AFARS - PART 5133

Protests, Disputes, and Appeals

(Revised 01 May 2019)

5133.090 Definition. 2

Subpart 5133.1 - Protests 2

5133.102 General. 2

5133.103 Protests to the agency. 3

5133.103-90 Annual agency bid protest report. 3

5133.104 Protests to GAO. 3

5133.170 Briefing requirement for protested acquisitions valued at $1 billion or more. 6

5133.170-90 Procedures. 6

5133.190 Reporting and analysis of bid protests. 7

5133.190-1 Bid protest action report. 7

5133.190-2 Quarterly bid protest analysis report. 7

Subpart 5133.2 - Disputes and Appeals 7

5133.203 Applicability. 7

5133.204 Policy. 8

5133.212 Contracting officer s duties upon appeal. 10

5133.212-90 Appeal procedures. 10

5133.212-91 Notice of an appeal. 11

5133.212-92 Comprehensive report to the Chief Trial Attorney. 11

5133.212-93 Review of appeal. 12

5133.212-94 Receipt of complaint. 13

5133.212-95 Litigation. 13

5133.212-96 Disposition. 14

5133.212-97 Review of ASBCA decisions. 15

5133.212-98 Dispute settlement and judgments, use of the Judgment Fund. 15

5133.213 Obligation to continue performance. 18

5133.215 Contract clauses. 18

Subpart 5133.90 - Grant and Cooperative Agreement Claims, Disputes and Appeals 18

5133.9001 Designation of grant appeal authority. 18

#### 5133.090 Definition.

Alternative dispute resolution (ADR) means any procedure, in lieu of litigation, used to resolve issues in controversy, including but not limited to facilitation, conciliation, mediation, early neutral evaluation, non-binding arbitration, minitrial, fact-finding, ombudsman process, or any combination thereof.

### Subpart 5133.1 - Protests

#### 5133.102 General.

(a)(1) See 5104.802(f) for the requirement to use the Protest and Claims Tracking tool.

(2) Contracting officers and their legal counsel are encouraged to use the Government Accountability Office s (GAO s) flexible alternative procedures, including alternative dispute resolution, when appropriate in defending a GAO protest.

(b)(i) The Assistant Secretary of the Army (Acquisition, Logistics and Technology) may make agency head determinations regarding actions described in FAR 33.102(b)(1) through (b)(3). See Appendix GG for further delegation.

(ii) Actions taken must be consistent with 10 U.S.C. 2305(f), 31 U.S.C. 3554, and FAR part 33.

(iii) For award of costs, contracting officers must attempt to reach an agreement on the amounts the Government will pay to a protester or an interested party. If the contracting officer and the protester or interested party do not reach agreement, persons exercising authority as cited in paragraph (b)(i) of this section may make the agency determination on the amount the Government will pay, at the request of the protester or an interested party.

(iv) Officials must consult legal counsel in exercising this authority.

#### 5133.103 Protests to the agency.

(d)(3) As soon as practicable, the contracting officer must consult with the legal office concerning the protest. Refer protests received at a level higher than the contracting office to the contracting office for resolution. Concurrent with this referral, the office that initially received the protest must inform the protester, identifying the contracting office that will handle the protest and giving the point of contact within that office.

(4) Handle requests for independent review of a protest at a level above the contracting officer as follows:

(i) For contracting officers under the jurisdiction of the Army Materiel Command (AMC), in accordance with AMC established procedures.

(ii) For contracting officers under the jurisdiction of the United States Army Corps of Engineers (USACE), in accordance with the USACE established procedures.

(iii) For contracting officers in all other contracting activities, in accordance with activity established procedures. If contracting personnel will conduct the independent review, the HCA will appoint a review authority. See Appendix GG for further delegation. The HCA or delegated designee, may also appoint individuals assigned outside contracting channels as a review authority (e.g., attorneys, chief of staff, installation commanders).

