Government Contracts – Changes and Terminations

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Changes to Your Contract

  • The Contracting Officer can change the specifications or terms, as long as these changes are “within the general scope of the contract.”
  • If the changes affect the general nature of the contract after it’s been awarded, you’re entitled to a fair adjustment in price and delivery schedule.
  • Some changes may be unilateral, while other changes may be bilateral, and require your agreement.
  • The contract will include provisions for resolving disagreements under the disputes clause.

 

Termination for Default

The government may terminate a contract for default if:

  • You fail to deliver within the time specified in the contract
  • You fail to make progress, which poses a risk to the performance of the contract
  • You fail to comply with any provisions of the contract
  • You must be given a chance to improve your performance, or show why the contract shouldn’t be terminated.
  • To be excusable, a delay must be beyond your control, and not caused by your fault or negligence.
  • If your contract is terminated for default, you’re entitled to payment for any goods or services you’ve already provided.
  • If the government still needs the items that you failed to deliver, it can get them elsewhere, and charge you for any additional costs.

 

Termination for Convenience

The government may terminate all or part of a contract for its convenience.

  • Termination for convenience is not the fault of the contractor – it allows the government to cancel contracts for products or services that become obsolete or unnecessary.
  • The government must give you written notice of termination for convenience, but it’s not required to give advance notice.
  • The government will pay you for any work you’ve already done.
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