**The Role of Alternative Dispute Resolution**

**in Resolving Air Force Contract Disputes**

MAJOR PATRICK E. TOLAN, JR., USAF /\*/

**I. INTRODUCTION**

Since the enactment of the Administrative Dispute Resolution Act of
1990, /1/ the Air Force has undertaken a number of initiatives to
incorporate alternative dispute resolution (ADR) techniques into
contracting disputes. Although ADR is still in its infancy, it is
carving out a niche for itself in appropriate cases. This is due to a
sustained emphasis on ADR as an economical alternative to litigation,
coupled with successful resolution of a number of recent Armed Services
Board of Contract Appeals (ASBCA) disputes through ADR. Although much
has been written about why ADR is (or is not) preferable to resolving
disputes through litigation, /2/ this article avoids that battlefield.
Federal law and policy /3/ and Air Force policy /4/ have made the use of
ADR techniques a viable option to resolve Air Force contract disputes.

Donald R. Rice, former Secretary of the Air Force, urged the use of ADR
in appropriate cases to resolve issues in controversy \"at the earliest
stage feasible.\" /5/ Consistent with this direction, the Air Force
General Counsel\'s Office (SAF/GC) has encouraged the use of ADR options
to resolve contract disagreements before they, ripen into formal claims
or appeals. /6/ As ADR becomes a more common phenomenon for resolving
contract disputes, and the application of ADR expands to disputes
arising before a final decision has been rendered by the contracting
officer (CO), base level contract attorneys will become increasingly
involved in ADR issues. The Federal Acquisition Reform Act of 1996 will
further reinforce the likelihood of base level exposure to ADR by
encouraging the use of ADR to resolve bid protests. /7/

The purpose of this article is to provide base level attorneys with
sufficient information to consider and implement ADR solutions in
appropriate cases. This article examines the genesis of the Air Force
ADR program, explains how to successfully pursue ADR, identifies
particular types of cases that would be most suitable for ADR, and
discusses some recent success stories. As a preliminary matter, however,
it is important to define the term \"ADR."

**II. DEFINITION**

Alternative dispute resolution is broadly defined as any method of
resolving a dispute short of adjudication on the merits. /8/ The most
familiar method of ADR is settlement negotiations between the parties.
In the context of Air Force contract disputes, by far the most numerous
settlements occur when the contractor and the CO agree to resolve a
claim amicably, before the CO renders a final decision. It is only when
the CO and the contractor cannot negotiate an acceptable settlement that
a final decision is rendered denying a contractor\'s claim.

It is important to note that the ADR initiatives discussed in this
article are not meant to supplant the CO\'s discretionary authority to
settle disputes with the contractor directly. Two‑party resolution by
those most familiar with the facts of the case prior to litigation
remains the most favored method of resolving disputes. /9/ ADR should be
considered only when this process breaks down. /10/ This article focuses
on ADR options involving a neutral third party. /11/ Because the
introduction of a third party could add additional expense or
inconvenience, ADR goals are not fostered by the use of these techniques
unless traditional attempts to settle the dispute amicably between the
parties were not fruitful. /1*2/*

**III. ADR OPTIONS**

**A. Mediation**

Mediation is a process by which a neutral (mediator) assists the parties
in the negotiation process. /13/ A mediator does not make findings, but
assists the parties in determining their interests and the interests of
the other parties. /14/ The mediator then assists the parties in
determining how to satisfy these interests through a mutually acceptable
resolution of the issue in controversy. /15/

**B. Factfinding**

The fact‑finding process involves \"the investigation of issues
specified by a third‑party neutral who is selected by the parties for
his or her subject matter expertise.\" /16/ The factfinder may be
charged with conducting an independent investigation or with receiving a
presentation of the facts by the parties in a formal or informal
setting. /17/ Factfinding is intended to (1) narrow factual or technical
issues in dispute or (2) provide an evaluation of the likely outcome of
the dispute. /18/ The parties may develop factfinding procedures which
usually result in a written or oral report by the factfinder. /19/

**C. Minitrial**

A minitrial is a structured settlement process in which the parties
agree to a procedure for presenting their case in an abbreviated version
(usually no more than a few hours or days) to senior officials for each
side who have authority to settle the dispute. /20/ The process allows
those in senior positions to see \"how their case and that of the other
party play out, and can serve as a basis for more fruitful
negotiations." /21/ Often a third‑party neutral presides over the
hearing and may subsequently mediate the dispute or help parties
evaluate their case. /22/ The parties develop procedures for a minitrial
that normally results in a written ADR process agreement.

**D. Arbitration**

Arbitration involves the use of a third‑party neutral to hear each
side\'s case and then to render a decision. /23/ The parties can submit
all, or a portion *of* the issues, whether factual, legal, or remedial.
/24/ Because arbitration is less formal than a courtroom proceeding,
\"parties can agree to relax the rules of evidence and use other
time‑saving devices. /25/ The decision of the arbitrator may be binding
or non‑binding, depending upon the agreement *of* the parties. /26/ A
word *of* caution: The Air Force \"may participate in an arbitration
that eventually results in a binding decision by the arbitrator, *but
only if* the Secretary *of* the Air Force is provided an opportunity to
reject the arbitrator\'s decision before it becomes a binding
decision.\" /27/

**E. Settlement Judge**

A settlement judge is an \"administrative judge or hearing examiner who
will not hear or have any formal or informal decision‑making authority
in the appeal and who is appointed for the purpose of facilitating
settlement.\" /28/ Often \"settlement can be fostered by a frank,
in‑depth discussion of the strengths and weaknesses *of* each party\'s
position with the settlement judge.\" /29/ Meetings with the settlement
judge will be flexible to accommodate the requirements *of* the
individual appeal. /30/ The settlement judge may meet with the parties
either jointly or individually to further the settlement effort. /31/ A
settlement judge\'s recommendations are nonbinding.

**F. Summary Trial With Binding Decision**

A summary trial with a binding decision is a \"procedure whereby the
scheduling of the appeal is expedited and the parties try their appeal
informally before an administrative judge or panel of judges.\" /32/ In
some cases, upon the conclusion of the trial, a summary \"bench\"
decision is issued. /33/ In other cases, \"a written decision is issued
no later than ten days following the conclusion of the trial or receipt
of a trial transcript, whichever is later.\" /34/ ASBCA guidance on this
procedure further states:

The parties must agree that all decisions, rulings, and orders by the
Board under this method shall be final, conclusive, not appealable, and
may not be set aside, except for fraud. All such decisions, rulings, and
orders *will* have no precedential value. The length of trial and the
extent to which the scheduling of the appeal is expedited *will* be
tailored to the needs of each particular appeal. Pretrial, trial, and
post‑trial procedures and rules applicable to appeals generally will be
modified or eliminated to expedite resolution of the appeal. /35/

**G. Other Agreed Methods**

The key to ADR is flexibility. The parties and the neutral may agree
upon other informal methods that are structured and tailored to suit the
requirements of the individual case. Because all ADR methods are
consensual and voluntary, the parties must first agree to submit to ADR
and then must define the ADR procedure they desire. Combinations or
permutations of the above methods provide infinite choices to the
parties, subject only to their joint agreement.

