In Todd Construction, LP v. U.S. 2008 WL 5248570 (Fed. Cl. Dec. 9, 2008), the roofing contractor conducted roof repairs at the Seymour Johnson Air Force Base in North Carolina under a contract with the United States Army Corps of Engineers. After completing the work, the Corps issued proposed final evaluations rating the contractor’s overall performance as unsatisfactory. The contractor submitted comments to the contracting officer explaining why, in its view, the evaluation was unmerited, but the contracting officer nevertheless issued a final unfavorable rating. When the contractor’s appeal to the Department of the Army was denied, the contractor filed a complaint in the United States Court of Federal Claims, arguing that the Corps’s evaluation was, inter alia, arbitrary and capricious. The government moved the court to dismiss the complaint for lack of subject matter jurisdiction.
In confronting the government’s motion, the court was faced with the following question: Where a contractor’s performance evaluation (1) was issued without observance of the proper procedures and (2) is substantively erroneous, does the contractor’s complaint constitute a “claim” within the meaning of the Contract Disputes Act of 1978? The government argued it did not because the complaint was not made as a “matter of right” and did not arise from or relate to the underlying roofing contract.
The court began by considering its jurisdictional limitations under 28 USC § 1491(a)(2) and FAR § 52.233- 1(c). The court held that, for non-monetary suits, jurisdiction vests in the Federal Court of Claims where (1) there has been a decision of the contracting officer, (2) on a written demand, (3) made as a matter of right, (4) requesting relief arising under or relating to the contract.
In analyzing the elements, the court concluded by noting the “increasing importance of performance reviews” in the government contracting arena, where “a negative review is potentially devastating to a contractor.” Having reviewed the high deference accorded to an agency’s performance evaluation of a contractor and the increasing importance agencies place on a contractor’s performance history, the court stated that “there should be some judicial forum available to consider challenges to the fairness and accuracy of evaluations.” Todd Construction, LP should give contractors comfort that poor performance evaluations may be separately appealed.