Important Facts About Construction Default Terminations In Florida
Florida contractors know that there are special considerations anytime you are working with the government on a construction project, but there are still situations that can take you off-guard.
Under the FAR Termination for Default, a public agency can exercise its right to terminate the contract in part or in full under certain circumstances. A failure to perform is the most obvious way to trigger a default termination, but the contact could even be canceled for an alleged anticipated breach or even a failed response to a cure notice.
If you received a notification from the contracting officer at a government agency, the communication should motivate you to contact a Florida default terminations attorney right away. It is difficult to protect your interests if you do not have meticulous knowledge of Florida construction law. Still, some important facts about terminations for default are useful.
Contractor Actions That May Justify Termination: A contract for a public construction project will include the details on when the government may cancel due to alleged failures by the contractor. A default termination may stem from:
- Claims of fraud or attempted fraud;
- Failure to deliver supplies or designated construction services by contractual deadlines;
- Not meeting quality requirements in terms of labor or materials; and,
- Failing to make progress with services or supplies in a way that hampers performance of contractual duties.
Potential Impacts for Contactors: Contracts for government construction projects will typically not set forth termination as the only remedy for default. Beyond the opportunity to cure, possible options to get the project back on track include supplementing the contractor’s crew or bringing in another contractor to assume some of the work. When these options do not resolve the default, a contractor may be:
- Required to return partial or advance payments;
- Subject to a liquidated damages clause; or,
- Forced to cover the government’s costs to complete the contract.
Comparing Termination for Default Versus Convenience: Contracts for public construction projects will often include a convenience termination clause in addition to provisions on cancellation for cause. The terms allow the government to terminate for any reason, at any time. However, there is still the requirement to pay the contractor for work performed and materials supplied. Some contracts may include financial penalties for termination for convenience, in addition to reimbursement.
The Government’s Burden in Court: When the contracting officer terminates for default, the agency must supply sufficient facts to prove why the cancellation was justified. The failure to meet this burden of proof could defeat the government’s claim for default termination, but the contractor will also get the opportunity to contest.
Trust a Florida Default Terminations Lawyer to Handle Details
These are important basics to know, but it is tough to address default terminations while still focusing on your job and operating a business. If you have questions about the legal concepts, please contact Linkhorst & Hockin, P.A. today. Individuals in South Florida can call 561-626-8880 or go online to set up a consultation at our offices in Jupiter. Once we review your circumstances, we can explain the details.
Source:
acquisition.gov/far/subpart-49.4#:~:text=(a)%20Termination%20for%20default%20is,to%20perform%20its%20contractual%20obligations
