Here’s a situation my colleagues and I see with some frequency: a contractor, in the course of working on a government contract, submits a request of some sort to the agency. Then waits for a response. And waits some more. Meanwhile, the government’s delay in responding prevents the contractor from moving forward with some aspect of the project, causing the contractor to incur costs.
For contractors faced with this type of government inaction, a recent decision by the Armed Services Board of Contract Appeals is welcome news. In that case, the ASBCA held that the government breached its implied duty of good faith and fair dealing by waiting more than three months to respond to the contractor’s request to amend the Statement of Work–allowing the contractor to “twist in the wind” during that period.
I recall sitting in a mediation one day when the mediator, a judge, told me and my client that we all have lightning in our fingers. He went on to explain that this means, once you sign a contract, it’s like magic in the sense that you can’t get out of the contract and are bound by it, absent certain exceptional circumstances.
I was reminded of this concept while reading a recent opinion from the Armed Services Board of Contract Appeals that dealt with the effect of a contractor signing a release with the government and then trying to back out of that release by refusing payment from the government.
The government was not required to exercise option years in a “long term” contract to lease aircraft, according to a recent decision of the U.S. Court of Federal Claims.
In Sundowner 102 LLC v. United States, No. 12-304C (2013), the Court held that the use of the words “long term” in a contract did not limit the government’s discretion to decline to exercise option years.