhibits and Witnesses ...........................................B-24

Sample Cover Letter for a Submission ..........................................................................B-25

Appendix C: ADR and Settlement .......................................................................................... C-1

ASBCA ADR Notice .......................................................................................................C-1

CBCA Rule 54 on ADR ..................................................................................................C-4

Sample Mediation Agreement I .......................................................................................C-7

Sample Mediation Agreement II......................................................................................C-9

Sample Mediation/Arbitration (Med/Arb) Agreement ..................................................C-12

Sample Settlement Judge Agreement ............................................................................C-15

Sample Agreement to Use Summary Trial with Binding Decision ...............................C-17

ADR Websites ...............................................................................................................C-19

PRACTICING BEFORE THE FEDERAL BOARDS OF CONTRACT APPEALS

INTRODUCTION

The purpose of this manual is to provide simple, straightforward guidance for contractors who

bring appeals to federal boards of contract appeals (BCAs) without representation by an attorney

(pro se litigants), and for attorneys who may not be familiar with BCA practice. It may also help

contractors decide whether to hire an attorney to present the appeal.1

The BCAs are tribunals established by Congress in the Contract Disputes Act (CDA) to resolve

disputed claims arising under or relating to a federal government contract. 41 U.S.C. §§ 71017109. The BCAs are charged with providing informal, inexpensive, and prompt resolution of

government contract disputes. In addition to providing a forum for a full hearing, the BCAs also

make a variety of alternative dispute resolution procedures available; these procedures can be

used either for matters that are already docketed at a BCA, or for issues still being disputed with

a contracting officer that may later result in an appeal to a BCA.

Since January 2007, two main BCAs have been tasked with hearing appeals from contracting

officers’ final decisions.

The ASBCA is generally responsible for deciding appeals from

decisions of contracting officers in the Department of Defense, the Department of the Army, the

Department of the Navy, NASA, and when specified, the CIA. The CBCA hears disputes from

all other executive agencies except the United States Postal Service (USPS), the Postal Rate

Commission, and the Tennessee Valley Authority. 41 U.S.C. §§ 7101-7109. The USPS is

served by the PSBCA. In addition, the Government Accountability Office Contract Appeals

Board (GAOCAB) handles contract disputes arising in the legislative branch, and the Office of

Dispute Resolution for Acquisition (ODRA) handles contract disputes and bid protests arising

out of Federal Aviation Administration procurements. This manual may be helpful to litigants

before those BCAs as well. Some of the BCAs exercise jurisdiction in other types of disputes,

not arising under the CDA. While this manual principally focuses on CDA cases, it should be a

useful tool in other types of cases before a BCA.

For administrative purposes, the BCAs are housed within federal agencies. However, Congress

has made the BCAs functionally independent. Decisions of the BCAs may not be reviewed or

changed by any agency official. Board decisions issued under the CDA are final unless one of

the parties appeals to the United States Court of Appeals for the Federal Circuit (Federal Circuit),

or, in the case of maritime appeals, the appropriate Federal District Court.

Appendix B to this manual contains sample forms of pleadings, discovery requests, letters,

mediation agreements, and other documents often used in BCA proceedings. These are typical

documents which might be used by either side. Parties may, but are not required to, use these

samples for preparing their own documents. Please remember that these forms will need to be

tailored to each individual appeal. Finally, the ASBCA and CBCA allow pleadings, briefs, and

certain other documents to be filed electronically as PDF attachments to e-mails. Please refer to

the BCAs’ websites, www.asbca.mil and www.cbca.gov, for instructions on e-filing. The

Small businesses may be eligible for payment of attorneys’ fees under the Equal Access to

Justice Act. See Section XIV.

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PSBCA and GAOCAB will allow pleadings and documents to be filed as attachments to e-mails

upon request.

Each BCA publishes its own rules, which may be found at the webpage for that board as well as

in the appropriate C.F.R. section (i.e., 48 C.F.R. part 6101 for the CBCA, and Appendix A to

Chapter 2 of 48 C.F.R. for the ASBCA). When questions arise, a party should always check the

rules of the BCA in which it is appearing. Generally, when a contracting officer’s decision is

appealed to a board, the clerk of that BCA will send a copy of its rules to the contractor with the

notice of docketing, or notify the contractor how those rules can be obtained.

This manual is not a substitute for the rules of the BCAs, and the published rules will

govern if there is any discrepancy between this manual and the rules. Parties must be sure

to read, and comply with, the rules and orders of the BCA to which the dispute has been

appealed. For questions about a particular rule, the clerk of the BCA or the judge’s legal

assistant may be able to help you.

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II.

PREREQUISITES OF AN APPEAL

The Claim and Certification

Claims often arise during the course contract performance; a party might seek relief by

requesting contract interpretation, money, and/or an extension of time. A claim generally

consists of two parts: (1) the “entitlement” portion, which typically includes a detailed

description of the actions or inactions of the party from whom relief is sought, entitling the

claimant to compensation; and (2) the damages or “quantum” portion, which sets forth the

calculations and support for the compensation claimed. The two parts are equally important

because without entitlement, damages cannot be recovered, and without proof of damages,

establishing entitlement is of little value.

Deciding to formally file and pursue a claim has significant implications. Among other things,

relationships become more adversarial as parties protect their own positions in anticipation of

litigation. If a party decides to file a claim and pursue an appeal, it should be sure that the claim

is carefully calculated and supported.

Contracting officers are subject to scrutiny and oversight, both inside and outside of their own

organizations. They will not typically pay a claim without sufficient back-up, even if it is just

for “nuisance value,” a practice which might make business sense.

Some claims remain

unresolved, and litigation prolonged, due to inadequate supporting proof of costs. In some

instances, an inflated claim may cause the government to dispute any entitlement at all; indeed, if

the contractor’s claim is unsupportable due to misrepresentation or fraud, the contractor can be

liable to the government for at least the unsupported amount of its claim, and perhaps more. So,

although the parties have a legal right to assert and pursue legitimate claims, the implications,

both as to process and as to proof, merit serious consideration.

The party that is asserting a claim has the responsibility to bring forward sufficient evidence to

support its claim. Stated another way, the party seeking to recover usually has the “burden of

proof.” If the government is asserting a claim, e.g., claiming it is entitled to liquidated damages,

it has the burden of proving it is entitled to recovery. Likewise, if a contractor is making a claim,

e.g., it has been required to do work not required by the contract, then the contractor must prove

entitlement to compensation for that work.

A BCA must have jurisdiction – the right to consider and decide a contract dispute. For a BCA

to have jurisdiction over a contract dispute brought by a contractor, the CDA requires that the

contractor must first submit a written claim to the contracting officer for his or her final decision

denying or granting all or part of the claim. For a BCA to have jurisdiction over a government

claim, the contracting officer must first have asserted the government’s claim via a final

decision.

For BCAs to exercise jurisdiction under the CDA, several prerequisites must be met. If these

requirements are not met, a board will not have the authority to decide the dispute. First, a claim

brought to a board must be in writing and seek, 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. The claim must be a clear and definite statement that gives the

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contracting officer notice of the basis and amount of the claim. Routine requests for payment

such as invoices that are not in dispute at the time they are submitted are not claims. See Federal

Acquisition Regulation (FAR) 52.233-l(c) (52 C.F.R. 52.233-1(c)).

If a contractor’s claim is for more than $100,000, the claim must be certified in accordance with

the CDA. The certification language required by the Disputes clause in the contract is shown at

FAR 52.233-1(d) and currently reads:

I certify that the claim is made in good faith; that the supporting

data are accurate and complete to the best of my knowledge and

belief; that the amount requested accurately reflects the contract

adjustment for which the Contractor believes the Government is

liable and that I am duly authorized to certify the claim on behalf

of the Contractor.

Signed by:

[name, company, position]

The person who signs the certification must be authorized by the contractor to bind the

contractor with respect to the claim.

A Sample Request for a Contracting Officer’s Final Decision is shown at Appendix B-2.

However, parties potentially facing a lengthy appeal process may wish to carefully consider

when best to submit a CDA claim. Once a claim meeting CDA requirements is submitted to the

contracting officer a final decision is required. The issuance of the final decision triggers the

deadline for filing an appeal. As an alternative to a CDA claim, a contactor might request that

the contracting officer issue an equitable adjustment (referred to as a request for equitable

adjustment (REA)). Until the contractor’s document requests a contracting officer’s final

decision (and, if over $100,000, is certified), the contracting officer should not issue a final

decision triggering the appeal deadline.

The Contracting Officer’s Final Decision

If a contractor’s claim is for $100,000 or less, the contractor may ask for a final decision within

60 days, in which case, the contracting officer is obliged to comply. For certified claims for

more than $100,000, the contracting officer has 60 days either to decide the claim or to notify the

contractor when a final decision will be issued.

The contracting officer’s decision must be in writing and must be mailed or otherwise furnished

to the contractor. The contracting officer must state the reasons for the decision and notify the

contractor of its rights, including the right to appeal the decision to a particular BCA within 90

days or to the United States Court of Federal Claims within twelve months of the final decision.

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PRACTICE TIPS

•

A BCA cannot consider a dispute until a claim has first been submitted to

the contracting officer responsible for administering the contract and a final

decision has been requested.

•

A BCA cannot consider a government claim until the contracting officer

has first asserted the claim by issuing a final decision and the final decision

has been appealed.

•

A claim must be in writing and seek 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.

• A claim for more than $100,000 must be certified in accordance with FAR

52.233-1.

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III.

BEGINNING AN APPEAL

Appeal from a Contracting Officer’s Decision

An appeal to a BCA is relatively easy and inexpensive. A contractor must file an appeal with the

appropriate board within 90 days after receiving the contracting officer’s final decision. An

appeal from a final decision issued by a USPS contracting officer may be also sent directly to the

contracting officer.

An appeal may be filed via USPS mail or any other document delivery service. It may also be

hand-delivered. An appeal sent by the USPS is timely if it transferred to the custody of the

USPS or postmarked within that 90-day period. For delivery other than USPS mail, the appeal is

timely only if the BCA receives it within 90 days after the contractor received the contracting

officer’s final decision. If an appeal is delivered by means other than USPS mail, a receipt

should be obtained indicating the date and time of delivery.

There is no fee to take an appeal to a BCA. All that is required is a written notice of appeal.2

The notice of appeal should:

a) be in writing and state that an appeal is being taken from a contracting

officer’s final decision;

b) describe the contracting officer’s decision from which the appeal is intended

in enough detail so the BCA can distinguish it from any other contracting

officer’s final decision; and

c) be submitted by the appellant, the appellant’s authorized representative, or by

the appellant’s attorney.

To ensure that the above criteria are met, the notice of appeal should:

a) identify the contract, by number, and the department and/or agency or bureau

involved in the dispute;

b) identify the amount of money in dispute or other relief sought; and

c) include a copy of the contracting officer’s decision from which the appeal is

taken.

Once an appeal has been filed with a BCA, the contractor is referred to as the appellant; the

government agency is typically referred to as the respondent or the government. The appellant

should also provide a copy of the notice of appeal to the contracting officer. In addition to

alerting the contracting officer that an appeal has been filed, provision of the copy also serves as

additional evidence of the date the appeal was filed.

A sample Notice of Appeal appears in the Appendix at B-3.

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In instances where there is a question about whether the appellant has met the 90-day deadline,

proof of timely delivery may be required by the BCA. If a contractor does not meet the 90-day

deadline for filing an appeal, the board will dismiss the appeal for lack of jurisdiction. Even if a

BCA does not have jurisdiction to consider an appeal because it was filed beyond the 90-day

deadline, a contractor has the right to file an action in the Court of Federal Claims within twelve

months after receiving the contracting officer’s final decision.

Appeal from a Contracting Officer’s Failure to Issue a Decision

A failure to issue a timely final decision is treated as a “deemed denial” of the claim, from which

a contractor may appeal. For a claim of $100,000 or less, if the contracting officer does not issue

a decision within 60 days of receipt of a request that a final decision be issued, the contractor

may appeal that failure to render a decision. If, on a claim over $100,000, the contracting officer

does not issue a decision within a reasonable time (which is at least 60 days or by another precise

date that the contracting officer has told the contractor s/he will issue the final decision), the

contractor may appeal from that failure.

A notice of appeal from a deemed denial should contain essentially the same information as set

forth above, and should state that the appeal is taken from the failure of the contracting officer to

render a decision within a reasonable time. An appeal from a deemed denial places the matter

before the BCA. Upon receipt of such an appeal, the board may temporarily stop the

proceedings and direct the contracting officer to either issue a decision or explain why a decision

cannot be issued. The BCA may take this action so that it and the contractor will have an

understanding of the government’s position. To avoid potential problems and delays in an

appeal from a “deemed denial,” make sure that the contracting officer is late in issuing the final

decision before filing the appeal.

PRACTICE TIPS

•

An appeal must be filed with the appropriate board within 90 days after

receiving the contracting officer’s final decision.

•

If a contracting officer does not issue a final decision within the required

time frame, a contractor may appeal that failure as a “deemed denial” of the

claim.

•

If an appeal is delivered by means other than USPS mail, a receipt should

be obtained indicating the date and time of delivery.

