Federal Contract Law Firm Guides Clients Through Deductive Modifications
Washington, D.C. Government Contract Lawyers Focus on Deductive Modifications
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The Federal Acquisition Regulation (FAR) serves as the guideline for federal acquisition, and any change in the terms of a federal contract must be in writing. Therefore, FAR defines contract modification as any written change in the terms of the contract.
A modification is any change within the scope of the contract, and these changes can be made regarding:
- Specifications
- Drawings
- Designs
- Methods of construction
- Types of government-provided material
- Time for performance
Contract modification can be categorized in several ways, but the most common include bilateral or unilateral modification.
Bilateral Modifications
A bilateral modification is a contract modification signed by the contracting officer and the contractor, and both parties agree to the terms of the modification. The FAR also refers to this type of modification as a supplemental agreement, since the change is a supplement to the original contract.
Unilateral Modifications
A unilateral modification is a modification signed only by the contracting officer, with or without any agreement by the contractor. In federal contracts, only the federal government has the ability to give unilateral direction, and there are typically a number of clauses in federal contracts that give the government the right to direct a contractor without his consent, including the Termination for Convenience clause and the Termination for Default clause.
Deductive Modifications
Deductive change or deduction occurs when there is a reduced in the amount of work that requires cancellation of an item in the contract. Depending on the contract agreement, the owner will normally request reduction in project cost commensurate to the canceled work or effort. Both parties, the owner and the contractor, have to mutually agree on the adjustment.
If there is a dispute on the amount of the change order, a claim normally is initiated. Deductive change is handled as a bilateral agreement in a federal contract.
Contact Our Federal Contract Law Firm Today
If you need legal advice regarding deductive modifications to a government contract, contact the Whay Law Firm online or call (202) 448-9677 to schedule your initial consultation today.
