Saturday, February 18, 2012


We've written about the rules of contract interpretation for a reason.  If the contractual language is patently ambiguous, you must seek clarification or be barred from recovery on a claim based on ambiguous contract language.  Hence, we warn you to scour the solicitation for obvious clarity issues.  Perhaps it is time to review the rules of contract interpretation in this light.  And the best instructor is Judge Park-Conroy of the Armed Services Board of Contract Appeals who writes in States Roofing Corporation, ASBCA No. 54854, (July 10, 2008), the following:

The rules of contract interpretation are settled.  We are to read the contract as a whole and give it meaning that makes sense.  A contract is unambiguous if there is only one reasonable interpretation.  It is not enough to demonstrate that there are two different interpretations; rather, both must be within the 'zone of reasonableness.'  Ambiguities will be construed against the government as the drafter under the doctrine of contra proferentem, so long as the contractor relied upon its interpretation during bid preparation.  An ambiguity is patent if it contains glaring errors or patently obvious conflicts.  A party must seek clarification of a patent ambiguity or be barred from recovery.  (Citations omitted.)

Further, extrinsic evidence (outside the four corners of the contract) can only be considered if a document is ambiguous (subject to two reasonable interpretations), says ASBCA Judge Grant.

If you see a sentence in the solicitation which appears to say one thing and another sentence appears to say something different, you must seek clarification from the contracting officer.  If the contracting officer stonewalls you, protest to GAO prior to the submission of bids (it must be done then or you lose).  Why take such drastic action?  If you intend to bid and make money, you had better clear things up before you bid.  Protesting to GAO will get the contracting officer's attention and force clarification.

If you have a claim based on contract interpretation, remember the rules.  The contracting officer's interpretation must be within the "zone of reasonableness", but so must yours.  The fact you differ means nothing.  You both may be wrong.  But if your interpretation is reasonable and the government's is not, you win.  But you may win even if both interpretations are reasonable.  In the end, the contract will be construed against its drafter.

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