•

Once an appeal has been filed with a BCA, the contractor is referred to as

the appellant; the government agency is typically referred to as the

respondent or the government. An appellant who represents himself or

herself is sometimes called a pro se appellant. An attorney will always

represent the government.

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IV.

THE PRELIMINARY PHASE

The Notice of Docketing

After receipt of a notice of appeal, the BCA sends a notice of docketing to the appellant and to

the chief trial attorney of the agency that issued the final decision. The notice of docketing

identifies the docket number that the BCA has assigned to the appeal. This docket number

should be used in all future communications with the BCA as it is the principal way the BCAs

track cases. The BCA will also either provide a copy of the board’s rules or information on

where the rules can be found electronically. The notice includes instructions concerning what

the parties will be required to file in the near future, and when. These filings may include a

complaint and answer, the government’s appeal file, and the appellant’s supplement to the appeal

file. The notice of docketing letter will also describe the procedures available for resolving the

appeal and options for possible settlement. These matters will be discussed in greater detail in

the sections that follow.

The parties must comply with the time periods and dates set by the BCA’s rules and by the

board. If it turns out that a due date cannot be met and an extension is needed, the extension

request should be made well before the filing is due. If a party misses a due date and fails to

request an extension, depending on the circumstances, the board may or may not allow a late

filing.

Representation before a BCA and the Notice of Appearance

At the outset of the appeal, the parties need to notify the board and each other who will be

representing each of them before the board. An individual or an attorney cannot represent a

party unless he or she has noted his or her appearance with the board. An appellant can do this

by stating in its notice of appeal who will be its representative. Either party can submit a

separate document called a notice of appearance.3 The notice of appearance is a simple

document. It must state the party’s name, the designated representative’s name, his or her

relationship to the party, address, telephone number, and email address. The appellant should

send a copy of the notice to the government’s attorney, if known, or to the contracting officer

who issued the final decision, who should forward the notice to the government attorney

assigned to the case.

Although the BCAs do not require that the contractor’s representative be an attorney, there are

some limitations upon who may represent an appellant. An appellant who is an individual may

represent him or herself before a BCA; a corporation may be represented by one of its officers;

and a joint venture by one of its members.

Shortly after the appeal has been filed, the government’s attorney will also file a notice of

appearance. Additional notices of appearance must be filed by the government and the appellant

each time a change in representation occurs.

A sample Notice of Appearance appears in the Appendix at B-4.

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Service of Documents

Unless otherwise directed by the board a party must provide a copy of all correspondence and

documents sent to the board to the opposing party’s representative so that everyone knows what

is happening in the appeal. The party should use the same delivery method to the opposing party

as is used with the board, so if something was sent by telefax (facsimile) to a board, it should

also be telefaxed to the opposing party on the same day. Each submission to the BCA should

reflect that a copy of the submission was sent to the opposing party. For submissions to the

BCA, such as the complaint or a brief, the parties should attach a certificate of service4 to show

that a copy was sent to the other side (unless the submission is sent with a cover letter that shows

a copy was sent to the opposing party). A typical certificate of service states:

CERTIFICATE OF SERVICE

I hereby certify that I served, or caused to be served, a true and

correct copy of the foregoing document by [state: hand-delivery,

mail, e-mail or telefax] to the following attorney of record this

[date] day of [month], [year]: [provide: name, title, address].

Signed by:

[signature]

[name of person making the certification and title]

Sample letters and forms for submissions are included in Appendix B.

Private or Ex Parte Communications

Neither party is allowed to discuss the merits (that is, the applicable facts and law) of an appeal

with the judge outside the presence of the opposing party. Therefore, if one or both sides want to

discuss the merits of the appeal with the judge, either or both parties must request a telephone

conference with the judge. The judge’s office will typically set up a conference call with both

parties participating. A request for a conference call may be submitted in writing to the BCA, by

e-mail, or orally by telephoning the recorder (or, in the case of the CBCA, the judge’s legal staff

assistant). Private, or ex parte, discussions with the judge about purely procedural matters may

be permitted.

Board Orders and Extensions of Time

The board or judge will set forth the schedule for various submissions and make other demands

by issuing an “order.” An order should be treated as a command from the judge to do what is set

forth in the order by the date(s) specified in the order. If a party anticipates it will not be able to

file (submit) a response to an order by the date(s) set forth in the order, it must ask the judge, in

advance, for an extension of time.5 The request should briefly set forth the reason(s) for the

extension and notify the judge when the required pleading or information is requested to be filed.

Additionally, before asking a judge for an extension, a party should contact the opposing party to

A sample Certificate of Service appears in the Appendix at B-5.

A sample Request for an Extension of Time appears in the Appendix at B-6.

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check whether that party is willing to agree to the extension. Be sure to let the judge know, in

the extension request, whether the request is opposed or not, so the judge can be fully informed.

Unopposed extension requests are typically granted, provided there is a legitimate basis for the

request and the parties do not constantly ask for them. Extensions that are opposed may require

more consideration by the judge. In any case, before granting an extension, the opposing party

will need to be consulted.

If a party cannot meet a date set by the board’s rules or by a judge, it must request an extension

of time in advance from the board. Failure to meet deadlines may lead the board to impose

sanctions. Repeated failures to meet deadlines can result in the dismissal of the appeal for failure

to prosecute it.

The Appeal File

The appeal file is often referred to as the “Rule 4 file” because BCAs address the content and

submission of the appeal file in Rule 4 of their rules of procedure. The government is required to

submit the appeal file to the BCA and to the appellant within 30 days of receiving the notice of

docketing. The appeal file should contain all the documents that the government considers

pertinent to the dispute. Each document in the appeal file should be arranged in chronological

order, if practical, and must be sequentially numbered, tabbed, and indexed.

For a number of reasons, appeal files are sometimes not complete when first submitted. For

example, the government may not have considered certain documents to be relevant. Typically,

the appellant will be ordered to submit a supplemental appeal file within 30 days after it received

the government’s appeal file.6 This is the appellant’s chance to submit relevant documents that

the government failed to include in its appeal file. Documents that the government has already

submitted should not be duplicated in the appellant’s submission.

Documents submitted to the BCA in the government’s appeal file and the appellant’s supplement

are considered evidence; they are made part of the record upon which the BCA will make a

decision, unless the other party objects and the BCA grants the objection. The documents in the

appeal file and the appellant’s supplement which are included in the record will not have to be

made exhibits during the hearing, which saves time and effort.

Usually, the BCAs will allow the parties to further supplement the appeal file after discovery has

been completed and/or prior to the hearing. As a general rule, the earlier a document is

submitted for the appeal file or appeal file supplement, the less likely it is to be opposed.

A sample Supplement to the Appeal File appears in the Appendix at B-9.

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PRACTICE TIPS

• The parties must comply with the time periods and dates set by the BCA’s

rules and by the judge. If it turns out that a due date cannot be met and an

extension is needed, the extension request should be made well before the

filing is due. If a party misses a due date and fails to request an extension,

depending on the circumstances, the judge may or may not allow a late

filing.

• Documents submitted to the BCA in the appeal file and any appeal file

supplements are accepted by the board as evidence and are made a part of

the record upon which the BCA will make a decision, unless the other party

objects and the BCA sustains the objection. Once this occurs, there is no

future need to submit these documents as exhibits.

• Once a document is included in the appeal file as an exhibit, do not resubmit

the document as an exhibit in the appeal file supplement. Resubmission

will cause confusion as to what document number should be referenced in

future filings.

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ELECTION OF PROCEDURES

The BCAs call their trials “hearings,” but they follow traditional litigation and trial processes,

including placing witnesses under oath, allowing direct and cross-examination, and ruling on

evidentiary objections. In addition to traditional litigation processes, the BCAs offer small

claims processes as well as alternative dispute resolution (ADR) procedures designed to help

quickly and informally resolve appeals. ADR (which, in federal contract practice is sometimes

generally referred to as mediation) is an alternative to having a hearing or submitting a case for a

decision on the basis of the written record. It uses procedures that vary depending on the nature

of the case. After a notice of appeal is received, a BCA will typically send a notice summarizing

available ADR procedures or where on the web information about ADR may be found. The

parties may elect to use an ADR procedure at any time.

The BCA’s rules and/or the notice of docketing will state the times within which choices about

litigation procedures must be made. The procedures discussed below are set forth in the rules of

each BCA.

The Traditional Litigation Procedure – A hearing

The traditional litigation procedure is available for all types of cases, regardless of the dollar

amount of the claim. Both parties file pleadings, with the appellant typically filing the first

pleading, called a complaint. On occasion, however, the judge may order the government to file

the complaint if the underlying dispute in the appeal arises from a government claim against the

contractor. The content of the complaint is discussed in Section VII.A and a sample complaint

can be found at Appendix B-7. After receiving the complaint, the government must then file an

answer (unless the government filed the complaint, in which case the appellant will file the

answer). The parties then typically conduct discovery, as discussed in Section VIII, to find out

more about the case.

With the traditional procedure, the BCAs typically hold a hearing unless the parties submit the

case for a decision on the written record. The hearing is conducted like a non-jury trial in the

federal courts and usually involves the parties filing pre-hearing or post-hearing briefs, or both.

Although the BCAs are located in the Washington, D.C. area, the judge will usually hold a

hearing at any location which best serves the interest of justice, so the judge will typically seek

the suggestions of the parties on where to hold the hearing.

In the traditional procedure, one judge will preside at the hearing and prepare the initial draft of

the decision. The decision will set forth, in detail, the factual and legal bases for the decision.

Two other judges will consider the record and review the initial draft decision. At least two of

the three judges must agree on the final version of the decision for it to be issued. At the

ASBCA, if there is a dissent (one of the panel judges disagrees with the decision), the case will

be decided by a five-judge panel. A decision issued pursuant to the traditional procedure is

considered binding precedent for the BCA issuing the decision and is final unless either party

files a timely appeal of the decision. Binding precedent means that the issuing BCA is obligated

to follow the law established by that case in future cases that have comparable facts.

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The Small Claims Expedited Procedure – A decision within 120 days

The BCAs have special procedures for small dollar value cases. For claims of $50,000 or less

($150,000 for small businesses), the appellant may elect the small claims procedure. The

objective of this expedited procedure is to resolve the dispute within 120 days after the BCA

receives the request for this process.

After the appellant asks for the expedited procedure, the judge assigned to the case will hold a

conference call with the parties to discuss how the appeal will be processed, consistent with the

objective of resolving it within 120 days.

The expedited procedure provides for simplified rules of procedure. The judge will streamline

proceedings and may eliminate discovery, motions, and certain pre-hearing procedures. The

judge may also shorten the time frames for completing such actions. The judge will hold a

hearing unless the parties elect to proceed on the written record without a hearing.

The election of the expedited procedure puts the case on a fast track. The parties must be able to

devote the time necessary to resolve the appeal quickly and must be willing to cooperate with

each other for the expedited procedure to work successfully.

Only one judge will issue a decision in an expedited appeal. If a hearing was conducted, the

judge, in his or her discretion, may ask the parties to give closing arguments and has the option

of issuing an oral decision at the close of the hearing.

The decision is typically short, with summary findings of fact and a brief statement of the legal

bases for the decision. A decision issued in an expedited appeal has no precedential value,

meaning that it is not cited for guidance in deciding other cases.

Although motions for

reconsideration are permitted, appeals to the Federal Circuit are not allowed, except in cases of

fraud.

The Small Claims Accelerated Procedure – A decision within 180 days

If the amount in dispute is less than $100,000, an appellant may ask to have the dispute resolved

within 180 days under the accelerated procedure. The accelerated procedure is similar to the

small claims procedure but involves the following major distinguishing features:

1) the appeal is to be resolved, if practicable, within 180 days after the BCA’s

receipt of the election;

2) the presiding judge issues the decision with the concurrence of one other

judge; and

3) the decision may be cited as precedent in later cases and may be appealed to

the Federal Circuit.

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Submission on the Record

Regardless of which of these three procedures is used, a party may ask that the case be

decided on the basis of the written record, without a hearing. If one party elects to have a

hearing, a hearing will be held. The party who requested a decision on the written record can

attend and participate at the hearing or may submit its case on the record and elect to appear

at a hearing solely to cross-examine any witness presented by the opposing party.

If a party chooses to submit the case on the record, it must satisfy the same burden of proof or

defense as would be required if a hearing were conducted. To help explain the documents in the

record, the appeal file may be supplemented with affidavits (statements of fact sworn to and

signed before a notary public), declarations (like affidavits but must contain a statement that “the

facts are true and correct under penalty of perjury” instead of being signed before a notary

public), depositions, admissions, answers to interrogatories, and/or stipulations of fact agreed to

by the parties.

While supplementation of the record as described above is not required, these additional

submissions may help the judge to better understand the parties’ respective positions. If there are

facts in dispute, it is important to supplement the record with affidavits or declarations given

under penalty of perjury by a person with direct knowledge of the facts.

Affidavits and

declarations should also reference relevant documents in the appeal file or appellant’s

supplement.

The BCAs will usually require the record to be supplemented with legal briefs and/or oral

argument. Although pro se appellants probably have not been trained to write legal briefs, it is

wise to provide the presiding judge with a brief containing a concise statement of the important

facts that includes citations to the evidence that support a claim or defeat a government claim.

