Don Mansfield

I don't think you are reading the definitions correctly. "Government property" includes property leased by the Government. "Contractor-acquired property", a subset of "Government property", does not include property leased by the Government. Property leased by the Government and subsequently provided to a contractor is "Government-furnished property", which is defined as: Property leased by a contractor is not "Government property."

So it was an unauthorized commitment?

Did you tell the contractor to read the clause?

Good find. I should have read the SBA regulations, they are much clearer. The FAR says the size determination is "final" "unless appealed" and the SBA regs say the determination is "effective and in full force" "unless reversed by OHA." You started a very thought-provoking discussion. I hope you continue to participate in the forum.

Nothing in FAR 19.302 states that size status protests received after award do not apply to the instant contract. This is what FAR 19.302(d) states about the applicability of a protest: This statement is not qualified by "unless an award has already been made." I think that you are confusing the rule about the applicability of SBA rulings on size status appeals with the rule on the applicability of size status protests. Two different things. First, just because an offeror files an appeal doesn't mean the SBA will hear it. See FAR 19.302(i): If the Judge decides not to hear the appeal, then the determination of the SBA Government Contracting Area Office is final. However, if the SBA Judge decides to hear the appeal, then the size status of the offeror is undecided. If the SBA Judge rules that an offeror is other than small and that ruling is received before award, then the offeror is other than small for the pending acquisition. If the SBA Judge rules that an offeror is other than small and that ruling is received after award, then the ruling applies to future acquisitions (i.e., the offeror is not "other than small" for the pending acquisition). All of the GAO decisions that I have read that recommend termination because an offeror has been found to be other than small make a point of stating that the size status protest is not under appeal. I have not found any decisions that recommend termination based on an SBA ruling (on an appeal) received after award, probably because such rulings do not apply to the pending acquisition.

I am curious, too. I didn't expect to find what I found in the court and board decisions.

I would not have terminated the contract. SBA appeal decisions received after award do not apply to the pending acquisition. FAR 19.302(i) states: The GAO decisions that you cited recommend termination in the absence of countervailing circumstances. If the SBA decides to consider an appeal, that is a countervailing circumstance. Consider Tiger Enterprises, Inc. B-292815.3; B-293439, January 20, 2004 From what you have told us, I don't believe that you were required to terminate the contract.

Jacques, I know you weren't trying to pick a fight and I didn't mean to come across as hostile. As far as your illegality argument, it is legal for the CO to award a contract to the SBA under the 8(a) program. That's what happened here.

I don't know. You're the attorney, you tell us. Let us know what you find.

For a more recent decision, see the case that darby cited--Aviation Specialists, Inc., DOT BCA 1967, O2-1 BCA 31.788 (December 30, 1990). In that case, the contractor was able to recover considerably more than what was ordered under the contract. I have not compared the 1984 version of the Fixed-price termination clause with the current version. I have looked at the 1984 version of the Requirements clause and it states: "Delivery or performance shall be made only as authorized by orders issued in accordance with the Ordering clause."

Be more specific. What particular term or condition?

What's the term or condition that they would be failing to comply with?

Jacques, If you research some of the decisions dealing with misrepresentation of size status, there is usually some discussion as to whether the representation was made in bad faith. If it was, then the contract is void. However, if the representation was made in good faith then the contract is not void, but it should be terminated. In other words, it seems that an offeror is required to make a good faith representation of its size status, but it is not required to be right.

That, under a requirements contract, recovery is not limited by the ordered amount.

This question is more interesting than I first thought. I found the following in Administration of Government Contracts, Fourth Edition, on p. 1120: The relevant passage Albano Cleaners, Inc., states: What's interesting is that the same does not hold true for IDIQ contracts. In this respect, Administration of Government Contracts states the following:

I would limit my obligation to what it says in the contract. See FAR 52.212-4(l): The clause provides for a settlement that includes more than just prices paid for work performed. Why should this T4C settlement be different?

Given the antiquated rules governing the submission of proposals, it was stupid for the offeror to wait as long as they did to submit their offer. However, it's questionable to conclude that an offeror's ability to submit a proposal on time is indicative of their ability to build airplanes.

The original poster was quoting from FAR 15.306( c )(2), which has to do with limiting the competitive range for purposes of efficiency. If the question was whether the competitive range could be limited for purposes of efficiency, then the answer is yes, if the solicitation advises offerors that the Government may do that. The problem is that, unlike FAR 52.215-1, FAR 52.212-1 does not advise offerors of that possibility. Compare the two relevant paragraphs in the provisions. Here's FAR 52.215-1(f)(4): Here's FAR 52.212-1(g): This doesn't advise offerors that the Government may limit the competitive range for purposes of efficiency. So if the solicitation contains FAR 52.212-1 and is otherwise silent on the Government's right to limit the competitive range for purposes of efficiency, then the competitive range cannot be limited for purposes of efficiency.

Then I will qualify my answer. If the offeror made the representation in bad faith, then the contract would be void. If the offeror made the representation in good faith, then I would terminate for convenience and negotiate a reasonable settlement.

In answering your questions, are we to assume that the offeror's representation was made in good faith?

Interestingly, the activity uses a requirements contract if the acquisition is sole source. They use the Rube Goldberg scheme if the acquisition is competitive. I don't know why. I'll see what I can find out.

Yes, it would. However, the agency could argue that the change is the type of change permitted by the Changes clause--a change in work specifications. That is, the work specifications that were used as a basis for pricing the original option (i.e., the sample task) are being replaced with the actual work specifications.

In the scenario that I described, the agency doesn't want to use an IDIQ because they want to award a contract over $100 million to a single source and they don't want to have to seek approval from the agency head. The uncertainty of the requirement at award is certainly not unique to ship repair. What's unique is the agency's use of priced options subject to renegotiation instead of an IDIQ or requirements contract.

Because the scope of the contract would be so broad that they fear breaching a requirements contract, which is probably a legitimate concern. They have other contracts that could potentially overlap the contract in question. The activity doesn't seem to have much control over its contracts.

Jacques, Think of the estimated cost in the original contract as a ROM estimate to complete the work under the option. The estimated cost to perform the actual work requirement would typically differ from the ROM estimate by ~20%. The contract contains an estimated cost and fee for the option when awarded. I don't think that compliance with FAR 17.207(f) is an issue.