Excusable Delays, Federal contractors, and Covid-19

Federal contractors must perform on their contracts. Failure to do so could cause termination for default. This reflects badly on their performance score card. Because of the Coronavirus outbreak contractors need to look at their contract to see whether the language of the FAR clauses addressing excusable delays is included in their contracts.

Specifically, the following FAR clauses address excusable delays: FAR 52.249 - 8 ( fixed price contracts); FAR 52.249 - 14 (cost reimbursement, time and materials); FAR 52.212-4 (commercial contracts). These clauses, to summarize, excuse delays in performance where there are acts of God or public enemy, epidemics, quarantine restrictions, war, etc.

Two key concepts to remember: 1. these clauses give the contractor an opportunity to extend the time for performance, however, generally both parties assume the cost of delays 2. the federal government does reserve the right to terminate the contract, however, the termination most likely will be for convenience and not default.

What should contractors do? 1. Draft a plan of action 2. Look at all your contracts and review their language addressing excusable delays 3. Keep the lines of communication open with your contracting officer. 4. Don’t forget to provide notice. 5. See if you can mitigate damages if the subcontractors cannot perform for no fault or negligence of their own or for reasons beyond their control. 6. Document, document, document, the events that brought about the delay in performance.

Questions? Thoughts? Write to us.