**IV. BACKGROUND**

On 15 November 1990, President Bush signed the Administrative Dispute
Resolution Act (the ADRA) /36/ which provides explicit authority for
agencies to resolve controversies through ADR. /37/ It was enacted based
upon Congressional findings that:

\(1\) administrative procedure, as embodied in Chapter 5 of title 5,
United States, and other statutes, is intended to offer a prompt,
expert, and inexpensive means of resolving disputes as an alternative to
litigation in the Federal courts;

\(2\) administrative proceedings have become increasingly formal,
costly, and lengthy resulting in unnecessary expenditures of time and in
a decreased likelihood of achieving consensual resolution of disputes;

\(3\) alternative means of dispute resolution have been used in the
private sector for many years and, in appropriate circumstances, have
yielded decisions that are faster, less expensive, and less contentious;

\(4\) such alternative means can lead to more creative, efficient, and
sensible outcomes;

\(5\) such alternative means may be used advantageously in a wide
variety of administrative programs;

\(6\) explicit authorization of the use of well‑tested dispute
resolution techniques will eliminate ambiguity of agency authority under
existing law;

\(7\) Federal agencies may not only receive the benefit of techniques
that were developed in the private sector, but may also take the lead in
the further development and refinement of such techniques; and

\(8\) the availability of a wide range of dispute resolution procedures,
and an increased understanding of the most effective use of such
procedures, will enhance the operation of the Government and better
serve the public. /38/

The Contract Disputes Act was modified to provide express authority to
agencies to engage in ADR proceedings for resolving contract disputes.
/39/ The Federal Acquisition Regulation (FAR) was similarly modified.
/40/

The ADRA encourages Federal agencies to use ADR and directs the agencies
to develop and adopt a policy that considers ADR techniques, including,
but not limited to, settlement negotiations, conciliation, facilitation,
mediation, factfinding, minitrials, and arbitration. /41/ The scope of
the ADR mandate to develop agency ADR policy included all formal and
informal adjudications, rulemaking, enforcement actions, contract
administration, and litigation brought by or against the agency. /42/
This article deals only with ADR initiatives pertaining to contract
disputes. /43/

The Secretary of Defense delegated authority to the General Counsel of
the Department of Defense (DoD) to designate a senior official to be the
dispute resolution specialist within DoD. /44/ All military departments
were urged to support the ADRA and increase the use of ADR to avoid the
high cost of litigation. /45/ The General Counsel of DoD further
requested that each Military Department General Counsel designate a
dispute resolution specialist. /46/ The Air Force General Counsel
(SAF/GC) designated the Deputy General Counsel as the dispute resolution
specialist. /47/

An April 1996 DoD Directive encourages the expanded use of ADR within
the DoD. /48/ The directive requires each DoD component to establish and
implement ADR policies and programs and to use ADR techniques whenever
appropriate. /49/ Because the Air Force has previously established ADR
policies

and programs, this directive merely supports continued ADR efforts and
is not expected to have monumental impact on the Air Force ADR program.
/50/

**V. AIR FORCE INITIATIVES**

In early 1993, the Secretary of the Air Force issued a memorandum
directing the development of an ADR implementation plan within 180 days.
/51/ The Secretary urged use of ADR procedures in appropriate cases to
resolve all or part of an issue in controversy \"at the earliest stage
feasible, by the fastest and least expensive method possible and at the
lowest organizational level.\" /52/

The implementation plan forwarded by the SAF/GC to the Secretary of the
Air Force on July 1, 1993 required ADR awareness training of Air Force
contracting personnel and contract attorneys. /53/ This training is
designed to increase the understanding and awareness of ADR options and
promote the use of ADR. As of April 1996, more than 3000 contracting
personnel and more than 300 Air Force attorneys have received ADR
awareness training. /54/ Additionally, approximately 350 contracting
personnel and 150 attorneys have received intensive two‑day ADR
training. /55/

In 1994, the Deputy Assistant Secretary of the Air Force for Acquisition
signed a pledge to expand the use of ADR in resolving contract disputes.
/56/ The Alternative Dispute Resolution Pledge states:

We, the undersigned agency officials and the Administrator for Federal

Procurement Policy, recognize that using alternative dispute resolution

(ADR) techniques can considerably reduce the cost and time devoted to

resolving contract disputes. ADR techniques have been used to resolve

disputes in a matter of days that otherwise might have taken years to

resolve, if formally handled by courts or boards of contract appeals.
Moreover, ADR techniques can be used in appropriate circumstances to
make contract administration more efficient and increase the likelihood
that acquisitions will be completed on schedule and on or under budget.

Accordingly, we pledge to:

• review existing contract disputes for appropriate use of ADR
techniques and consider using such techniques in at least one existing
contract dispute;

• consider the use of partnering and similar ADR techniques in at least
one acquisition;

• identify and eliminate impediments to appropriate use of ADR

techniques in contract I administration and resolution of existing

contract disputes;

participate on interagency teams to expand the use of ADR techniques

in government contracting; and

cooperate with each other and the Office of Federal Procurement Policy

to share experiences relevant to expanded use of ADR techniques in

government contracting. /57/

Additionally, the Air Force Directorate of Contract Appeals /58/ more
commonly referred to as the Trial Team agreed to screen all proposed
contracting officer final decisions valued at more than \$50,000 to see
if ADR was appropriate. /59/ Consistent with the guidance from the
Secretary of the Air Force, the screening efforts hoped to identify
suitable cases for ADR before extensive resources had been committed to
litigation and before the parties became entrenched in a litigation
position. A two‑day ADR training program was provided in November of
1993 to all Trial Team attorneys. /60/ The focus of this training was
implementing ADR solutions as an alternative to litigation. /61/ One
objective was training the trial attorneys to determine when ADR
techniques are best suited to assist in resolving contract disputes.
/62/

**VI. IDENTIFYING CASES FOR ADR**

The Trial Team began assessing proposed final decisions for the
appropriateness of ADR in January 1994. As of December 31, 1995, the
Trial Team had reviewed 217 proposed final decisions. /63/ The Trial
Team recommended that ADR be considered in 51 casesm /64/ approximately
25% of the total cases. /65/ While this may not seem to be an
overwhelming percentage, it is important to realize that certain types
of cases, such as terminations for default, are oftentimes unsuitable
for ADR /66/

**VII. FACTORS PRECLUDING ADR**

The first consideration in deciding whether or not ADR is appropriate is
to screen and exclude cases from consideration where one or more factors
make the case unsuitable for resolution by ADR. The ADRA states that an
agency shall consider not using a dispute resolution proceeding if

\(1\) a definitive or authoritative resolution of the matter is required
for precedential value, and such a proceeding is not likely to be
accepted generally as an authoritative precedent;

\(2\) the matter involves or may bear upon significant questions of
Government policy that require additional procedures before a final
resolution may be made, and such a proceeding would not likely serve to
develop a recommended policy for the agency;

\(3\) maintaining established policies is of special importance, so that
variations among individual decisions are not increased and such a
proceeding would not likely reach consistent results among individual
decisions;

\(4\) the matter significantly affects persons or organizations who are
not parties to the proceeding;

\(5\) a full public record of the proceeding is important, and a dispute
resolution proceeding cannot provide such a record; and

\(6\) the agency must maintain continuing jurisdiction over the matter
with authority to alter the disposition of the matter in the light of
changed circumstances, and a dispute resolution proceeding would
interfere with the agency\'s fulfilling that requirement. /67/

Obviously, if the case presents a legal issue of first impression, and a
decision with precedential value is needed, ADR is not appropriate. In
general,

ADR would not be appropriate in an area where the law is unsettled, when
neither the parties nor the neutral would have a stable framework for
assessing the likely outcome of the case. There is a danger in
recommending ADR in such circumstances because, without such a
framework, neither party could have any expectation that the results of
the ADR process would parallel the expected outcome if the case was
litigated.