An appellant should also explain the reasons it believes that the government’s position is

incorrect based on the evidence in the record.

The submission of an appeal for a decision on the record does not eliminate the need to prepare

pleadings or conduct discovery. A decision in an appeal submitted on the record without a

hearing is final, subject only to an appeal by either party. See Section XIII.

Separate Decisions on Entitlement and Quantum

A claim generally consists of two parts: (1) the “entitlement” portion, which typically includes a

detailed description of the actions or inactions of the party from whom relief is sought, entitling

the claimant to compensation; and (2) the damages or “quantum” portion, which sets forth the

calculations and support for the damages claimed. In some cases, to shorten the time needed to

process an appeal and save resources, the parties may ask the judge to decide the appeal in two

parts: entitlement and quantum. Sometimes the judge will raise this issue. When separate

decisions are issued on entitlement and quantum, the appeal is said to be “bifurcated.”

To decide whether an appeal should be bifurcated, the judge will consider the benefits of

splitting the litigation into two parts. In the entitlement phase of an appeal, the merits of a case

are addressed, i.e., whether the party is entitled to any relief. The quantum phase determines the

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amount of money that an entitled party should recover, i.e., what costs the party has proved. If

the judge determines in the entitlement phase of an appeal that the claim should be denied (for

instance, the government did not change the contract as contended by the appellant), there is no

need to move to the quantum phase.

If the quantum portion of the claim is particularly

complicated and will take a long time to explain and decide, it might be best to have a hearing

and obtain a decision on entitlement first, leaving the issue of quantum (what/how much

entitlement) to a later date. Sometimes, the parties may be able to agree to the amount of the

equitable adjustment, but need the judge to decide whether the party is entitled to an equitable

adjustment under the terms of the contract. Other times, both parties may agree that the

contractor is entitled to an equitable adjustment but the amount of the entitlement is in dispute.

Deciding whether to bifurcate a case is ultimately a decision left to the judge.

PRACTICE TIPS

•

A hearing will be held if either party elects one.

•

Electing the small claims or accelerated procedure puts the case on a fast

track, but the parties must be willing to cooperate with each other and

devote the time necessary to process the appeal with shorter than usual time

frames.

•

When a party decides it does not need a hearing to prove its case, it can ask

the judge to make a decision on the written record. A party that chooses to

submit the case on the record must satisfy the same burden of proof on the

claim or defense as would be required if a full hearing were conducted.

•

A party electing to submit its case on the record may also elect to appear at

a hearing solely to cross-examine any witness presented by the opposing

party.

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VI.

ALTERNATIVE DISPUTE RESOLUTION (ADR) AND SETTLEMENT

NEGOTIATIONS

ADR Procedures

Because litigation is time-consuming and expensive, many agencies and contractors want a

different approach – one that still involves a third party neutral but which is faster, more flexible,

informal, and comprehensive. These kinds of alternative procedures are called alternative

dispute resolution or ADR, and there are many different types, all of which can be tailored by the

parties and the neutral. Statutes, regulations, and BCA procedures provide for and encourage

ADR, and the success rates are high. Parties should seriously consider this option as they work

to resolve their disputes.

ADR is voluntary; neither side is required to choose it. For an ADR proceeding to be conducted,

both parties must agree to use ADR. However, most ADR processes still allow the parties to

proceed later with litigation if the ADR is unsuccessful, so many parties consider ADR a no-risk

proposition; they will either reach a resolution they can live with, or they can walk away and

continue with traditional litigation. The parties may ask the board for ADR assistance anytime

there is an issue in dispute, from pre-claim, through the early appeal process, to post-hearing. It

is important to note that the later that ADR is requested, the more costs are incurred and the more

entrenched the parties’ positions become. ADR procedures can also be used for the entire

dispute or just parts of it, as the parties agree.

There are two basic kinds of ADR – binding and non-binding – although there are many

variations of both. Mediation, which is non-binding, is the most popular form of ADR used at

the BCAs. When using mediation, the parties will typically exchange position papers addressing

the facts and disputed issues, as well as their positions. They then meet with the judge in a joint

session and make informal presentations to each other and the judge. Each party must be

represented by someone with authority to settle the dispute. The judge, acting as a third-party

neutral, meets both together and separately with the parties to assess the strengths and

weaknesses of each side and help identify settlement options. If the parties reach an agreement,

they sign a settlement agreement and then jointly move to dismiss the case. If they do not settle,

the judge that served as the neutral withdraws and removes or “recuses” himself or herself from

any further activity with the case. The case goes back into the litigation process before the

presiding judge, or another judge is assigned to preside if the presiding judge conducted the

ADR. This way, any concessions made for settlement purposes during the ADR remain private

from the judge deciding the case. However, the parties may request that a presiding judge who

conducts an ADR procedure remain as the presiding judge. This type of arrangement is allowed

provided the parties and judge agree. The documents at Appendix C-7 through C-12 contain

sample agreements for non-binding ADR. Reading those sample agreements can provide a

better understanding of what to expect during an ADR procedure.

Binding ADR at the BCAs is typically accomplished through a procedure called summary trial

with binding decision. This procedure is similar to binding arbitration and has been used to

resolve many claims.

The parties will normally be expected to prepare short pre-hearing

statements identifying the disputed facts and applicable law. A summary trial, at which

witnesses testify, is held. A board judge then issues a very brief written decision, which is

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binding, non-precedential, and non-appealable. Cases that have single or well-defined issues,

such as clear-cut factual issues, discrete cost issues, or matters of contract interpretation, may be

good candidates for this procedure. This option should also be considered for cases in which the

contractor could elect to proceed under the boards’ small claims or accelerated procedures.

Appendices C-15 through C-17 contain sample ADR agreements for binding ADR.

Sometimes the parties decide that using a combination of ADR processes will work the best for

them. For instance, in the process called mediation/arbitration (or med/arb), the judge will start

out as a mediator and work with the parties to resolve the dispute. If the parties reach an impasse

and are unable to resolve the dispute between themselves through mediation, the judge is then

tasked with becoming an arbitrator and making a decision. The decision can be binding or nonbinding. See Appendix C-12 for a sample med/arb agreement.

If the parties decide they want to use ADR, a request should be sent to the board’s chair, who

will assign the matter to a board judge for action. The CBCA’s chair will consider a joint

request that a particular judge be assigned as the neutral, provided that judge has time in his or

her schedule. Parties who have had particular success settling past cases using ADR sometimes

request a particular judge by name. The ASBCA prefers that the parties provide a short list of

preferred judges from which to make a selection.

The parties, sometimes with input from the judge, will prepare a written ADR agreement setting

the schedule and defining the procedures for resolving the dispute. Sample ADR agreements for

various binding and non-binding ADR processes can be found at Appendix C. These agreements

should be tailored to the needs of the parties. Note that agreements can be crafted to allow for

multiple techniques, so that if one ADR method fails to result in a settlement, a second method

may be tried. For example, the parties might agree to non-binding mediation, and if that proves

unsuccessful, proceed to a summary trial with binding decision. More information about ADR is

available at the BCAs’ websites.

Using a BCA judge for ADR has several benefits. Through ADR, the parties can get an early

idea about the strengths and weaknesses of their cases, they can get a faster decision, the process

is less formal than a hearing and easily done without an attorney, and relationships can be

preserved and/or repaired. Any time the parties believe that getting the individuals important to

the dispute together, with a board neutral helping them to discuss the dispute and to work

through their differences, ADR should be seriously considered. The main restraint to using ADR

to help resolve a contract dispute is that both parties must agree that using ADR might be

beneficial.

Settlement Procedures

The government’s policy is to try to resolve all disputes by mutual agreement at the contracting

officer’s level. Contracting officers are generally authorized, within any specific limitations of

their warrants, to decide or resolve all claims arising under or relating to a contract subject to the

CDA.

However, the authority to decide or resolve claims does not include settlement,

compromise, payment, or adjustment of any claim involving fraud.

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Board judges encourage settlement of disputes.

If the parties are engaged in serious and

meaningful settlement discussions, the judge may be willing to postpone (“stay” or “suspend”)

proceedings for a reasonable period so the parties can focus on their settlement efforts without

the distraction and expense of litigating the appeal at the same time. Sometimes the judge’s

involvement in issue identification during prehearing conference has prompted the parties to

reassess their positions and agree to settlement.

The parties may consider settlement at any point during litigation or ADR. Settlement should

always be considered after the appeal file has been submitted since both parties and their

attorneys are now more actively involved and new faces can give a fresh perspective to the

dispute. Settlement should also be considered after discovery is complete. Documents produced

or testimony taken during discovery may provide additional information about the merits of the

dispute, defenses to the claim, or whether the amount claimed can be justified.

Settlement can also occur at the hearing and sometimes occurs at the end of the hearing, or

shortly thereafter, when the parties have had a chance to think about the evidence produced at the

hearing. Depending on the circumstances, the presiding judge may be willing to help the parties

with their assessment of the case.

PRACTICE TIPS

•

ADR is voluntary, and neither side is required to choose ADR; for an ADR

proceeding to be conducted, both parties must agree to use ADR.

•

The important thing to remember about ADR is that the parties and the

judge all work together to fashion an ADR proceeding that will meet the

parties’ needs.

•

In most forms of ADR, the neutral judge does not act as a judge. Instead,

the judge acts as an informal advisor helping each party consider and weigh

the strengths and weaknesses of its case.

•

ADR can be requested and used, and an appeal may be settled at any time

before the judge issues a decision on the merits of the claim.

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VII.

PLEADINGS

The Complaint

The first pleading normally filed after the notice of appeal is called the complaint, which the

appellant generally files with the board within 30 days after receiving the notice of docketing.

Alternatively, the appellant can file the complaint along with the notice of appeal. The

complaint tells the board about the dispute. It should contain a short, clear statement of the

principal facts concerning the dispute, each set out in a separate numbered paragraph, followed

by a concise statement of the relief requested. It is not necessary to address each detail of the

dispute in the complaint. Appendix B-7 contains a sample complaint. When the claim at issue is

a government claim, the board may ask the government to file the complaint.

If the claim is simple and the claim or appeal letter adequately explains the bases of the claim,

upon request by an appellant, a board may be willing to designate the claim or appeal letter as

the complaint. BCA judges typically construe a pro se party’s pleadings liberally, holding it to

less stringent standards than formal pleadings prepared by an attorney. However, this more

lenient standard for interpreting pleadings does not change a pro se party’s burden of proof or the

judge’s weighing of the factual record.

The Answer

The government is generally required to file a pleading called an “answer” within 30 days after

receiving the appellant’s complaint. Usually the government will simply admit or deny each of

the allegations set forth in the complaint and assert any available affirmative defenses.

Sometimes the government will add a section stating its perspective of the case. If the board has

asked the government to file the complaint it will require the appellant to file the answer.

Where an appellant has elected the small claims expedited or accelerated procedure, the board

may opt to not require a complaint and an answer if the claim and the contracting officer’s final

decision adequately frame the matters in dispute.

- 19 -

PRACTICE TIPS

•

The complaint, which is typically to be submitted by the appellant, should

contain a short, clear statement of the principal facts concerning the dispute,

each set out in a separate numbered paragraph, followed by a concise

statement of the relief requested.

•

BCA judges typically construe a pro se party’s pleadings liberally, holding

it to less stringent standards than formal pleadings prepared by an attorney.

However, this more lenient standard for interpreting pleadings does not

change a pro se party’s burden of proof or the judge’s weighing of the

factual record.

•

If a party cannot meet a filing date set by the board’s rules or by a judge, it

should request a time extension before the filing is due. Repeated failures to

meet deadlines can result in a judge issuing sanctions against the delinquent

party.

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VIII. DISCOVERY

Description, Purpose, and Scope

The term “discovery” relates to a number of ways each party can learn about the other side’s

case, by asking for information or documents, or getting the testimony of specific people.

Discovery helps define or narrow issues for trial and allows the parties to go to trial with the best

available proof of their case. Discovery can also help settlement, as each party better

understands the facts of the dispute and the other party’s case. However, despite its benefits,

discovery can be very time-consuming and expensive. A party should tailor the type and extent

of the discovery it conducts, particularly when the potential recovery in the case may not justify

a substantial investment in pre-hearing discovery.

The BCAs encourage the parties to engage in discovery voluntarily and to cooperate with each

other when asking for or responding to discovery. Either party may initiate discovery at any

time after an appeal is docketed and the complaint has been filed with the board. The types of

discovery, as discussed more fully below, are: (i) interrogatories, (ii) requests for production of

documents, (iii) requests for admission, and (iv) depositions. The boards also encourage

informal discovery. If a party just needs to learn more about the facts of the case, rather than

make a formal request, it can ask the opposing party to participate in a meeting or conference call

with the witness and the opposing attorney present, but with the matter not being recorded.

Opposing attorneys will sometimes allow this informal procedure because it can save time and

aggravation for everyone.

The board judges are not typically involved in the discovery process, so parties are not required

to provide a copy of the discovery request or response to the judge.

Discovery Obligations

Whether issuing or responding to discovery requests, both parties have certain discovery

obligations. Failure to understand and comply with discovery rules can result in sanctions or

other negative consequences.

