Want Your Profit? Prove a Constructive Change, Not a Suspension of Work.

What’s the difference between a suspension of work and a constructive change? For federal contractors, there are two important differences:

  1. If you want profit, prove a constructive change.
  2. If any other contract clause affords an equitable adjustment (e.g., Changes Clause), the Suspension of Work clause won’t help you.

To recover from a suspension of work, a contractor must show:

  1. Contract performance was delayed;
  2. Government directly caused the delay;
  3. The delay was for an unreasonable period of time; and
  4. The contractor suffered damages therefrom (excluding profit); and
  5. No other clause provides an equitable adjustment to the Contractor

FAR § 52.242-14

To prove a constructive change, a contractor must show:

  1. Any written or oral order from the Contracting Officer;
  2. Not a directed change;
  3. That caused a change;
  4. Contractor gave timely notice that it considered the order as a change; and
  5. The contractor suffered damages therefrom.

FAR § 52.243-4(b)

In a recent Civilian Board of Contract Appeals decision, the Board agreed with the contractor in finding an unreasonable delay (179 days) and awarded damages for a suspension of the work.  In the same decision, the Board also found a constructive change in the contractor’s favor.  The Board did not discuss why the suspension of work clause prevailed when the contractor may have been able to show a constructive change (unless, perhaps, notice of a constructive change was inadequate).

BCPeabody Construction Services, Inc. v. Dept. of Veterans Affairs, CBCA No. 5410, March 26, 2018

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