The contractor submitted a termination settlement proposal. The agency sat on the proposal. The contractor asked for a decision, but the agency said the parties were still negotiating. The ASBCA found negotiation had reached an impasse. The board ordered the agency to issue a decision.
Petition of AeroKool, Aviation Corp., ASBCA No. 63637-PET
- Termination and Claim – The agency terminated a contract for convenience. The contractor submitted a termination settlement proposal and additional claims for breach. The agency sat on the claims and settlement proposal for several months. The agency asked for more time. The contactor petitioned the ASBCA for a final decision.
- Breach Claim – The agency alleged the contractor had merely submitted a breach proposal and had not submitted a formal breach claim. Thus, the agency contended, a final decision was unnecessary. The board rejected the argument. The breach proposal satisfied the requirements of a claim, and the contractor had certified it. While the contractor had submitted the breach claim concurrently with its settlement proposal, the breach and settlement proposal were distinct; they alleged different legal theories and sought a distinct set of costs.
- Impasse – A settlement proposal converts to a claim when negotiations between the parties reach an impasse. The agency argued it was still negotiating. But the board thought the parties had reached an impasse. The government had not done anything about the proposal for months. The dilatory processing of the proposal rose to the level of an impasse.
The contractor is represented by Paul J. Seidman and David J. Seidman of the Seidman & Associates, PC. The government is represented by Samuel W. Morris, Quinn A. Disparte, and Amelia R. Lister-Sobotkin of the Defense Contract Management Agency.
--Case summary by Craig LaChance, Senior Editor