Legal Definitions - Armed Services Board of Contract Appeals

The Armed Services Board of Contract Appeals is an independent body that functions much like a court, specifically designed to resolve disputes between government contractors and certain federal agencies. It hears appeals from companies or individuals who disagree with a final decision made by a government contracting officer regarding a contract.

Its primary focus is on contracts involving the Department of Defense (such as the Army, Navy, Air Force, and Marines) and other specifically designated civilian agencies. While it operates outside the traditional court system, its decisions are legally binding and can be further reviewed by federal courts if a party believes the Board made an error.

Here are some examples of situations where the Armed Services Board of Contract Appeals might be involved:

• Scenario 1: Defense Contractor Payment Dispute

  A company that manufactures specialized communication equipment for the U.S. Navy completes a large order. However, the Navy's contracting officer decides to withhold a portion of the final payment, claiming the equipment did not meet all specifications, despite the company's belief that it fully complied. The company can appeal this decision to the Armed Services Board of Contract Appeals to argue for the full payment, presenting evidence and legal arguments to the Board.

• Scenario 2: Civilian Agency Contract Termination

  A software development firm has a contract to create a new data management system for a designated civilian agency, such as the National Aeronautics and Space Administration (NASA). Midway through the project, the agency's contracting officer decides to terminate the contract for convenience, meaning the government no longer needs the services, but offers a settlement amount that the software firm believes is unfairly low and doesn't cover their incurred costs. The firm can appeal the contracting officer's final decision on the settlement amount to the Armed Services Board of Contract Appeals to seek a higher, more equitable payment.

• Scenario 3: Military Base Construction Delay Claim

  A construction company is building new housing units on an Army base. During the project, unexpected soil conditions, which were not disclosed in the original contract documents, cause significant delays and require costly additional work. The company submits a claim to the Army's contracting officer for an extension of time and additional compensation, but the officer denies the claim. The construction company can then appeal this denial to the Armed Services Board of Contract Appeals, seeking a ruling that acknowledges the unforeseen conditions and grants them the requested time and money.