Modification Reset Project Clock, Effectively Erased Stop-Order Delay

Thursday, August 30, 2018 6:29 am
September 2018 - Volume 40 Number 9

Contract Termination --- Stop Order

Appeal of Coastal Envtl. Grp., Inc., 2018 ASBCA Lexis 221 (ASBCA July 17, 2018)

When a contractor promised it could mobilize equipment and materials to a project site within three days, the government took it at its word: Seeing no progress three days later, the government terminated the contract for default.

In September 2013, Coastal Environmental Group, Inc. (Coastal) performed on a U.S. Navy project to repair the Security Boat Marina at a base in Monmouth County, New Jersey. The original contract completion date was February 5, 2014, but the parties extended that to December 30, 2014. Coastal was still working on the project in early January 2015. At that point, the government ordered Coastal to stop work on the project, and in July 2015 another contract modification (Mod5) followed. Mod5 increased the contract price, added additional repair work for post-award damage, and extended the completion date to November 26, 2015.

On October 5, 2015 the government notified Coastal of its frustration that the contractor had not “completed or met one single item” on its schedule. Coastal conceded that it was “behind schedule” and intended to mobilize within the next two weeks. Instead, the government terminated the contract “for default for failure to make progress” just three days later, on October 8.

The question in this appeal---in which Coastal sought to convert the termination to one of convenience---was whether the government was able to determine on the termination date, October 8, 2015, that there was no reasonable likelihood that Coastal would complete the project by the November 26, 2015 deadline. The board agree[..]