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Hello all,

Just putting this topic here because I saw a former topic here. (Apologies if it is the incorrect section) 

It is similar in nature to this thread. 

 

In my scenario though, sub has received a rated order. Prime has put the incorrect price (of course, lower) and sub is rejecting the notion of accepting the order as the prime has put incorrect pricing on the order. 

Prime is arguing that sub MUST accept the rated order and disputes on price can be made at a later date as the sub performs the contract. 

I have looked at 15 CFR 700. 

700.13(c) (1) (under Optional rejection) does not seem it would apply in this case. "If the person placing the order is unwilling or unable to meet regularly established terms of sale or payment;" at least according to person I spoke with at the DCMA. The person did mention that incorrect pricing is a valid argument for not accepting the rated order but could not cite anything. 

I was hoping anyone here has experience in a similar fact pattern and could advise. 

I still think that 700.13(c)(1) could be argued to reject the rated order as regularly established terms of sale should include agreement on pricing/payment. 

Thanks again everyone. Feel free to ask me to clarify or provide further details. 

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Your situation is rare from my contractor side view. I would send the required DPAS notice of non acceptance within the given time. I would put an acceptable price in the notice. If the prime "corrects" the price with a change notice, I could then accept the deal.

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17 hours ago, ji20874 said:

Will a quick correction to the pricing solve the problem?

@ji20874 If the prime would make the correction, this would work. They refuse to though. 

1 hour ago, Neil Roberts said:

Your situation is rare from my contractor side view. I would send the required DPAS notice of non acceptance within the given time. I would put an acceptable price in the notice. If the prime "corrects" the price with a change notice, I could then accept the deal.

@Neil Roberts Thanks Neil. My concern was that 700.13 outlines acceptance and rejection of rated orders and I wasn't sure if the sub fell under any of the "optional rejections" outlined in subsection (c). I agree with you that non acceptance is the right step but wasn't sure if the regs back us up somewhere. 

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Not sure why you don't believe paragraph (c) (1) "backs you up." Was the price offered by the prime your regularly established price for the quantity involved? Have you sold the item previously at that price and quantity? Were you offered an undefinitized subcontract?  Why is the prime refusing to offer another price? Is the value of the transaction in excess of the truth in negotiations threshold and/or an exception to it?  

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18 hours ago, Neil Roberts said:

Not sure why you don't believe paragraph (c) (1) "backs you up." Was the price offered by the prime your regularly established price for the quantity involved? Have you sold the item previously at that price and quantity? Were you offered an undefinitized subcontract?  Why is the prime refusing to offer another price? Is the value of the transaction in excess of the truth in negotiations threshold and/or an exception to it?  

Hello Neil. The Sub has a contract with the prime for several parts. This particular part was not listed on the contract with a price. The part was listed as "quote". Prime asked for quote, sub quoted a price for x quantity. 

Prime submitted rated order for parts at random price which is lower than quoted price. They took a stance that sub must accept rated order regardless of the dispute in pricing. Sub disagrees. 

Value of the transaction is not in excess of TINA threshold and exception exists if it did. (commercial item). 

The language "terms of sale" in (c)(1) was what was undefined for me. Whether pricing is included in the terms of sale as defined in (c)(1)  was unclear so I did not want to rely on it. I also spoke to someone from DCMA who said (c)(1) wouldn't apply..which confused me but I accepted. 

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1 hour ago, StePa said:

This particular part was not listed on the contract with a price. The part was listed as "quote". Prime asked for quote, sub quoted a price for x quantity. 

Prime submitted rated order for parts at random price which is lower than quoted price. They took a stance that sub must accept rated order regardless of the dispute in pricing. Sub disagrees. 

If this is factually correct, then this is reprehensible contracting. The DPAS stuff is ignorant bluster. I would not accept the order and I would dare the prime to escalate, knowing the facts would embarrass the company and might lead to CPSR findings.

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1 minute ago, here_2_help said:

If this is factually correct, then this is reprehensible contracting. The DPAS stuff is ignorant bluster. I would not accept the order and I would dare the prime to escalate, knowing the facts would embarrass the company and might lead to CPSR findings.

@here_2_help Those were my thoughts exactly and what the DCMA rep told me as well. It seems to be a case of a prime trying to bully a sub into accepting an order for either (a) keeping the price low, (b) ensuring the parts are delivered on time or (c) both. 

From what @Neil Roberts has stated, it seems like 700.13(c)(1)  is the best citation. 

Just wanted to confirm my thoughts and it seems everyone does agree with me. Thanks all. 

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