IDIQ Modification Placement

[Postaward]

I just picked up administration on a contract and would like to get a very anxious contractor paid. But there are issues. The payment office is saying the invoices do not match the contract price. Which they (the invoices) do not, because the buying command issued a modification. The question is where should the modification be applied?

IDIQ supply contact. Quantities (min and max) and unit prices are set on basic.

Delivery Order 0001 was issued and completed (not relevant, but DO 0001 had 4 mods: 01-04)

DO 0002 was issued (say 04/11) following the basic?s pricing scheme. (DO 0002 has one mod already: 01) There are no other active orders.

The buying command issued P00006 (say 06/11) against the basic. It changes the prices (which is what the contractor is billing to) and several other bits of information. The previous administrator said the buying command stated that the prices flow down.

Here is where I disagree. My view is the price changes or the entire modification should be with DO 0002 so that the proper billing can take place. Not on the basic. I should have a X87888 11 D 8788 0002 02 vs. X87888 11 D 8788 P00006.

Since the order was previously issued, prices would not flow down would they with P00006?

Or is the buying command correct because orders on an IDIQ are not contracts by themselves?

Hopefully I put in all the relevant information.

Just FYI trying to get the payment office to just pay what the contractor is billing for ( it is a lessor amount and they can do an additional billing later if needed, but the argument is about matching the contract)

[Guest Vern Edwards]

The answer depends on why the prices changed.

If the parties agreed to change the contract prices for some reason and to apply the new prices to the existing delivery order, then both the contract and the delivery order should have been modified. It is not a matter of one or the other. The mod to the contract should state whether the changes apply retroactively or only prospectively. (Whether you can make the changes on the contract mod and say that they apply to the delivery order in question without making a separate mod of the delivery order is going to be a matter of local procedure, not regulation. In my opinion, good practice calls for separate mod documents, but I would not make a fuss about it.)

If the parties agreed to change the delivery order item prices in order to settle some claim against the delivery order, or for some other reason that applies only to the delivery order, then only the delivery order needed to be changed, and the mod should expressly state that the change applies only to the delivery order. (However, I would not be surprised to be told that some automated contract writing/reporting "solution" required the establishment of a new set of CLINs on the contract in order for the pricing to be applied to the delivery order and the contractor to get paid.)

[joel hoffman]

I just picked up administration on a contract and would like to get a very anxious contractor paid. But there are issues. The payment office is saying the invoices do not match the contract price. Which they (the invoices) do not, because the buying command issued a modification...

Just FYI trying to get the payment office to just pay what the contractor is billing for ( it is a lessor amount and they can do an additional billing later if needed, but the argument is about matching the contract)

I tend to agree with Vern.

For payment purposes, if the problem is that the delivery order describes unit prices that have been changed in the basic contract, you need to know for sure whether or not the change was intended to apply to the delivery order or not. If yes, then it would seem that the paying office would need a mod to the delivery order to reflect the current unit price and funding on the delivery order. If no, then the Contractor should be billing for the unit prices reflected in the D.O.

EDITED: Situations like this illustrate the danger of simply referencing unit prices in a base contract in a delivery order, rather than including the applicable CLINS in the D.O. - I'm not even sure if that is possible. Aside from that, you didn't say which organization issued the task order but if the buying command issued the D.O., I believe that it has the responsibility to modify the D.O., if the changed prices apply to it. Somebody should modify the D.O., to reflect the correct prices and funding for the entire order, so the contractor can get paid and so the DO will be up to date.

[Postaward]

Thank you both very much for your insight.