Recovery of Costs under Terminated Contracts

By Craig Stetson

I do not see why there was a dispute to begin with. The terminated contract was converted from default to convenience. The contractor submitted the settlement proposal claiming costs attributable to all work, in accordance with Part 49 guidance. Appears the TCO denied the settlement request as all parts were not accepted and delivered. That is not a requirement – the only real difference in that situation is that completed units are recovered at contract price and the others (in process or WIP) are recovered at cost plus reasonable profit. Read Reference

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