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Asbca Checks Govt. For Abuse Of Power To Terminate

Thursday, September 04, 2008 03:42 pm

Asbca Checks Govt. For Abuse Of Power To Terminate

The government failed to show its termination of a contractor's contract for lack of progress was justified; rather, the Armed Services Board of Contract Appeals (ASBCA) found the action unreasonable and based on inaccurate, misleading analysis of the project's progress.

The New Orleans District of the United States Army Corps of Engineers (Corps) hired Kostmayer Construction LLC (KC) to enlarge an existing levee at Lake Cataouatche, Louisiana. The project, which commenced in March 2004, involved four phases to (1) excavate a new drainage canal parallel to the levee, (2) fill in the existing canal and then (3 and 4) strengthen the levee with uncompacted and compacted fill. In May 2005, with seven months to go on the project timeline and in the middle of phase 2, the Corps terminated the contractor's right to proceed for "[fa]ilure to make adequate progress" and "[f]ailure to demonstrate ... the ability toplan and prosecute the work in a manner necessary to complete by the required contract completion date."

However, the Corps failed to accurately judge the project's progress or the contractor's ability to complete the work, the ASBCA found. Specifically, the Board noted that the Corps: miscalculated the degree of project completion at the time of termination, underestimated KC's commitment of additional resources to meet the completion date, and disregarded the results of its own test when it directed KC to "cure" its performance deficiencies.

Govt. shortchanged contractor progress

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