ASBCA Addresses Contractor's Burden in Submitting "or Equal" Product

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In Carothers Construction, Inc.,1 the Armed Services Board of Contract Appeals discussed the contractor's burden in submitting an "or equal" product. The contract incorporated FAR 52.336-5, Material and Workmanship, which provided in part that:

The Contractor may, at its option, use any [sic] equipment, material, article, or process that, in the judgment of the Contracting Officer, is equal to that named in the specifications, unless otherwise specifically provided in this contract. (emphasis in original)

The contractor sought to substitute a type of acoustical deck roof product that was different from that called out in the solicitation structural drawings. The Government rejected the substitution request, and the contractor ultimately provided the specified decking and sought the increased costs of supplying such material. The Government took the position that it was entitled to strict compliance with the specified its specifications.

The Board held that the contractor was required to (1) establish the specifications are proprietary, (2) submit a substitute product along with sufficient information for the contracting officer to make an evaluation of the substitute, and (3) ensure the proposed substitute meets the standard of quality represented by the specifications.

Carothers established the specification was proprietary and then was required to show that the Government's refusal to consider the equivalency of the proposed deck was "an unreasonable exercise of judgment." In order to do so, Carothers bore the burden of providing that the substitute was equal in quality and performance to the specified item.

In this case, the Board held that Carothers did this, noting that there was no serious consideration on the part of the Government as to equivalency, and that the Government gave no thought to FAR 52.236-5, resting on its right to insist on strict compliance with the specifications.

The Board rejected the Government's strict compliance argument, noting that the general rule of strict compliance with the contract specifications does not apply simultaneously with the Material and Workmanship clause—it is one or the other. Since the solicitation did not provide any warning to Carothers that the Government would not accept substitutions of equivalent decking, strict compliance did not apply.

Because the Government did nothing to rebut Carothers' proof of equivalency, the Government's action was an unreasonable exercise of judgment. Accordingly, Carothers was entitled to compensation for the additional costs associated with its installation of the proprietary specified deck.


FOOTNOTE

1  ASBCA No. 62204 (February 11, 2021).

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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