Based on the situation I have described, It is clear that contractor A is in breach of contract and does not intend to fulfill its acknowledged contractual obligation without government intervention and adverse action. What authority would support the contractor assertion direct billing is allowed on a contract where the PoP is physically complete?
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There is no authority that I aware of that would allow a contractor to bill for services performed after completion of contract. You must speak with your council as to the remedy you seek from the contractor.