Doug0464 Posted November 12, 2024 Report Share Posted November 12, 2024 Good afternoon!! This is actually my first post here, but have been following Wifcon for years... I have a vendor who was awarded a below SAT service contract in 2022 for landscape maintenance. On 6/27/2024 they sent me notice that read " On January 16th, 2024, the Small Business Administration Office of Hearings and Appeals (SBA, OHA) issued a final determination declaring that Sanford Federal Inc. no longer qualified as a small business concern under the criteria for businesses with annual revenues of $22 million or below as of January 16th, 2024, the company, however, was unaware that we had an obligation to inform you of the same immediately after this determination." SBA instructed me that we would not be able to exercise any additional options on the contract but the vendor could continue to perform under the current option until it expired (which was 2 more months) and we ended up awarding a new contract. Now, the vendor has not invoiced for the final 3 months of performance on the contract, performance was by a subcontractor, and the subcontractor has not been paid either. What actions are available for me to get the vendor to invoice and pay the sub? I have already posted a FAPIIS entry and an interim CPARS and they have 2 other "Subcontractor Payment Issues" in FAPIIS as well as 10 "Terminations for Cause" entries and it appears to have no effect on them. I have scoured the FAR and cannot find anywhere that says I can de-obligate and close the contract following a failure to invoice... Any recommendations??? Quote Link to comment Share on other sites More sharing options...
C Culham Posted November 13, 2024 Report Share Posted November 13, 2024 Here are my thoughts - 17 hours ago, Doug0464 said: What actions are available for me to get the vendor to invoice and pay the sub? Not much if anything is available to the agency to compel the payment of a subcontractor in the scenerio you have painted. A sub getting getting paid is left to subs own efforts via its subcontract language, court, possible mechanics lien etc. My thoughts extend to the "even if" you did recieve an invoice and were preparing to pay it. No guarantee that the prime would filter payment down to the sub. Here the suggestion would be to review the contract fully to see if my thinking is correct as there might be a condition in the contract that would help you compel but I kind of doubt it. 17 hours ago, Doug0464 said: I have already posted a FAPIIS entry and an interim CPARS and they have 2 other "Subcontractor Payment Issues" in FAPIIS as well as 10 "Terminations for Cause" entries and it appears to have no effect on them. An aside which is too late now but considing what you found makes me wonder how the contractor was evalauted to receive the instant contract that you have posted about? No need to respond just a rhetorical thought on my part. 17 hours ago, Doug0464 said: I have scoured the FAR and cannot find anywhere that says I can de-obligate and close the contract following a failure to invoice... Any recommendations??? Again I recommend you scour the contract. If nothing is found that will assist then I would consider unilaterally closing out the contract and making final payment, Doing so gets a little tricky so I would discuss with your legal advisors. Essentially what you would be doing is a CO Final Decision and then leaving it to the contractor to file an appeal of the decision if they did not agree. Lots to consider taking this route including how long do you wait to do so, funding issues, the subcontractor, etc. Hope my thoughts help and possibly generate thoughts from others. Quote Link to comment Share on other sites More sharing options...
Retreadfed Posted November 13, 2024 Report Share Posted November 13, 2024 Doug, how is the contract priced and is FAR 52.216-7 in the contract? Quote Link to comment Share on other sites More sharing options...
