If the contractor is currently outside of the CCD and is suspended for 90 days, is the contractor liable for LD's for the duration of the suspension?
After reading your question and the background information, I believe these are the facts:
1. The contractor has missed the original Contract Completion Date (CCD) (for reason(s) unknown).
2. The contractor has completed only 50% of the contract work (for reason(s) unknown).
3. The contractor is not due a time extension (for either compensable or excusable delay).
4. The contract has been suspended for 90 days (for reason(s) unknown).
Lacking all the facts I can only give you general information on government construction contracting procedures involving the assessment of liquidated damages.
There are three clauses that government contracting officers use for construction contracts that relate to your question:
1. FAR 52.211-10 -- Commencement, Prosecution, and Completion of Work (Apr 1984). This clause is inserted in solicitations and contracts when a fixed-price construction contract is contemplated.
"The Contractor shall be required to:
(a) commence work under this contract within _________ [Contracting Officer insert number] calendar days after the date the Contractor receives the notice to proceed,
(b) prosecute the work diligently, and
(c) complete the entire work ready for use not later than ______________.* The time stated for completion shall include final cleanup of the premises."
The date that the contracting officer inserts in sub-paragraph (c) is often referred to as the Contract Completion Date (CCD).
2. FAR 52.211-12 -- Liquidated Damages – Construction Sep 2000). This clause is inserted in solicitations and contracts for construction, other than cost-plus-fixed-fee, when the contracting officer determines that liquidated damages are appropriate. Usually this pertains to all fixed-price construction contracts exceeding $700,000 where the contractor can control the pace of the work. Use of the clause in contracts of $700,000 or less is optional.
“(a) If the Contractor fails to complete the work within the time specified in the contract, the Contractor shall pay liquidated damages to the Government in the amount of _______________________ [Contracting Officer insert amount] for each calendar day of delay until the work is completed or accepted.
(b) If the Government terminates the Contractor’s right to proceed, liquidated damages will continue to accrue until the work is completed. These liquidated damages are in addition to excess costs of repurchase under the Termination clause.”
Normally, the contracting officer would assess liquidated damages only when the delay is the contractor’s fault. All other delays would allow the contractor to request a time extension which could extend the CCD.
3. FAR 52.242-14 Suspension of Work (Apr 1984) – The contracting officer shall insert this clause, in solicitations and contracts when a fixed-price construction or architect-engineer contract is contemplated.
“(a) The Contracting Officer may order the Contractor, in writing, to suspend, delay, or interrupt all or any part of the work of this contract for the period of time that the Contracting Officer determines appropriate for the convenience of the Government.”
Your question does not explain why the contracting officer issued a suspension of work order. Usually, a suspension of work order is issued when an issue arises under the contract that requires the contracting officer time to perform an investigation to determine how to proceed. An example of such an issue would be the uncovering of asbestos pipe insulation when the scope of work did not include asbestos remediation.
If the suspension of work is issued due to a change in the contract, such as change under the differing site conditions clause, the contracting officer would not continue to assess liquidated damages from the date of the order until the issue is resolved and the suspension of work order is rescinded. The contractor would normally be able to get its costs due to the suspension, but no profit. Any time due to the contractor would be granted under the Default Clause for construction.
The foregoing is not legal advice and is being provided solely to assist in understanding government contracting procedures. Any information provided here is not binding on the U.S. Government.
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