Board Denies Anti-Assignment Act Violation

(Editor’s Note. The following case illustrates the potential problems of having subcontractor or teaming partners perform certain administration tasks.)

GH held the contract and designated an employee from its subcontractor AB to be the job representative or project superintendent. The contracting officer said it was understood that a GH employee would be in charge of all communications, progress meetings and change order negotiations while GH said it had authorized the AB rep on its behalf and the president of GH controlled and directed the AB rep. The government asserted that AB’s involvement violated the Anti-Assignment Act which provides that no contract can be transferred by the party to whom that contract was given where AB was the real contractor and GH had “zero control and little involvement.” The Board disagreed saying the act does not prohibit a government contractor from forming joint ventures or partnerships to perform a contract. It credited GH’s statement it had a close teaming and subcontractor relationship with AB on the project that was not forbidden and that AB had limited authority to act on GH’s behalf where GH performed significant contract work and its president oversaw contractor performance including actions involving time and money (General Heat and Air Conditioning Inc vs. GSC, CBCA, No. 1242).

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