Government Contracts Monitor
Contractor Time Barred over Untimely Caterpillar Contract Claim
October 22, 2012
The Court of Federal Claims recently dismissed several patently meritorious claims involving the Army’s leasing of Caterpillar construction vehicles in connection with the Iraq war because they were untimely under the relevant statutes of limitation. Uniglobe General Trading & Contracting Co. v. United States, No. 10-204C (Fed. Cl. Sept. 27, 2012).
Under the contract, the Army leased five Caterpillars from the plaintiff, a Kuwaiti contractor, for use in support of Operation Iraqi Freedom. The Army cancelled the contract just one month later following the rapid collapse of the Iraqi government. The contractor picked up all but two of the vehicles, which the Army could not locate. On October 29, 2003, the last of the missing vehicles was returned, but was severely damaged and required major repairs.
The procedural history of the case is long and tortuous, but essentially the contractor filed a claim for damage to the vehicle, the contracting officer issued a final decision awarding about $20k in damages, and the contractor accepted the decision in writing. A few months later the contractor inquired about the status of the payment and was told a “final decision” would be made in thirty days. However, the record contained no evidence of any further communication for the next sixteen months, at the end of which, on November 17, 2007, the Government denied all relief due to the contractor’s failure to respond to multiple communications. Two years later, on November 5, 2009, the contractor submitted another claim for $450k for damage to the vehicle, the extended lease and interest.
The Court held that the November 2009 claim was untimely because it was filed more than six years after the contractors claim accrued in October 2003. The court rejected the contractor’s argument that its claim accrued in November 2007 – when the contractor said became apparent the Government would not pay – because the contractor was not alleging a breach of a settlement agreement. According to the court, the contractor’s claim for an extended lease and damage was known as of October 29, 2003.
Finally, the court held that the appeal of the October 29, 2003 decision was untimely because it was not filed within a year of the contracting officer’s decision. The court noted that even if the one year requirement could be equitably tolled, there was no reason to toll it beyond one year from the final November 17, 2007 decision, and the instant appeal was filed several years after that.
This case is yet another example of the Court’s strict interpretation of the statutes of limitation governing contract claims. It serves as a stark warning for contractors to “turn square corners” with respect to timing issues and a reminder to aggressively pursue all viable claims within the allotted time periods. Click here and here to read our other articles on the Court’s dismissal of untimely claims.
Jeffry Cook is the attorney responsible for the content of this article.