Arriving at a comparable outcome is critical to the success of ADR. The
paramount concern is in serving the best interests of the Government. It
is doubtful that anyone would seriously argue that saving litigation
expenses through ADR would justify paying more money to resolve a
dispute through ADR than we would expect to pay if fully litigated. If
the outcome of ADR is not comparable to the outcome of litigation, it is
impossible to assess whether or not there really were any savings from
employing the ADR process.

Therefore, where the dispute concerns an unsettled legal issue or where
a precedential decision is needed, ADR is not appropriate regardless of
the expected expense, inconvenience, or duration of the litigation.
Similarly, ADR may not be appropriate when significant policy questions
are involved, when a public record of the proceedings is important, or
when the outcome would significantly affect nonparties. /68/ Any of
these factors, alone or in combination with each other, may be
dispositive in deciding not to use ADR.

Fraud is another factor which weighs heavily against the use of ADR. If
there is evidence that the contractor is unable to support its claim due
to misrepresentation or fraud, the CO is without authority to settle,
compromise, or pay the claim. /69/ Although the decision to use ADR
ordinarily rests with the contracting officer, this authority does not
extend to resolving fraudulent claims. /70/

**VIII. PRACTICAL CONCERNS WEIGHING AGAINST ADR**

When none of the aforementioned factors precluding ADR are present, the
decision to use ADR involves a balancing test. If the costs of ADR (in
time and money) would probably exceed the costs of litigation, ADR is
not recommended. /71/ One example is where the case can be dismissed in
a motion for summary judgment. Where the facts are undisputed and either
party is entitled to judgment as a matter of law, it would most likely
be quicker and less expensive to resolve the issue by summary judgment
than by ADR.

Alternative dispute resolution is not likely to be successful where
there is no bona fide dispute and the other side\'s case is wholly
without merit /72/ (i.e., there is no middle ground). Although
contractors may request ADR in such situations in the hope that the
Government will be convinced to pay something for nothing, the
Government should not enter unto ADR when the Government has nothing to
gain. When there is no basis whatsoever for the contractor to recover,
the contractor would have to be convinced to forfeit its claim
altogether for ADR to be successful. Unless this occurs, ADR would
simply add another layer of prelitigation expense and inconvenience.
This is not to say that when the parties are in dispute over a number of
different issues, and one or more is nonmeritorious, ADR cannot be used
to address and dispose of these issues while resolving the meritorious
claims.

The Air Force should not enter into ADR when we will not get an even
playing field. Alternative Dispute Resolution is not recommended where
there is a need for continuing court or board supervision of the
opposing party. /73/ If the opposing party does not cooperate and the
board or court is constantly compelling it to secure compliance during
discovery, or is forced to sanction it for noncompliance, there is
little hope that it will be cooperative and forthcoming during ADR.
Alternative dispute resolution is less likely to be successful where the
parties are not even willing to cooperate in discovery. When ADR could
give an uncooperative contractor an unfair advantage it should be
avoided. Additionally, ADR should be avoided where there is a question
of contractor dishonesty (versus reluctance or laziness), since the
other side might not be forthright in its ADR presentation. /74/

**IX. FACTORS FAVORING THE USE OF ADR**

As a corollary to the above considerations, certain factors favor the
use of ADR, including: the law concerning the determinative legal issues
in the case is well settled; the dispute is primarily factual; avoiding
an adverse precedent is desirable; or the parties wish to avoid a public
forum. /75/ Several practical considerations also tilt the scales in
favor of ADR.

The first factor is found when the position of each party has merit, but
the value is overstated. /76/ For example, if the contractor has a
meritorious claim, but fails to provide evidence to substantiate the
magnitude of its desired recovery, the Government might be willing to
pay, but is unable to pay because the amount sought exceeds the
perceived damages. In situations where the Government owes the
contractor some money, but the parties can\'t agree on how much, ADR can
help the parties reach a mutually agreeable settlement.

A second important consideration is when limited discovery is needed to
crystallize the facts prior to ADR. /77/ If additional facts could be
found through discovery which would cause a party to reevaluate or
abandon a particular position, this information should be obtained prior
to ADR. This is not to say that ADR cannot be pursued after extensive
discovery (including interrogatories, production of documents, requests
for admission, or even depositions) has taken place. However,, the
payoff from ADR ‑ reducing the time, expense, and inconvenience of
litigation ‑diminishes the closer you get to trial. Of course, where the
factors clearly favor ADR, it may still be advantageous to opt for a
two‑ or three‑day ADR proceeding, versus a two‑ or three‑week trial.

When litigation is expected to be costly and protracted, /78/ ADR should
be seriously considered. In the same vein, if trial preparations are
expected to be costly and protracted, there is a greater incentive to
use ADR to avoid traditional discovery. For example, if you expect to
have to depose fifty witnesses, including some experts, to find out what
the other side is contending and what testimonial evidence they have to
support it, costs to prepare for trial would be extensive. Avoiding
these costs could be a powerful inducement to opt for ADR. Position
papers with supporting affidavits and documentary evidence could be
exchanged with the opposing party (and the neutral) as part of the ADR
process in order to short circuit discovery expense. Obviously, with a
voluntary exchange of positions, the opposition will give us their
strengths, not their weaknesses. This approach would be ideal when we
simply do not understand the other side\'s position. It would not be
appropriate where we think they have weaknesses we have not already
discovered. In this respect, we need to be cautious. The Air Force
should not agree to ADR unless sufficient discovery has been obtained
and we are certain we have a complete understanding of the facts and
will not be blindsided by the opposing party.

Another factor counseling for ADR is when participation of a neutral is
desirable. /79/ A neutral can help break a stalemate. If both parties
see the neutral as fair and credible, the neutral\'s perception of a
compromise position may jolt both parties from their \"all‑or‑nothing\"
view of the case. Often a neutral can help diffuse the hostility or
emotion which has polarized the parties. /80/ Remember, these are
situations where, settlement between the parties has been impossible ‑
typically when traditional settlement negotiations are no longer
bringing the parties closer together or where the parties have stopped
communicating altogether. When the dispute will not likely be resolved
absent intervention by an outside force, ADR is an expedient alternative
to a court or a board.

