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3 min read

What To Do When The Government Breaches Its Contract

Government Breach of Contract | Procurement Law | CDA Claim
In his insightful discussion, Joe delves into the essence of a breach of contract committed by the government, shedding light on the detrimental impact it can have on contractors. He explains that a breach of contract occurs when the government fails to fulfill its promise after making one. This can lead to significant consequences for contractors, who rely on the government's commitment to carry out their work effectively.




Going deeper into the subject, Joe outlines five common types of breaches that contractors often encounter when dealing with the government. These breaches include the duty to disclose superior knowledge, the implied duty of good faith and fair dealing, the implied warranty of specifications, constructive changes, and cardinal changes. By discussing these breaches, Joe provides contractors with a comprehensive understanding of the potential challenges they may face throughout their contracts with the government.

To ensure that these concepts are easily comprehensible, Joe accompanies his explanations with compelling examples. For instance, he highlights the government's failure to disclose the need for a specific credential or the presence of asbestos at a construction site. These real-life scenarios serve as concrete illustrations of the breaches that contractors might encounter, making it easier for them to identify and navigate such situations.

In addition to discussing the breaches, Joe also emphasizes the significance of contractors trusting their instincts and taking advantage of site visits whenever possible. Site visits provide contractors with an opportunity to assess the project's requirements and potential risks firsthand. By actively participating in these visits, contractors can safeguard themselves against potential challenges that may arise from the government's actions or lack thereof.

Overall, Joe's exploration of breach of contract and its various types provides contractors with invaluable insights and knowledge. By understanding these breaches and the accompanying examples, contractors can navigate their contracts with the government more effectively and protect their interests. Joe's emphasis on trust and proactive engagement further empowers contractors to assert their rights and ensure fair treatment throughout the duration of their contracts.

Joe highlights the significance of conducting site visits and urges contractors to make the most of these opportunities to safeguard themselves against potential challenges from the government. Additionally, Joe explains the implied duty of good faith and fair dealing, which is automatically included in every government contract. To illustrate this breach, Joe provides an example where the government obstructs the contractor's ability to fulfill the terms of the contract. Moreover, Joe delves into the implied warranty of specifications, which grants contractors the ability to rely on the plans provided by the government. During the Q&A session, Joe addresses two thought-provoking questions from the audience. The first question revolves around the consequences of a contracting officer altering the scope of a project after it has commenced. Joe responds by highlighting that the severity of the change determines whether it falls under a constructive change or a cardinal change. The second question concerns a grantee who faced difficulties in completing a program due to COVID-19 shutdowns. Joe suggests potential remedies such as invoking force majeure or excusable delay.

Joe delves into the concept of excusable delay, which serves as a powerful defense mechanism against the government's attempts to terminate a contract or impose liquidated damages. Furthermore, Joe outlines a range of potential claims that can be asserted against the government, including government-caused delay, breach of the duty of good faith and fair dealing, and breach of the duty to disclose superior knowledge. During the Q&A portion, Joe addresses a query regarding a contract that fell significantly short of expectations, enlightening us that this discrepancy could potentially give rise to a negligent estimates claim. Additionally, Joe discusses the notion of constructive change, which arises when the government introduces a minor alteration to the contract that aligns with the original agreement. Another audience question prompts Joe to shed light on the issue of the government's failure to pay invoices in a timely manner, with Joe clarifying that contractors are entitled to interest under the Prompt Payment Act. Similarly, Joe responds to a query regarding the government's delay in approving credentials, indicating that this delay could potentially form the basis for a government-caused delay claim.

Joe explores the potential risks faced by the government when breaching a contract, shedding light on the importance of presenting factual evidence to a judge to determine accountability. Additionally, Joe delves into the concept of constructive change, which necessitates contractors to exceed the original contract's requirements. Furthermore, Joe discusses cardinal change, referring to significant alterations outside the contract's scope. To illustrate this, Joe provides compelling examples such as the government's request for a substantially larger quantity of items than initially agreed upon. Joe strongly advises against undertaking a cardinal change without a contract modification. Moreover, Joe addresses a query about the government's request for excessive documentation for invoices, clarifying that the government is entitled to request a reasonable amount of information. Lastly, Joe briefly touches on the notion of bad faith, highlighting its extreme nature as a breach of the duty of good faith and fair dealing.

Joe delves into the complex topic of bad faith, underscoring its rarity and the challenges associated with proving it. To illustrate this concept, Joe presents a compelling example where a contracting officer retaliates against a contractor for reporting an EEOC violation. In addition, Joe emphasizes the importance of initiating a Contract Disputes Act (CDA) claim with the contracting officer before resorting to legal action. Furthermore, Joe advises against approximating the amount of money owed and instead recommends providing an exact figure. Joe underscores the significance of including all relevant facts in the CDA claim and explains the timeline for the contracting officer to respond to the claim. If the contracting officer fails to respond, Joe enlightens us about the available options for the contractor. Moreover, Joe delves into the different venues that exist for filing a claim, depending on the type of agency involved. Lastly, Joe offers valuable advice to consult with an attorney, encouraging individuals to inquire about their rationale for selecting a particular venue.