Board Rules Governing Discovery

A party is expected to know the discovery rules of the board before which its case is being heard.

Each board has its own discovery rules, which are generally available on the board’s website.

Rules 13 through 16 of the CBCA rules of procedure pertain to discovery before the CBCA.

Rules 14 and 15 of the ASBCA rules concern discovery before the ASBCA. Although not

bound by the Federal Rules of Civil Procedure (FRCP), which govern discovery in federal

courts, most BCAs find the federal rules instructive in managing discovery. FRCP Rules 26

through 37 concern discovery.

Preservation

Both parties have a legal obligation to preserve all documents and information relevant to a

possible claim or defense in the pending case. The duty to preserve information usually arises

even before an appeal is filed with the board. Certainly, upon filing or receipt of a claim, the

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parties must retain all documents, data, and evidence that may be relevant to a possible claim or

defense in the matter before the board.

Discovery Conferences

As a general matter, the BCAs expect that parties will cooperate to complete discovery and make

a good faith attempt to resolve any disagreements relating to discovery before asking for board

intervention. An early discovery conference between the parties is helpful to discuss the nature

and basis of the claim and defenses, the possibilities for settlement, and development of a

proposed discovery schedule and plans that can be submitted to the board for adoption. A

discovery plan typically addresses an agreed-upon discovery schedule and the number of

depositions, interrogatories, or requests for admission each party is allowed. The parties should

also consider the potential witnesses and documents (electronic or otherwise) that are relevant to

the dispute.

At the discovery conference, the parties should pay particular attention to whether the burden

and expense of preserving, collecting, and reviewing large quantities of documents and

electronically stored information outweighs the likelihood that the discovery will actually lead to

useful information to help prove a case. The parties should balance the burden and expense of

discovery against the amount in dispute, the parties’ resources, and the importance of the issues

at stake. A sample letter for forwarding discovery requests can be found at Appendix B-10.

Types of Discovery

Interrogatories

Interrogatories are written questions asked by one party and served on the opposing party. They

are generally used to determine what factual issues are present in a case and help the parties to

develop other discovery requests. Written answers or objections, if any, are required within the

time specified by the rules of each board or as specified by the judge to whom the case is

assigned, usually 30 or 45 days after the party receives the interrogatories.7 Board rules require

the answering party to certify or verify its interrogatory responses under oath. The responding

party must sign the responses and certify, declare, or verify that the information provided is true

and correct. “I, (name), (give name of company and position) hereby certify (declare or verify)

under penalty of perjury that the facts contained in the within and foregoing [responses to

respondent’s interrogatories] are true and correct to the best of my information, knowledge and

belief. Signed: (give signature).”

The responding party has a duty to provide written answers to all interrogatories that are not

objectionable.

Answers to interrogatories must be responsive, complete, and not evasive.

Interrogatories are most useful for discovering the people who have the best knowledge about

particular issues, identifying the most relevant documents, and learning the basis for assertions in

the other party’s pleadings. Appendix B-11 includes a sample set of appellant’s interrogatories.

The CBCA requires that objections to interrogatories must be provided within 15 calendar

days after receipt. See CBCA Rules 13(f)(2), 14(a).

- 22 -

The party answering the interrogatories must provide all responsive information that is within its

control, including information that could be obtained by questioning its agents or employees.

Where the answer to an interrogatory may be derived from a party’s business records, the

responding party should specify the records from which the answer may be derived and give the

asking party a chance to copy or inspect those records.

After submitting its initial response to an interrogatory, the responding party has an ongoing duty

to supplement its responses with any subsequent information necessary to give a complete and

accurate response to the original question. If an interrogatory is not answered, or the answer is

evasive or incomplete, the party who asked the questions should discuss the issue with the

opposing party’s representative prior to contacting the board or submitting a motion to compel

more complete answers. See Section IX.

Requests for Production of Documents

Requests for production of documents are written requests from one party to the other for

specific documents or categories of documents.

They are often served along with

interrogatories. Requests for production generally include paper documents as well as any

electronically stored information that is responsive and in the possession, custody, or control of

the responding party.

The request for production should contain instructions regarding the documents sought and the

form of production. Requests for production should be tailored to the key documents a party

needs: if overbroad, they will likely trigger a discovery dispute. An example of a request for

production of documents is included in Appendix B-16. The producing party generally should

ensure that all documents or images it provides, whether electronic or paper, contain unique

identifying numbers to help identify the documents later in depositions or in proceedings before

the board.

Responses to requests for production, or any objections to document requests, must be made

within the time specified by the rules of each board, which may span 15 to 45 days depending

upon the board. If the parties cannot agree on the scope of the production, the requesting party

may move for an order compelling production of the documents and/or the receiving party may

move for a protective order. See Section IX.

The responding party is required to provide any information that is responsive to the request,

unless the information is legally privileged or otherwise objectionable. Section IX provides

further discussion of objections to written discovery and privilege issues.

Generally, the

responding party may satisfy the request for production by producing copies of the requested

information or making the information available to the requesting party for inspection and

copying.

As with interrogatories, after submitting its initial response to a request for production, a party

has an ongoing duty to supplement its production with any subsequently available information

necessary to give a complete and accurate response to the document request.

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Failure to produce documents responsive to a production request may result in the judge issuing

an order to produce them. Repeated refusal and failure to produce properly requested documents

can lead to sanctions, such as the judge denying the part of the appeal to which the documents

apply on the assumption that they contain evidence favoring the other side.

Requests for Admission

Requests for admission are a set of statements sent from one party to the opposing party, asking

the opposing party to admit or deny each specific statement. This helps narrow the issues by

showing what really is in dispute. Additionally, admitted facts do not have to be proven at trial,

making the dispute process simpler and more efficient. Requests for admission may ask a party

to admit or deny the authenticity of a document or the truth of factual allegations. A sample of a

request for admissions is included at Appendix B-20.

The responding party can either admit, deny, or state in detail why it can neither admit nor deny

the truthfulness of the statement (e.g., for lack of knowledge). Requests for admission can be

denied or admitted in full or in part. If a party makes the requested admission, it cannot argue

later against the statement in which it admitted certain facts.

Responses to requests for admission are required within the time specified by the rules of the

board to which you have appealed, which may be 15 to 45 days depending upon the board.

Failure to respond to a request for admission within the time stated in the board’s rules can

result in the statements contained in the request being deemed by the board to be admitted.

Depositions

A deposition is the taking and recording of the testimony of a witness before a hearing. The

individual being questioned is called the deponent. Deposition testimony is generally taken

under oath, recorded, and transcribed into a written document by a court reporter. Depositions

usually take place after responses have been made to interrogatories and requests for production

because they build on information obtained in the earlier requests. Unlike written discovery,

depositions allow a party to talk with witnesses and learn more about what happened, even if it is

not documented. Depositions also give a party the chance to lock in the testimony of the other

side’s witnesses to use in dispositive motions or at the hearing. Sometimes, where a witness

testifying at a hearing tries to change what he or she testified during the deposition, the opposing

party might try to use the deposition to impeach the witness. To do this the party attacks the

credibility of the witness using the deposition to show inconsistent testimony or evidence of

lying.

The parties should work together to find mutually agreeable dates, times, and places for

depositions. A party should not unilaterally set a date, time, and place for a deposition.

If one party believes the other party is being unreasonable in its deposition requests, it can ask

the judge for a protective order limiting the scope, length, and number of depositions.

Subsection D.3 of this section reviews protective orders in more detail. Similarly, if a party

refuses to make a witness reasonably available, the board can issue a subpoena requiring the

deposition. Once the individuals, locations, dates, and times are determined, the party requesting

- 24 -

the deposition should send a formal notice of deposition to the person to be questioned

(deposed). A sample notice of deposition is at Appendix B-18. The requesting party is also

responsible for obtaining a court reporter to record and transcribe the deposition.

At a deposition, the individual being deposed may be asked a wide variety of questions;

questions are appropriate if they might reasonably lead to admissible statements or evidence.

The deponent or his or her counsel may object for the record, but the deponent should then

answer the question. A deponent who refuses to answer a reasonable question can be subject to

sanctions.

After the requesting party has finished asking questions, the opposing party and any

representative the deponent has with him or her can ask follow-up questions to clarify or

emphasize the deponent’s testimony. Any documents used to question the deponent are marked

as exhibits and copies are attached to the deposition transcript. If a party plans to rely on these

documents, it should make sure to supplement the appeal file with them because, as mentioned

below, deposition transcripts (and the documents included with them) are not typically made part

of the record.

Sometimes a party may wish to depose an individual as speaking for an entity (e.g., corporation,

governmental agency). If so, the requesting party sends a notice of deposition to the entity

describing the matters it wishes to discuss in the deposition. The organization must then name

someone to testify on its behalf about information known or reasonably available to the

organization.

Deponents may also have to attend and testify at the hearing. Statements made in a deposition

generally do not become part of the hearing record except where a witness’ hearing testimony is

inconsistent with his or her deposition testimony or where the witness is unexpectedly unable to

testify at the hearing. If a party has concerns about whether a witness will be available to testify

at the hearing (e.g., due to serious illness), it can ask the board for permission to take an

evidentiary deposition to preserve the testimony of the witness. The opposing party must be

given notice of that so it can be prepared to cross-examine the witness.

Managing Discovery

Successful discovery helps a party to better understand the facts and merits of the whole case;

unsuccessful discovery can overshadow the entire dispute. The parties, and the BCAs, have

tools to help achieve a reasonable balance of disclosure of information.

Privilege

“Privilege” is the term used to describe the protection the law gives certain documents,

information, and communications. With some limited exceptions, parties do not have to respond

to discovery where the information being sought is protected by privilege. There are two main

legal doctrines that protect communications or documents from disclosure during discovery. The

first doctrine is attorney-client privilege, which protects certain communications between a client

and his or her attorney and keeps those communications confidential. The second is the work-

- 25 -

product doctrine, which prevents disclosure to adversaries of materials developed in preparation

for litigation. The contours of these two doctrines are further described in board case law.

Objections to Written Discovery

A party can object to a written discovery request that it believes is inappropriate. Objections to

written discovery must be filed within the time frames specified by the board, and if a party does

not raise an objection, it may be waiving the chance to raise that objection later. Objections to

written discovery typically consist of both general and specific objections. General objections

set forth any general objections to the written discovery requests or challenge definitions or

instructions of the asking party. A party should also raise any specific objection it may have to a

particular interrogatory, document request, or request for admission. If a party believes it should

not have to answer a particular question, it must state a valid reason for not answering.

Objections may be made as to the form of the questions asked or to the information the questions

seek. Form objections include, for example, objections that questions are vague, duplicative,

overly broad, and/or lack detail. The responding party may also object to the substance of the

questions. This may include objections that the information sought is not relevant; unduly

burdensome; privileged, proprietary or confidential in nature; not within the possession of the

party; and/or outside of the scope of the responding party’s knowledge.

Protective Orders

Protective orders help to protect information exchanged during discovery or to prevent undue

discovery burdens. Protective orders can be negotiated between the parties and proposed to the

judge to protect trade secrets, confidential information, proprietary information, or other

sensitive information.

Such orders will provide that the specified documents (or parts of

documents) that either party designates as covered by the protective order are to be held in

confidence, used only to prepare for the hearing, and disclosed only to specified persons. A

party may challenge a request that a document (or part of a document) be designated protected

information by arguing the material is not in fact confidential or otherwise sensitive.

If a party believes that discovery requests it has received are unduly burdensome, it can ask the

board to issue a protective order relieving it from having to respond. It is up to the board to

decide whether or not to grant the request. However, the BCAs are often reluctant to grant

protective orders unless a party can show a clearly defined serious injury if it is required to

respond.

Motions to Compel

If a party does not respond to a discovery request or responds evasively or incompletely, the

other party can ask the board to order a response or more complete answers. This request is

called a motion to compel. Because the BCAs encourage voluntary discovery, parties should

rarely have to resort to a motion to compel.

Whenever there is a dispute concerning the completeness of responses to discovery, the parties

should first try to resolve the dispute before filing a motion to compel with the board. A motion

- 26 -

to compel should include a representation that the moving party has tried in good faith, before

filing the motion, to resolve the matter informally with the other side. The motion should also

include a copy of each discovery request at issue and the response, if any. Details on how to

present a motion and tips for written advocacy appear at Section IX.C.

If the board has issued an order compelling responses to a discovery request and the noncomplying party still refuses to respond or the response remains incomplete, the board has a

number of options. The board may find facts relating to the incomplete or missing information

in favor of the other party. In addition, the board may deny the non-complying party the right to

present certain claims or defenses or exclude certain matters from evidence during the hearing.

These options are called sanctions and may also be applied to any party for failure to comply

with board orders.

Sanctions

Occasionally, after attempting to resolve discovery disputes with the opposing party, a party still

refuses to comply with the discovery request. If after attempting to work with the opposing party

a response is not forthcoming, the requesting party may ask the board to sanction the offending

party. A party should not approach the board requesting sanctions without first attempting to

work out the discovery dispute with the other party. After it has attempted that, the requesting

party must then follow the procedures set forth below to obtain a board order. It is only after the

board has become involved in the discovery by issuing an order that the requesting party should

file a motion for sanctions.

