Dispose Bookmark Contract For Free
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When can the government terminate a contract for convenience?
The government can terminate a contract for their convenience, or in the case of most contracts in excess of $25,000, for default when the government believes that a contractor failed to perform in accordance with the provisions of the contract.
Why does the government need the ability to terminate a contract for convenience?
As a rule, the government cannot be held liable for breach when it exercises its right to terminate contracts for convenience because it has the contractual and/or inherent right to do so. ... Such settlements typically include any costs incurred in anticipation of performing the terminated work and profit thereon.
What does terminate for convenience mean?
A termination for convenience clause is a clause in a construction contract that allows one or both parties to terminate the agreement without a specific reason for doing so (such as a default or breach of the contract).
Why is termination for convenience important?
A “termination for convenience” clause, which allows a party to terminate the contract without cause, can be a useful mechanism to end a contract and avoid costly disputes. This type of clause has become more common in the construction industry in recent years.
What is the most important thing that you as the government contracting officer should remember when pursuing a termination for
Probably most important to remember in a termination for convenience of commercial items is that the contractor is paid for the percentage of the contract price reflecting the percentage of work performed prior to the termination plus any directly related termination costs.
Can a contractor terminated for convenience recover lost profits on the contract?
Importantly, the terminated contractor may not recover anticipatory profits or consequential damages. See, e.g., FAR 49.202(a). In addition, when it can be shown that a contractor contract would have lost money, the contractor will typically be entitled to no profit on any of the work.
Can a contractor terminate for convenience?
A termination for convenience clause is a clause in a construction contract that allows one or both parties to terminate the agreement without a specific reason for doing so (such as a default or breach of the contract).
How can a contractor terminate the contract?
Poor Workmanship/Defective Work.
Consistent Failure to Perform According to Schedule.
Failure to Pay Subcontractors, Suppliers, or Laborers.
Use of Materials or Equipment Inferior to Contract Specifications.
Under staffing the Project.
What is the contractor liable for under a contract terminated for default or cause?
(a) Under a termination for default, the Government is not liable for the contractor's costs on undelivered work and is entitled to the repayment of advance and progress payments, if any, applicable to that work.
Who is responsible for negotiating any termination settlement with a contractor?
49.101 Authorities and responsibilities. (d) After the contracting officer issues a notice of termination, the termination contracting officer (TCO) is responsible for negotiating any settlement with the contractor, including a no-cost settlement if appropriate.
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