When it comes to proving a construction cost, particularly a cost in dispute, the cost must be REASONABLE. Costs subject to claims must be reasonably incurred and the party incurring the costs must show the costs are reasonable.

An example of the burden falling on the contractor to prove the reasonableness of costs is found in government contracting.

“[T]here is no presumption that a [government] contractor is entitled to reimbursement ‘simply because it incurred…costs.’” Kellogg Brown & Root Services, Inc. v. Secretary of Army, 973 F.3d 1366, 1371 (Fed. Cir. 2020) (citation omitted). Stated differently, a federal contractor is not entitled to a presumption of reasonableness just because it incurs costs. Id.

In government contracting, the Federal Acquisition Regulations (known as “FAR”) puts the burden of reasonableness on the contractor that incurred the costs. Id.