The BCAs have considerable discretion in determining whether a sanction is appropriate, and if

so, what particular sanctions should be used to address the specific circumstances of the case.

Most board sanctions are issued because a party has failed to take action to develop its case

(failure to prosecute) or has not been timely in responding to a discovery request.

A board’s power to impose sanctions is broad. In egregious situations, for instance, where a

party has willfully and repeatedly failed to respond to an order, appeals have been completely or

partially dismissed. This sanction has been described as harsh and severe, so it is employed

sparingly by boards. BCAs can issue sanctions prohibiting the introduction of evidence; taking

the facts of the non-offending party as true; forbidding challenge of the accuracy of evidence;

prohibiting the calling of witnesses; drawing adverse inferences; and disqualifying a party’s

representative, attorney, or consultant/expert from further participation in the case. Through

sanction authority, boards have the flexibility to balance any injustice that may have occurred as

the result of an offending party’s behavior with appropriate penalties. Thus, BCA judges have

available, and have used, a variety of sanctions designed to fit the situation and enforce

compliance with its rules and orders.

Judges do not issue sanctions lightly. Parties are urged to work out problems before approaching

the board for a sanction. Typically, a sanction will not be issued unless a board order has been

violated, and, then, only after significant consideration by the judge. So, if a party is having

difficulty getting a timely response to some discovery, it should first discuss the issue with the

opposing party and agree to a specific date for production. If that does not work, next request a

telephone conference with the judge. In that telephone conference, ask the judge to issue an

- 27 -

order establishing a specific date for production. Once the order has been issued, if the opposing

party still does not comply, submit a motion for sanctions to the judge. It is only after a judge’s

order (or specific written direction) is not obeyed that a sanction will be issued.

The BCAs do not have the authority to sanction a party or an individual by holding it “in

contempt,” by issuing a monetary fine, or by forcing a party to perform a contract in a particular

way (specific performance).

PRACTICE TIPS

•

Tailor discovery to balance the need for information with the burden and

expense of discovery. Consider the amount in dispute, resources, and the

importance of the issues. Informal discovery is always an option, as is

ADR.

•

Remember that each party has an on-going duty to supplement responses to

discovery if additional responsive information later becomes available.

•

Try to work out all discovery disputes with the opposing party. Although

recourse to the board is an option, judges generally dislike being dragged

into discovery disputes and expect the parties to try to resolve the issues

themselves.

•

Where a party has repeatedly failed to respond to a discovery request and

the board has issued an order setting a date for a response that the offending

party has failed to meet, the party seeking the discovery may ask the judge

to sanction the offending party. However, a sanction will not be issued

against the offending party until after the judge has issued an order requiring

the offending party to provide the discovery by a certain date and the party

fails to meet that date.

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IX.

MOTIONS AND BRIEFS

Motions and briefs are written legal documents advocating a party’s position and asking the

board to rule in its favor on the points raised. They are filed at different times depending on the

stage of the proceeding and what specifically a party is asking the BCA to rule on. Motions and

briefs have many traits in common, including a statement of the facts, explanation of applicable

legal authority, and analysis of why the party should win based on how the established law

applies to the facts in the case. Distinctions and details are set forth below.

Dispositive Motions

Although motions can be filed on a wide variety of topics (including many procedural issues),

motions that will resolve all or part of a case are particularly important. These are known as

“dispositive motions” because they ask the board to resolve (dispose of) the appeal early, before

a hearing or before the BCA’s decision on the record. The two most common types of

dispositive motions are the motion to dismiss and the motion for summary judgment.8

Motion to Dismiss

A motion to dismiss can be filed by either or both parties and may be based on a variety of

theories. A motion to dismiss for lack of jurisdiction argues that the board does not have

jurisdiction under the CDA to resolve the disputed issue(s). In a related vein, a motion can assert

that the appellant has not stated a claim for which the BCA can grant relief. Procedural motions,

such as a motion to dismiss for failure to prosecute the appeal, can also sometimes be dispositive.

If a party files a dispositive motion, the BCA will give the opposing party a chance to respond to

that motion. If the BCA raises the issue itself, as is sometimes the case with jurisdictional issues,

both parties will be asked to file briefs addressing the judge’s concern.

Motion for Summary Judgment

In a motion for summary judgment, the moving party asks the judge to enter a decision in its

favor on the merits of the case (or on certain specific issues, in which case, it is called a motion

for partial summary judgment). The grant of such a motion decides, and ends, the appeal (or the

identified issues) at the BCA. Guidance on motions for summary judgment may be also found in

Rule 56 of the Federal Rules of Civil Procedure (FRCP).

To win a motion for summary judgment, the party making the motion must show that: (1) there

are no genuine issues of material fact in dispute, and (2) the law supports the position of the

party making the motion. This means that the important facts on which the outcome of the case

depends are not genuinely disputed, and even if all inferences from those facts are resolved in

favor of the party not making the motion, the law (prior decisions, statutes, regulations, and/or

contract terms) requires the conclusion that the moving party wins. To do this, the moving party

must provide a statement of undisputed material facts at the start of the motion, clearly listing the

material facts of the case. The statement of undisputed material facts is similar to the proposed

findings of fact, discussed in Section IX below, but it lists undisputed facts, rather than disputed

The CBCA refers to a motion for summary judgment as a motion for summary relief.

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facts, about which the judge may make specific findings if the case proceeds. Without proposed

undisputed material facts in a party’s motion, the motion will likely be denied because the judge

cannot determine that there is no genuine dispute of material fact.

If one party files a motion for summary judgment, the BCA will give the opposing party a

chance to respond. That party may either cross-move for summary judgment, if it agrees there

are no facts in dispute (but believes the law supports its position rather than the other side’s), or

simply oppose the motion if there are disputed facts. If the non-moving party disputes the facts

asserted by the moving party, it must say so in its opposition to the statement of undisputed

material facts by submitting a statement of genuine issues, clearly identifying which facts it

agrees are undisputed and which it contests; it may also add any other facts that were omitted but

essential to resolving the motion. The evidence can consist of documents in the appeal file,

sworn affidavits, declarations, or other available evidence that contradicts the other side’s

version of the facts. Unsupported statements or conclusions in a party’s brief are generally not

considered evidence. Failure to adequately respond to the motion for summary judgment could

result in a party losing its case.

Briefs

A brief is a legal document written by a party to persuade the judge to rule in that party’s favor,

typically filed before or after a hearing, or in connection with a submission on the record.

Pre-Hearing Briefs

The judge may require the parties to submit pre-hearing briefs to better inform the judge, before

the hearing starts, about what facts will be presented (and disputed) and how they fit with the

legal theories advanced by the party. If the judge asks for pre-hearing briefs, the judge will

usually specify what the briefs should address and when they will be due. Typically, the brief

will contain a statement of the facts and issues in dispute and a concise discussion of the

applicable law. It should serve as a road map for the judge to understand the facts of the case,

especially those that are not in the written record and will be addressed by witnesses. It should

explain, from the party’s standpoint, why the facts and appropriate law entitle the party to win.

Post-Hearing Briefs

At the end of the hearing, the judge will usually set up a schedule for submitting post-hearing

briefs. Post-hearing briefs are similar to pre-hearing briefs except that they are typically more

comprehensive and are based on the testimony actually presented at the hearing (rather than what

the parties anticipated the hearing would show). They should put all the pieces (factual and

legal) together and take the judge through each step to the logical conclusion in favor of the party

writing the brief. All statements of fact must reference documents in the record and must cite to

the hearing transcript (volume and page) whenever they refer to testimony given during the

hearing. The judge may also allow for filing of reply briefs, where each side can counter the

facts or legal positions taken by the opponent in its brief. The judge may require both parties to

submit their initial post-hearing briefs at the same time (simultaneous briefing), or the judge may

require sequential briefs where the party with the burden of proof submits its brief first, followed

by the response by the opposing party, and then a last reply brief from the party with the burden

- 30 -

of proof. If one of the parties believes a particular order of submission is best for its case,

suggest it in a pre-hearing conference or at the end of the hearing when the judge addresses

briefs.

Writing Motions and Briefs

Although the BCAs do not require a particular format for motions and briefs, the guidelines

below are standard, and using this format will help the BCA understand a party’s position.

Generally, briefs should be typed and double-spaced, using traditional upper and lower case

lettering and traditional margin settings. Some judges set a page limit on briefs. If the judge’s

page limit is unclear (for example, if it does not address attachments or type-size), a party may

receive clarification from the judge. If the judge does not set a page limit, write only as much as

needed to present the case; then stop. Unnecessarily long, repetitious, or rambling briefs may

weaken a presentation. It is important to pay attention to page limits set by the judge.

Introduction

The introduction provides an overview of what the case is about, summarizing clearly and

succinctly the factual and legal issues. At this stage, simply summarize your position, without

describing all the details. Any statement made in the introduction should be later supported in

the proposed findings of fact section of the brief. The introduction should avoid inflammatory

and derogatory language.

Questions Presented

State the questions (issues) before the BCA for decision.

It is important to frame issues

accurately. Inaccurate statements may lead the judge down the wrong path and potentially delay

the case.

Proposed Findings of Fact

These are the facts that a party believes are true and wants the BCA to find are true also. The

proposed findings of fact are very important to the brief because the judge applies the law to the

facts of the case in making his or her decision. Each proposed finding of fact should be

numbered and limited to either just one fact or just a very few closely related facts. Each fact

should be supported by something in the record – the appeal file, the supplemental appeal file,

any exhibits that were admitted into evidence at the hearing, and/or the transcript of the

testimony presented during the hearing. The party must cite to the appropriate document for

each proposed finding of fact, including the exact page where the support for the fact appears.

Arrange the proposed findings of facts logically (typically chronologically), with headings if

needed for clarity, e.g., Contract Formation PFFs [proposed findings of fact] 1-8, Appellant’s

Progress [PFFs 9-25], Cure Notice [PFFs 26-29], Appellant’s Response to Cure Notice [PFFs

30-42], Contract Termination [PFFs 42-50].

Argument

In the argument, the party explains the relevant law and applies the law to the facts, explaining

why the case law, statutes, regulations, contract provisions, and other authorities, when applied

- 31 -

to the case, lead to a result in the party’s favor. When a party cites cases to support its legal

argument, be sure those cases stand for the proposition the party claims it stands for. If there is

no case directly applicable, explain why the reasoning of a similar case should apply by analogy.

A party should also address the arguments advanced by the opposing party in its brief and

explain why those positions are not correct. If a party has weaknesses in its case, it should

address them in the brief. Weaknesses won’t go away, and opposing counsel will usually see

them and point them out to the judge in a much more damaging way. Further, weaknesses in a

case usually will be obvious to the judge even if the opposing party does not point them out.

Therefore, a party should acknowledge its weaknesses and explain why those weaknesses do not

prevent the judge from ruling in its favor. Despite the fact that this part of a typical brief is

called “argument,” avoid inflammatory and derogatory words, which really say nothing and can

actually hurt a party’s position. The judge will make his or her own conclusions about a party’s

behavior. Persuasion is best accomplished by strong facts and sound legal analysis, not by

emotional pleas.

Conclusion

Finally, the party should provide a summary stating it believes it should win based on the facts

and applicable law. Be clear and concise, and leave the judge with a final impression of the

persuasiveness of your position.

PRACTICE TIPS

•

When writing a motion for summary judgment, include a separate section

setting forth the material facts.

•

When responding to and defending against a motion for summary judgment,

address the facts that the moving party says are not in dispute by either

admitting those facts are not in dispute or stating they are in dispute (give

reasons they are in dispute with citation to the record). Also, include

material questions of fact that make summary judgment inappropriate.

•

Try to keep written products concise and nonrepetitive.

•

If a party’s representative is not familiar with writing legal documents

consider allowing someone who is not overly familiar with the dispute

proof-read the document. If that individual is able to understand the facts

and arguments the document is ready to be submitted to the board.

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PRE-HEARING MATTERS

Pre-Hearing Orders

Typically, the presiding judge will issue a pre-hearing order which addresses various matters that

need to be resolved before the hearing. Issues that may be addressed in a pre-hearing order may

include cut-off dates for discovery and the submission of appeal file documents, and exhibits,

and submission of a list of witnesses being called, including experts and consultants. The judge

may require information concerning expert testimony, including a report or narrative of the

actual testimony to be given by the expert. Sometimes a judge will order one or both of the

parties to develop a joint stipulation of facts or a schedule of costs. At this stage in the

proceedings, it is even more important that the parties make sure the due dates in the judge’s

orders are met. Items not provided by the due dates will often be excluded when a party attempts

to introduce them later; witnesses not listed will typically not be allowed to testify at the hearing.

Parties should be aware that as the time grows closer to the hearing, many judges become more

reluctant to grant time extensions, especially if they impact other due dates before the hearing.

Judges want a full record to review prior to the hearing and do not respond well to surprise

evidence attempted to be introduced for the first time during a hearing. The pre-hearing order is

meant to eliminate any surprises.

