Fundamental Legal Principles Affecting Government Contracting

1. Fundamental Legal Principles Affecting Government Contracting Sean Hannaway Chief, Airborne/Space Warning and Sensors Division Office of the Staff Judge Advocate Electronic Systems Center Hanscom AFB

2. What this session is not about • The Federal Acquisition Regulation (FAR) • Contract Law • Procedures

3. Not the road – the terrain

4. Format • Discuss legal principle or area of law • Explore how these legal principles are reflected in government procurement • Focus on the Why?

5. Sovereign Immunity

6. Rex non potestpecarre! The King can do no wrong!

7. What is it? • The doctrine from English common law that no governmental body can be sued unless it gives permission • Permission is typically in the form of a statutory waiver of immunity • “Men must turn square corners when they deal with the government.” • Oliver W. Holmes, Rock Island, Ark. & La. R.R. v. United States (1920)

8. Primary Statutory Waivers in Government Contracts • Tucker Act – 1887 - 28 U.S.C. § 1491 • Jurisdiction for the Court of Claims • Monetary Claims • An express or implied-in-fact contract • Contract Disputes Act (CDA) of 1978, 41 U.S.C. §§ 601-613 • Help induce resolution of more disputes by negotiation prior to litigation; • Equalize the bargaining power of the parties when a dispute exists; • Provide alternate forums suitable to handle the different types of disputes; and • Insure fair and equitable treatment to contractors and Government agencies.

10. How are sovereign immunity principles reflected in government contracting? • Disputes • Process • Recovery • Authority • Power to terminate • Nearly everything!

11. Separation of Powers

12. Key Provisions and Principles • The United States Government has inherent power to contract • United States v. Maurice (1823) • This power is shared between the Executive and Legislative Branches • Constitution Article I • Section 8 • The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States • To raise and support armies, • To provide and maintain a navy; • Section 9 No money shall be drawn from the treasury, but in consequence of appropriations made by law; • Obligations enforced through Anti-Deficiency Act 31 USC §1341(a) • Constitution Article II • Section 1 The executive power shall be vested in a President of the United States of America • Section 2. The President shall be commander in chief of the Army and Navy of the United States, and of the militia of the several states, when called into the actual service of the United States;

14. Authority Limitation

15. How is separation of powers reflected in government contracting? • CICA • The bid protest regime • Socio-economic programs • Congressional reporting requirements • New Starts?

16. Due ProcessandAdministrative Law

17. What is it? • Administrative law encompasses laws and legal principles governing the administration and regulation of government agencies • Rulemaking • Adjudication (decision making) • Enforcement/execution • Explosive growth in the late 20th Century • Administrative Procedures Act (1946) • 5 USC §500 et seq.

18. What’s the focus? • Public participation and information • The decision making process • The record, the record, the record • Judicial Review • "arbitrary and capricious, an abuse of discretion, or otherwise not in accordance with the law.“ • 5 USC §706

19. How administrative law principles reflected in government contracting? • The FAR System! • Judicial involvement in bid protests • Documentation requirements (e.g.) • D & F’s • Contract Award decisions • Termination and Claims decisions • The CO’s “independent” role

20. So what? • If you know why you do something you know whether you should • If you know why you do something you will know how to do it best • Pay attention to the terrain!

21. Questions?