Category: Government Contracts

How Enforceability of a Termination for Convenience Clause in the Prime Contract Can Impact a Subcontract

Intellectual property attorney Chris Han of Morrison Foerster wrote a useful article in November 2021 about a decision from the Federal Circuit regarding termination for convenience. Han notes the Court determined that the termination for convenience clause in the prime contract was applicable only in specific instances despite it being enumerated in the contract and [..]

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Does the Federal Prompt Pay Act Confer a Private Right of Action?

The overwhelming legal precedent on this question is that it does not. The requirements of the Federal Prompt Payment Act are found in FAR clauses 52.232-25 through 232-27. In short, these clauses set out invoicing and payment terms and provide for an interest penalty for late payments. However, FAR 52.232-27, Prompt Payment for Construction Contracts [..]

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Recourse After Assignment

One of Attorney Laura Frederick’s contract tips was on recourse against a party after it assigns a contract. She makes the point that obligations under the agreement that belong to the assignor (the party assigning the contract) do not end simply through an assignment. A three-party novation is needed. The same is – somewhat – [..]

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Does the Federal Prompt Pay Act Confer a Private Right of Action?

The overwhelming legal precedent on this question is that it does not. The requirements of the Federal Prompt Payment Act are found in FAR clauses 52.232-25 through 232-27. In short, these clauses set out invoicing and payment terms and provide for an interest penalty for late payments. However, FAR 52.232-27, Prompt Payment for Construction Contracts, [..]

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Suing the Owner for Non-Payment when the Owner is the Government

Law360 recently reported on a newly-filed case in the U.S. District Court for the Southern District of Texas where a lower-tier subcontractor sued the project owner for non-payment, bypassing the subcontractor with whom it had contracted. While the complaint does not appear to be related to government contracting, it nevertheless made me think about similar [..]

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High “Litigation Impact” Term Number 8 – Order of Precedence

Because subcontracts usually include flow-down clauses and/or an incorporation of the entire prime contract, the parties will want to include an order or precedence provision in their agreement. Generally, courts will interpret a contract as written. In other words, if a contract term is not subject to reasonable differing interpretations, they will not read meaning [..]

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Cost Recovery on FFP Contracts

Robert Nichols, Andrew Victor, and Haaleh Katouzian published an article earlier this year about a case out of the U.S. Court of Appeals for the Federal Circuit on recovering increased costs associated with a firm fixed price government contract. In sum, the Court affirmed a CBCA ruling that denied relief to the contractor on the [..]

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