ADR Acquisition
Acquisition ADR

The Army embraces the overarching Government policy of trying to resolve all contractual issues in controversy by mutual agreement at the contracting officer’s level. Reasonable efforts should be made to resolve controversies prior to the submission of a claim, and agencies are encouraged to use Alternative Dispute Resolution (ADR) procedures to the maximum extent practicable.(FAR 33.204)

ADR is a powerful tool that helps Army contracting personnel and their advisors to resolve issues at any stage of the acquisition process, at any time that the contracting officer has authority to resolve the issue. (FAR 33.214) ADR allows the parties to create early, efficient, merits-based resolutions to difficult contract issues in controversy. ADR may be used to resolve all, or part of the issues in controversy. The best reasons to use ADR are 1) the parties maintain control over the process, 2) it increases the parties control over the results, 3) it reduces the transaction costs of resolution, and 4) it works. As a result, Army policy requires Army personnel involved in disputes to consider ADR in each acquisition issue in controversy. The goal is to resolve disputes at the earliest stage feasible, by the fastest and least expensive method possible, and at the lowest possible organizational level. While ADR can be applied in most cases, certain factors might make ADR inappropriate. The ADR Program Office can work with Army personnel to ensure ADR is appropriate, and to help choose an ADR procedure that allows Army contracting officers to collect “decision quality information” more efficiently, empowering them to resolve disputes in months rather than the years it frequently takes to resolve disputes via litigation. In 2015 the Army revised Part 5133 of the Army FAR Supplement (AFARS), Protests, Disputes and Appeals, by adding a new subpart, 5133.204, implementing Army ADR policy in contract claims beginning at the contracting officer’s level. The full text of the new subpart 5133.204 is available at:

Bid Protests

ADR can help the parties identify and resolve issues both before and after a protest is filed at the Government Accountability Office (GAO) or United States Court of Federal Claims (COFC). GAO protests are designed to ensure the inexpensive and expeditious resolution of protests, and all protests are required to be resolved within 100 calendar days of being filed. However, the filing of a GAO protest usually triggers an automatic stay of contract award or performance, and the associated delay occurs at a critical point in the acquisition process that may adversely impact the warfighter. As a result, FAR 33.103 (Protests) states that parties should use “best efforts” to resolve concerns raised by an interested party at the contracting officer level through open and frank discussions. The agency should provide for inexpensive, informal, procedurally simple and expeditious resolution of protests. FAR 33.103 (c) notes that where appropriate, the use of ADR techniques, third party neutrals, and another agency’s personnel are acceptable protest resolution methods. Army Materiel Command has an award winning bid protest ADR Program that results in a decision in a matter of weeks, and has further resulted in the near elimination of appeals of HQ-AMC level protests to the GAO or COFC. If an interested party protests to the GAO, ADR usually takes the form of negotiation assistance or via “outcome prediction.” In outcome prediction ADR, the GAO advises the parties of the likely outcome of the protest. This allows a party that is likely to be unsuccessful to take appropriate action to resolve the protest before a written decision is issued. The ADR Program Office can help contracting officers and their advisors to understand the benefits of ADR in the Protest area.

Contract Administration, Requests for Equitable Adjustment, Claims and Appeals

Litigation is sometimes necessary to support the Army’s mission. However, contract litigation is expensive, time consuming, and interferes with ongoing operations. Appeals to the Armed Services Board of Contract Appeals (ASBCA) or to the COFC take, on average, several years from docket to decision, and this doesn’t count the years that the issues festered in leading up to the Appeal. Each lawsuit uses precious departmental resources that could be used support the Army mission in other ways. Every dollar spent on litigation is a dollar that will not be spent organizing, equipping, and training forces for the conduct of prompt and sustained land combat operations. As a result, Army personnel must consider ADR in each acquisition issue in controversy, claim, and appeal arising out of contract performance. ADR helps the Army and it’s suppliers resolve disputes at the earliest stage feasible, by the fastest and least expensive method possible, and at the lowest possible organizational level. The ADR Program Office can help the Government decision makers choose the best ADR procedure, or “fit the form to the fuss,” resulting in early, efficient, interest-based resolution, based on the merits of the dispute, in months rather than the several years litigation requires. ADR is a proven method for providing Government decision makers with decision quality information, thereby allowing informed decisions, risk analysis, and negotiated resolutions that are in consonance with litigation risk. The Army regularly uses subject matter experts, typically judges from the ASBCA, to assist with contract administration related ADR. The ASBCA makes these judges available at no cost to the parties. There is a wide spectrum of ADR methods available to resolve contract disputes, but the most common methods are Facilitative Mediation (where the neutral facilitates resolution), Evaluative Mediation (where the neutral provides feedback on the strengths, weaknesses and risk in each side’s position), and Summary Trial With Binding Decision (where the neutral decides the matter using a streamlined process). These methods reduce the processing costs for both parties, and result in a resolution nearly 90% of the time. The ADR Program offers acquisition and legal professionals several options for additional training. We provide “ADR Awareness” briefings to components that wish to learn more about ADR in acquisition disputes. We also provide Advanced Mediation and Negotiation and Appropriate Dispute Resolution Training, for more in-depth training on the theory and practice of interest based negotiations. Contact us for additional information or to request training.

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