#### 5133.103-90 Annual agency bid protest report.

HCAs must prepare an annual report of agency bid protests and send it to the addressee in AFARS 5101.290(b)(2)(ii)(B) not later than 30 calendar days following the end of the fiscal year. The analysis must include -

(a) The number of protests received during the reporting period, to include their disposition;

(b) An assessment of the causes of the most frequently recurring issues, including a description of all corrective actions taken to include the award of protest costs;

(c) The distribution of protests by subordinate contracting offices; and

(d) Any additional information considered necessary to a full understanding of the efficiency and effectiveness of the activity s agency protest procedures.

#### 5133.104 Protests to GAO.

(a) General procedure. The contracting officer must take the action required of the agency in FAR 33.104.

(3)(i)(1) Contracting offices must use the following reporting procedures; the SCO may require the contracting offices to send the report through the SCO s office:

(i) Contracting offices reporting to AMC must send the report directly to the addressee in 5101.290(b)(7).

(ii) Contracting offices reporting directly to the USACE must send the report directly to the following address:

U.S. Army Corps of Engineers

Attn: CECC-C

441 G St., N.W.

Washington, DC 20314-1000.

(iii) All other Army contracting offices must send the report via courier or express mail service to:

U.S. Legal Services Agency, ATTN: JALS-KFLD

Contract and Fiscal Law Division

9275 Gunston Road, Suite 2100

Fort Belvoir, VA 22060-5546.

(iv) The contracting officer must send the report not later than 20 days after the Government Accountability Office (GAO) notifies the agency by telephone that a protest has been filed. If the GAO decides to use the express option and the contracting officer concludes that the report cannot be furnished in time, he/she must notify the appropriate office in (i)-(iii) at once so that it may request an extension from GAO.

(2) Before forwarding the report to the GAO Comptroller General, the addressees in paragraphs (a)(3)(i)(1)(i)-(iii) of this section must review the report and recommend any changes required to ensure that the report is accurate, complete, and legally sufficient.

(b) Protests before award. See Appendix GG.

(1)(A) The contracting officer must prepare a determination and findings (D&F) for HCA concurrence when it is necessary to request authorization to award a contract notwithstanding a protest. The D&F must clearly address -

(1) Whether significant adverse consequences will necessarily occur if the stay is not overridden;

(2) Whether reasonable alternatives to the override exist that would adequately address the circumstances presented;

(3) How the potential costs of proceeding with the override, including the costs associated with the potential that GAO might sustain the protest, compare to the benefits associated with the approach being considered for addressing the agency s needs; and

(4) The impact of the override on competition and the integrity of the procurement system.

(B) The contracting officer must have approval from the Deputy Assistant Secretary of the Army (Procurement) (DASA(P)) prior to any award or selection, except for contracting offices reporting to AMC, where the Command Counsel provides approval. The contracting officer must also prepare a request for approval that identifies all protest issues and addresses the merits and expected resolution of the protest. Include details of any congressional interest in the protest. After legal review, forward the request with the D&F in accordance with agency procedures to the HCA. (See Override of Competition in Contracting Act (CICA) Stays: A Guidebook, which is available via the Internet at https://www.jagcnet.army.mil/Sites%5C%5Ccontractandfiscallaw.nsf/0/9DE4D2C744ABFC3F85257B42004536AC/$File/CICA%20Override%20Guidebook%20_June%2008_.pdf

(C) Within three days after the contracting office receives notification of the protest, the HCA may endorse the request for approval and electronically transmit the request and the D&F to the appropriate office in paragraphs (a)(3)(i)(1)(i)-(iii) of this section. That office shall immediately distribute the request and the D&F to the addressee in 5101.290(b)(1).

(c) Protests after award. See Appendix GG.

(2) Process the finding as required at paragraph (b) of this section. The D&F must clearly address the areas identified in paragraph (b)(1)(A). The DASA(P) must approve the D&F before the contracting officer authorizes continuing performance, except for contracting offices reporting to AMC, where the Command Counsel provides the approval. Process the request for approval as required in paragraph (b).