Doug0464 Posted November 13, 2024 Author Report Share Posted November 13, 2024 4 minutes ago, Retreadfed said: Doug, how is the contract priced and is FAR 52.216-7 in the contract? Good morning... it was FFP under FAR 12 and 13 so no, 216-7 was not included 1 hour ago, C Culham said: Here are my thoughts - Not much if anything is available to the agency to compel the payment of a subcontractor in the scenerio you have painted. A sub getting getting paid is left to subs own efforts via its subcontract language, court, possible mechanics lien etc. My thoughts extend to the "even if" you did recieve an invoice and were preparing to pay it. No guarantee that the prime would filter payment down to the sub. Here the suggestion would be to review the contract fully to see if my thinking is correct as there might be a condition in the contract that would help you compel but I kind of doubt it. An aside which is too late now but considing what you found makes me wonder how the contractor was evalauted to receive the instant contract that you have posted about? No need to respond just a rhetorical thought on my part. Again I recommend you scour the contract. If nothing is found that will assist then I would consider unilaterally closing out the contract and making final payment, Doing so gets a little tricky so I would discuss with your legal advisors. Essentially what you would be doing is a CO Final Decision and then leaving it to the contractor to file an appeal of the decision if they did not agree. Lots to consider taking this route including how long do you wait to do so, funding issues, the subcontractor, etc. Hope my thoughts help and possibly generate thoughts from others. Good morning and thank you for the feedback... Only thing I have found in the contract is in 52.212-4(g)(2) referencing 52.232-25(a)(3) which stats "...Contractor shall prepare and submit invoices to the designated billing office specified in the contract." Not sure what an "instant" contract is, but this was best value trade off and with nothing in CPARS/FAPIIS, past performance eval was based on PPQs received in response to the RFQ. After I posted this, a counterpart found a post from Vern Edwards back in 2015 citing the Contract Disputes Act and the contractor's right to submit a claim up to six years after its accrual, stating "To show good faith I would send each contractor whose right to submit a claim has not yet expired a certified letter telling them to submit an invoice within 30 days of receipt. I would do nothing else and send no other notice. Set a date for the end of the sixth year of each such contract and on that date close out the contract and deobligate the funds." Quote Link to comment Share on other sites More sharing options...
Vern Edwards Posted November 13, 2024 Report Share Posted November 13, 2024 19 hours ago, Doug0464 said: Now, the vendor has not invoiced for the final 3 months of performance on the contract, performance was by a subcontractor, and the subcontractor has not been paid either. Just out of curiosity, have you telephoned the vendor to inquire? Have you inquired by any other means? Email? Quote Link to comment Share on other sites More sharing options...
Doug0464 Posted November 13, 2024 Author Report Share Posted November 13, 2024 Just now, Vern Edwards said: Just out of curiosity, have you telephoned the vendor to inquire? Have you inquired by any other means? Email? Hi Vern... Yes, I have sent multiple follow-up emails including one that stated individual invoices were not necessary and they could simply submit a final invoice for the remaining balance of the contract. Quote Link to comment Share on other sites More sharing options...
Vern Edwards Posted November 13, 2024 Report Share Posted November 13, 2024 Are we talking about a lot of money? Quote Link to comment Share on other sites More sharing options...
Doug0464 Posted November 13, 2024 Author Report Share Posted November 13, 2024 10 minutes ago, Vern Edwards said: Are we talking about a lot of money? Well, that's sort of subjective, but no... only $9,200 Quote Link to comment Share on other sites More sharing options...
formerfed Posted November 13, 2024 Report Share Posted November 13, 2024 4 hours ago, C Culham said: Again I recommend you scour the contract. If nothing is found that will assist then I would consider unilaterally closing out the contract and making final payment, Doing so gets a little tricky so I would discuss with your legal advisors. Essentially what you would be doing is a CO Final Decision and then leaving it to the contractor to file an appeal of the decision if they did not agree. Lots to consider taking this route including how long do you wait to do so, funding issues, the subcontractor, etc. If this is being contemplated, I would also check with the Finance/Comptroller office. There are very few circumstances where payment is authorized without a proper invoice. I would be surprised if they made payment without one. Quote Link to comment Share on other sites More sharing options...
Vern Edwards Posted November 13, 2024 Report Share Posted November 13, 2024 I don't think you should pay without an invoice. Send a letter the highest person in the company by USPS certified mail, return receipt requested, and tell them that you will close out the contract without further payment if you do not receive a proper invoice by a specified date. Then, if they do not respond, document the file and close out the contract. Quote Link to comment Share on other sites More sharing options...
Doug0464 Posted November 13, 2024 Author Report Share Posted November 13, 2024 17 minutes ago, Vern Edwards said: I don't think you should pay without an invoice. Send a letter the highest person in the company by USPS certified mail, return receipt requested, and tell them that you will close out the contract without further payment if you do not receive a proper invoice by a specified date. Then, if you they do not respond, document the file and close out the contract. I had the same thought Vern... NO way I would pay without an invoice!! I really appreciate everyone's input and advise! Quote Link to comment Share on other sites More sharing options...
