ChuckB

I finally got this matter resolved. The Prime's legal counsel would not budge on the contract verbiage, so I convinced the program manager in charge of project execution agreed to write in the Master Services Agreement a 30 day limit to each "Service" my employee will provide. That in effect bounds my risk to an acceptable level.

All, This issue is still in progress. I'm working under an NTP while still negotiating the contract using your advice. I'll let you know what occurs as soon as I have a worthwhile update. Vern, the company wrote this contract for several purposes, which include consulting services. Their legal advisor understands this is for consulting but won't budge on deleting the verbiage, so I've requested to apply limits/bounds to the paragraph. v/r Chuck

Fara, In response to your point about "too vague"... a different clause allows the Prime to withhold "Any payments due SUBCONSULTANT may be reduced by (1) any retainage withheld from CONSULTANT, (2) amounts of work in dispute", so I believe it does mean they don't have to pay you even for services already delivered or invoiced? I'd appreciate any suggestion about where to find the FAR settlement and payment provision you referenced.

I received a subcontract with a Prime who has this clause in their MSA: 12. TERMINATION FOR CAUSE. In the event SUBCONSULTANT fails or is unable to comply with the provisions of this Agreement, or there is a defect in the Services, and same is not corrected within five (5) workdays after written notice by CONSULTANT to SUBCONSULTANT, CONSULTANT may at its sole discretion, notwithstanding any other right or remedy: (1). Terminate this Agreement as provided above and be relieved of the payment of any further consideration to SUBCONSULTANT. In the event of such termination, CONSULTANT may proceed to complete the services in any manner deemed proper by CONSULTANT, either by the use of its own forces or by re-subcontracting them to others. In either event, SUBCONSULTANT shall be liable for the cost to complete the services herein provided for, over and above what SUBCONSULTANT would have been entitled to receive for the completion of said services. (2). CONSULTANT may, without terminating this Agreement or taking over the services, furnish the necessary materials, equipment, supplies or help necessary to remedy the situation, at the expense of SUBCONSULTANT. This is a professional services contract. The Prime's legal advisor won't strip the yellow highlighted text. In the event of termination for cause, How do I mitigate my risk of being charged for another subcontractor's employee for a lengthy period? Please advise acceptable bounds or limits that I can propose to the Prime that eliminate or limit my risk.