Jump to content

Resolution to Termination for Cause and Reprocurement Costs - Failure to Deliver on Time


Recommended Posts

For anyone that followed this thread last year,

I thought I'd provide an update on how it ended. After issuing the termination notice and claim for reprocurement costs, the contractor challenged the termination at the Civilian Board of Contract Appeals. For context, the primary reason for terminating the contract for cause was because the contractor failed to deliver a working system within the 30-day extension the CO provided after having re-established the delivery schedule. The issue of re-establishing the delivery schedule was discussed separately on this Wifcon thread: 


Unfortunately, despite spending countless hours researching court/board decisions, legal blogs and other references, and drafting a series of notices to ensure our termination was procedurally solid, our attorneys did not believe they would prevail in court. They recommended we settle with the contractor. Part of the draft settlement agreement required the contractor to return a small portion of the amount we paid. Unfortunately, the contractor also demanded a satisfactory past performance rating in CPARS. Ultimately, we decided to walk away from the partial refund and instead converted the termination into a termination for convenience and gave the contractor a past performance rating that accurately reflected their performance.

From the date of termination, settlement discussions, to the Reviewing Official finalizing the evaluation in CPARS, the entire process took a year. There were some significant lessons learned from the contracting process on this procurement that got us to the point of having to terminate the contract. But there were also some lessons learned about the termination process itself. Among them:

1. Ensure that your attorneys and leadership are onboard and ready to support a termination for cause or default before embarking on that path.

2. Maintaining a strong working relationship with your attorneys will make it more likely that they will be willing to go to bat for you when the time comes.

3. Be aware of how time consuming it can be to build a case to support a termination for cause. Drafting lengthy notices and compiling documents and correspondence for a Rule 8 file for your attorneys is not a pleasant way to spend several weekends.

4. Sometimes in contracting, it doesn't matter how right you believe you are, or how strong a case you think you have against a contractor. The interests of the agency may dictate pursuing a different course of action. As a leader, you'll need to get behind that course of action.


In the end, contract B provided us the system we needed with all the required functionality and has performed beautifully to date.

Link to comment
Share on other sites

2 hours ago, rios0311 said:

terminating the contract for cause

Thank you for the update.   

Your thoughts are not unlike mine when having similar experiences.   I will say I am too much of an idealist.   I was around when Commercial Item procurement became a reality.  I really liked the idea of termination for cause as it seems play out in the commercial market place.   Like by example I come home to find my painter not doing as we agreed to and I send them packing, not pay, etc.  It seems, and as I understand, that termination for cause has taken on the face of termination for default and for me that is just a little disappointing.

Again thank you for the update much appreciated.

Link to comment
Share on other sites

Yes, I think it is a great idea to report back on What Happened after applying (or rejecting) the information learned on the threads we create. I would suggest to anyone doing so to include a link to the original discussion topic, and to include a link on the original thread to the What Happened resolution.

Thanks for the forum, bob7947. It's been a great learning tool and sounding board throughout the years.

Link to comment
Share on other sites

This topic is now closed to further replies.
  • Create New...