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  • Question

    What are disruption claims in general and are disruption claims non-compensable to the contractor? I have heard that such claims are a basis for non compensable time extensions, but not compensable ones.


    Answer

    Based on your scenario I have to make some assumptions. 

    1.  You already negotiated the suspension of work and the differing site condition.  You have agreed to a price increase and an extension of time.

    2. NTP was issued after modification was signed and now the contractor states his subcontractor is not available thus delaying his new schedule. 

    Based on the above assumptions, you have already compensated the contractor for time and money and have a signed agreement.  It is incumbent upon the contractor to now meet the new schedule in which he has agreed.  There could be one exception to review.  FAR 52.249-10(b)(1)(xi), Default (Fixed Price Construction)clause.  This clause would allow you to provide the contractor compensation of time only if the following applied:

     

    The Contractor’s right to proceed shall not be terminated nor the Contractor charged with damages under this clause, if-

               (1) The delay in completing the work arises from unforeseeable causes beyond the control and without the fault or negligence of the Contractor. Examples of such causes include- (Note this clause provides a listing of potential excusable delays. This one below applies most closely to your scenario.)

    (xi) Delays of subcontractors or suppliers at any tier arising from unforeseeable causes beyond the control and without the fault or negligence of both the Contractor and the subcontractors or suppliers.

    Based on how I read your scenario, it does not meet the standard of paragraph (xi).  Therefore, the contractor would not be due any compensation (time or money) since the delay was within the control of the subcontractor.

    Further information: Under the FAR 52.242-14, Suspension of Work, this clause states you can only pay cost no profit, provided it was not the fault or negligence of the contractor. Time would be provided under FAR 52.249-10, Default.  If you were providing relief under the FAR 52.236-2, Differing Site Conditions clause, it allows for an “equitable adjustment.” This could be time, price or both depending on the circumstances.

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