Mission Impossible? Government Unable to Satisfy Impossibility Element of Sovereign Acts Defense

The contractor sought equitable adjustment for 14 days it was required to quarantine for COVID-19. The government argued it was not liable under the sovereign acts doctrine. ASBCA found that the government was liable because it failed to establish the impossibility element for the sovereign acts defense.

Appeals of – Chugach Federal Solutions, Inc., ASBCA Nos. 62712, 62713, 62877

• Claim – The contractor was performing operations and maintenance on three military facilities when the government required contractor employees to quarantine for 14 days due to COVID-19. The contractor sought the costs of complying with the quarantine. The government said it was not liable because the quarantine order was a sovereign act defense.
• Sovereign Acts Doctrine – The government bears the burden of establishing the elements of a sovereign acts defense. ASBCA recognized that the sovereign acts doctrine includes an “impossibility” requirement. The government maintained that it did not need to satisfy the common law impossibility test unless the government claimed the sovereign act made performance impossible. The Board disagreed. The law was clear that a successful sovereign acts defense requires a showing that the sovereign act made contract performance impossible. Thus, even though the quarantine was a sovereign act, the government was not shielded from liability because the government had not demonstrated impossibility.

The contractor was represented by Douglas L. Patin, Lee-Ann C. Brown, Lisa A. Markman of Bradley Arant Boult Cummings LLP. The government was represented by Caryl A. Potter, III and Josephine R. Farinellie.

— Case summary by Joshua Lim, Assistant Editor

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