Claims, Certification and the Disputes Process
A request for money becomes a claim only when it demands a sum certain as a matter of right, and above a stated amount it must carry a certification in prescribed terms. That conversion starts interest, starts deadlines, and closes off the informal route.
The rule in short
A claim is a written demand or assertion seeking, as a matter of right, payment of a sum certain, adjustment or interpretation of contract terms, or other relief. It must be submitted to the contracting officer within six years of accrual, and above the statutory threshold must carry a certification in the prescribed terms. The officer's decision may be appealed to an agency board within ninety days of receipt, or to the Court of Federal Claims within twelve months.
The definition does the work. A claim is a written demand or written assertion by one of the contracting parties seeking, 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. Everything about the process turns on whether a document meets that description.
Three elements, and the invoice that is not one
Three elements have to be present: a writing, a demand as a matter of right, and a sum certain where money is sought. A request that invites negotiation rather than demanding payment is not a claim. A demand that gives a range or an estimate lacks a sum certain. And an oral assertion is nothing at all, however clearly it was made.
A routine request for payment is expressly excluded. A voucher or invoice that is not in dispute when submitted is not a claim, but it may be converted into one by written notice to the contracting officer where it is subsequently disputed as to liability or amount, or is not acted upon in a reasonable time. That conversion is a deliberate step and it should be taken deliberately, because it changes the character of the relationship.
Six years, and the certification
Each claim must be submitted to the contracting officer within six years after its accrual. Accrual occurs when all events fixing liability and permitting assertion of the claim were known or should have been known, whether or not the amount had been calculated. Contractors that hold claims until the end of a long performance period frequently find the earliest ones outside the period.
Above the statutory threshold, the claim must be certified in substantially the prescribed language. The threshold is a fixed statutory figure stated in the disputes subpart, and it should be read from the regulation rather than assumed, since acquisition-related dollar figures are subject to periodic adjustment. A claim over the threshold submitted without any certification is not a valid claim, and a decision on it is a nullity. A defective certification is different: it can be corrected, and the defect does not deprive the tribunal of jurisdiction.
Dividing a single dispute into several claims each just under the certification threshold is treated as one claim for certification purposes where the amounts are based on a common set of operative facts. The tribunal will aggregate them, find the certification missing, and dismiss. The same aggregation applies to a claim increased during litigation: an amount that grows past the threshold needs a certification, even though the original submission did not.
What the contracting officer must do, and when
For a claim at or below the threshold, the contracting officer must issue a decision within sixty days of receipt where the contractor requests one. For a larger claim, the officer must within sixty days either issue the decision or notify the contractor of the date by which it will be issued, and must then issue it within a reasonable time given the size and complexity of the claim.
Failure to meet the applicable period permits the contractor to treat the claim as denied and to appeal, which is the deemed denial route. It is available and it is also usually a poor first choice, because a tribunal can remand for a decision and because the officer's reasoning is useful to have. The decision itself must state the reasons, inform the contractor of the appeal rights, and identify itself as a final decision.
Board or court, and the choice that binds
An appeal to the agency board of contract appeals must be filed within ninety days of receiving the decision. An action in the Court of Federal Claims must be brought within twelve months of receiving it. Both periods run from receipt and neither is extended by settlement discussions. Choosing one forum generally forecloses the other for the same claim.
| Stage or forum | Deadline | Decided by | Discovery | Review of the outcome |
|---|---|---|---|---|
| Contracting officer decision | Sixty days, or notice of a date for larger claims | The contracting officer | None; the officer requests information | Appeal to a board or an action in court |
| Agency board of contract appeals | Ninety days from receipt of the decision | Administrative judges | Yes, on the board's rules | Appeal to the Federal Circuit |
| Court of Federal Claims | Twelve months from receipt of the decision | A judge of the court | Yes, on the court's rules | Appeal to the Federal Circuit |
| Accelerated board procedure | Elected after appeal, for smaller claims | Administrative judges, on a compressed schedule | Limited | Same as a board decision |
| Expedited small claim procedure | Elected after appeal, below a stated amount | A single judge | Minimal | Very limited; the decision has no precedential value |
What the certification costs if it is wrong
Interest runs on the amount found due from the date the contracting officer receives the properly certified claim until payment, at the rate set for the relevant period. That is a substantial reason to submit a claim promptly once negotiation has failed, since a request for equitable adjustment sitting in negotiation earns nothing.
