Contractor’s Unwaivable CDA Right to Board Review

December 5, 2017

In Ikhana, LLC (ASBCA Nos. 60462 et al., Oct. 18, 2017), the Board held that a contractor’s right to CDA appeal cannot be indirectly waived by an assignment of the underlying claims to a surety. Following a termination for default, Ikhana appealed several previously submitted claims (deemed denied). The surety and the Government, believing that Ikhana had assigned those claims to the surety, brokered a settlement agreement to withdraw those appeals and finish performance. The Board held that, regardless of whether Ikhana had assigned its claims, an assignment cannot indirectly “waive” a contractor’s statutory right to Board review under the CDA. The Board distinguished its earlier decision in Safeco Ins. Co. of Am. (ASBCA No. 52107), which upheld a surety’s right to appeal assigned claims while the government attempted to nullify the contractor’s assignment because––critically––the contractor in Safeco was uninterested in pursuing that appeal.

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