...Claims observed that "the focus of a cost-reimbursement contract is contractor input, not output."

CACI cited, and the Board agreed, an earlier case of E.I.L.-Instruments in which the contractor, under a T&M contract, failed to perform the work to the satisfaction of the Government, the Board required payment. In that case, the Board referred to an earlier case at the GSBCA which ruled that "under a time-and-materials contract, the contracting officer may not reduce payments for hours actually worked when, in his opinion, the work was performed inefficiently."

The Board agreed that CACI "was not required to deliver a usable program, and that it is entitled to be paid for services performed and goods purchased and delivered under the contract even if the contract requirements were not met by CACI." The Board continued by stating that the facts disputed by the Government "are not material to [CACI's] entitlement to recover payments."

If you have a T&M contract, you are entitled to payment regardless of how well you perform. Do not be misled into thinking you are not due a payment if something goes wrong. Remember, the Government is paying for the input, not the output.

Tom Petruska, Owner
Contracts Unlimited, Incorporated

Footnotes:

1. FAR 16.601

2. General Dynamics Corp v. United States, 671 F.2d 474, (Ct. Cl. 1982)

The foregoing is not legal advice nor is it a legal opinion. Please contact your attorney for legal advice.

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