Title to Equipment under a C/R Contract

[HigherEd123]

If one has a cost reimburseable contract with the CIA for research and development (and if anyone has done business with this agency, you will know they are anything less than willing to explain themselves when they administer contracts, you can't even get the prescriptions for their agency specific clauses they insert) and one purchases equipment under said contract, but there is no Government Property clause, or anything else that addresses equipment, the allowability of the purchase of said equipment, or who owns title to the equipment, then who owns it? I might add that permission was sought and received from the CO to purchase such equipment. Just wondering if anyone has dealt with a similiar situation in the past.

[Old-Dog]

When a contractor purchases equipment under a cost reimbursement contract the property belongs to the Government. If the contractor wants to keep the equipment they should purchase it and charge the government for their ownership cost. See FAR 45.402.

[Guest Vern Edwards]

See FAR 45.107(a):

(a) (1) Except as provided in paragraph (d) of this section, the contracting officer shall insert the clause at 52.245-1, Government Properly, in

(i) All cost-reimbursement and time-and-material type solicitations and contracts, and labor-hour solicitations when property is expected to be furnished for the labor-hour contracts.

Paragraph (d) exempts purchase orders for property repair when the unit acquisition cost of the property to be repaired does not exceed the simplified acquisition threshold.

Now see FAR 52.245-1, paragraph (e)(3):

(3) Title under Cost-Reimbursement or Time-and-Material Contracts or Cost-Reimbursable contract line items under Fixed-Price contracts.

(i) Title to all property purchased by the Contractor for which the Contractor is entitled to be reimbursed as a direct item of cost under this contract shall pass to and vest in the Government upon the vendor’s delivery of such property.

(ii) Title to all other property, the cost of which is reimbursable to the Contractor, shall pass to and vest in the Government upon—

(A) Issuance of the property for use in contract performance;

( Commencement of processing of the property for use in contract performance; or

( C) Reimbursement of the cost of the property by the Government, whichever occurs first.

The rules for the CIA are the same as for everybody else. The fact that the contract is for R&D has no bearing.

[here_2_help]

All,

The original post stated that the contract had **no** property clause. How do you read the missing property clause into the contract? Are you asserting it's there via Christian Doctrine?

The question is (or ought to be) how does the government obtain title when the contract is silent on passage of title?

H2H

[Guest Vern Edwards]

Oops! I missed that.

But why doesn't the contract include the clause if the contract is cost-reimbursement and does not involve the repair of equipment valued at less than the SAT? I would ask the CO. There might be a Christian Doctrine issue. My bet is that there has been a goof, but there is only one way to find out. Ask the CO.

[Don Mansfield]

If one has a cost reimburseable contract with the CIA for research and development (and if anyone has done business with this agency, you will know they are anything less than willing to explain themselves when they administer contracts, you can't even get the prescriptions for their agency specific clauses they insert) and one purchases equipment under said contract, but there is no Government Property clause, or anything else that addresses equipment, the allowability of the purchase of said equipment, or who owns title to the equipment, then who owns it? I might add that permission was sought and received from the CO to purchase such equipment. Just wondering if anyone has dealt with a similiar situation in the past.

HigherEd123,

1. Is the contract for basic or applied research?

2. Is the contractor an educational institution?