Once a judge has stated that the established schedule is “firm,” extensions or changes to that

schedule will usually be made “only upon good cause,” e.g., when a good reason is given for the

schedule change. While earlier in the proceedings, judges are usually fairly generous with

extensions, later in the proceedings, after a pre-hearing order is issued, a party stating it simply

“did not get it done” is not typically a good enough reason to grant an extension. If a judge

decides that an extension is not merited and the party is unable to get the evidence timely

submitted, that evidence may be excluded from consideration in the case.

Of course, a request for a time extension should be made before the item is due in case the

extension is denied. Also, a party wishing to change the schedule or otherwise amend a prehearing order late in the proceedings should first consult with the opposing party before

submitting a written request to the judge. Any such request must include the reasons for the

request and state whether the opposing party concurs with or objects to the request. A copy of

the written request must also be provided to the opposing party. After a pre-hearing order has

been issued or late in the period immediately preceding a hearing, depending on the facts given

for the request and its timing, a judge may or may not grant a request for an extension.

Pre-Hearing Conference

Pre-hearing conferences are held for the judge to determine if there are any irregularities or

problems that might impede a smooth hearing and to resolve those issues off the record before

the start of the hearing. Pre-hearing conferences are sometimes held face-to-face with the judge

and other times via a telephone conference. Parties are encouraged to raise any questions that

they have, as this may be the last conference scheduled by the judge prior to the hearing. Faceto-face prehearing conferences are usually held immediately before the start of the hearing. In

- 33 -

that type of conference, the judge will typically review the documents that comprise the appeal

file and the appeal file supplement, exhibits, and who will be testifying at the hearing.

Exhibits

As discussed earlier, the purpose of the appeal file and any supplements is to eliminate the need

for introduction of evidence at the hearing. If a document is submitted as part of the appeal file

or supplements, and is not timely objected to by the opposing party, that document automatically

becomes part of the record on which the case will be decided. There may be occasions, however,

where a party may wish to include a document that was not part of the contract, such as a report

prepared by a consultant after the contract work was finished.

Similarly, to ensure the

qualifications of each witness is fully understood, some judges request that the parties submit a

resume, curriculum vitae, or biography for each witness. Each judge has his or her own

preferences as to how to deal with evidentiary issues. The best time to deal with a potential

problem is to raise it with the judge in a telephone conference prior to the hearing. A party

should not wait until the hearing to find out about whether a particular piece of evidence will be

admitted into the record because the party may be unpleasantly surprised at hearing when the

judge decides to exclude it and the party is not prepared to work around the excluded evidence.

Parties should never surprise the judge or the opposition with new exhibits at the hearing. The

party will probably be violating the judge’s pre-hearing orders regarding exchange of exhibits by

a certain date, and it risks not getting its evidence admitted if it has not given appropriate notice

of the exhibit prior to the hearing. This particularly applies to an expert or consultant report or

testimony that has not been previously disclosed. Judges typically will not allow what they

consider to be litigation “by ambush.”

Stipulations

Stipulations are agreements between the parties regarding the facts or legal principles that apply

to the case. Some judges require that the parties develop a joint statement of stipulated facts to

narrow the matters that will have to be decided at the hearing. An example of a stipulation is:

“The contract was awarded on [date]. Appeal File, Exhibit 3.” To arrive at stipulations the

parties will need to exchange proposed stipulations and determine which ones are agreeable to

both parties. Once there is agreement, the stipulation may be signed by both parties and

presented to the judge for adoption as part of the record of the case.

Motions to Exclude Evidence

A motion to exclude evidence, sometimes raised in limine (preliminarily to a hearing), is a

request for the judge to rule on whether to admit a particular piece of evidence into the record.

For example, a party receives an updated, significantly more elaborate, report from the opposing

party’s expert consultant three days before the start of the hearing. Noting that all consultant

reports were due a month earlier, the party requests through a motion to exclude evidence that

the judge not allow the expert consultant’s revised report into the record. A judge may exclude

evidence if he or she believes that a party may be harmed by the late introduction of certain

evidence.

- 34 -

Pre-Hearing Briefs or Position Papers

A judge may order the parties to submit pre-hearing briefs or position papers, or sometimes one

party will request permission to submit a pre-hearing brief or position paper. Perhaps, as in some

expedited proceedings, there will be insufficient time for filing briefs post-hearing, and the judge

decides that a summary of the facts and law pertinent to the dispute will be helpful. Sometimes a

judge may have questions about particular set of facts or law that he or she would like to have

addressed prior to the hearing. If so, the judge will usually raise the need for pre-hearing briefs

or position papers and set a date for submissions. These pre-hearing submissions can help the

judge become familiar with a party’s position on difficult technical and legal issues before the

hearing. For more discussion on the structure and content of pre-hearing briefs or position

papers, refer to Section IX.

PRACTICE TIPS

•

Request time extensions as early as possible. As the time for the hearing

grows closer, many judges become more reluctant to grant time extensions,

especially if the extension will impact other items due before the hearing. If

a solid reason for an extension is not given, be prepared for the request to be

denied.

•

Most judges will not allow one party to “ambush” another party during the

hearing. This usually means the party cannot introduce things it has not

previously disclosed, such as new evidence, reports, documents, witnesses,

or theories of recovery. In a case that is developed correctly, each party has

the opportunity to understand the other party’s facts and theories of

recovery fully before the hearing starts and is not “surprised” by any

evidence that is attempted to be introduced for the first time at the hearing.

•

Representatives should anticipate potential evidentiary problems and check

to determine a particular judge’s preference during a telephone conference,

so they can prepare properly for the hearing.

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XI.

THE HEARING

Date and Length of the Hearing

If the parties elect to have a hearing, the judge will typically ask them to jointly propose a

hearing date(s), to estimate the expected length of the hearing, and to propose a hearing location.

If the parties cannot agree on the various items relating to a hearing, they should notify the judge

of their disagreement and the reasons for it. All of the boards, which are located in the

metropolitan Washington, D.C. area, have courtrooms. Judges decide the location for a hearing

considering a variety of factors which may include the desires of the parties, the locations of

witnesses, the location of the contract, and other pertinent factors raised by the parties. Judges

will travel throughout the world to hold hearings at the location that best serves the needs of the

parties and the judge. The parties should work together to find a mutually agreeable place for the

hearing, so that when the judge asks they are ready to tell the judge their preferences. A typical

hearing may start around 9 a.m. and continue until 5 p.m. Plan for at least one break in the

morning and one in the afternoon, as well as a lunch break.

Parties should build into their estimates some extra time because, depending on the judge, they

may be held to their estimates during the hearing. Allow time not only for questioning your own

witnesses during direct and redirect examination, but also allow time for the opposing party to

conduct cross-examination of those witnesses. As a rule of thumb, allow the same amount of

time for cross-examination as for direct examination.

Even experienced attorneys have

underestimated the amount of time necessary to present their witnesses and run into problems

with time limits at a hearing.

The judge will send an order to the parties setting the date, location, and starting time for the first

day of the hearing. Make sure that witnesses and all the necessary documents, such as copies of

the appeal file and any appeal file supplements, are at the hearing location early, allowing for

some time to get organized and to be ready to start at the designated time.

Immediately Before the Start of the Hearing

The judge will typically go over several “housekeeping” matters immediately prior to the start of

the hearing. The judge may raise the question of whether the parties wish to have the witnesses

allowed in the hearing room throughout the hearing. A witness may be influenced by hearing the

testimony of other witnesses. To avoid this, the parties or the judge may decide to have

witnesses “sequestered” (excluded from the courtroom) before they testify. In that case, the

judge will issue an order excluding the witnesses and prohibiting witnesses and party

representatives from telling other witnesses about testimony in the hearing. Violations of a

sequestration order may result in the judge excluding the testimony of a witness. However, a

sequestration order ordinarily does not prohibit a party’s representative from discussing the case

with witnesses in preparation for their testimony as long as the testimony of other witnesses is

not revealed. If there is any question as to the scope of the sequestration order, it is best to ask

the judge to explain it on the record. Naturally, the judge will not exclude a party’s

representative who is also a witness, or someone essential to the presentation of the party’s case.

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The judge may ask who will be representing each party at the hearing, i.e., who will be in charge

of the presentation of the case. Do not arrive at the hearing with someone not authorized by the

rules of the particular board to represent the party, such as a claims consultant or an unlicensed

attorney, because the judge will not allow an unauthorized representative to speak at the hearing

on an appellant’s behalf or to question witnesses.

Failure to Appear at the Hearing

Once an agreed-upon hearing date has been set, a judge will not usually change the date unless

the parties jointly request a change and/or the party requesting the change has a “good cause” for

requesting a change (e.g., death or a serious illness of a family member). The fact that a party or

its representative may not be ready for the hearing or has gotten unexpected work is not good

cause. However, if something serious happens that makes a party’s representative or important

witness unable to attend the hearing, the judge and other party’s representative should be notified

immediately. Postponement of the hearing should be requested with reasons given, and the

parties should make sure the judge has granted the request and the hearing has been postponed,

before the representatives and witnesses decide on their own not to appear for the hearing. The

closer the hearing, the more reluctant the judge will be to postpone the hearing. If a

postponement is not granted and the party does not appear for the hearing, the party will face an

unexcused absence. The judge will likely proceed with the hearing and consider the party to

have made its case on the record, i.e., based solely on the documents that are already in evidence,

such as documents in the appeal file and any supplements. Similar warnings apply to witnesses

who become unavailable or do not show up for the hearing.

The Hearing Record

At the hearing, the proceedings are recorded by a court reporter who then types up a transcript,

which is a precise written record of what was said, word by word, by every individual testifying

at the hearing. The board hires the court reporter and, depending on the rules of the particular

board, a transcript of the hearing may be purchased by, or is free to, each party. Usually, the

judge will discuss what arrangements need to be made to obtain a transcript at the end of a

hearing, when the judge is also discussing a briefing schedule. Each party will want a copy of

the transcript because a judge expects that, for each statement in the brief the party claims

supports its case, the party will also provide a citation by page number to the testimony or

document where the judge can find proof of such support.

While only one judge presides over the hearing, two other judges will also review the written

record of the hearing and participate in deciding the case, except in cases following the small

claims or accelerated procedure. It is important when an individual is speaking at the hearing not

to use ambiguous terms to describe documents, for example, “that piece of paper.” Instead, the

individual should refer to documents by identifying the volume and exhibit number, and waiting

until the judge and opposing party finds the document. For example, instead of saying “I’m

handing you a document to read,” say, “I’m handing you volume [number] of the appeal file and

I would like you to turn to exhibit [number], page [number].” Likewise if a document has more

than one page, it is helpful to specify the page or paragraph number of the document to be

addressed by the witness.

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Orderly Conduct of the Hearing

A chief responsibility of the judge is to make sure that the hearing is conducted in an orderly

fashion and that a proper record of the documents and testimony is made. A hearing is similar to

a non-jury trial in a state or federal court, except that the rules of evidence are generally more

relaxed at a hearing. This usually plays out to give the judge the choice to receive documents or

testimony as evidence that might not be admitted as evidence by a federal court or in more

formal trial proceedings. For instance, a witness’ testimony may contain hearsay, i.e., testimony

by a witness relating a statement made by another individual who is not present to testify. Of

course, it is always best to have the individual who actually said or saw something important

speak about it during the hearing. However, sometimes that is not possible or practical and a

compromise must occur. The judge has the freedom and responsibility to decide whether or not

to accept the testimony and how much weight or value the evidence should be given. Typically,

hearsay testimony will not be given as much weight as testimony from someone who was

actually present.

If the parties have a disagreement at the hearing, both parties should not speak at the same time.

It is difficult for the court reporter to make an accurate record if two people are talking at the

same time; a judge cannot listen to both parties at the same time. Also, if both parties are talking

at the same time, neither party is listening to what the other party is saying. If there is an issue

on which both parties want to comment, the judge normally will ask one side to address the issue

first. Then, when the first party is finished speaking or, when the judge thinks that he or she has

heard enough, the judge will ask the other party to speak. Usually the judge will give the first

party to have spoken an opportunity to reply to the other party’s comments.

Board judges have many years of contract disputes experience and are often willing to help the

parties focus on what the judge considers the key issues in a case. For example, some judges

will question a witness during direct or cross-examination; this usually occurs if a judge does not

fully understand some testimony or line of questioning or wants to get more quickly to the issues

that he or she believes are important to the case. Some judges prefer to wait until after the

witness has been cross-examined to ask questions that they believe might help them decide the

case. Occasionally, a judge may ask a party or a witness to address a particular subject, or tell a

party that he or she has heard enough testimony on a particular topic and ask the party to move

on to another issue or topic.

Opening Statements and Order of Proceedings

Opening statements provide each party an opportunity to give the judge an overview of what is

to come during the hearing. While an opening statement is common in a jury trial, it is not

always necessary in BCA hearings. The judge conducting the hearing may not want to hear

opening statements from the parties, particularly if the judge is familiar with the parties’

positions from pre-hearing briefs or a detailed complaint and answer. However, if the judge

requests opening statements, the parties should be prepared to give an overview of how the

witnesses and exhibits relate to the dispute. An opening statement should consist of a summary

of the dispute and how the party plans to prove its case, including a short statement of what key

witnesses are expected to say when testifying. For example, one might say:

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This is a case about whether there was an ambiguity in the contract

and whether appellant’s interpretation was reasonable.

