ASBCA Finds Hesitation Is Not Repudiation

When the Government terminates a contract for default ("T for D"), there can be a series of nasty consequences for contractors. Among other things, the contractor may be liable for actual or liquidated damages and for excess costs of reprocurement or completion; the contractor can be suspended or debarred; and the Government is not liable for the costs of unaccepted work and is entitled to the return of progress, partial, or advance payments. In contrast, when a contract is terminated for convenience ("T for C"), the contractor is usually entitled to the costs of goods and services furnished, demobilization costs, and a reasonable profit on the work performed. Also, because a T for C is not a breach, neither party is liable for lost profits or other damages allowed for breach of contract.