joel hoffman Posted November 14, 2024 Report Share Posted November 14, 2024 I wouldn’t worry much about a future claim. What would be the basis? “I intentionally refused to submit an invoice as required by the contract to be paid, even after numerous government attempts to pay me?” Im assuming that you informed them that you will close out the contract and de-obligate remaining funds if they refuse to invoice for the final payment. The prime has a separate subcontract relationship to deal with. Quote Link to comment Share on other sites More sharing options...
joel hoffman Posted November 14, 2024 Report Share Posted November 14, 2024 18 hours ago, Vern Edwards said: Just out of curiosity, have you telephoned the vendor to inquire? Have you inquired by any other means? Email? 18 hours ago, Doug0464 said: Hi Vern... Yes, I have sent multiple follow-up emails including one that stated individual invoices were not necessary and they could simply submit a final invoice for the remaining balance of the contract. I’m curious… Did you actually speak with the contractor or just email the person? If you SPOKE with them, what was their reaction/response/intent/reasons for not invoicing? Quote Link to comment Share on other sites More sharing options...
Vern Edwards Posted November 14, 2024 Report Share Posted November 14, 2024 Voice communication seems to be increasingly uncommon in both private life and business. Email and text seem to be the preferred and prevailing methods. When I call businesses where I live, the people answering don't seem to know how to talk. They sometimes seem shocked that they have received a voice communication instead of an email or a text. They say "Hello" tentatively, with what seems a sense of wonder. Quote Link to comment Share on other sites More sharing options...
joel hoffman Posted November 14, 2024 Report Share Posted November 14, 2024 24 minutes ago, Vern Edwards said: Voice communication seems to be increasingly uncommon in both private life and business. Email and text seem to be the preferred and prevailing methods. When I call businesses where I live, the people answering don't seem to know how to talk. They sometimes seem shocked that they have received a voice communication instead of an email or a text. They say "Hello" tentatively, with what seems a sense of wonder. My experience and that of a fellow retiree who worked as a consultant, over the past several years, indicate that it also evident with current government employees. I have been thinking about Vern’s separate thread about suggestions for “what can be done to improve and streamline contracting without the need for new legislation.” The workforce needs to be transformed concerning frank, open and personal communications both internal to the organization and external with outside stakeholders and industry, especially their awarded contractors. The art of Oral communications is much more effective than written snippets, not only in administering contract, but in Acquisition Planning and in the Acquisitions process. Written communications can be used, when necessary, to confirm and document the oral communications. Send employees to training in effective personal communications and interaction. If the in-person class for the late Stephen Covey’s “The 7 Habits of Highly Effective People” is still being offered, it would be my first pick. It was truly personally transforming. Quote Link to comment Share on other sites More sharing options...
formerfed Posted November 14, 2024 Report Share Posted November 14, 2024 2 hours ago, Vern Edwards said: Voice communication seems to be increasingly uncommon in both private life and business. Email and text seem to be the preferred and prevailing methods. When I call businesses where I live, the people answering don't seem to know how to talk. They sometimes seem shocked that they have received a voice communication instead of an email or a text. They say "Hello" tentatively, with what seems a sense of wonder. I’ve read in several sources the new telephone “etiquette” is texting someone first to ask if it’s okay to call them and what’s a good time? I suppose this has carried over to businesses and unexpected phone calls come as a surprise. Quote Link to comment Share on other sites More sharing options...
C Culham Posted November 14, 2024 Report Share Posted November 14, 2024 22 hours ago, Doug0464 said: Not sure what an "instant" contract is Sorry I was not clear, the current contract to which you speak. 17 hours ago, Doug0464 said: NO way I would pay without an invoice!! No disagreement I just read your initial questions as implying you were trying to find a way to pay to closeout. 22 hours ago, Doug0464 said: I have found in the contract is in 52.212-4(g)(2) referencing 52.232-25(a)(3) 2 hours ago, joel hoffman said: I wouldn’t worry much about a future claim. So more thoughts- Your reference that 52.232-25 is referenced in 52.212-4 suggests tailoring as the standard 52.212-4 does not reference the -25 clause. Many agencies now require release of claims on all contract final payments. Was 52.212-4 also tailored regarding a release and/or does the contract happen to do so? If so I would think there might opportunity for future claim as you have no release if required. I think calling the contractor and discussing why they are not invoicing is a great approach as I would think somebody in their organization could provide the answer. Quote Link to comment Share on other sites More sharing options...
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