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Jamaal Valentine

Ratification Authority

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I think this is an excellent discussion touching on a more existential point: "The words used in the FAR"  vice "What the FAR is trying to tell me".

While the words of 1.602-3 are a bit messy, it  is clearly telling me that "Ratifications are like deputizing someone after they shoot the bad guy; not the best disincentive to  people taking the law into their own hands!  So if you can resolve your issue without a ratification, and under the terms of the contract, do it!"    Validation comes from the fact that I can apply this interpretation without contravening a single provision of 1.602-3.

Trying to parse the FAR always leads to frustration and argument.  I've found that applying obvious guiding principles provides clarity that is often lacking in the words.  

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12 hours ago, C Culham said:

 

Joel - Actually the FAR says this -

"The Government’s policy is to try to resolve all contractual issues in controversy by mutual agreement at the contracting officer’s level. Reasonable efforts should be made to resolve controversies prior to the submission of a claim."

Not this 

Quote

 

On April 10, 2017 at 9:04 PM,  joel hoffman said: 

But that, of course, defeats the intent of the government's policy at 33.204 to make reasonable efforts to resolve controversies prior to the submission of a claim.

 

 

Carl, I'm confused.  It should be obvious that telling the contractor to perfect a claim out of a non-claim defeats the purpose of a stated policy in 33.204.  I was paraphrasing part of the policy, using the active voice, rather than the passive voice. The policy urges  [presumably, the contracting officer per the first sentence in the paragraph] to make reasonable efforts to resolve controversies prior to [the contractor] submitting a claim.

 Hard to resolve a non-claim before it becomes a formal claim if you tell the contractor to convert the non-claim issue into a formal claim so that you can resolve it as a claim,  isn't it?  

I didn't mention the first part of the policy. The second sentence is certainly part of the policy, in my opinion. 

As for the DFARS required certification for REAs, it was required by a separate law long ago, even though the language is essentially the same as that for a claim certification.

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Joel:

If the particular passage is unclear to some, the contracting officer is responsible for the action --under FAR conventions-- unless another party is expressly cited. (FAR 1.108(f))

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7 hours ago, Jamaal Valentine said:

Joel:

If the particular passage is unclear to some, the contracting officer is responsible for the action --under FAR conventions-- unless another party is expressly cited. (FAR 1.108(f))

Thanks, Jamaal. I wasn't trying to say that I am confused about the actor in the sentence. Yes, per your citation, I presumed that the actor in this situation is the KO, but the government's policy should also apply to organizations and to anyone administering contracts. I was taught not to coach a contractor to or how to submit a claim but to try to resolve issues before they become claims.  Formal claims invoke procedural processes and a lot of time and effort.  Most construction contractors that I have worked with and all of the big defense contractors that I have worked with on major Systems contracts avoided turning issues into formal claims, if at all possible.  The USACE has promoted formal and informal partnering processes with contractors and with all stakeholders since the late 80's. USACE policy encourages the use of Alternative Dispute Resolution processes, to avoid unnessary reliance on the formal claims process and litigation. There are MANY players involved in these processes not only the KO.

For gosh sakes, if there was a situation under the contract (see Vern's second post in this thread, last Thursday) where the KO was unreachable and the COR took action to save the taxpayers unnecessary expense and probably to minimize disrupting the contractor's operations. The contractor cooperated and the KO agrees that, had he/she known of the situation, he/she would have issued a change order.  Why should the KO tell the contractor to submit a claim so that he/she could resolve the matter of payment as a claim (irrespective of merit of the claim) instead of going through yet another procedural process (ratification)?  The KO ought to take some initiative and just issue a change order the next day!

I am confused why Carl said that the FAR doesn't "say" that the government's policy at 33.204 is to make reasonable efforts to resolve controversies prior to the submission of a claim.  I just reworded the second FAR sentence in the active voice to express policy. 

To me, the second sentence is part of the policy at 33.204. Otherwise, it shouldn't have been included in the same paragraph as the first sentence. 

[See Merriam Webster definition of "say"]. 

