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  • Question

    If FAR 52-245.1 was not included in contract, and GFP/CAP came into the picture at a later time, is it "implied" that FAR 52-245.1 would be adhered to in the management of the property? Or, would a contract modification be required to insert the property clauses?


    Answer

    When the Government property clause at FAR 52.245-1 shall be inserted into a contract in accordance with FAR 45.107 and it is omitted, a contract modification should be issued to correct the deficiency. By “implied” you may be thinking in terms of the Government property clause being incorporated into a contract by operation of law when it has been physically omitted from the contract. Many in Contracting and Industrial Contract Property Management are familiar with the Christian doctrine, G. L. Christian and Associates v. the United States, (312 F.2d 418 (Ct. Cl. 1963) U.S. Court of Claims (1855-1982) - 312 F.2d 418 (Ct. Cl. 1963)), which determined that the standard termination clause, when omitted, should be read into the contract by operation of law. The rationale for the Court’s decision was that the clause was mandatory under statutory authority and the profit limitation and recovery of anticipated but unearned profits within the clause were determined to be “a deeply ingrained strand of public procurement policy.” Relative to the Government property clause is the Appeals of Hart's Food Service, Inc., d/b/a Delta Food Service (ASBCA No. 30756 1989 WL 47610 (A.S.B.C.A.), ASBCA No. 30,756, 89-2 BCA 21,789). In this appeal the Armed Services Board of Contract Appeals applied the Christian doctrine to the mandatory Government property clause. There have been other decisions from the ASBCA and other courts that have decided for and against the Christian doctrine’s applicability to the Government property clause. It is best to issue a contract modification to insert FAR 52.245-1 in the contract in accordance with FAR 45.107 rather than to rely solely upon it being read into the contract by operation of law. Currently there is a Department of Defense effort to ensure FAR 52.245-1 is inserted in all cost-reimbursable contracts.


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