52.233-1
Disputes
FAR 52.233-1 requires contractors to follow strict procedures for submitting and certifying claims, continue performance during disputes, and provides structured timelines for resolution and interest payments.
Overview
FAR 52.233-1, Disputes, establishes the procedures and requirements for resolving disputes arising under or relating to a government contract. It implements the Contract Disputes Act (41 U.S.C. chapter 71) and defines what constitutes a claim, the process for submitting claims, certification requirements for claims over $100,000, and the timelines for contracting officer decisions. The clause also addresses the use of alternative dispute resolution (ADR), the accrual and payment of interest on claims, and the contractor’s obligation to continue contract performance during dispute resolution. Alternate I modifies the requirement for continued performance to include disputes "relating to" the contract, broadening the scope of the obligation.
Key Rules
- Definition of Claim
- A claim is a written demand for payment, contract adjustment, or other relief; claims over $100,000 require certification.
- Submission and Certification
- Claims must be submitted in writing within 6 years of accrual; claims over $100,000 must be certified with specific language.
- Contracting Officer Decision Timelines
- CO must decide claims under $100,000 within 60 days if requested; for larger claims, CO must decide or provide a decision date within 60 days.
- Appeals and Finality
- CO’s decision is final unless appealed or litigated.
- Alternative Dispute Resolution (ADR)
- ADR may be used by mutual consent; contractor must provide written reasons if refusing ADR.
- Interest on Claims
- Interest accrues from claim receipt until payment, including for defective certifications.
- Continued Performance
- Contractor must continue performance during dispute resolution and comply with CO decisions.
Responsibilities
- Contracting Officers: Must render timely decisions, notify contractors of decision timelines, pay interest on valid claims, and offer ADR when appropriate.
- Contractors: Must submit claims in writing, certify claims over $100,000, respond to ADR offers, and continue contract performance during disputes.
- Agencies: Oversee compliance with dispute procedures and ensure proper handling of claims and interest payments.
Practical Implications
- This clause ensures a structured process for resolving contract disputes, protecting both parties’ rights and obligations. Contractors must be diligent in documenting claims, meeting certification requirements, and maintaining performance during disputes. Failure to follow procedures or deadlines can jeopardize claims or delay resolution. ADR offers a potential path for faster, less adversarial resolution.