The federal government is responsible for the setting specifications for most products and services coupled with the process of termination for default as a result of a contractor’s failure to perform the obligations of the contract (Bugge, 2014). In general terms, if the contractor is found to or otherwise determined to have not been performing under the stipulations of the standard default, or that the failure by the contractor to perform the contract is excusable, the default is considered to be a termination, where the process of termination works for the convenience of the government. This implies that in the event that the failure by the government was as a result of causes that are beyond control like the case of having the causes that do not have a fault or those causes that are out of the negligence of the contractor, then the termination works as a convenience to the government (Ely, 2009). Essentially, the process of termination will also work for convenience of the rights and obligations of the parties, which are governed by the contract.
The first instance where the parties governed are protected is in the process of combination of the “termination of fixed-price contracts for default”, which is a standard default law on one hand and the “contractor inspection requirements” and thus a regulation of the FAR on the other (Scott, 2010). In the default standard clause, the government has that sole right of terminate a contract fully or partially for the stipulated default in the event that the contractor fails to make the supply delivery or if the contractor fails to perform the services within the stipulated time. Consequently, the government may terminate the contract for default in the event that the contractor fails to perform any other contract provision o makes progress of the contract in a way that endangers the eventual performance of the contract. In this event, the FAR regulation of contractor inspection requirements under the inspection of supplies act sub clause, “fixed price”, the government has the full right of inspecting and testing all supplies that are called upon for the completion of the contract. In the wake of the inspection, the government can has to ensure that the contractor is within the bounds of the period of manufacture of the supplies. It is thus vital from the two provisions of the standard default clause and the FAR regulation 52.246-1 that the parties governed are protected in this sense that the process of testing for supplies and the timeline for completion of the project is within the bounds required by both parties (Bugge, 2014). The provisions help in reducing chances of termination of the contract, which in the event may lead to loses on the part of the contractor.
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The other way of combining the standard default clause and the FAR delay provision for the definition of protection of both parties involved in the contract is the application of the 49.402-procedure for default and the 52.246-1 contractor inspection requirements is in the event that there is need for making a decision for the type of termination applicable for the contract. In this process, the 52.246-1 helps in ensuring that the contractor inspects and tests the vital requirements of the contract and in the process, the contractor substantiates that the services or supplies are furnished with conformity to the necessary requirement (Scott, 2010).
In the event that these supplies are not in full conformity with the requirements of the contract, the government may choose the type of termination, where it may apply default termination for lack of supplies or for supplies not delivered within the stipulated time. It may also use the procedure for default clause to choose the no-cost cancellation method for termination of the contract in the event that the problem came about as a result of an error with the manufacturers (Ely, 2009). It may also recommend the convenience method of termination in the procedure for default as a way of terminating contracts for supplies with partial conformity to the requirements of the contract. In the process of choice of the procedure for termination, the parties are protected in the sense that the government relies on reviews through contracting and technical personnel, while the counsel reviews are also considered to ensure that the basis for termination is from a neutral review.
In the event that the contracting officer makes changes to payment terms within the contract, it would lead to either the delay in the delivery of the supplies, or this would affect the conformity of the supplies with the requirements of the contract (Ely, 2009). For instance, if the constricting officer decides to reduce the amount to be paid, the contractor would resort to cheaper and thus low quality supplies, where in the event, this would affect the eventual quality of the project. This would also affect the government as it would make the government to incur losses in the eventuality of completion of the contract.
The most secure way of making a contractual change is by issuing written orders of change on standard form 30, which gives the stipulations for amendments of solicitation and the eventual modification of the considered contract. The method of writing the changes in standard form 30 protects the contractor in the sense that the supplies would now be in conformity with the new requirements as stated in the modifications of contract form (Bugge, 2014). Consequently, the process of inspection should be based on technological software management systems, while the reviewers of the inspection should undergo frequent training sessions. The system of inspection by software management systems helps in reducing human errors, while frequent training of the reviewers ensures conformity to changing requirements of the supplies within contracts.
References
Ely Jr, J. W. (2009). Whatever Happened to the Contract Clause. Charleston L. Rev. , 4 , 371.
Bugge, R. G. (2014). A User's Guide to the ABA's Model Fixed-Price Supply Subcontract. Public Contract Law Journal , 502-527.
Scott, R. E. (2010). A relational theory of default rules for commercial contracts. The Journal of Legal Studies , 19 (2), 597-616.