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P.S. , I   Doubt that Vern was seriously suggesting that KO's should encourage or direct a contractor to submit a formal claim so that the KO could resolve an unauthorized commitment under FAR 33.2 to avoid the ratification process.  I believe he was saying that FAR 33.2 doesn't only cover formal claims but also matters that could become claims under the contract, regardless of merit/entitlement of the issue (33.204). He said - to emphasize the point-  if Carl cant accept that,  then he could direct the contractor to submit a claim to be able to resolve the matter without ratification. 

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19 hours ago, REA'n Maker said:

I've found that applying obvious guiding principles provides clarity that is often lacking in the words.  

I wonder if the Guiding Principles are based on sound logic and are not really as messy as they have been made out to be in this thread?

http://www.cbca.gsa.gov/files/decisions/2010/HYATT_06-15-2010_1165__ENGAGE_LEARNING_INC_508.pdf

http://www.cbca.gsa.gov/files/decisions/2016/POLLACK_03-31-16_2294__AMERICOM_GOVERNMENT_SERVICES_INC.pdf

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On 4/11/2017 at 11:11 PM, joel hoffman said:

As for the DFARS required certification for REAs, it was required by a separate law long ago, even though the language is essentially the same as that for a claim certification

Yeah; and the work required of the poor Contract Specialist is practically identical: Rule 4 File, COFD, etc.  

Not to start Nerd War III, but I've often wondered other than the certification, what IS different between an REA and a Claim, practically?  The REA that I worked ended up being a negotiation like almost any other, albeit with a lot more legal input. But at the end of the day, when it was in the  government's best interests to settle on a particular requested cost adjustment, it was the CO's call (e.g., "Although the litigation risk associated with denying the requested cost of this item are low, it is in the Government's best interests to incorporate this cost into the COFD for the purpose of avoiding a formal claim.")

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An REA is a request for an adjustment under a contract clause like the changes clause. If the REA meets the requirements of a claim as per FAR, then its an REA thats a claim. Otherwise, its an REA thats not a claim. Vern Edwards wrote something about this in his blog I think.

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Rea'n Maker, I'm not sure exactly what your question was concerning the difference between a claim and an REA.  However, to me, the practical differences are that a claim accrues interest while an REA does not.  The cost of pursuing an REA is an allowable contract administration cost (assuming the cost elements are otherwise allowable in accordance with FAR Part 31) while the cost of pursuing a claim is not an allowable cost.  An REA can be resolved by the contracting officer, but a contracting officer may lose the ability to resolve a claim if it gets to the Court of Federal Claims where the government is represented by the Justice Department.  An REA may require the submission of truthful cost or pricing data but no such data is required for a claim.  There are different time limits within which a claim and REA must be asserted. 

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Reflectone's REA is clearly “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.”   Reflectone, a contracting party, submitted a written document to the CO demanding the payment of $266,840 which it asserted the government owed for delaying performance of the contract by furnishing defective goods.   The submission was certified and requested a CO decision.   Consequently, Reflectone's REA satisfies all the requirements listed for a CDA “claim” according to the plain language of the first sentence of FAR 33.201.   The REA is not a “routine request for payment” and, therefore, the fourth sentence of the FAR definition does not apply here to require, inter alia, a pre-existing dispute as to either liability or amount.   Because we conclude that Reflectone's REA is a “claim” according to the FAR, we further conclude that the Board has jurisdiction to review the CO's denial of Reflectone's REA.

Reflectone v. Dalton, U.S. Court of Appeals for the Federal Circuit, July 26, 1995, 93-1373.

If an REA meets the requirements for a claim it is an REA that is a claim.

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On 4/14/2017 at 0:07 PM, Retreadfed said:

However, to me, the practical differences are that a claim accrues interest while an REA does not.  The cost of pursuing an REA is an allowable contract administration cost (assuming the cost elements are otherwise allowable in accordance with FAR Part 31) while the cost of pursuing a claim is not an allowable cost.  An REA may require the submission of truthful cost or pricing data but no such data is required for a claim.  There are different time limits within which a claim and REA must be asserted. 

Good points, all.  But as I said, practical differences associated with resolving either are almost non-existent.

(I believe the Claim requires the cert, while an REA does not.  Unless I am misunderstanding your point.)

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If you have a DoD contract, an REA requires certification as well as a claim.  However, there are different certifications for each.

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