Alternative dispute resolution is also appropriate when neither side
really wants to litigate. /81/ If both sides want speedy resolution of
the case, ADR is preferable to litigation. Also, when the parties have a
continuing relationship, both parties may want to get the dispute
resolved short of litigation, so as to preserve a good working
relationship. In these cases, settlement may be desirable, but
traditional settlement negotiations may have failed, for example, due to
one or both sides having an unrealistic attitude about the merits of the
case. In these situations, ADR can be valuable by actually forcing the
parties to listen carefully to the position of the other side. A strong
presentation by the opposing, party or indications from the neutral
regarding strengths and weaknesses of the case may encourage a more
realistic outlook. /82/

Finally, ADR is appropriate when there is a middle ground. Nonbinding
ADR is more likely to succeed when both parties consider themselves a
winner. In contrast to a typical termination for default, for example,
when either the default was proper or it wasn\'t, ADR succeeds in cases
where there is room for compromise. The ideal situation occurs when
there are several issues in controversy. While each side may win some
and lose some, both sides save face and both sides save the costs of
litigation.

**X. BALANCING THE FACTORS**

Alternative dispute resolution is appropriate where the Air Force is in
a better position to resolve the dispute through negotiation than to
have a decision imposed upon it by adjudication. Obviously, each case
needs to be analyzed individually on its merits. Because the principles
underlying ADR are the same as those underlying settlement versus
litigation, ADR should not be used in cases when settlement is not
appropriate. As a rule of thumb, therefore, we should not submit to ADR
when the opposing party is not acting in good faith, when we don\'t have
enough information to arrive at a reasonable settlement, or when the law
is clearly and decisively in favor of the Government.

**XI. IMPLEMENTATION**

The contracting officer and the advising attorney are in the best
position to analyze the suitability of the case for ADR. Because the CO
is most knowledgeable about the facts of the case and the attorney is
most knowledgeable about contract law, they need to work together to get
an accurate appraisal of the merits of the case. When the attorney and
the CO believe ADR is appropriate, the close working relationship will
continue as ADR is implemented ‑ through negotiations on ADR procedures,
the drafting of an ADR agreement, the selection of a neutral,
preparation for the ADR proceeding, and the ADR proceeding itself

After the attorney has recommended ADR and the CO has decided that ADR
should be pursued, how do the parties go about doing it? Federal
Acquisition Regulation 33.214 identifies the following \"essential
elements\" of ADR. /83/

\(1\) Existence of an issue in controversy;

\(2\) A voluntary election by both parties to participate in the ADR
process;

\(3\) An agreement on alternative procedures and terms to be used in
lieu of formal litigation;

\(4\) Participation in the process by officials of both parties who have
the authority to resolve the issue in controversy; and

*(5)* Certification by the contractor in accordance with 33.207. /84/

If the contractor is unwilling to participate in ADR, will not agree
with the CO on ADR procedures, refuses to certify its claim, or will not
allow an official with authority to resolve the dispute to participate,
then ADR is no longer an option. The CO and the attorney can attempt to
convince the contractor (and the contractor\'s counsel) that ADR is
desirable, however, the Government cannot require the contractor to
submit to ADR, no matter how well suited the case may be for resolution
through ADR. Assuming the contractor consents to ADR, there are still a
number of issues that need to be addressed.

**XII. TIMING**

The first step is deciding whether to pursue ADR before rendering a CO
final decision. According to the FAR, \" ADR procedures may be used at
any time that the contracting officer has authority to settle.\" /85/ In
addition, the FAR notes that when \"ADR procedures are used subsequent
to issuance of a contracting officer\'s final decision, their use does
not alter any of the time limitations or procedural requirements for
filing an appeal of the contracting officer\'s final decision and does
not constitute a reconsideration of the final decision.\" /86/

In situations where the contractor appeals to the Court of Federal
Claims, there is no opportunity for the Air Force contracting officer to
participate in ADR without the concurrence of the Department of Justice
(DOJ) trial attorneys. This is because ‑ for cases appealed to the Court
of Federal Claims ‑ the DOJ is the settlement authority (as opposed to
the contracting officer). /87/ In appeals to the ASBCA, on the other
hand, the CO retains settlement authority. /88/ For this reason, the CO
can consider ADR at any point in the dispute resolution process ‑ prior
to final decision, after final decision but prior to appeal, or at any
time during litigation of an ASBCA appeal.

Alternative dispute resolution prior to the final decision has the
advantage of resolving the dispute most expeditiously and with minimal
processing costs, thereby attaining the goal of \"\[r\]esolution of a
dispute at the earliest stage feasible, by the fastest and least
expensive method possible.\" /89/ Disadvantages of using ADR prior to
the final decision include: little opportunity for discovery, no formal
ASBCA involvement (so no guarantee that the board will appoint a
settlement judge or neutral), /90/ and, no possibility that the
contractor, through inaction or change of heart, will forgo an appeal.
If the CO decides ADR is appropriate prior to rendering a final
decision, the CO can contact the Office of the General Counsel for
assistance in finding a qualified neutral. /91/ The General Counsel\'s
office currently monitors lists of recommended neutrals, including
former judges, members of the private bar with expertise in government
contracting, academicians, and current board judges from other agency
contract boards. /92/

If the CO waits to pursue ADR until after a final decision has been
rendered, there seems to be no reason to suggest ADR prior to the
contractor

filing a notice of appeal. If the contractor fails to timely appeal, the
dispute will have been resolved at no cost to the Government (either
procedural cost or settlement cost).

When the contractor appeals to the ASBCA, once the notice of appeal is
filed, the parties can request that proceedings be suspended, pursuant
to Board Rule 30, to pursue settlement discussions. /93/ Proceedings can
be suspended before either side incurs any litigation expense. Also,
once the ASBCA is involved, the parties can request that a board judge
be assigned as a mediator, factfinder, settlement judge, neutral for a
minitrial, or a variation thereof /94/ The board held its first formally
designated ADR proceeding in March 1987. Since that time, ADR has been a
tool available to parties at the board to resolve disputes. /95/

The advantage of having a board judge as a neutral is immense. The judge
brings to bear a wealth of expertise regarding Government procurement
law and is in the best position to accurately assess the strengths and
weaknesses of the parties\' positions if the appeals were to be
litigated. /96/ The ASBCA judges are also ideal neutrals because both
parties realize that it will be board judges who resolve the case if it
is litigated. Therefore, the opinion of the judge regarding the merits
of the case carries tremendous weight. The judges are also flexible,
adapting their role to whatever procedure the parties propose.

**XIII. DRAFTING THE ADR AGREEMENT**

The ADR agreement is crucial in defining the nature of the ADR
proceeding, the ground rules that will apply, and the obligations of the
parties (prior to, during, and after the ADR proceeding). The Air Force
attorney should draft the agreement to accommodate the desires of both
parties, while

ensuring that it protects Air Force interests. Both the Trial Team and
the General Counsel\'s office have model ADR agreements. While each ADR
agreement must be tailored to fit the particular needs of the case,
there are certain factors that should be addressed in all ADR
agreements.

