Legal Definitions - CDA claims

A CDA claim refers to a formal, written demand or assertion made by one party in a government contract, typically a contractor, against the U.S. federal government. CDA stands for the Contract Disputes Act of 1978, which is the law governing how disputes related to federal government contracts are resolved.

Essentially, a CDA claim is a structured way for a contractor to seek specific relief from the government when they believe the government has breached its contractual obligations or owes them money or other adjustments under the contract. This relief can include:

• The payment of a specific amount of money.
• An adjustment to the terms or conditions of the contract.
• Other forms of relief that arise from or relate to the contract.

These claims are distinct from routine requests or negotiations because they are formal legal assertions, intended to be resolved through a specific process outlined in the Contract Disputes Act. If a CDA claim is not settled through negotiation, it can become the basis for formal legal proceedings. Claims exceeding $100,000 must also be certified by the contractor, affirming that the claim is made in good faith, the supporting data is accurate, and the amount requested is believed to be owed by the government.

The process typically begins with the contractor submitting the claim to the government's Contracting Officer, who then issues a final decision. If the contractor disagrees with this decision, they can appeal it to either a Board of Contract Appeals or the United States Court of Federal Claims.

Here are some examples of situations where a contractor might file a CDA claim:

• Example 1: Unpaid Invoices for Completed Work
  Imagine a small business, "GreenTech Solutions," completes a contract to install energy-efficient lighting systems in several federal buildings for the Department of Energy. After the work is finished and inspected, GreenTech submits its final invoice for payment. However, the government's contracting officer refuses to pay the full amount, citing minor, disputed issues that GreenTech believes are either non-existent or not their responsibility under the contract. To recover the unpaid balance, GreenTech Solutions would file a CDA claim, formally demanding the payment of the specific sum of money they are owed, asserting their right to it based on the completed contractual obligations.

• Example 2: Increased Costs Due to Government-Directed Changes
  Consider "Bridge Builders Inc.," a construction company contracted by the Department of Transportation to build a new bridge. Mid-project, the government issues a change order requiring a significant alteration to the bridge's design, which necessitates more expensive materials and additional labor hours. Bridge Builders Inc. submits a proposal for an equitable adjustment to the contract price to cover these increased costs, but the government rejects it, offering a much lower amount. Bridge Builders Inc. would then file a CDA claim seeking an adjustment to the contract terms (specifically, the contract price) to reflect the true cost of the government-directed changes, arguing that these costs arise directly from the contract and the government's actions.

• Example 3: Damages from Government-Caused Delays
  Suppose "AeroParts Manufacturing" has a contract with the Department of Defense to produce specialized components for military aircraft. The contract specifies that the government will provide certain raw materials by a particular date. However, the government repeatedly delays delivering these materials, causing AeroParts' production line to sit idle for weeks, incurring significant standby costs, labor expenses for idle workers, and missed deadlines for other projects. AeroParts Manufacturing would file a CDA claim to seek monetary compensation for the financial damages (such as idle labor costs, extended overhead, and lost profits on other contracts) they incurred due to the government's failure to provide the materials on time, asserting these losses are a direct result of the government's breach of its contractual obligations.