Quantcast Deductions to the Contract Price

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MO-327 CHG 94-01
be modified, and an equitable adjustment made in the contract
price.  A standard of work considered when the contract was
written may prove inadequate when the work is underway.  In such
circumstances modification of the contract should be considered.
(b)  In a fixed price contract the contractor can only be
required to carry out the amount of work specified in the
contract, unless an equitable price adjustment is granted.
(c)  In an indefinite quantity contract or a requirements
contract a gross disproportion between the estimated quantities
and the actual quantities may entitle the contractor to an
equitable price adjustment.
(d)  If the Government is placing constrains on the
performance of the contractor not specified in the contract, or
which could not be anticipated by a site inspection, an equitable
price adjustment may be justified unless the constraints are
removed. Typical constraints on performance include:  preventing
access to certain areas during normal working  hours, requiring
the contractor to work outside of normal work ing hours, mandating
the sequence in which the contractor is to perform his work, or
prohibiting the use of certain types of equipment or utility
(e)  The contractor is entitled to be paid in accordance
with the terms of the contract.  Holding up payment of the
contractor's invoice as an incentive to improve performance is
impermissible and may cause the Government to be found in breach
of contract.
6-720 Deductions to the Contract Price.  Deductions are
routinely taken to the contract price for nonperformed or
unsatisfactory work.  When deductions are taken, the contractor
should be informed that the deductions do not relieve him of his
contract obligations and that the Government reserves the right
to take other actions it, deems proper including termination f or
6-730 Contract Discrepancy Reports.  Contract discrepancy
reports (CDRS) document discrepancies (defects) in performance by
the contractor.  The discrepancies reported by the QAE form the
basis for identifying deficiencies in contractor performance.
Each CDR should be signed by the Contracting Officer and
forwarded to the contractor as rapidly as possible.  T h e
contractor should describe the corrective action he intends to
take and return the CDR to the Contracting Officer.  On return of
the CDR the contractor's response should be evaluated to
determine if further action is necessary.  A sample CDR form is
located in Appendix H.
6-740 Meetings with the Contractor.  If the contractor  persists
in unsatisfactory  performance, the Contracting Officer s hould
call for a formal meeting with the contractor.  The Contracting
Officer, with the assistance of the facility support contract
manager (FSCM) / quality  assurance evaluators (QAEs), should
prepare an agenda for t he meeting and send the agenda to the
participants prior to the meeting.  A copy of the agenda may also


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