(g) Notice to GAO. The head of the contracting activity shall report to GAO as described at FAR 33.104(g). See Appendix GG for further delegation. Send the report to the addressee in 5101.290(b)(1) not later than 45 days after receipt of the recommendations.

#### 5133.170 Briefing requirement for protested acquisitions valued at $1 billion or more.

#### 5133.170-90 Procedures.

(a) Within 10 days of receipt of a protest, provide an initial, written notification of the protest via email to the Office of the DASA(P) and furnish a copy to the SCO, field attorney and trial attorney. The initial notification shall be in the form of a briefing and shall include the following items:

(1) Buying activity and contracting officer with phone number and email address.

(2) Protester and counsel.

(3) Protest number and date filed.

(4) Protest forum (GAO or Court of Federal Claims).

(5) Description of the protested acquisition, estimated dollar value and whether it is a pre- or post-award protest.

(6) Summary of protest allegations.

(7) Status of the stay or stop work order.

(8) Anticipated date of protest resolution.

(9) Any other information deemed appropriate.

(10) Attach a copy of the protest.

(b) After the contracting officer formulates the agency response, he/she may provide more detailed information relating to the position that the agency will take before filing the agency report in the protest action.

(c) If required, the contracting officer shall schedule a formal briefing on the protest with the DASA(P) or Defense Procurement and Acquisition Policy subsequent to the submission of the follow-up information.

#### 5133.190 Reporting and analysis of bid protests.

#### 5133.190-1 Bid protest action report.

Within 15 calendar days following notification of resolution of a GAO protest, the contracting officer must send a bid protest action report in the format in 5153.303-6 (double spaced between item numbers) to the following addressees:

(a) AMC contracting activities send the report to the addressee in 5101.290(b)(7).

(b) USACE contracting activities send the report to

U.S. Army Corps of Engineers

Attn: CECC-C

441 G St., N.W.

Washington, DC 20314-1000.

(c) All other contracting activities send the report to the addressee in 5133.104(a)(3)(i)(1)(iii).

#### 5133.190-2 Quarterly bid protest analysis report.

(a) AMC, USACE and the Contract and Fiscal Law Division, U.S. Army Legal Services Agency must prepare a quarterly bid protest analysis report for GAO protests in the format in 5153.303-7 (double space between item numbers) and send it with the bid protest action reports to the addressee in 5101.290(b)(2)(ii)(B) not later than 30 calendar days following the end of the quarter. The analysis will include the number of protests in which a flexible alternative procedure was used, in accordance with 4 C.F.R. 21.10, and will also include an assessment of the causes of the most frequently recurring issues and recommendations for appropriate corrective action. Reconcile the numbers submitted with the most current data available from the GAO.

(b) The DASA(P) will prepare a consolidated quarterly report not later than 45 calendar days following the end of each quarter.

### Subpart 5133.2 - Disputes and Appeals

#### 5133.203 Applicability.

(b)(2) The Assistant Secretary of the Army (Acquisition, Logistics and Technology) shall determine the application at FAR 33.203. See Appendix GG for further delegation.

#### 5133.204 Policy.

(a) As used in this section:

Dispute Resolution Specialist means the official designated by the head of an agency to implement agency ADR policy as prescribed by Section 3(b) of the Administrative Dispute Resolution Act of 1996, 5 U.S.C. 571-584 and Note. The Principal Deputy General Counsel of the Army is designated the Army Dispute Resolution Specialist.

Issue in controversy means a material disagreement between the Army and a contractor that may result in a claim, or is all or part of an existing claim.

