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CDA's Statute of Limitations Subject to Equitable Tolling

The dismissal of a contractor's breach of contract claims was reversed by the Court of Appeals for the District of Columbia Circuit because the Contract Disputes Act's statute of limitations is not jurisdictional and therefore is subject to equitable tolling. The dispute arose from a contract authorized by the Indian Self-Determination and Education Assistance Act (25 USC 450 and following), which permits Indian tribes to enter into self-determination contracts and assume responsibility for federally funded programs or services that a federal agency would otherwise provide to the tribes' members. Self-determination contracts are governed by the CDA, which requires contractors to submit claims relating to a government contract to a contracting officer within six years of accrual (41 USC 605(a)). The contractor claimed the government failed to pay contract support costs between 1995 and 2004, but the contractor did not submit its claims, which the CO denied, until 2005. After the contractor appealed its breach claims in district court, as authorized by the ISDEAA, the government moved for dismissal on claims that had accrued more than six years before the contractor submitted the claims to the CO. The district court declined to equitably toll the filing deadline because "[s]tatutory time limits are jurisdictional in nature, and courts do not have the power to create equitable exceptions to them."

Presumption in Favor

The Court of Appeals, however, concluded the CDA's limitations period is not jurisdictional and consequently subject to equitable tolling in appropriate cases. The court reasoned that filing deadlines are generally not jurisdictional and whether a statutory time limit is jurisdictional is "discerned by looking to the condition's text, context, and relevant historical treatment." Here, the time limit for initiating a claim under the CDA is not stated in jurisdictional terms, and 41 USC 605(a) does not refer in any way to jurisdiction. Likewise, the historical treatment of the type of limitation imposed by Section 605(a) does not suggest that its six-year filing deadline is jurisdictional. As originally enacted, the CDA did not contain any time limit for filing claims, and when the limitation was added by the Federal Acquisition Streamlining Act of 1994 (PL 103-355), Congress did not include any specific statutory language that could be construed to rebut the presumption in favor of equitable tolling. The court also rejected the government's argument that the CDA limitations period is jurisdictional because it facilitates administrative review and promotes judicial efficiency. As the court noted, a limitations period should not "be ranked as jurisdictional merely because it promotes important congressional objectives." Accordingly, the district court erred in dismissing the contractor's claims for lack of subject matter jurisdiction, and the D.C. Circuit remanded the matter to the district court to determine whether equitable tolling was appropriate in this case. (Menominee Indian Tribe of Wisconsin v. U.S., CA-DC, 54 CCF 79,388)




(The news featured above is a selection from the news covered in the Government Contracts Report Letter, which is published weekly and distributed to subscribers of the Government Contracts Reporter. )


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