Government Contracts-Judicial Review Under Disputes Clause

In a factual dispute arising under a standard government construction contract, the contractor followed the procedures required by the disputes clause. The contractor, after its claim was denied by the contracting officer, appealed to the Board of Claims and Appeals of the Corps of Engineers. The Board rejected the claim, and the contractor brought suit in the Court of Claims, alleging, in the words of the Wunderlich Act, that the Board’s decision was “capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or was not supported by substantial evidence.” Over the Government’s objection, a commissioner of the court received evidence de novo and concluded that the contractor was entitled to recover. The court received further evidence on the issue of damages and entered judgment for the contractor. On certiorari, held, reversed, two Justices dissenting. In cases subject to the standard disputes clause, the court may look only to the administrative record in order to determine, with respect to any of the Wunderlich Act’s standards of finality except fraud, whether the administrative decision should retain its finality. United States v. Carlo Bianchi & Co., 373 U.S. 709 (1963).