(b) Contracting officers and their legal counsel, assisted by other members of the Acquisition Team as necessary, are encouraged to use alternative dispute resolution (ADR) techniques to resolve pre-appeal disputes (e.g., claims, unresolved requests for equitable adjustment, and other issues in controversy) to the maximum extent practicable and appropriate. For any dispute in which unassisted negotiations have reached impasse or in which the contracting officer has received a request for ADR, the contracting officer shall review the dispute to determine whether ADR is appropriate for resolving it, applying the reasons listed in paragraph (c) of this section. If the contracting officer finds ADR to be appropriate, the contracting officer should offer or agree to ADR. Participation in ADR does not obligate any party to settle or accept a proposal for settlement. This section does not create any right to ADR for any contractor or prospective contractor, and a decision by the contracting officer finding ADR to be inappropriate is not subject to appeal.

(c) The use of ADR to resolve an issue in controversy is generally authorized if the parties agree. However, the contracting officer or other authorized official may decide that ADR is inappropriate to resolve the issue for any of the following reasons:

(1) A definitive or authoritative resolution of the matter is required for precedential value, and an ADR proceeding is not likely to be accepted generally as an authoritative precedent.

(2) The matter involves or may bear upon significant questions of Government policy that require additional procedures before a final resolution may be made, and an ADR proceeding would not likely serve to develop a recommended policy for the Army.

(3) Maintaining established policies is of special importance, so that variations among individual decisions are not increased, and an ADR proceeding would not likely reach consistent results among individual decisions.

(4) The matter significantly affects persons or organizations who are not parties to the ADR proceeding.

(5) A full public record of the proceeding is important, and an ADR proceeding cannot provide such a record.

(6) The Army must maintain continuing jurisdiction over the matter with authority to alter the disposition of the matter in the light of changed circumstances, and a dispute resolution proceeding would interfere with the Army s fulfillment of that requirement.

(7) The issue is amenable to a disposition that will fully resolve the matter quickly and with a high probability of finality, including procedures under Rules 11 and 12 of the Rules of the Armed Services Board of Contract Appeals (ASBCA).

(8) The anticipated transaction costs of ADR in money and time materially exceed the anticipated transaction costs of litigation.

(9) The dispute involves one or more credible allegations or indications of fraud, gross mismanagement, abuse of official authority, or violation of federal or state criminal laws.

(10) Any other specific reason why the contracting officer determines ADR is inappropriate. Sole reliance on this provision to find ADR inappropriate must be approved by the cognizant senior contracting official (SCO), or higher authority. Forward a copy of any decision based on this provision, with supporting rationale, to the Army Dispute Resolution Specialist at usarmy.pentagon.hqda-ogc.mbx.adr@mail.mil. Include the name, telephone number and email address of the point of contact for the decision.

(d) The contracting officer, legal advisor, attorney of record, or other official responsible for procurement ADR matters within the cognizant interested organization(s) may contact the Army ADR Program Office in the Office of the Army General Counsel (SAGC-ADR) for advice and guidance on ADR processes, strategies, and other informal dispute resolution matters. Send correspondence to:

Department of the Army General Counsel

ADR Program Office (SAGC-ADR)

104 Army Pentagon

Washington DC 20310-0104;

by fax to 703-614-8073; or by email to: usarmy.pentagon.hqda-ogc.mbx.adr@mail.mil. Ensure appropriate coordination through command channels before contacting SAGC-ADR directly for assistance under this section. USACE contracting activities may also contact

U.S. Army Corps of Engineers

Attn: CECC-C Alternative Dispute Resolution Specialist

441 G St., N.W.

Washington, DC 20314-1000,

for dispute resolution guidance.

(e) Appeals filed with the ASBCA are eligible for ADR consideration, consistent with the Chief Trial Attorney s authority over litigation of all ASBCA matters. Apply the reasons in paragraph (c) of this section when considering whether to participate in ADR. All decisions whether to participate in ADR for any issue in controversy are within the Chief Trial Attorney s discretion, and are not subject to appeal.

