Challenging Past-Performance Ratings: The Armed Services Board of Contract Appeals Highlights the Need for Informal Objections and Formal Claims under the Contract Disputes Act

For government contractors, a strong past-performance record is essential for winning new contracts. Therefore, government contractors should always consider challenging unfair or unreasonable past-performance ratings. As recently demonstrated by the Armed Services Board of Contract Appeals (ASBCA) in Cameron Bell Corp., successful challenges can force the government to improve negative past-performance ratings.[1] Further, contractors may be entitled to breach of contract damages for unfair past-performance ratings.

The Contractor Performance Assessment Reporting System (CPARS)

In general, past-performance ratings are subject to the Contractor Performance Assessment Reporting System (CPARS), which is the Federal Acquisition Regulation’s (FAR) government-wide system for reporting contractor performance. Under FAR 42.1503(b), a CPARS rating must be supported by “relevant information” and “objective facts.” Further, FAR 42.1503 defines exceptional, very good, satisfactory, marginal, and unsatisfactory ratings and identifies the information contracting officers must document to justify such ratings. Past-performance ratings that do not meet the requirements of FAR 42.1503 can be overturned through legal challenges. 

Challenging CPARS Past-Performance Ratings

There are two ways to challenge CPARS past-performance ratings. First, a contractor can informally request a higher rating before the rating is finalized. Under FAR 42.1503(d), contracting officers must provide contractors with up to 14 days to review a proposed rating. During this time, a contractor can submit additional information demonstrating entitlement to a higher rating.

Second, once a rating becomes final, a contractor can file a claim under the Contract Disputes Act (CDA). In this context, a CDA claim essentially just means a written demand to the contracting officer demonstrating why the contractor is entitled to a better ranking. In addition, the claim should also demand any applicable monetary damages. If the contracting officer denies the claim, the contractor can then seek review before the United States Court of Federal Claims or the applicable Board of Contract Appeals. In general, the court and the boards will review the rating to determine whether it is arbitrary, capricious, an abuse of discretion, or contrary to law.

Conclusion

Bad past-performance ratings can mean the difference between winning and losing contracts. Therefore, contractors should always consider enforcing their right to fair and well-documented ratings. For further information, please contact Christian Robertson. 

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.