A Greater Sum of Certainty: ASBCA Weighs in on when Sum Certain Defense Is Not Waived

A recent Armed Services Board of Contract Appeals decision provides useful guidance on when the government may (or may not) waive its defense that a contractor’s claim failed to state a sum certain. In GE Renewables US, LLC, the contractor had submitted a claim to the contracting officer for a determination that the contractor had the right to an economic price adjustment (EPA) due to an inflation-related price increase. Notably, the contractor did not provide the value of its requested adjustment in its claim. The contracting officer denied the claim, and the contractor appealed to the Board.

Just over two weeks before discovery was scheduled to close in the appeal, the government moved to dismiss for failure to claim a sum certain. The contractor challenged the timeliness of that motion. In ECC International Constructors, which we previously discussed, the Federal Circuit determined that the Federal Acquisition Regulations (FAR) requirement to include a sum certain in a monetary claim is not jurisdictional. This meant that the government could waive an argument about compliance with the FAR’s sum certain requirement by failing to timely assert that argument during an appeal. The court in ECC did not specify when a sum certain challenge becomes untimely, other than holding that such a challenge is untimely when made after a hearing on the merits of the claim. In GE Renewables, the Board concluded that the discovery stage was not too late in the proceedings to assert the sum certain defense.

The Board also held that the contractor’s claim required a sum certain because “the only significant consequence” if the contractor prevailed at the Board would be that the contractor had the right to a price adjustment under the EPA Clause. Thus, the Board concluded that “the essence of the dispute is monetary.” Without a sum certain for a monetary claim, the Board held that the contractor failed to state a claim on which relief could be granted and dismissed the appeal without prejudice.

This decision is a useful guidepost to evaluate when parties may raise non-jurisdictional defenses before the Board, particularly when the other party fails to state a sum certain.