#### 5133.212 Contracting officer s duties upon appeal.

#### 5133.212-90 Appeal procedures.

(a) For purposes of this section and DFARS Appendix A, the Army Chief Trial Attorney or the Engineer Chief Trial Attorney performs the duties and responsibilities of the Chief Trial Attorney as follows:

(1) In accordance with Army Regulation (AR) 27-1, the Army Chief Trial Attorney is the authorized representative of the Secretary of the Army with sole authority and responsibility for the conduct and control of litigation of contract disputes for all Department of the Army cases docketed with the ASBCA, except for United States Army Corps of Engineers cases described in (2) and (3). The Judge Advocate General appoints the Army Chief Trial Attorney.

(2) The Engineer Chief Trial Attorney is the authorized representative of the Secretary of the Army and has sole authority and responsibility for the conduct and control of litigation of contract disputes for all Corps of Engineers cases docketed with the ASBCA of a value of less than $3 million. The Chief Counsel, Corps of Engineers appoints the Engineer Chief Trial Attorney.

(3) The Director, Civil Law and Litigation, U.S. Army Legal Services Agency may determine, on a case-by-case basis, to delegate Corps of Engineer cases of a value of $3 million or more to the Engineer Chief Trial Attorney.

(b) All contract disputes addressed in this section remain subject to the litigation oversight authority and responsibility of the General Counsel of the Department of the Army.

#### 5133.212-91 Notice of an appeal.

Contracting officers must perform the following actions concurrently:

(a) Send any notice of appeal received directly, including the envelope showing the postmark directly to:

Chairman, ASBCA

5109 Leesburg Pike

Skyline 6, Room 703

Falls Church, VA 22041-3208.

(b) When the Defense Contract Management Agency staff has participated in contract award and/or administration, send to the Defense Contract Management Agency office involved a notice of the appeal with direction to preserve all documents pertaining to the contract.

#### 5133.212-92 Comprehensive report to the Chief Trial Attorney.

(a) Concurrent with forwarding the appeal file to the ASBCA, the contracting officer must send the following documents to the addressee in 5133.104(a)(3)(i)(1)(ii) or (iii) as applicable with a copy to the reviewing official designated in accordance with 5133.212-93:

(1) A copy of the appeal file.

(2) A trial attorney s litigation file, except the report in paragraph 5-2e(4) of AR 335-15. The contracting officer shall not provide this report to the ASBCA or the contractor. The litigation file shall include the information listed in paragraphs (2)(i) through (iv) of this section.

(i) The names, current addresses and telephone numbers of all potential witnesses (including the contractor s) who have information concerning the facts in dispute.

(ii) A signed statement of each Government witness itemizing personal knowledge of the facts to which the witness will testify under oath at hearing, or a summary if it is impossible to obtain a signed statement. Include the following:

(A) Background and circumstances surrounding the generation of pertinent documents.

(B) Explanation, basis and/or rationale of those portions of the available documents which will require clarification at the hearing.

(C) List of any facts and events not shown by available documents.

(D) Identification of any other persons who have personal knowledge of pertinent facts.

(E) A statement regarding the expected availability of the witness for the hearing.

(iii) An analysis for the Chief Trial Attorney discussing the contractor s individual allegations and overall position with an opinion of the validity of each, and an appraisal of the strengths and weaknesses apparent in both parties positions.

(iv) A memorandum by the legal advisor or the official making the decision, with input from legal counsel, setting forth an analysis of the legal issues involved in the dispute, including comments about the adequacy of the findings of fact and the legal sufficiency of the decision.

(b) The contracting officer must send a copy of all correspondence, and other data pertinent to the dispute, to the Chief Trial Attorney. This includes all documents received after submitting the trial attorney s litigation. The contracting officer shall forward copies to the reviewing official.

(c) The Chief Trial Attorney may, upon discovery of new facts or circumstances, have the reviewing official reconsider the matter.

#### 5133.212-93 Review of appeal.

(a) The head of the contracting activity (HCA) shall -

(1) Furnish technical and legal assistance to the contracting officer as required; and

(2) Establish procedures to ensure that review of all appeals filed under the disputes clause occur at a level higher than the contracting officer.

