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No Cost Analysis Needed To Terminate Delinquent Contractor

Monday, August 01, 2011 03:02 am


Contract Termination

Appeal of: Advance Construction Services, Inc., ASBCA No. 55232 (June 8, 2011)

A contractor reasoned that even its tardy performance would cost the government less than hiring someone else to complete the work. That may have been true, but that didn't make the government's contract termination improper.

Advance Construction Services (Advance) won a $7.6 million U.S. Army Corps of Engineers (Corps) contract to enlarge levees along the Mississippi River in Louisiana. After just a few months into what was to be a 450-day project, Advance was falling behind schedule. The Corps eventually terminated the contract for default, claiming that Advance had failed to diligently pursue contract performance. Advance argued that the government acted improperly. Specifically, it contended that (1) the Corps didn't prove Advance could not have completed the work on time; (2) the Corps improperly terminated before the cure period's expiration; (3) the Corps should have analyzed the cost of the termination versus re-procurement; and (4) Advance's nonperformance was excusable. All these arguments failed. [...]

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