The certification also creates exposure. A contractor is liable for the unsupported part of a claim where the unsupported part results from a misrepresentation of fact or fraud, together with the government's costs of reviewing it. Separate false claims liability is available to the government for the same conduct. Cost elements presented in a claim are also tested against the principles described in the three cost tests, so including an expressly unallowable cost in a certified claim compounds the problem.
Government claims and where they come from
The government asserts claims through the same mechanism, by a contracting officer's decision demanding payment or asserting a right. Government claims require no certification. The common sources are a demand for the excess cost of reprocurement following a default, addressed in cure notices, excusable delay and reprocurement costs, and a demand for costs disallowed after audit.
Most contractor claims begin as something else. An unpriced change becomes a claim when negotiation on the adjustment described in the changes clause and the request for equitable adjustment stalls. A disputed termination settlement becomes a claim under the process in the settlement proposal after an early ending. Objections to how a contract was awarded do not belong here at all; they run through the bid protest framework on its own much shorter clocks.
Points to carry away
- A routine invoice is not a claim until it is disputed and converted by written notice.
- A claim must be submitted to the contracting officer within six years of its accrual.
- Above the statutory threshold the claim must carry a certification in the prescribed wording.
- A defective certification can be corrected; the absence of any certification cannot.
- An appeal to an agency board is due within ninety days of receiving the decision.
- An action in the Court of Federal Claims is due within twelve months of receiving the decision.
Questions readers ask
What does the certification have to say?
Four things, in substance: that the claim is made in good faith; that the supporting data are accurate and complete to the best of the contractor's knowledge and belief; that the amount requested accurately reflects the contract adjustment for which the contractor believes the government is liable; and that the certifier is authorized to certify on the contractor's behalf. Substantially the statutory language must be used. A certification signed by someone without authority is a defect, and defects can be corrected before the tribunal decides.
When does a claim accrue for the six-year period?
When all events fixing the liability of either party and permitting assertion of the claim were known or should have been known. Monetary damages need not have been calculated, but some injury must have occurred. That standard makes accrual earlier than contractors expect, particularly for claims resting on a course of conduct rather than a single event. The period is a limitation on submission to the contracting officer, so waiting for the end of performance to assemble everything can be costly.
Must a contractor keep performing while a claim is pending?
Yes. The disputes clause requires the contractor to proceed diligently with performance of the contract, pending final resolution of any request for relief, claim, appeal or action, and to comply with any decision of the contracting officer. Stopping work is a separate breach that transforms a strong claim into a default posture. Where the government has directed a suspension or a stop-work, the direction itself provides the route to compensation, and performance stops on the government's instruction rather than the contractor's choice.
Sources
- Cornell Legal Information Institute — 41 U.S.C. 7103, Decision by Contracting OfficerThe six-year submission period, the certification requirement and the decision timetable.
- Cornell Legal Information Institute — 41 U.S.C. 7104, Contractor's Right of AppealThe ninety-day board appeal and the twelve-month action in court.
- Cornell Legal Information Institute — 41 U.S.C. 7101, DefinitionsThe scope of the disputes statute and the contracts it reaches.
- Cornell Legal Information Institute — 41 U.S.C. 7109, InterestInterest running from receipt of the claim until payment.
- Acquisition.gov — FAR Subpart 33.2, Disputes and AppealsThe claim definition in practice, certification, and the decision requirements.
- Acquisition.gov — FAR 33.207, Certification of ClaimsThe certification threshold and the prescribed wording.
- Acquisition.gov — FAR 52.233-1, DisputesThe clause obliging continued performance while a dispute is resolved.
Lawwise is a publication, not a law firm. This article states general rules and cites its sources; it is not advice about any particular case, and the law differs by state and changes over time.
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