First,

appellant will call Mr. Smith as a witness. He will testify that he

prepared appellant’s bid and that he read the specifications as

requiring . . . . Next, appellant will call Mr. Jones who will testify

that . . . .

After opening statements, the party that has the burden of proof typically will present its case

first. In most cases, the appellant has the burden of proof because it is the appellant who is

asserting the claim. However, sometimes the government has the burden of proof, for instance

when it must justify a termination for default. If in doubt about which party has the burden of

proof or who will present its case first, consult with the judge before the hearing.

When it is time for a party to present a witness, its representative should state the witness’ name

and ask the witness to sit in the witness chair. Witness testimony is taken under oath and false

statements made at the hearing may subject a witness to criminal prosecution. Either the judge

or court reporter will administer the oath. When direct examination is completed, the opposing

party has the opportunity to cross-examine the witness. The judge, in his or her discretion, may

allow re-direct and re-cross-examination of the witness, or may ask questions.

After the first party has called all its witnesses and their testimony is finished, that party rests,

telling the judge it is done with its presentation of witnesses. Then the opposing party has a

chance to call its witnesses and present its case.

The judge may allow limited rebuttal testimony from the parties after each party has had a

chance to present its case. Rebuttal testimony is testimony given to cast doubt on the evidence

presented by the other party’s witnesses. Witnesses will not be allowed to testify about new

things that were not raised and discussed during the other party’s presentation. Rebuttal

witnesses can only be used to contradict the other party’s witnesses.

Testimony

Witnesses are used to tell the story of what happened to cause the dispute. They can be used to

tell the facts and to explain things that a layperson may have difficulty understanding. It is best

to approach the judge as a lay person who is unfamiliar with the technical area of the dispute. It

is up to the parties to recreate the facts of their particular issue so the judge can fully understand

the dispute and the facts leading up to it. While judges have practiced federal contract law for

many years, they need the particular facts associated with the dispute clearly presented to them in

a way they can understand. Once a judge fully understands what the facts of a case are, he or she

will be able to apply the correct law to the case and reach a decision.

A witness should not be used merely to repeat what is in a document that is already in evidence.

If a document is in the appeal file or a supplement and has not been objected to by the opposing

party, the document is already part of the evidence. The judge will have read the document to

prepare for the hearing. However, if there is something particularly important in a document that

a party wishes to inquire about, it is appropriate to go to that document and have the witness read

the important part out loud and then answer questions about it.

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If the party is represented by a non-lawyer representative, and that representative is personally

aware of certain factual information, that individual has personal knowledge of what happened.

If the representative has personal knowledge of certain facts he or she may wish to become a

witness, be placed under oath, and testify about what he or she knows. A party’s representative

should do this only if he or she was personally present while the events he or she describes were

happening and actually observed what he or she is testifying about. Second-hand information is

not typically as reliable or convincing as first-hand information. A representative who was back

in the office and heard about important events only after they had taken place, is not necessarily

going to be the best witness to describe what happened. It is better to use the individual who was

present at the scene as the witness to describe what happened. The representative should not

give hearsay testimony, or talk about something that he or she does not know about from

personal experience. Hearsay is testimony of a witness as to statements made by another

individual who is not present in the courtroom to testify. If a party has a choice of several

witnesses ready to testify about the same issue or event, they should use witness who can testify

from personal knowledge, because that individual will be more convincing than an individual

who was not directly involved and can only testify about what others told him or her.

If a party’s representative plans to testify at the hearing, the judge may allow that individual to

state the relevant facts as a story rather than by providing answers to questions.

Subpoenas

Normally, a party has no problem producing witnesses under its control, such as its employees.

Parties are expected to cooperate with each other and make witnesses under their control

available when requested to do so by the other party. Parties should work together to make sure

all the witnesses who need to get to a hearing get there.

One option a party has for making sure a witness who is not under its control gets to a hearing is

to ask the judge to issue a subpoena. Subpoenas should not be needed on a regular basis, but

sometimes, witnesses need a subpoena to secure an excused absence from an employer. Other

times, witnesses may not wish to cooperate with the party needing them, and a subpoena will

order them to attend the hearing or face penalties as the judge sees fit. The rules of the various

boards set forth the method for obtaining a subpoena.

Direct Examination of Witnesses

A judge wants to hear testimony in a witness’ own words using the witness’ own memory. Any

witness called by a party should provide testimony that advances that party’s position.

Avoid asking questions that can be answered with a simple yes or no because questions like that

provide the testimony of the individual asking the questions – not the answer of the witness.

Leading questions are not permitted on direct examination. A leading question is a question

posed to a witness that is phrased so as to suggest or elicit a particular answer desired by the

individual asking the questions.

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Cross-Examination of Witnesses

After direct examination of a witness is completed, the judge will ask the other party if it has any

questions or “cross-examination” for the witness. A party has a choice about whether to crossexamine. Where the other party’s witness offers testimony damaging to your case, think

carefully about the best way to handle the damaging testimony. For example, instead of crossexamining a witness who has provided testimony against your case, you may instead want to call

your own witness, and/or rely upon documents, to lessen the weight given to the damaging

testimony. It is unwise to give a witness an opportunity to repeat the testimony given on direct

examination, as it just reinforces what he or she already said.

If a party decides to cross-examine the opposing party’s witnesses, leading questions are

appropriate. Leading questions may allow a party to control the testimony of a witness by

limiting the witness to a series of “yes” or “no” or “I don’t know” answers.

Conclusion of the Hearing

Normally, there are no closing arguments at a hearing; arguments are typically saved for the

parties’ briefs. Some judges close the record at the conclusion of the hearing, while other keep it

open for the submission of post-hearing briefs. Once the record is closed, a judge will not take

any more documents or testimony before issuing the decision. Accordingly, at the end of the

hearing, before the record is closed, a party’s representative should take the opportunity to

review his or her notes and make sure that there is no other evidence that it wishes the judge to

consider. Just as in a wedding ceremony, this is the time to “speak now or forever hold your

peace.” A judge will typically ask the parties if there is anything else they want to add before

closing the record. Do not expect to get any documents or testimony considered by a judge after

the hearing is concluded unless the judge has specifically agreed, before the end of the hearing,

to consider that particular document or testimony.

Post-Hearing Briefs

At the conclusion of the hearing, the judge will usually set a schedule for submitting post-hearing

briefs. Post-hearing briefs are similar to pre-hearing briefs except that they are based on the

testimony as actually presented at the hearing rather than what the parties anticipated the hearing

would show. A brief is a written document used to submit to the judge the party’s final

arguments and tie those arguments to the facts that support them. Briefs are used to reconcile

different viewpoints and persuade the judge to rule in a party’s favor. For more discussion on

the structure and content of pre-hearing briefs or position papers, see Section IX.

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PRACTICE TIPS

•

A judge wants to hear testimony in a witness’ own words using the

witness’ own memory; on direct examination, avoid asking questions that

can be answered with a simple yes or no because questions like that

provide the testimony of the individual asking the questions as opposed to

the testimony of the witness.

•

It is always best to use a witness who was there, personally observed what

occurred, and has actual knowledge of what happened, as opposed to

someone who heard about what happened later from someone who saw it.

•

Do not expect to get any documents or testimony considered by a judge

after the hearing is concluded unless the judge has specifically agreed,

before the end of the hearing, to consider that particular document or

testimony.

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XII.

PROOF OF DAMAGES – QUANTUM

Introduction

As discussed in Section II, a claim generally consists of two major parts: (1) the “entitlement”

portion, which typically includes a detailed description of the actions or inactions of the party

from whom relief is sought, entitling the claimant to compensation; and (2) the damages or

“quantum” portion, which sets forth the calculations and support for the damages claimed. The

two parts are equally important because without entitlement, damages cannot be recovered, and

without adequate proof of damages, establishing entitlement is of no value.

When a claim is considered by a BCA judge, and for that matter by a contracting officer, it is

usually first addressed in terms of entitlement. It may be that the contract was changed, a

differing site condition was discovered, a latent ambiguity arose, or a delay occurred that caused

the contractor to do extra work and incur extra costs it did not anticipate in the contract.

However, only after it is determined that something occurred entitling a contractor to an

equitable adjustment does the government start to consider quantum, i.e., “how much” the

contractor is entitled to recover.

In analyzing a claim, and ultimately, in structuring and

conducting a hearing, usually a BCA judge will first address entitlement, and only move to

address quantum if he or she finds entitlement. If a party fails to establish why it is entitled to an

equitable adjustment, there is no need to address “how much” the party should receive in terms

of dollars and cents. This section addresses what types of damages may be recoverable, how

damage claims should be presented, methodologies for calculating damages, and what records

are required to support a claim.

As discussed in earlier sections, except where the government affirmatively asserts a claim a

final decision, the BCAs deal with contractor claims that have been denied, in whole or in part,

by a contracting officer. When a contractor submits a claim seeking additional monetary

compensation, it should always submit proof of the damages it claims it incurred. Inflating

damages is not usually a good idea. Where certification of a claim is required, inflating damages

may have serious consequences beyond the case before the board.

In some instances, a

contracting officer may be motivated to deny all entitlement for a claim, simply because the

damages sought “seem high” or because the contractor has failed to properly quantify its

damages it seeks. Such occurrences can lead a contracting officer to doubt the validity of a claim

from the outset, undervalue a claim, or make him or her unwilling to negotiate.

A party should not simply show up with a box full of receipts and expect the contracting officer

or judge to review the records in order to substantiate or determine the correct amount of

damages. Quantum calculations should be well-organized, easily understandable, and logically

presented. This is true at both the claim stage and the appeal and hearing stages. BCA judges

may be skeptical of claims when there is a lack of supporting documentation for the dollar

amounts. Also, they will reject a claim where a contractor fails to show how the damages are

causally connected to the changed events or condition that is the subject of the claim.

As soon as a party realizes that a potential change needing an equitable adjustment is occurring,

it should immediately start to track and segregate the costs associated with the potential equitable

adjustment. While estimates are frequently used, a contractor’s actual costs incurred to perform

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the changed work will be far more persuasive. Since most claims are litigated after the changed

work has been completed, a contractor should have tracked and know the actual costs it incurred

for the changed work. Similarly, if the government is asserting a claim against a contractor, the

government has the burden (responsibility) of proving its costs.

For example, where the

government seeks excess reprocurement costs arising out of a contractor default, the government

must prove the amount of increased costs it incurred in obtaining the goods or services under the

replacement contract.

Types of Damages – Direct and Indirect

The BCAs deal primarily with cost-based claims. Cost-based claims usually arise when a

contractor incurs increased out-of-pocket expenses during the performance of the contract.

Contractor cost increases can arise for a variety of reasons, many of which are unrelated to any

action, or inaction, of the government. In certain circumstances, the government may be entitled

to recover cost increases.

In a claim, a contractor may seek direct costs and, if appropriate, indirect costs. Direct costs

include: labor costs (including labor burden), material costs, equipment and small tools costs,

and bond costs. Indirect costs may include home office overhead, jobsite overhead (if the

contractor accounting system treats these costs as indirect costs and they have not been claimed

as direct costs), general and administrative expenses, and ownership/operating costs. Recovery

of indirect costs such as overhead and general and administrative costs is usually accomplished

by the application of the contractor’s normal indirect rates. The rates used may have been agreed

to in the contract or, depending on the circumstances, it may be acceptable to use the actual rates

that the contractor incurred during the change.

As with all claim items, the party seeking the damages must have actually incurred increased

costs. For instance, the fact that a delay occurred and materials costs generally escalated is not

proof. The appellant must demonstrate that it actually paid higher prices.

Necessary Records

A party will not be able to recover damages without proof of those damages. Proof usually

consists of books, records, and documents that show how the claimed costs were derived.

Records should be organized to include computations and summaries of costs for each claim

element.

Supporting documentation for each cost component claimed may include: (a) copies of a

contractor’s accounting records, such as ledger sections, job cost reports; (b) job records

reflecting labor hours expended (e.g., daily logs, time cards) and material costs incurred (e.g.,

material delivery receipts and vendor invoices); (c) documents establishing proof of payment,

such as canceled checks, bank statements, remittance reports for electronic transfers; (d)

documents that may bear on proof of government design related delay, such as large numbers of

requests for information (RFIs), records showing days taken by the government to respond to

RFIs and change orders arising from the RFIs; and (e) other documents essential to proving

project delay and disruption, such as performance schedules and productivity reports, as well as

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proving project cost overruns, including original contract cost estimates used for bidding,

budgeting, and cost control.

Presenting the Claim

It is important to present the claim in an organized and easy to follow manner. Reference and

provide support for each cost item to help validate the claimed costs. This will help all parties

involved to trace the costs throughout the claim. A claim narrative specifically addressing why

each element of the claimed costs is directly traceable to the issues in dispute can be very

convincing. Explain why each of the cost items was incurred and the rationale for linking the

costs to actions or inactions of the government.

One effective way to prepare a compelling claim is to provide a summary schedule that identifies

each category of cost attributable to each claimable item included in the claim. The following

chart is an example of a summary schedule.

