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Terminated Contractor's Equitable Adjustment Hopes Crumble Like The Road It Built

Thursday, September 01, 2011 07:27 am


Contract Termination

Appeal of: Tawazuh Commercial and Construction Co. Ltd., 2011 ASBCA No. 55656 Lexis 37 (June 13, 2011)

A contract ambiguity couldn't save a contractor from termination given how poorly it failed to meet the rest of the contract specifications.

After being terminated for default from a contract to pave a road in Afghanistan, contractor Tawazuh Commercial and Construction Co. Ltd (TCCC) sought more than $2.5 million in equitable adjustment. TCCC argued that the termination was improper, alleging that it had performed in accordance with the contract and that the government had misinterpreted the contract as requiring work it did not. The U.S. Army Corps of Engineers (Corps), who administered the contract, disagreed. It charged that there were major deficiencies with the completed work, the materials used, and the methods of application.

The government issued two progress payments to TCCC before it was able to inspect the work at the site (due to security issues). At the eventual site visit, the government discovered significant deviations from the specifications and substandard workmanship. For instance, the specs required that the road surface treatment be at least 10 millimeters thick, but the road's surface had an average thic [...]

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