Our client was awarded a commercial item contract to build a caisson for the U.S. Navy. During contract performance, the client discovered that the plans and specifications issued by the Navy contained numerous defects. These defects caused the client to incur significant additional costs. The Navy argued that the plans and specifications were of a performance type and thus obligated the client to provide a fully functional and complete caisson, which effectively excused the defects in the plans and specifications.
We prepared and filed a claim on behalf of the client. When the Navy failed to timely issue a final decision, we appealed that failure to the Armed Services Board of Contract Appeals as a deemed denial of the claim. We then exchanged documents during discovery and entered into informal negotiations with Navy trial counsel in an effort to resolve the claims. Those informal negotiations were successful and the contracting officer agreed to settle the appeals by paying our client in excess of $1 million. However, the Navy did not have ready access to the funds to fund the settlement. Accordingly, we convinced the Navy to enter into a joint motion to sustain the appeals so that the settlement could be paid using the Judgment Fund.