**A. Scheduling**

At a minimum, the agreement must identify the date, time, and location
of the ADR proceeding and its duration. If the parties have already
confirmed an available neutral, the scheduling section will merely
confirm what has been previously arranged. If the parties are requesting
an ASBCA judge as a neutral, they should propose alternative dates for
the ADR in their request. A Board Scheduling Order (usually following a
conference call between the parties and the settlement judge) will then
confirm the ADR scheduling particulars. If the parties have not yet
decided upon a neutral, a scheduling supplement to the ADR agreement
should be completed once the parties and the selected neutral have
confirmed their availability.

**B. Outstanding Discovery**

When the parties agree they have each enjoyed sufficient discovery to
prepare adequately for the ADR proceeding, the ADR agreement should
acknowledge that fact and agree to stay all further discovery. If one or
both parties requires additional discovery, the parties should agree to
the nature and scope of additional discovery, as well as its timing.
Specific deadlines will increase the chance that these items will be
closed out in time to meet the agreed ADR schedule.

**C. Exchange of Information**

Pre‑ADR statements of position can be exchanged with the opposing party
and the neutral. The parties could further agree to exchange documentary
evidence that they will offer in the ADR proceeding. An exchange of
information assists each side in preparing its case for, the proceeding
and enables it to meet the opponent\'s arguments. This information can
also make the neutral quickly aware of the parties\' positions and
streamline the information that will need to be presented at ‑the
proceeding itself If agreed upon, the parties should also agree to the
timing of the exchange and the page limits of information to be
exchanged.

**D. Confidentiality**

Because ADR is a method of attempting to reach settlement, matters
submitted for the ADR proceeding are protected by Rule 408 of the
Federal

Rules of Evidence as matters submitted in compromise negotiations and
are inadmissible to prove or disapprove liability for a claim or its
amount. /97/ The ADRA protects from disclosure \"dispute resolution
communications,\" including all oral or written communications prepared
for the purposes of a dispute resolution proceeding. /98/ These
communications and any communication provided in confidence to the
neutral cannot be disclosed by the neutral. /99/ Nor can they be
disclosed by the opposing party. /100/ Any dispute resolution
communication disclosed in violation of 5 U.S.C. Sec. 574(a) and (b)
shall not be admissible in any proceeding relating to the issues in
controversy. /101/ Except for that, nothing in 5 U.S.C. Sec. 574
prevents discovery or admissibility of any evidence that is otherwise
discoverable or admissible, merely because the evidence was presented
pursuant to an ADR proceeding. /102/ To ensure that both parties fully
understand the confidential nature of the ADR proceedings, a statement
similar to the following should be included:

Written material prepared specifically for use in the ADR proceeding,
oral presentations made at the ADR proceeding, and all discussions in
connection with such proceeding are confidential and inadmissible in any
pending or future proceeding involving the parties or the matter in
dispute. However, evidence otherwise admissible, is not rendered
inadmissible because of its use in this ADR proceeding.

**E. Obtaining a Neutral**

The parties need to identify an agreed upon neutral or specify a process
which will be used to select a neutral. A number of methods are
available to select a neutral, including: exchanging lists of names
until a neutral is agreed upon, choosing a third party to pick the
neutral; or agreeing to accept as a neutral anyone from a specified
government agency as designated by that other government agency. /103/
The parties also need to agree on how the neutral will be compensated
(if applicable). The Air Force normally agrees to split the cost of
hiring a neutral with the contractor. /104/ Where an ASBCA judge has
already been involved in a case, the parties should discuss whether they
prefer that judge to be appointed as the ADR neutral. if so, a
conference call should be held with the judge to confirm availability.

**F. Recusal**

When requesting an ASBCA judge as a neutral for an ASBCA appeal, the
parties must decide up front whether they want to preserve the
opportunity to have the case heard before the same judge. The ASBCA
notice of ADR methods states that a judge who has been involved in an
ADR procedure ordinarily will not participate in a restored appeal,
\"unless the parties explicitly request to the contrary\" and the board
chairman approves the request. /105/

**XIV. PREPARING FOR THE ADR PROCEEDING**

Needless to say, \"\[a\]n intensive preparatory effort is required to
present and negotiate effectively.\" /106/ Parties will need to finish
discovery and prepare and exchange prehearing statements or documentary
evidence in accordance with their executed ADR agreement. Additionally,
the Air Force attorney must prepare witnesses who will testify during
the ADR proceeding. The attorney must discuss negotiation goals and
objectives with the \"principal,\" who will be a warranted contracting
officer with authority to bind the Government. The attorney and the CO
most familiar with the case will decide whether that CO or another CO in
the chain of command will act as the Air Force principal. The attorney
must prepare the principal for his or her role. Finally, the attorney
and the principal will allocate duties and responsibilities for the
conduct of the proceeding itself

**XV. CONDUCTING THE ADR HEARING**

The parties will follow the procedures agreed upon in their ADR
agreement or as mutually modified during the proceeding itself. Any
negotiated settlement of the dispute(s) should be memorialized in
writing and signed by both principals before they leave the ADR
proceeding. Any written justification, such as a price negotiation
memorandum or a settlement memorandum explaining the basis of the
negotiated settlement, should be drafted contemporaneously with the ADR
proceedings or as shortly thereafter as possible. Accomplishing these
tasks up front will result in less follow‑up work.

**XVI. RESULTS**

As of April 1996, Trial Team participation in ADR proceedings has been
basically limited to situations where the contractor has appealed to the
ASBCA. /107/ The Air Force has only submitted to ADR with an ASBCA judge
as a neutral. /*108/* As of April 1, 1996, the Trial Team has attempted
to use ADR to resolve sixty‑two docketed ASBCA appeals. /109/ Fifty‑six
were. successfully resolved, primarily through the use of board‑assisted
ADR. /110/ The Air Force has had only three appeals that have gone
through a board‑assisted ADR proceeding where the dispute was not fully
resolved. /111/ A couple of \"war stories\" may help explain the utility
and flexibility of board‑assisted ADR.

For example, in one case of board‑assisted ADR, the judge functioned as
a mediator and as a neutral presiding over a minitrial. The judge
caucused privately with both sides after hearing both presentations,
provided input on the strengths and weaknesses of the parties\'
positions, and evaluated the probabilities of success at litigation and
expected damages. The biggest factor fostering settlement of this appeal
was the judge\'s candid, private discussions with the parties. Because
of the private communications, the judge insisted upon being recused
from further involvement in the proceedings if ADR failed.

In another case with equally positive results, the parties and the judge
insisted that there would be no ex parte communications with the
judge\'. Both parties wanted the ADR judge to be the trial judge for
litigation on the merits if the ADR failed. /112/ The judge functioned
as a factfinder and settlement judge. Each party presented documentary
and witness testimony (unsworn) on a particular issue. Each party then
had a chance to rebut the opposing party\'s presentation. The judge
presented an oral evaluation of the strengths and weaknesses of each
side\'s case and left the room. The parties attempted to resolve each
issue by settlement. The judge was not involved in the give‑and‑take of
the settlement negotiations between the parties. If the parties were
unable to negotiate a settlement, the judge would provide an assessment
of the likely outcome of the dispute. Ultimately, all of the issues were
resolved by negotiation of the parties.

