Payne Hackenbracht & Sullivan

Sample Board of Contract Appeals Proof of Cost Order

PRETRIAL ORDER ON PROOF OF COSTS AND OTHER MATTERS

It Is Ordered as follows:

1. Appellant's Statement. The appellant shall furnish to the attorney of record for the respondent and to the Board a statement in schedule form showing (a) all the items and figures which the appellant intends to prove from books of account or other records and (b) all the items and figures which the appellant intends to prove by means other than (a) above.

2. With respect to items and figures to be proven from books of account or other records, such statement shall be prepared in accordance with the requirements set out in the following subparagraphs of this paragraph 2:

(a) The basic figures, costs, and rates from which any claim is computed shall be tabulated in such detail that the statement

May he admitted in evidence in lieu of producing the books and records from which the pertinent data were taken.

(b) The statement shall include a complete computation of the total amount of each claim that is based upon or derived from books of account or other records.

(c) Each separate portion of the statement shall contain a reference showing the particular books and records from which it was taken.

(d) Where the statement includes a claim for overhead, factory burden, general and administrative expense, or similar items based upon allocations of entries shown in the books or records, the statement shall itemize such indirect expenses for the period involved, and shall show the accounting method or principle upon which the allocations were made.

(e) Where a claim includes an item for machinery or equipment expense, the statement shall show the type, class, capacity, or other identifying description of each major piece of machinery or equipment involved, and the book value of each item. If book values are not separately shown in the records, or if some basis of value other than book value is used, the statement shall show how the value was determined. The statement shall contain a complete computation of the equipment expense claimed; and unless the costs incurred or the expenses claimed are fully set forth in the books or records, the statement shall show the accounting method, principle, or authority upon which such computation is based.

(f) The statement shall be accompanied by:

(i) a declaration that the books and records, or any part thereof, upon which the statement is based (including ledgers, journals, payrolls, and the original invoices, vouchers, checks, and other records and documents needed for a verification of the amount claimed or for a determination of the basis upon which the claim is computed) will be made available to the respondent for examination; and

(ii) a notice showing the address where such books and records may be examined by the respondent, together with the name and address of the bookkeeper or accountant who prepared the statement and who will be made available for the furnishing of information regarding such books and records in connection with the respondent's examination.

3. With respect to items and figures to be proven pursuant to paragraph 1.(b)) above, the appellant shall comply with the following:

(a) The appellant shall furnish to the attorney of record for the respondent and to the Board a statement specifying by what means or theories, and the witnesses through whom, the appellant intends to prove the amounts claimed.

(b) With respect to prospective witnesses, the appellant's statement shall indicate as to each witness his name, address, and occupation, and the subject or subjects to which his testimony will be directed.

4. Respondent's Response. The respondent shall make an examination of the pertinent books of account and other records, and shall furnish to the attorney of record for the appellant and to the Board a statement showing the results of such examination, or waive challenge of the accuracy of the statement submitted by the appellant as reflecting the contents of such books and records and the accuracy of the computations, including allocations, made therefrom. The respondent's statement shall be prepared in accordance with the requirements set out in the following subparagraphs of this paragraph 4:

(a) If the respondent verifies the items and figures (or any of them) contained in the appellant's statement, including the appellant's computations and allocations, the respondent shall so report in its statement. Such a report shall not be deemed to be an admission by the respondent of anything more than the accuracy of --

(i) the statement examined as reflecting the contents of the books and records and

(ii) the allocations and computations based thereon.

(b) If the respondent's examination fails to verify any of the items, figures, allocations, or computations contained in the appellant's statement as submitted, the respondent shall specify in its statement each item, figure, allocation, or computation not verified, together with such different item, figure, allocation, or computation, if any, derived by the respondent from its examination. The respondent shall set forth in its statement a complete explanation of each exception, and shall specify any alternative methods or theories of accounting upon which the exceptions are based.

(c) The respondent shall be deemed to have waived challenge of the accuracy of all items, figures, allocations, and computations contained in the appellant's statement, as submitted, that are not specified in the respondent's statement as the subject of exceptions.

5. Respondent's Cross-Statement. In a situation where the respondent (a) has derived any items, figures, allocations, or computations from its examination of the appellant's books and records, and (b) intends to offer evidence based upon the material so derived in reduction of any portion of the amount claimed by the appellant, or in support of a counterclaim or offset or affirmative defense, or in support of a theory of damages different from that of the appellant, the respondent shall prepare a cross-statement reflecting such items, figures, allocations, or computations. The cross-statement shall be prepared in conformity with the requirements set out in subparagraphs (a)-(e) of paragraph 2 of this order, and it shall be furnished to the attorney of record for the appellant and to the Board within the period prescribed in paragraph 4 of this order.

6. With respect to appellant's submission, if any, under paragraph 3 of this order, the respondent shall:

(a) Furnish to the attorney of record for the appellant and to the Board a statement outlining the basis of its exceptions (if any) to the appellant's proposed presentation on damages, and such theories and witnesses as the respondent will rely upon to rebut the appellant's presentation.

(b) With respect to the respondent's proposed witnesses, the respondent's statement shall indicate as to each witness his name, address, and occupation, and the subject or subjects to which his testimony will be directed.