Quantcast Consequences of the Contractor's Failure to Perform Required Services

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leads to disputes with the contractor concerning the scope of the work
included in the contract.
If the solicitation is an indefinite quantity contract, a minimum dollar
value must be specified.  A minimum quantity need not be specified for the
indefinite quantity part of a firm fixed price/indefinite quantity (FFP/IQ)
contract.  The quantities shown on the schedule of indefinite quantity work
are maximum quantities and they cannot be exceeded without a formal
modification to the contract.
A series of standard clauses, dependent on the type of contract being used,
are given in the contracting Manual P-68 at Part 52. The various types of
contracts commonly employed by NAVFACENGCOM are described in Chapter 5 of
this manual.
An example of a bid schedule, as completed by the contractor, for a firm
fixed price/indefinite quantity contract for refuse collection and disposal
is shown in Figure 3-8.
3-550 Section E, Consequences of the Contractor's Failure to Perform
Required Services. The primary goal of the Government is to obtain timely
performance in accordance with the contract specifications while preserving
the integrity of the competitive procurement system. To insure that this
goal is achieved, various clauses are included in the contract giving the
Government substantial rights to monitor performance and to take appropriate
steps when performance is unsatisfactory.  The two principal clauses which
contain the fundamental rules for inspection and acceptance of the
contractor's work are "Inspection of Services-Fixed Price" which is included
in the Federal Acquisition Regulation (FAR), and "Consequences of
Contractor's Failure to Perform Required Services" which is a NAVFACENGCOM
The Government is given a wide range of remedies if the contractor's work is
unsatisfactory.  The "Consequences of Contractor's Failure to perform
Required Services" allows the Government to:
(1) reject work and order the contractor to correct,
(2) take an equitable deduction in price for defective work,
(3) have defective services performed by Government personnel or by
other means.
The various versions of the "Consequences" clauses are given in the
Contracting Manual P-68, Part 52. Alternate I is used when statistically
extrapolated surveillance techniques, random sampling for extrapolated
deductions (RSED), or random sampling without extrapolated deductions
(RSWED) are used.  Alternate II is used when statistically extrapolated
surveillance techniques will not be used to either assess the contractor's
performance or determine the amount of payment due. Alternate III is used
for watchstanding .  Alternate I should be used for watchstanding if
statistically based inspection techniques are used.


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