Constructive Changes. There were numerous decisions that clarify when a constructive change does and does not occur that would allow for a contract price adjustment. A constructive change occurs when a contractor is required to perform work beyond contract requirements without a formal "change" order (see GCA DIGEST Vol. 1 No. 1 for a discussion of constructive changes). Constructive changes were held to occur when (1) the type of wire mesh specified in the contract was commercially unavailable and the government insisted on using another type of mesh (Technocratica) and (2) the government required completion of the original contract date even though the contract had been delayed pending resolution of a differing site condition (Earth Tech Indus.).
For constructive acceleration of a contract the contractor must establish five elements: (1) there was an excusable delay (2) the government had knowledge of the delay (3) the government acted in a manner that reasonably could be construed as an order to accelerate (4) the contractor gave notice to the government that an "order" amounted to a constructive change and (5) the contractor actually accelerated and thereby incurred added costs. The order to accelerate need not be couched in terms of a specific command but a request to accelerate or even an expression of concern about lagging progress may have the effect of an order (Fru-Con Const. Corp.).
For claims related to government interference and delay, the contractor needs to show (1) the specific delays were attributable to government responsible causes (2) they resulted in delay of the overall project and (3) the government-caused delays were not concurrent with delays within the contractor’s control (Technocratica). Another case showed that the contractor must prove the government was the "sole proximate cause" of the delay when in spite of the government allowing a delay, the government was able to avoid a price adjustment when it showed the delay (1) was intended to reestablish a new delivery date following performance delinquencies (2) there was no indication the government admitted to accepting any responsibility for the delay and (3) the government presented proof the contractor was responsible for part of the delay (Essex Electro Engrs., Inc).
Assertions of changes caused by defective design specifications have been ruled on. (Design specification describe in detail the material to be employed and work to be performed which allows for no discretion by the contractor while performance specifications sets forth a standard to be achieved where the contractor is expected to use its discretion to achieve.) When drawings are deemed to be design specifications, the agency is liable for any defect in the design (Apollo Sheet Metal). When a specific product was identified as suitable for the job, the government was implicitly warranting that it would be suitable for the job even if other products were also identified (they would also be covered by the assertion of suitability (C.T, Builders). Even if a contract provided language requiring a contractor to identify errors, the contractor was entitled to an equitable price adjustment for efforts related to preparing engineering change proposals (Essex Electro Engrs., Inc.). Though the contractor bears the risk for obvious omissions and apparent inconsistencies or discrepancies, it does not bear such risk of deficiencies if it cannot be gleaned from a knowledgeable reading of the contract and therefore it first becomes detectable only through discriminating study or later during actual performance (M.A. Mortenson Co.).
Merging of companies. When two companies merge numerous decisions have held the surviving company can pursue all claims of the contract but the following indicates problems when there is a sale of assets. Following a sale, the Board ruled it could not settle a claim because there was no "contract" since no novation agreement took place. The writers not only remind companies of the need to execute such novation agreements, but due to the often long process of approving such agreements, the contractor should authorize the successor to pursue claims in the name of the contractor.
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