Schedule A

Case Name

Case Number

Claim Summary Schedule

Description

Amount

Reference

Total Direct Labor

Overhead (30%)

$ 44,000.00

$ 13,200.00

Schedule B

Schedule C

Burdened Direct Labor

Total Materials

Total ODCs

Subtotal

$ 57,200.00

$ 13,500.00

$ 8,650.00

$ 79,350.00

Schedule D

Schedule E

G&A (5%)

Subtotal

$ 3,967.50

$ 83,317.50

Schedule F

Profit (10%)

$ 8,331.75

Schedule G

Behind each claim cost summary detailed schedules should be included to support each cost

element. These should include all important information relative to that cost element, such as

dates, descriptions, quantities, rates, etc. For each detailed schedule, provide additional support

for that cost, when applicable. For example, when claiming additional direct labor costs, detail

those costs in a separate schedule; append documents such as: (1) the job cost report for the

project showing the direct labor costs; (2) daily logs; and (3) copies of canceled employee

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payroll checks or receipts for electronic payroll transfers. The claim narrative should specifically

address why each element of the claimed labor cost is directly traceable to the issues in dispute,

e.g., explain the duration of claimed hours and rationale for attributing the extra labor hours

actions or inactions of the government. Schedule B below provides an example of a detailed

schedule showing appropriate labor information.

Schedule B

Cas e Name

Cas e Number

Direct Labor Summary

Job Cos t Report

Pos ition

Project Manager

Analys t

Adminis trative Support

Des cription

Employee A

Employee B

Employee C

Employee D

Employee E

Employee F

Project

Time Period Hours Rate

Amount

Reference

Claim Project Date Range

180 75.00 $ 13,500.00 Invoice B-1, Check B-1.a

Claim Project Date Range

120 75.00

9,000.00 Invoice B-2, Check B-2.a

Claim Project Date Range

160 50.00

8,000.00 Invoice B-3, Check B-3.a

Claim Project Date Range

150 50.00

7,500.00 Invoice B-4, Check B-4.a

Claim Project Date Range

140 25.00

3,500.00 Invoice B-5, Check B-5.a

Claim Project Date Range

100 25.00

2,500.00 Invoice B-6, Check B-6.a

Total Direct Labor

$ 44,000.00

When addressing direct material costs, provide copies of invoices from the vendors that include a

description of the material being purchased and copies of canceled checks showing payment for

those materials. The claim narrative should specifically address why each element of the

claimed damages is directly traceable to the issues or project in dispute. When the materials

being claimed are of the same types as required to perform the base work, be prepared to explain

when and why these purchases were made to justify their inclusion as an increased cost caused

by actions of the government. Schedule D below provides an example of a schedule showing

appropriate materials information.

Schedule D

Cas e Name

Cas e Number

Direct Materials Summary

Vendor

Acme, Inc.

Vandalay Indus tries

Amazon.com

Des cription Quantity Per Unit

Amount

Reference

Hardware

100

10.00 $ 1,000.00 Invoice D-1, Check D-1.a

Computers

25 400.00

10,000.00 Invoice D-2, Check D-2.a

Software

25 100.00

2,500.00 Invoice D-3, Check D-3.a

Total Direct Material

$ 13,500.00

Make sure that your schedules are easy to follow and include all of the relevant information

necessary to provide back-up. The more detail provided, the better the chance it will be well

received. Take the time to prepare the schedules carefully and completely.

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Claim Pricing Methodologies

There are three basic techniques that are generally used for pricing contract claims for increased

costs: total cost, modified total cost, and specific identification/detailed cost buildup.

A total cost claim is calculated as total incurred cost minus the contract price. While the total

cost method is the simplest and fastest method to calculate damages, it is also the method that is

least favored by BCAs and courts. That is because it seeks recovery for a contractor’s project

cost overrun without attempting to segregate out any portion of the overrun that is attributable to

factors unrelated to government action or inaction. Essentially, the total cost method fails to

account for any portion of the cost overrun that was caused by the contractor. In order for the

total cost method to be used, four specific criteria must be met:

1) total cost can only be used when absolutely no alternative method of calculating damages

exists. In other words, it will be up to the appellant to convince the judge that, because of

factors such as lack of records or that the project was subject to changes, delays, and/or

disruptions from the very beginning, this method is the only reasonable one to use;

2) the original bid was reasonable and reflects the costs the appellant would have incurred

had there been no changes, delays, and/or disruptions. The reasonableness of the bid can

be shown by comparison to other bids the government received, comparison to

government estimates, or comparison to other independent estimates;

3) the actual costs incurred to perform the work were reasonable and allowable. This means

that the appellant needs to show that it performed the work in the most efficient and

economical way possible, given the specific circumstances of the project; and

4) the contractor must demonstrate that it was not responsible for any of the extra costs

incurred. This requires the contractor to closely analyze the costs incurred to ensure that

none of the increased costs were due to a contractor problem.

Failure to identify

contractor caused cost increases can lead to denial of the appellant’s claim.

The modified total cost methodology, as its name suggests, is the total cost method with

adjustments to account for costs that are identified as having not been caused by the government.

The claimed costs must be adjusted for contractor-responsible items such as: (1) bid errors; (2)

contractor inefficiencies; (3) cost increases not due to government action or inaction; (4) other

problems for which the contractor is responsible; and (5) factors beyond government or

contractor control for which only an uncompensated time extension is allowed, e.g., weather,

acts of God, concurrent delay, etc.

Once these costs have been identified and removed from the claim amount, the presumption is

that the remaining cost overruns are attributable to the government. It is the appellant’s burden

to prove that all non-government-caused costs have been removed from the claim amount. This

will require the contractor to have thoroughly analyzed the records to convince the board that all

such costs have been accounted for.

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The specific identification method of claim pricing is likely to be the most successful

methodology not only at the BCAs, but also in negotiations with the government. It identifies

and links the increased cost of specific activities to the alleged changes made and actions or

inactions of the government. This allows the BCA to adequately compensate the appellant for

those increased costs which the board has determined were caused by the government.

The specific identification method involves the determination of the cost of each change. It is

best, when possible, to have the actual costs segregated in the contractor’s books and records.

Because claims are usually submitted well after the changed or extra work has been performed,

the board looks to the contractor to keep track of the costs associated with the change as the work

is being performed. It is always more convincing to have contemporaneous cost records rather

than to present reconstructed costs.

Estimates

While contemporaneously tracked actual costs are always more convincing evidence, it is not

always practical to have records kept at this level of detail, and estimates may need to be used.

If the quantum includes an estimate as a portion of the damage calculation, that portion should be

dealt with separately and clearly identified as an estimate.

A detailed explanation of the

estimate’s calculation should be provided, as should an explanation of why an estimate is being

utilized instead of the actual costs.

Even when actual costs are known, estimates may help to properly allocate the actual costs to

each claim item. This can be the case when, for some reason, the contractor did not segregate

costs between original and changed work. Perform reconciliations of actual costs to estimates to

ensure the reasonableness of the estimate.

Documentation supporting the use of an estimate may also be useful where the estimate might

not be easily understood by the judge, e.g., if using RS Means as a cost estimating tool provide

information on the particular data used and how the estimate was calculated. Understandably, an

appellant’s case is not enhanced if it claims more for a specific item of work than is actually

recorded in the books and records.

Claimed costs are evaluated in accordance with the cost principles contained in FAR [Federal

Acquisition Regulation] Part 31, 48 C.F.R. Part 31. Costs identified by the FAR as

“unallowable” should not be included in a claim.

Government Audits

An appellant should be prepared for an auditor to question certain costs as being unallowable or

unsupported. While an auditor’s questioning of a cost indicates a potential problem with the

questioned cost, the final determination of whether the cost is allowable, allocable, and

reasonable rests with the judge.

An audit may be ordered by the government prior to the contracting officer’s final decision or at

any time before a hearing. Appellants should anticipate that the government will order an audit

of a claim, particularly if it involves a large dollar amount or includes a significant amount of

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indirect costs. The Defense Contract Audit Agency (DCAA) performs some federal government

audits, and it often takes at least six months to complete one. Some agencies have audits

performed by an internal Inspector General (IG) office. In other instances, the requesting agency

may order an audit through a private consultant.

Stipulating to Damages

In many cases, the judge will encourage the parties to meet prior to trial to determine if they can

agree on which, if any, damage amounts, are actually in dispute. The parties may be able to

stipulate to some of the damage amounts so that no further presentation of evidence, or only a

limited presentation, is required at hearing.

Agreeing to stipulate to damages often requires the parties to break the total claimed damages

into discrete dollar amounts for each of the items at issue. For example, both parties may agree

that the appellant’s costs have increased as a result of schedule delays causing the contractor to

incur increased costs for time-related expenses. If the parties can agree on the daily cost of those

time-related expenses, those daily rates can easily be calculated once the judge determines

government liability for delay and the number of days of delay. Stipulations, especially damages

stipulations, are very useful in negotiating settlements and speeding up resolution of a dispute.

Schedule of Costs

After an appeal has been filed and before the hearing, some judges require the parties to submit a

schedule of costs, particularly in the absence of an agreement stipulating to damages. A

schedule of costs can also be particularly useful where the claimed damages are complex and not

well defined by the claim that was submitted to the contracting officer.

A schedule of costs sets forth, in an easily understandable format, such as a spreadsheet, the

damages portion of a claim and support for each cost damage asserted. Required information

usually includes:

1) a reference to the claim (name/number);

2) a separate listing of each cost item with each individual component of each cost item

separately listed;

3) a computation showing how each cost item and cost component was derived;

4) if the cost item is an actual cost, the identification of the specific books, records,

accounting data, time sheets or cards, invoices, canceled checks or other documents

supporting the cost, together with appended copies of any such documents (or relevant

excerpts of books and records) for each cost item or component and/or citations to page

numbers within the appeal file and appeal file supplement, as appropriate; and

5) if the cost item is based on an estimate, a detailed explanation of how the estimate was

prepared, including the identification of any cost estimating guide used (with the page(s)

upon which the party relies), and the identity of each witness who will be called to testify

with respect to each and every claimed item of cost.

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After the party seeking damages submits its schedule of costs, the judge may require the party

that denies the costs to submit a detailed response to the schedule of costs claimed. If a

particular cost item cannot be confirmed, the responder must specify the item to which it takes

exception, together with a complete explanation of the reason for such exception. In the case

where alternate amounts are proposed by the responder, an alternate schedule of costs for such

items is required, and it should provide the same information required by the original schedule of

costs.

After the schedule of costs and response are filed, it should be clear to the judge precisely where

the parties are in dispute in terms of cost components being claimed and the extent to which

evidence proving damages may exist. Some board judges have ruled that a party is deemed to

have waived costs that are not included, or insufficiently detailed, in a schedule of costs.

Likewise, where the government has failed to expressly challenge the accuracy of particular

items listed in the schedule of costs in a timely fashion, some judges have concluded that the

government has waived any future right to raise a challenge.

PRACTICE TIPS

•

While it is only necessary to prove damages with reasonable certainty,

where an appellant seeks damages, it is the appellant’s burden to prove that

the damages it claims are properly supported.

•

The more detail and specific identification of the increased costs caused by

the opposing party, the greater possibility of recovering damages, if

entitlement is found.

•

It is always more convincing to base damages on actual costs as opposed to

estimated costs.

•

Organize accounting and cost records in a clear and concise manner; do not

expect a judge to dig through source documents to track damages.

•

Explain how the damages were calculated, identifying methodologies,

assumptions, and estimating techniques.

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XIII. THE BOARD’S DECISION AND APPEALING TO THE COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

The Board’s Decision

Following the presentation of evidence, a hearing, and/or briefs, the BCA will issue a written

decision setting forth its findings of fact and legal conclusions. Except for certain motions and in

the case of small claims procedures, a panel of three judges will decide the case. In most

instances, the “presiding judge” will have put the primary work into the case and written a draft

decision. Then, the two “panel judges” review the draft decision, make comments, and concur

(agree) on a final decision. There is no time limit within which a decision must be issued.

Relief Granted

BCAs can grant two types of relief under the CDA: monetary and non-monetary.

In the case of monetary relief, a BCA awards the prevailing party a specific dollar amount and,

in typical cases, interest on the award. Interest is calculated beginning on the date the

contracting officer received a proper claim and ending on the date of payment. The rate of

interest is set by the Department of Treasury and is adjusted every six months. Interest is

generally not recoverable on relief awarded in non-CDA cases. Under the Equal Access to

Justice Act, attorneys’ fees may be awarded in limited situations, but not until after a decision is

issued. See Section XIV.

In the case of non-monetary relief, a BCA declares the parties’ rights and obligations in the

dispute. Depending on the facts of the case, the board may even order reformation of the

contract. In very unusual circumstances, the board may declare the contract void or invalid. The

BCAs do not have jurisdiction to order specific performance by directing a party to perform in a

precise way, nor can the BCAs issue an order prohibiting an act by issuing an injunction.

Furthermore, a board may not direct that a contract be reinstated, that a contract or task order be

awarded, or that an option be exercised.

Motion for Reconsideration

If a party is unsuccessful on one or more issues, it may ask the board to reconsider its decision.

Motions for reconsideration must be filed within 30 days from the date the party received the

board’

This text is long and has been trimmed here. Open the source document for the complete record.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.