Prior Course of Dealing

A prior course of dealing is a method of contract interpretation which is applied when a specification is being construed by an agency in a way which is different from that same agency’s interpretation in the past. The contractor may rely upon a prior interpretation of a specification by the same agency if that specification has the same language and has been consistently applied in the same manner on prior contracts. The courts have held that the parties to an interpretation dispute may be bound by their interpretation of prior contracts and that a prior course of dealing may be an aid to interpretation. M.A. Mortenson Co. v. United States, 29 Fed. Cl. 82, 96 (1993); Lockheed Aircraft Corporation v. United States, 192 Ct.Cl. 36 (1970); Blue Cross & Blue Shield Ass’n v. United States, 17 Cl. Ct. 558, 564 (1989); Engineered Systems, Inc., ASBCA No. 20919, 76-2 BCA ¶ 12,098.

Updated: August 3, 2018