Sign In
  • Question

    Would a bilateral termination modification be the path to pursue or would the path be issuing a T4C notice.


    Answer

    Determining which method to use is situation dependent. Most ESPCs contain a cancellation clause with a cancellation ceiling included. Review the contract itself to identify the clause and any liabilities you might have if the contract is terminated or cancelled early. FAR subpart 17.1 provides the appropriate information to cancel or terminate multi-year contracts such as this one. Additionally, the program attorney must be consulted before either action is taken. The contractor may have already made a considerable investment in the effort (even if it hasn't been successful yet) and if the government terminates it prior to them being able to realize any benefit, there could be considerable equitable adjustment that would need to be provided. While the funding for the cancellation ceiling wasn't needed to award the contract, it would need to be available in the event of a cancellation or termination of the contract. 

    Open full Question Details
Chat with DAU Assistant
Bot Image