Last month, the Civilian Board of Contract Appeals (CBCA) confirmed that both the courts and boards of contract appeals are increasingly willing to look beyond the surface of a claim that starts an appeal for the purposes of establishing jurisdiction before them. On Nov. 22, 2024, the CBCA found that it had the jurisdiction to review the ELA Group, Inc.’s challenge of a Department of Labor’s (DOL) Contracting Officer’s (CO’s) decision regarding a submission that the contractor initially described as a proposal under the “Equitable Adjustments” clause of its contract.

The finding is notable because the Contract Disputes Act (CDA), which allows contractors to challenge the government’s contract decisions up to a board of contract appeals or a court, requires those contractors to do so based on either an adverse “final decision” or improper delay (amounting to a “deemed denial”) involving a claim, rather than the more informal Requests for Equitable Adjustments (REAs).

In this case, the contractor actually submitted two separate submissions to the government that it eventually asserted to be claims.

ELA’s first submission came in October 2023 after the government’s request for a cost proposal for a change to the contract plans. The DOL withdrew its request when it received the contractor’s proposal. ELA initially described that submission as a proposal under the “Equitable Adjustments” clause of the contract that the submission referenced while noting in its submission that it was “entitled to receive” certain payments from the government. But, eventually, after receiving the government’s November 2023 rejection of that submission as an “inaccurate [REA],” ELA proceeded with an appeal describing the government’s failure to issue a “final decision” on its first submission (as would follow a claim) after that rejection as a “deemed denial.”

In doing so, ELA provided the CBCA and the DOL with a second submission in the form of a September 2024 “notice of appeal” that included a certification required for claims over a certain threshold. That notice of appeal also challenged the DOL’s decision to assert liquidated damages.

As one would expect, the DOL challenged ELA’s appeal as premature. The DOL’s position was that the contractor’s first submission was merely an REA, not appealable under the CDA. The DOL further maintained that it still had additional time to address ELA’s second submission under the CDA in a timely manner.

The CBCA disagreed. Instead, it focused on the contractor’s current description of its first submission as a claim. Relying on a recent Federal Circuit decision (Zafer Construction), which held that an REA can constitute a claim under the CDA, even where the contractor described it as an REA – the CBCA concluded that it needed to look beyond the title of that submission to fully consider what it was.

Upon doing so, the CBCA was persuaded that it should treat ELA’s initial submission as a claim because even though ELA initially identified its submission as a “proposal” under the Equitable Adjustments clause, the submission demanded the DOL’s payment of a specific sum of money and identified the basis of its payment demand. Although the CBCA recognized that the submission did not “expressly request a final decision,” as a CDA claim would require, the CBCA determined that “such a request was implicit in [ELA’s] statement that it was ‘entitled to receive’ the requested money and its attachment of its change order form detailing [its incurred costs].” The CBCA further explained that even though ELA cited the Equitable Adjustment clause in its submission, that clause set forth a process specific to obtaining recovery for costs associated with a change before it occurred. But, in this case, ELA’s submission involved its demand for DOL to compensate it for work that it already completed.

In spite of all of that, however, the CBCA did not allow ELA to proceed with an appeal of its challenges to the government’s liquidation damages, since those assertions were not a part of ELA’s initial submission. Instead, ELA first brought them up as part of its subsequent claim.

Part of a Trend or an Outlier? And, Does It Matter?

The fact that CBCA’s decision regarding ELA’s claim relies on recent Federal Circuit precedent is no coincidence. Both the Federal Circuit and other government contracting fora have recently shown increasing willingness to interpret contractors’ demands for payment from the government as claims under the CDA for purposes of jurisdiction – a necessity for conveying their authority to review resulting disputes. Although a positive development, it should not lull contractors into a false sense of security that any submissions that they make to the government would satisfy the CDA standards for a claim and permit an appeal. On the contrary, contractors preparing such submissions should never hesitate to give the requirements for properly asserting a claim under the CDA an extra look before sending one in.