As these examples illustrate, board involvement is flexible to meet the
needs of the parties and the case. Paul Williams, Chairman of the ASBCA,
has noted, \"As we approach an era where DoD personnel and resources
will be stretched to the limit, litigation parties must look to new and
creative ways to resolve their disputes. The Board is committed to
helping the parties meet the challenge.\" /113/

While there is no requirement to use ASBCA judges as neutrals in cases
docketed with the ASBCA, there appears to be no reason to avoid them. In
fact, there are many reasons why it makes sense to use ASBCA judges.
Contractors participating in these proceedings have wanted ASBCA judges
as neutrals, and the judges have been willing to travel to accommodate
the parties\' choice of hearing location. In addition, the board funds
the judges\' travel (and salary), so there is no expense to the parties
for these neutrals. Most importantly, the board judges have been
successful in helping resolve these disputes to the mutual satisfaction
of the parties.

For cases not docketed with the ASBCA, one can expect that ADR will be
just as successful, provided tile parties agree upon a knowledgeable and
credible neutral and the cases themselves are appropriate for ADR.
Presumably, the Air Force will not agree to a neutral who is not
knowledgeable or credible. Further, in any form of nonbinding ADR, the
Air Force should not agree upon a settlement where the ADR proceeding
itself has demonstrated that the neutral is unfair or incredible.

**XVII. CONCLUSION**

The key to a successful ADR program is properly identifying appropriate
cases for ADR. It will never replace litigation, which remains the tip
of the sword in ensuring continued fair dealings between the contractor
and the Government. Most cases, however, are suitable for settlement.
When a case should be settled, but the parties have been unable to do so
on their own, ADR is a useful tool for the attorney and the CO. As
attorneys and COs become more comfortable with ADR and more adept at
pairing appropriate cases with ADR solutions, use of ADR will continue
to gain momentum.

\*Major Tolan (B.S.E.E., United States Air Force Academy; J.D.,
University of Michigan Law School) is an Assistant Professor of Law,
United States Air Force Academy, Colorado. He recently completed an
assignment at Air Force Materiel Command Law Office, Directorate of
Contract Appeals, Wright‑Patterson AFB, Ohio, where he represented the
Air Force in two ADR proceedings resulting in settlement of sixteen
ASBCA appeals. He is a member of the Michigan Bar.

1\. Administrative Dispute Resolution Act of 1990, Pub. L. No. 101‑552,
104 Stat. 2736 (1990) (codified at 5 U.S.C.A. Secs. 571‑83 (West 1977 &
Supp. 1996)) \[hereinafter the ADRA\].

2\. Compare Eldon H. Crowell & Charles Pou, Jr., Appealing Government
Contract Decisions: Reducing the Cost and Delay of Procurement
Litigation with Alternative Dispute Resolution Techniques, 49 MD. L.
REV. 183 (1990) (advocating ADR to avoid the increasingly judicialized
Boards of Contract Appeals and the concomitant expense, delay, and
complications of contract litigation) with R. Philip Deavel, Rethinking
Civil Litigation: The Potential for Alternative Dispute Resolution in
the Air Force, THE REPORTER (June 1994) (concluding that the costs to
the local installation commander and legal staff are too high and the
benefits too few to create a proper incentive for the use of ADR).

3\. The ADRA requires agencies to designate an ADR specialist and
develop an agency ADR policy. The Civil Justice Reform Act of 1990, Pub.
L. 101‑650, 104 Stat. 5089 (codified at 28 U.S.C.A. Secs. 471‑82 (West
1993 & Supp. 1996)), encourages the use of ADR in appropriate cases to
reduce the demands on district court resources. Exec. Order No. 12988
requires Federal agencies and litigation counsel who conduct or
otherwise participate in civil litigation on behalf of the United States
Government in Federal court to consider use of ADR in all appropriate
cases. 61 Fed. Reg. 4,729 (1996). See also Report of the National
Performance Review, Creating a Government that Works Better & Costs Less
(Sept. 7, 1993) (Vice President Al Gore advocates increased use of ADR).

4\. Memorandum from Donald B. Rice, Secretary of the Air Force, to
ALMAJCOM‑FOA DRUs and Distribution C, Implementation of the
Administrative Dispute Resolution Act of 1990, (Jan. 12, 1993)
\[hereinafter Rice\]. This policy letter encourages the use of ADR in
appropriate cases. See also Alternative Dispute Resolution Pledge, 61
Fed. Cont. Rep. (BNA) No. 20, at 697 (May 23, 1994) (various Federal
agency officials pledging to expand the use of ADR techniques).

5\. Rice, supra note 4.

6\. Telephone interview with Joseph McDade, Air Force Deputy Dispute
Resolution Specialist (Apr. 25, 1996).

7\. Public Law 104‑106, The National Defense Authorization Act for
Fiscal Year 1996, Div. D, The Federal Acquisition Reform Act of 1996,
Sec. 4104, amends 10 U.S.C.A. Sec. 2305 (b) to include a paragraph
stating:

The Federal Acquisition Regulation shall include a provision encouraging
use of alternate dispute resolution techniques to provide informal,
expeditious, and inexpensive procedures for an offeror to consider using
before filing a protest, prior to the award of a contract, of the
exclusion of the offeror from the competitive range (or otherwise from
further consideration) for that contract.

Pub. L. No. 104‑106, 110 Stat. 186 (1996) (to be codified at 10 U.S.C.
Sec. 2305(b)). See also Exec. Order No. 12979, 60 Fed. Reg. 55,171
(1995) (directing agencies \"to the maximum extent practicable, \[to\]
provide for inexpensive, informal, procedurally simple, and expeditious
resolution of protests, including, where appropriate and as permitted by
law, the use of alternate dispute resolution techniques, third party
neutrals, and another agency\'s personnel\").

8\. 5 U.S.C.A. Sec. 571 defines \"alternative means of dispute
resolution\" as \"any procedure that is used, in lieu of adjudication
\... to resolve issues in controversy, including, but not limited to,
settlement negotiations, conciliation, facilitation, mediation,
factfinding, minitrials, and arbitration, or any combination thereof.\"

9\. Federal Acquisition Regulation \[hereinafter FAR\] 33.204 states:
\"The Government\'s policy is to try to resolve all contractual issues
in controversy by mutual agreement at the contracting officer\'s
level.\" 48 C.F.R. Sec. 33.204 (1996) (All FAR citations are current as
of Apr. 12, 1996). The Contract Disputes Act of 1978 (CDA) \"provides a
fair, balanced, and comprehensive statutory system \... to induce
resolution of more contract disputes by negotiation prior to
litigation.\" Historical and Statutory Notes to 41 U.S.C.A. Sec. 601
(West 1987).

