Imagine as a supplier of medical oxygen cylinders and tanks in your region, you enter into an arrangement with HHS or DHS to provide oxygen to nearby hospital facilities dealing with surges in the COVID-19 pandemic. However, due to the recent dramatic surge in your area and the significant demand for oxygen, the government moved quickly to award you a contract that appears very different from other federal contracts you have previously signed.
For example, instead of containing a standard FAR clause for Terminations for Convenience, your contract has a clause that states “this contract may be terminated in whole or in part by either party upon thirty (30) days notice in writing to the other party.” Is this mutual termination clause treated any differently under the law? Would you still get the same protection if the government decided to cancel your contract to obtain better prices a week later from your competitor across town?
Unfortunately, the answers to these questions are murky at best. But contractors should be aware that there could be a difference between these two types of clauses and to not instantly assume that they will be treated similarly should a claim arise.
Continue reading at: The Contractor’s Perspective