(b) The HCA designated reviewing official shall -

(1) Ensure that the findings cover all issues in dispute and are consistent with the decision from the appeal;

(2) Ensure that the contracting officer s comprehensive report to the Chief Trial Attorney, including the evidence submitted in support of the contracting officer s decision, is complete;

(3) Within 10 calendar days after receiving the contracting officer s comprehensive report, forward to the Chief Trial Attorney -

(i) Evaluations, conclusions and recommendations;

(ii) Any additional evidence considered essential to enable the Chief Trial Attorney to protect the interests of the Government before the ASBCA; and

(iii) If the reviewing official decides that the available evidence does not sufficiently support contracting officer s decision, or that the decision is erroneous, an estimated date by which the contracting office will either furnish additional support or withdraw the decision; and

(4) Assist the Chief Trial Attorney in obtaining additional evidence or in making other necessary preparations for presenting the Government s position before the ASBCA.

#### 5133.212-94 Receipt of complaint.

(a) See DFARS Appendix A, Part 2, Preliminary Procedures, Rule 6, paragraph b. If the contracting officer receives the complaint after forwarding the comprehensive report to the Chief Trial Attorney, he/she must, within 15 calendar days after receipt of the complaint, send directly to the Chief Trial Attorney supplementary information regarding any issues raised in the complaint that the comprehensive report did not sufficiently cover. Include specific admissions or denials of each allegation of fact contained in the complaint and a statement of any affirmative defenses or counterclaims applicable.

(b) Provide copies of the supplementary information furnished the Chief Trial Attorney to the reviewing official.

#### 5133.212-95 Litigation.

(a) See 5133.212-90(a)(1) regarding the authority and responsibility of the Chief Trial Attorney.

(b) The Chief Trial Attorney will present all Army cases to the ASBCA, using trial attorneys assigned to the office, except the Chief Trial Attorney may authorize local contract attorneys to act as trial attorneys or to assist in the presentation of Army cases if the appeal has particular significance to the contracting activity and that it involves difficult operational issues and technical facts.

(c) Local legal counsel and personnel within the contracting activity assist and support the Office of the Chief Trial Attorney in preparing the case.

(d) The Chief Trial Attorney and the attorneys assigned may communicate directly with any person or organization to secure any witnesses, documents, or information considered necessary in connection with representing the Government in matters before the ASBCA. The Chief Trial Attorney must inform the contracting officer of any actions taken in connection with these matters.

#### 5133.212-96 Disposition.

(a) The authority and responsibility to settle contract disputes docketed with the ASBCA remains with the contracting officer, subject to (b) and the following:

(1) The contracting officer must advise the Chief Trial Attorney of all offers of settlement from a contractor, whether directly from the contractor or through the contractor s attorney.

(2) The contracting officer must consult with the Chief Trial Attorney before accepting a contractor s offer of settlement and before making a settlement offer to the contractor.

(b) The Chief Trial Attorney has all necessary authority to conclude settlement agreements with the concurrence of the contracting officer, the reviewing official, or the Deputy Assistant Secretary of the Army (Procurement). He/she must notify the appropriate Army Command legal office/staff judge advocate of any disagreement regarding the settlement of a case before raising the matter to the Assistant Secretary of the Army (Acquisition, Logistics and Technology).

(1) The Chief Trial Attorney or an individual trial attorney may enter into an agreement on matters for which there is no substantial controversy and which will not have the effect of disposing of an appeal, provided that, in the case of a pre-hearing written stipulation or agreement, the Chief Trial Attorney has granted this authority to the individual trial attorney in advance.

(2) In appropriate cases, such as those where time-consuming delays would occur by returning the appeal to the contracting officer, the Chief Trial Attorney or an individual trial attorney acting with the prior approval of the Chief Trial Attorney may enter into an agreement with an appellant which will have the effect of disposing of an appeal after obtaining concurrence from a representative of the HCA. Such agreement may then become the basis of an ASBCA decision disposing of the appeal.

