It is high time to remind ourselves that federal procurement is based on contracts of adhesion. What are the contracts of adhesion? In this context, and in the legal sense, they are contracts in which the government dictates the terms and conditions. Our mentor, Gil Cuneo, was fond of reminding all of the audiences before which he spoke that one must start with the understanding that when you enter the government marketplace, you must be prepared to deal with contracts of adhesion. The closest commercial counterpart is the insurance contract, to which we all can relate. The insurance company dictates the terms and conditions. How many times has each of us negotiated the terms of our insurance policies?
Yes, government contract terms and conditions are dictated by the government. And if the term or condition is not written in the contract, chances are it will be read into the contract by operation of law. See our article on the Christian doctrine. There are no changes or termination for convenience clauses in the commercial marketplace contracts. Making changes unilaterally and terminating for convenience would be breaches of contract there. But, like it or not, the government contract will contain these clauses whether they are written in the contract or not. (Of course, if the contract is for a "commercial item", the unilateral change is eliminated in government contracts.) Here, we've picked but two of the hundreds of clauses dictated by the government that will be found in government contracts. In most every case, the contractor has no control over whether the clause is included or not. And in many instances, it is there even if you can't see it.
So, what do we make of these contracts of adhesion? Contractors play on a tilted and even uneven playing field. Tilted in the sense that the government controls the entire system, from clauses to remedies. Uneven, in the sense that the professional contract administration staff for the government often does not understand the rules and applies them unevenly and even unfairly.
Yes, government contract terms and conditions are dictated by the government. And if the term or condition is not written in the contract, chances are it will be read into the contract by operation of law. See our article on the Christian doctrine. There are no changes or termination for convenience clauses in the commercial marketplace contracts. Making changes unilaterally and terminating for convenience would be breaches of contract there. But, like it or not, the government contract will contain these clauses whether they are written in the contract or not. (Of course, if the contract is for a "commercial item", the unilateral change is eliminated in government contracts.) Here, we've picked but two of the hundreds of clauses dictated by the government that will be found in government contracts. In most every case, the contractor has no control over whether the clause is included or not. And in many instances, it is there even if you can't see it.
So, what do we make of these contracts of adhesion? Contractors play on a tilted and even uneven playing field. Tilted in the sense that the government controls the entire system, from clauses to remedies. Uneven, in the sense that the professional contract administration staff for the government often does not understand the rules and applies them unevenly and even unfairly.
But help is close by and affectionately known as free rent a judge.
Both the Civilian Board of Contract Appeals (CBCA) and the Armed Services Board of Contract Appeals (ASBCA), have procedures for Alternative Dispute Resolution (ADR) which permit the parties to request a judge to act as a neutral to conduct ADR even in advance of a claim, final decision or appeal. That is, if both parties agree, they may request an independent actual judge hear their positions and mediate a resolution of the impasse. CBCA Rule 53 says the Board may provide ADR services for "pre-claim and pre-final decision" matters. A judge can be appointed as an independent neutral. ADR Procedures at the ASBCA mimic the CBCA procedures.
ADR procedures are tailored to the particular needs and desires of the parties. The procedures can be simple and pragmatic. The request to the Board must be in writing, signed by both parties and the parties must agree on a written ADR procedure plan. The Boards will assist with the preparation and implementation of that plan. The role of the judge must be clear and the Boards can assist in defining that role. The parties can actually request that a certain judge be assigned.
The types of ADR procedures available include facilitative mediation, evaluative mediation, mini-trial, non-binding advisory opinion, and summary binding decision. Facilitative mediation involves informal presentations followed by the judge meeting with the parties separately and together to facilitate the settlement of differences. Evaluative mediation adds the element of the judge reciting the strengths and weaknesses of the parties' positions. In a mini-trial, the judge sits with the parties' principals to hear presentations and evaluate evidence. The judge mediates a settlement or renders and non-binding or binding decision. If binding, the decision is non-precedential. The Boards encourage the parties to tailor the ADR procedures to their particular needs.
So if the parties are truly at an impasse, there is a way out. It is possible even before the issues arise to the level of a claim or final decision, the parties may get a real judge involved. That is probably the smartest thing they can do to avoid the trouble, delay and expense of litigation.
bill@spriggsconsultingservices.com bill@spriggslawgroup.com
Both the Civilian Board of Contract Appeals (CBCA) and the Armed Services Board of Contract Appeals (ASBCA), have procedures for Alternative Dispute Resolution (ADR) which permit the parties to request a judge to act as a neutral to conduct ADR even in advance of a claim, final decision or appeal. That is, if both parties agree, they may request an independent actual judge hear their positions and mediate a resolution of the impasse. CBCA Rule 53 says the Board may provide ADR services for "pre-claim and pre-final decision" matters. A judge can be appointed as an independent neutral. ADR Procedures at the ASBCA mimic the CBCA procedures.
ADR procedures are tailored to the particular needs and desires of the parties. The procedures can be simple and pragmatic. The request to the Board must be in writing, signed by both parties and the parties must agree on a written ADR procedure plan. The Boards will assist with the preparation and implementation of that plan. The role of the judge must be clear and the Boards can assist in defining that role. The parties can actually request that a certain judge be assigned.
The types of ADR procedures available include facilitative mediation, evaluative mediation, mini-trial, non-binding advisory opinion, and summary binding decision. Facilitative mediation involves informal presentations followed by the judge meeting with the parties separately and together to facilitate the settlement of differences. Evaluative mediation adds the element of the judge reciting the strengths and weaknesses of the parties' positions. In a mini-trial, the judge sits with the parties' principals to hear presentations and evaluate evidence. The judge mediates a settlement or renders and non-binding or binding decision. If binding, the decision is non-precedential. The Boards encourage the parties to tailor the ADR procedures to their particular needs.
So if the parties are truly at an impasse, there is a way out. It is possible even before the issues arise to the level of a claim or final decision, the parties may get a real judge involved. That is probably the smartest thing they can do to avoid the trouble, delay and expense of litigation.
bill@spriggsconsultingservices.com bill@spriggslawgroup.com
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