Under what authority is the modification issued? Would this fall under the Default clause if its not an excusable delay, or is it an excusable delay?
At this point, I believe it would be appropriate for the new KO to extend the period of performance with a bilateral modification that references the Excusable Delays Clause. I am not suggesting the contractor is free of responsibility. But, the Government played a role in this delay and the work still needs to be completed.
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A contractor that hasn’t maintained insurance as required is in breach of contract. The KO issued a Suspension of Work letter to make the contractor address this non-compliance issue. All Suspension of Work Letters include an effective date and an estimated duration. In your scenario, the duration far exceeded any estimate and could now be considered “unreasonable” under FAR 52.242-18. The gap in administrative control during contract performance has limited the options for the new KO.