#### 5133.212-97 Review of ASBCA decisions.

(a) Contracting activity review.

(1) The contracting activity must review ASBCA decisions and, if the HCA thinks that the ASBCA should reconsider a decision or appeal to the U.S. Court of Appeals for the Federal Circuit, the HCA may within 10 calendar days after receipt of the decision, request the Chief Trial Attorney to either -

(i) File a motion for reconsideration, stating the grounds relied upon to sustain the motion; or

(ii) Initiate action seeking an appeal to the U.S. Court of Appeals for the Federal Circuit, stating the basis for such an appeal pursuant to the review standards of section 7107(b) of the Disputes statute (41 U.S.C. chapter 71).

(2) If the Chief Trial Attorney does not concur with a request of the HCA within five calendar days, the Chief Trial Attorney shall forward the request, together with reasons for opposition, through the Judge Advocate General to the addressee in 5101.290(b)(1) for the decision in coordination with the General Counsel of the Army. If the Deputy Assistant Secretary of the Army (Procurement) determines that the Government will not make a motion for reconsideration or that the Government will not take an appeal to the U.S. Court of Appeals for the Federal Circuit, the Chief Trial Attorney may certify this fact to the ASBCA.

(3) When it appears that an adverse decision of the ASBCA has resulted from flaws in the regulations that implement DoD policy rather than an error by the ASBCA, recommendations for changes to acquisition regulations should be developed following the format in DFARS 201.201-1(d)(i) and submitted to the addressee in 5101.290(b)(2)(ii)(B).

(b) Chief Trial Attorney review. The Chief Trial Attorney independently reviews all ASBCA decisions involving Army contracts to determine whether the ASBCA should reconsider any decision or if the Army should appeal a decision to the U.S. Court of Appeals for the Federal Circuit.

#### 5133.212-98 Dispute settlement and judgments, use of the Judgment Fund.

(a) Judgment Fund.

(1) The Disputes statute provides for the use of the Judgment Fund ( the Fund ) (31 U.S.C. 1304) to pay for adverse judgments against the Government. Under certain circumstances, the Army can convert settlement agreements in Disputes statute cases before the ASBCA into consent judgments to access the Judgment Fund to pay for settlements. In Disputes statute cases before federal courts where Department of Justice represents the Army, the Department of Justice may use its independent authority to use the Judgment Fund for settlements. Contracting officers should consult with their legal counsel and their local resource management office prior to taking any actions related to the use of the Judgment Fund. Only authorized officials of a federal agency may submit a request for payment from the Judgment Fund. Requests submitted by anyone other than an authorized federal official are deemed fraudulent. Filing a false or fraudulent claim constitutes a Federal offense that is punishable by fines, imprisonment, or both. (See 31 U.S.C. 3729 and 18 U.S.C. 287.) The authorized official for Army is the Assistant Secretary of the Army (Financial Management and Comptroller). Army contracting activities shall follow the policy set forth in this section of the AFARS.

(2) The Army must reimburse the Judgment Fund with funds current as of the date of the judgment. According to the Department of Defense Financial Management Regulation, (DoD FMR), Volume 3, Chapter. 8, paragraph 080304F.5, approval authority is required from the cognizant Assistant Secretary of the Military Department (Financial Management and Comptroller) or Defense Agency Comptroller for all Judgment Fund Reimbursements to the Department of the Treasury in excess of $1,000,000.

(b) Fiscal considerations in settlements. If funds appropriate to pay a settlement are expired but the account remains open, contracting officers must use expired funds to pay the settlement. If the account remains open but no expired funds remain, contracting officers must use the Judgment Fund to access current funds to pay the settlement. Access to the Fund requires a consent judgment from the Board or use of the Department of Justice s independent authority to use the Fund. The contracting officer may use current funds to pay the settlement if appropriate accounts are canceled or closed.