10\. Exec. Order 12988, signed by President Clinton on Feb. 5, 1996,
addresses ADR in the context of Civil Justice Reform. Section 1,
Guidelines to Promote Just and Efficient Government Civil Litigation,
states: \"Whenever feasible, claims should be resolved through informal
discussions, negotiations, and settlements rather than through
utilization of any formal court proceeding\.... It is appropriate to use
ADR techniques \... after litigation counsel determines \... that such
use will materially contribute to the prompt, fair, and efficient
resolution of the claims.\" Exec. Order No. 12988, 61 Fed. Reg. 4,729
(1996).

11\. FAR 33.204 encourages agencies to use ADR procedures to the maximum
extent practicable in accordance with the ADRA. Under 5 U.S.C.A. Sec.
571 of the ADRA, \"dispute resolution proceeding\" is defined as any ADR
process \"in which a neutral is appointed and specified parties
participate.\"

12\. FAR 33.214(a) states: \"The objective of using ADR procedures is to
increase the opportunity for relatively inexpensive and expeditious
resolution of issues in controversy.\"

13\. Memorandum from the Air Force Directorate of Contract Appeals,
Trial Team ADR Memorandum (1994) (on file with author). The mailing
address for the directorate is HQ AFMCLO/JAB, Wright‑Patterson AFB, OH
45433‑7112.

14\. Id.

15\. Id.

16\. Id.

17\. Id.

18\. Id.

19\. Id.

20\. Id.

21\. Id.

22\. The ASBCA provides each party a document entitled Notice Regarding
Alternative Methods of Dispute Resolution \[hereinafter ASBCA Notice of
ADR Methods\] (undated) (on file with author) with each docketed ASBCA
appeal at the time the appeal is docketed. The ASBCA Notice of ADR
Methods defines minitrials as:

[Minitrial:]{.underline} The minitrial is a highly flexible, expedited,
but structured, procedure where each party presents an abbreviated
version of its position to principals of the parties who have full
contractual authority to conclude a settlement and to a Board‑appointed
neutral advisor. The parties determine the form of presentation without
regard to customary judicial proceedings and rules of evidence.
Principals and the neutral advisor participate during the presentation
of evidence in accordance with their advance agreement on procedure.
Upon conclusion of these presentations, settlement negotiations are
conducted. The neutral advisor may assist the parties in negotiating a
settlement. The procedures for each minitrial will be designed to meet
the needs of the individual appeal. The neutral advisor\'s
recommendations are not binding.

23\. Memorandum from the Air Force Directorate of Contract Appeals,
Trial Team ADR Memorandum, supra note 13, at 2.

24\. Id.

25\. Id.

26\. Id.

27\. Id. See 5 U.S.C.A. Sec. 580(c).

28\. ASBCA Notice of ADR Methods, supra note 22.

29\. Id.

30\. Id.

31\. Id.

32\. Id. The ASBCA cites 41 U.S.C.A. Sec. 607(e) (\"An agency board
shall provide to the fullest extent practicable, informal, expeditious,
and inexpensive resolution of disputes\") as the general authority for
allowing this type of binding arbitration. This procedure is not to be
confused with the expedited procedure for resolution of disputes
concerning small claims at the sole election of the contractor,
authorized by 41 U.S.C.A. Sec. 608 (West 1987 & Supp. 1996).

33\. ASBCA Notice of ADR Methods, supra note 22.

34\. Id.

35\. Id.

36\. 5 U.S.C.A. Secs. 571‑83 (West 1977 & Supp. 1996).

37\. Id.

38\. Historical and Statutory Notes to 5 U.S.C.A. Sec. 571 (West 1996).

39\. 41 U.S.C.A. Sec. 605(d) and (e). Note that while the ADRA contained
a termination date of Oct. 1, 1995, Sec. 2352(a) of Pub.L. 103‑335
amended Sec. 605(e) of Title 41, Public Contracts, by extending agency
authority to engage in ADR to 1 Oct. 1999. See Effective and Termination
Date, Historical and Statutory Notes to 5 U.S.C.A. Sec. 571 (West 1996).
Note also that Sec. 4322(b)(6) of the Federal Acquisition Reform Act of
1996 preserves the applicability of the provisions of the ADRA \"as in
effect on September 30, 1995\" to the use of ADR for resolving Contract
Disputes Act claims under 41 U.S.C. Sec. 605. Pub. L. No. 104‑106, 110
Stat. 186 (1996) (to be codified at 41 U.S.C. Sec. 605(d) and (e)).

40\. FAR Subpt. 33.2 ‑ Disputes and Appeals; FAR 33.214 ‑ Alternative
Dispute Resolution.

41\. Pub. L. 101‑552, Section 3(a), Congressional Findings, Historical
and Statutory Notes to 5 U.S.C.A. Sec. 571 (West 1996).

42\. Id.

43\. Air Force Policy Directive 36‑12, Personnel ‑ Dispute Resolution
(Sept. 27, 1993) addresses ADR considerations in resolving personnel and
labor disputes. Air Force ADR initiatives include three pilot ADR
projects which were funded as part of the Air Force ADR Implementation
Plan. These include test programs at: (1) the Sacramento Air Logistics
Center to use ADR to resolve all disputes at the installation; (2) the
USAF Academy program to use ADR to resolve contract and labor disputes;
and (3) the Kirtland AFB Mediation Center to resolve labor and personnel
disputes throughout the base. Information on these ADR initiatives may
be obtained from the Air Force Deputy Dispute Resolution Specialist,
Joseph McDade, DSN 227‑3900/commercial (703) 697‑3900.

44\. Memorandum from Donald J. Atwood, Secretary of Defense, to the
Secretaries of the Military Departments, Administrative Means of Dispute
Resolution (Jan. 10, 1992) (on file with author).

45\. Id.

46\. Memorandum from Terrence O\'Donnell, DoD General Counsel, to the
General Counsels of the Military Departments, Administrative Dispute
Resolution Act, Pub. L. No. 101‑552 (1990) (Jan. 31, 1991) (on file with
author).

47\. Letter from Ann C. Petersen, SAF General Counsel to The Honorable
Marshall J. Breger, Chairman of the Administrative Conference of the
United States (Feb. 12, 1991) (on file with author).

48\. DoDD 5145.5, Alternative Dispute Resolution (Apr. 22, 1996).

49\. Id.

50\. Telephone interview with Joseph McDade, Air Force Deputy Dispute
Resolution Specialist (May 2, 1996).

51\. Rice, supra note 4.

52\. Id.

53\. Air Force ADR Program Status and Implementation Plan, FY 1994 and
1995

(July 1, 1993) (on file with author).

54\. Telephone interview with Joseph McDade, Air Force Deputy Dispute
Resolution Specialist (Apr. 25, 1996).

55\. Id.

56\. ALternative Dispute Resolution Pledge, 61 Fed. Cont. Rep. (BNA) No.
20, at 697

(May 23, 1994). The pledge was signed by 24 agencies.

57\. Id.

58\. The mailing address for the directorate is HQ AFMCLO/JAB,
Wright‑Patterson AFB, OH 45433‑7112.

