Don’t Be Unreasonable: Equitable Adjustment Conditioned on Government Contractor’s Proof of Reasonable Interpretation of Contract

The U.S. Court of Appeals for the Federal Circuit, in U.S. Army Corps of Engineers v. John C. Grimberg Co., Inc., recently reversed an Armed Services Board of Contract Appeals (ASBCA) decision that a federal contractor was entitled to an equitable adjustment on a differing site conditions claim.

The Federal Circuit held that the contractor, in developing its proposal, did not demonstrate that its interpretation of government subsurface data was reasonable — a condition precedent to entitlement for an equitable adjustment.

Even though the ASBCA agreed that the subsurface conditions actually encountered far exceeded what a reasonable interpretation of the subsurface data would have allowed for, as discussed below, the Federal Circuit determined such a finding could not cure the contractor’s initial deficient interpretation or justify an equitable adjustment.

The complete article, "Don’t Be Unreasonable: Equitable Adjustment Conditioned on Government Contractor’s Proof of Reasonable Interpretation of Contract," was published by Thomson Reuters Westlaw on July 17, 2020.