Contract Law You have a firm fixed price contract to deliver 10,000 aluminum foi

Question

Contract Law

You have a firm fixed price contract to deliver 10,000 aluminum foil hats to Agent Mulder at the FBI. The contract is silent on the method of testing but requires the contractor to present a test and acceptance plan for approval. When you meet to present your test and acceptance plan, Agent Mulder tells you that every single hat must be tested in a microwave oven. Your understanding of accepted industry practice is that testing a one percent sample of the hats is sufficient. After discussions, Agent Mulder is still adamant that every hat must be tested. If you do this it will double your costs and delay deliveries.

What should your next step be, assuming that Agent Mulder is the program manager and not the contracting officer? After talking to Contracting Officer Scully, it appears that she agrees with Program Manager Mulder. Now what should you do? What steps might occur going forward assuming the problem is not resolved?

Explanation / Answer

First I should deal with concerned parties both program manager and contracting officer and try to convince showing them the standards and explain how costly it is to test all products. Usually, it is only the contracting officer who is involved in the acceptance of the contract in the contract agreement. I should also explain to him there is no mention of any specific standards as per contract

As per Federal Acquisition Regulation FAR 52.246-2 - Inspection of Supplies—Fixed-Price, The standard clause requires the contractor to follow acceptable norms and inspection system. If there are any requirements additional sub-clauses can be added.

If there are higher level requirements like ISO standards then under FAR 52.246-11 - Higher-Level Contract Quality Requirement (Government Specification), special criteria can be included. This clause applies when technical requirements require more control and attention to factors like testing, process, technology etc.

The above clause tells the contractor to follow standard protocols as customary practices in the industry say and mandate special test only if there are high-level requirements and a special mention about the test in the contract.Since there has been no mention of such special tests in the contract, I have been perfectly legal and there is no breach of contract by the contractor in this case. But the contracting officer is demanding for something not mentioned in the contract and is breaching the contract.

If the officer does not accept the terms even after convincing, then I would resort to legal methods through a lawyer.

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