The "strict limits" of the Contract Disputes Act ("CDA") determine whether the Civilian Board of Contract Appeals ("CBCA," and its Armed Services companion, the "ASBCA") has jurisdiction to hear a contractor claim against the government. One jurisdictional limitation is that the contracting officer ("CO") must render a final decision prior to the CBCA having jurisdiction to decide a claim against the United States. Without it, the boards have no legal authority to consider a contractor claim. The CDA also provides that a contractor has to appeal a negative contracting officer's final decision to the boards within 90 days of its receipt, or within one year to the Court of Federal Claims. This rule has always seemed fairly clear, until the CBCA considered this question. See Safe Haven Enterprises, LLC v. Department of State, CBCA No. 3871, 3912, Sept. 29, 2015.
In Safe Haven, the contractor alleged that after the CO had issued his final decision, he agreed to reconsider the claim, thereby stopping the time period within which the contractor had to appeal in order to be timely and satisfy the CDA jurisdictional requirement. Not surprisingly, the agency disagreed. The government argued that 1) the CO had not agreed to reconsider the claim; and 2) even if the CO had agreed to reconsider the claim, at most the time period for appeal had been tolled and did not re-start from the time of the reconsidered final decision — in effect giving the contractor no more than a total of 90 days to appeal to the board rather than restarting the 90-day period after the CO issued his reconsidered decision.
After careful consideration of the CDA itself, applicable regulations (e.g., FAR) and its case law at the boards of contract appeals and the Court of Federal Claims, the CBCA noted that neither the CDA nor the FAR provided guidance as to what constitutes a reconsideration or the effect of a reconsideration. Therefore, it decided that “there is no question that, if the contracting officer (before the time for the contractor to appeal has expired) expressly retracts a prior decision in writing, the time for appealing that decision completely disappears.” (Emphasis added.)
Employing a reasonable person standard, the CBCA found that under the specific facts of the case a CO’s promise to “take a look at” the claim constituted a reconsideration of the claim. The CBCA specifically noted, however, that under the particular facts of a case it can be difficult to determine whether the CO has agreed to reconsider the final decision. The CBCA’s discussion of what would or would not constitute a reconsideration, while not black and white, is illustrative.
According to the Safe Haven court, with regard to reconsideration of a CO’s final decision, three things are clear:
- If, under the specific facts of the case, the CO has undertaken to reconsider the case, the time period in which the contractor has to appeal comes to a complete stop.
- If the CO does reconsider the case, the time period in which the final decision may be appealed, to either the board or the Court of Federal Claims, starts over from the date the reconsidered final decision is issued.
- If the period for appeal from the original final decision has already expired, a CO’s reconsideration of the claim does not revive the time to appeal. In other words, once the appeal period has lapsed (whether 90 days or 365 days), the reconsideration does not create a new appeal period.
Safe Haven did not address what happens if a CO decides to reconsider but then doesn’t issue a second decision – or when a contractor can appeal under a “deemed denied” of a reconsideration.