59\. The Air Force Supplement to the Federal Acquisition Regulation
(AFFAR) requires that final decisions of claims of more than \$50,000 to
be reviewed by the Directorate of Contract Appeals prior to being
issued. AFFAR 33.211(a) and (b); 48 C.F.R. Sec, 5333.211; 6 Govt. Cont.
Rep., at 28,582 (CCH) (1995).

60\. Training Conference, Air Force ADR Program: Contract Disputes
Training for Air Force Attorneys, Wright‑Patterson AFB, OH (Nov. 16‑17,
1993).

61\. Id.

62\. Id.

63\. Col. Michael I Hoover, ADR Lessons Learned and the Air Force Trial
Team\'s View as to ADR\'s Appropriate Role and Effective Use,
Presentation to the Office of the Air Force General Counsel Acquisition
Law Seminar (Jan. 30, 1996) \[hereinafter Trial Team Statistics\].

64\. Id.

65\. Note that many cases where ADR was recommended did not result in
actual ADR proceedings. As a member of the Trial Team in June 1995, the
author gathered data from paralegals and attorneys to determine why ADR
was not pursued in cases where it had been recommended, resulting in the
following information. Thirty‑two percent were resolved at the CO level
short of ADR. In 5% of the cases the contractor would not agree to ADR .
In 17% of the cases the CO did not believe ADR was appropriate. Five
percent resulted in CO final decisions against the contractor which were
never appealed. Two percent resulted in appeals to the Court of Federal
Claims. Seventeen percent concerned final decisions where the time to
file an appeal ‑ 90 days for the ASBCA or one year for the Court of
Federal Claims ‑ had not yet expired, or cases where an appeal had been
docketed and the parties were still considering ADR. Twenty‑two percent
were successfully resolved with ADR.

66\. Id. Nearly 30% of final decision reviews concerned terminations for
default.

67\. 5 U.S.C.A. Sec. 572(b).

68\. Joseph McDade, Interim Guidelines For Using Alternative Dispute
Resolution Techniques to Resolve Contract Disputes \[hereinafter SAF/GCQ
Interim Guidelines for ADR\] (Nov. 1993), atch. 1, Alternative Dispute
Resolution Case Evaluation Worksheet \[hereinafter ADR Case Evaluation
Worksheet\]. This guidance was distributed at the Nov. 16‑17, 1993 ADR
Training Conference, supra note 60.

69\. FAR 33.210(b).

70\. FAR 33.210.

71\. ADR Case Evaluation Worksheet, supra note 68.

72\. Id.

73\. Id.

74\. Id.

75\. Id.

76\. Id.

77\. Id.

78\. Id.

79\. Id.

80\. Id.

81\. Id.

82\. Id.

83\. FAR 33.214.

84\. FAR 33.207 provides the same claim certification requirements when
using ADR as required for contractor claims over \$100,000.

85\. FAR 33.214(b).

86\. Id.

87\. 28 U.S.C.A. Secs. 516 and 519 (West 1993 & Supp. 1996).

88\. FAR 33.210.

89\. ASBCA Notice of ADR Methods, supra note 22.

90\. The unenacted House of Representatives version of the Federal
Acquisition Reform Act of 1995 would have required board assistance for
ADR regardless of the stage of litigation \"for any disagreement
regarding a contract or prospective contract upon the request of all
parties to the disagreement.\" H.R. 1670, 104th Cong., 1st Sess., 141
CONG. REC. H5366 (May 18, 1995). If passed, this bill would have
consolidated the Government Boards of Contract Appeals and the
Government Accounting Office bid protest section, allowing
board‑assisted ADR to be employed even before contract award.
Additionally, the bill would have required the parties and the board to
consider and reject ADR before the dispute could go forward to
litigation when there is a formal CDA appeal. 63 Fed. Cont. Rep. (BNA)
No. 20, (Special Supp. at S‑22) (May 22, 1995).

91\. The address is: Assistant General Counsel (Acquisition), ATTN: ADR
Program, SAF/GCQ, Room 4D980, 1740 Air Force Pentagon, Washington DC
20330‑1740. FAX: DSN 224‑8846 or (703) 614‑8046. Phone: DSN 227‑3900.

92 Telephone interview with Joseph McDade, Air Force Deputy Dispute
Resolution Specialist,

(Apr. 25, 1996). Mr. McDade indicated that the chairman of the ASBCA has
expressed a willingness to devote, on a case‑by‑case basis, an ASBCA
judge as an ADR neutral prior to an appeal being docketed. The General
Counsel\'s office also has funding available, in appropriate cases, to
pay for the cost of obtaining a third‑party neutral.

93\. Board Rule 30 states: \"The Board may suspend the proceedings by
agreement of counsel for settlement discussions, or for good cause
shown.\"

94\. ASBCA Notice of ADR Methods, supra note 22.

95\. \"Memorandum from Paul Williams to The Secretary of Defense, Report
of Transactions and Proceedings of the Armed Services Board of Contract
Appeals for the Fiscal Year Ending 30 September 1993 (Oct. 31, 1993), 61
Fed. Cont. Rep. (BNA) at 286 (Feb. 28, 1994) \[hereinafter ASBCA Report
of Transactions\].

96\. The ASBCA Report of Transactions notes:

Though the use of formal ADR has not been extensive, the role of the
administrative judge in assisting issue identification during the
prehearing phases of the appeal process often has the effect of the
judge serving as a settlement judge, facilitator, or mediator. Indeed,
with the assistance of the judge explaining the strengths and weaknesses
of the parties\' positions, it is not uncommon for appeals to be settled
during or after a hearing.

Id. at 287.

97\. FED. R. EVID. 408 states: \"Evidence of conduct or statements made
in compromise

negotiations is likewise not admissible. This rule does not require the
exclusion of any

evidence otherwise discoverable merely because it is presented in the
course of compromise

negotiations.\" 28 U.S.C.A. Rules 1‑700 (West 1984 & Supp. 1996).

98\. 5 U.S.C.A. Secs. 571(5), 574.

99\. 5 U.S.C.A. Sec. 574(a) identifies the general rule and its
exceptions.

100\. 5 U.S.C.A. Sec. 574(b) identifies the general rule and its
exceptions.

101\. 5 U.S.C.A. Sec. 574(c).

102\. 5 U.S.C.A. Sec. 574(f).

103\. SAFIGCQ Interim Guidelines for ADR, supra note 68.

104\. Id.

105\. ASBCA Notice of ADR Methods, supra note 22.

106\. Crowell & Pou, supra note 1, at 209.

107\. Telephone interview With Col. Michael G. McCormack Trial Team ADR
focal point, (Apr. 30, 1996). Col. McCormack indicated that the Trial
Team is willing to engage in ADR discussions with contractors (with the
concurrence of the CO) prior to an ASBCA appeal. In fact, Trial Team
attorneys have discussed ADR with contractors under such circumstances
on several occasions, but none have yet materialized into an ADR
proceeding.

108\. Id.

109\. Id.

110\. Id.

111\. Id.

112\. The ADR agreement specified the desires of the parties, but
stipulated that either party

or the judge could subsequently request recusal.

113\. ASBCA Report of Transactions, supra note 95, at 287.