(c) Settlement procedures.

(1) The Office of the Assistant Secretary of the Army (Financial Management and Comptroller) (ASA(FM&C)), tracks available expired funds within the Service.

(2) The Army shall use the following procedures for settlements:

(i) In situations where contract funds have expired but the accounts have not closed, the Army shall fund settlements with expired funds if available. Contracting officers will ascertain the availability of appropriate expired funds through their resource management office.

(ii) If the resource management office determines that no expired funds exist within the Army to fund the settlement and the accounts are not closed, the contracting officer must access the Judgment Fund through a consent judgment in order to use current year funds to pay the settlement (i.e., reimburse the Fund).

(iii) If no expired funds exist but the account remains open, use the following procedure. If current year funds are available to reimburse the Fund, then the contracting officer may enter into a consent decree and allow the Fund to pay the judgment. If there is not sufficient current funding to reimburse the Fund, the contracting officer must receive authorization from the ASA(FM&C) prior to entering into a consent decree.

(iv) If the accounts are closed, use the following procedure. If the contracting officer has sufficient funds to pay the settlement, he/she will not use the Fund, and pay the settlement with Agency funds. If sufficient current funds are not available, ASA(FM&C) will provide approval to access the Fund prior to the contracting officer entering into a consent judgment.

(v) When use of the Judgment Fund is authorized, the contracting officer shall work with the resource management office to ensure execution of the appropriate Certificate of Finality and Financial Management Service forms (FMS Forms 195, 196, 197A and 198 (if appropriate)) and submit the payment request to the FMS. The reimbursement contact on FMS Form 196 shall be the ASA(FM&C).

(d) Judgments. Use the following procedures to pay judgments using the Judgment Fund.

(1) The contracting officer shall ascertain the availability of current funds through financial management channels. If current funds are available, the contracting officer will not use the Fund, and will pay the judgment with Agency funds.

(2) If current funds are not available, the contracting officer will pay the judgment using the Fund after proper coordination and authorization from the ASA(FM&C).

(e) Settlement agreements. All settlements converted to consent judgments and funded by the Judgment Fund shall be in writing and contain appropriate release language. The contracting officer, local attorney and trial attorney shall insure that all settlement amounts are fair and reasonable.

(f) Expeditious handling. To expedite handling of settlements, inquiries and approvals that these procedures require may be oral so long as the contracting officer documents them in a memorandum for record.

#### 5133.213 Obligation to continue performance.

(a) The HCA must approve the determination to use the alternate paragraph in the clause at FAR 52.233-1. See Appendix GG for further delegation.

#### 5133.215 Contract clauses.

(3) The head of the contracting activity shall make the determination at DFARS 233.215(3). See Appendix GG for further delegation.

### Subpart 5133.90 - Grant and Cooperative Agreement Claims, Disputes and Appeals

#### 5133.9001 Designation of grant appeal authority.

(a) Procedures governing grants and cooperative agreements are set forth in Department of Defense Directive 3210.06, Defense Grant and Agreement Regulatory System (DGARS) and the Code of Federal Regulation (CFR) provisions cited in that directive.

(b) 32 CFR section 22.815(e)(1) requires the designation of grant appeal authorities to decide formal administrative appeals brought under 32 CFR section 22.815(e).

(c) The head of the contracting activity (HCA) that awarded the grant or cooperative agreement shall serve as the grant appeal authority, provided that the individual is a general officer or member of the Senior Executive Service. The grant appeal authority may utilize a board in accordance with 32 CFR section 22.815(e)(1). (d) The HCA may not delegate grant appeal authority. In the event that the HCA is not a general officer or member of the Senior Executive Service, the Deputy Assistant Secretary of the Army (Procurement) shall designate a qualified individual as the grant appeal authority on a case-by-case basis.

(d) The grant appeal authority shall utilize the procedures specified in 32 CFR sections 22.815(e) and (f).