{
  "id": "R44202",
  "type": "CRS Report",
  "typeId": "REPORTS",
  "number": "R44202",
  "active": true,
  "source": "EveryCRSReport.com",
  "versions": [
    {
      "source": "EveryCRSReport.com",
      "id": 446851,
      "date": "2015-09-23",
      "retrieved": "2016-04-06T18:19:53.612174",
      "title": "Selected Legal Mechanisms Whereby the Government Can Hold Contractors Accountable for Failure to Perform or Other Misconduct\t",
      "summary": "Reports of \u201cwaste, fraud, and abuse\u201d in federal contracting often prompt questions about what the government can do to hold its vendors accountable for failure to perform as required under their contracts, or for legal violations or other misconduct unrelated to contract performance. Broadly speaking, the government can be seen as having two types of legal recourse available to it in such situations. The first type involves rights provided to the government as terms of its contracts, which the government may exercise without resort to judicial proceedings. The second type involves other actions, not necessarily provided for by contract. In some cases, the government may take these actions on its own behalf, without resort to judicial proceedings. In other cases, the government must seek sanctions or damages through the courts. \nNot all of these mechanisms involve \u201cpenalties\u201d as that term is generally understood. In some cases, the controlling legal authority expressly provides that the government may take certain actions only to protect the government\u2019s interest, and \u201cnot for purposes of punishment.\u201d However, in all cases, the government\u2019s action represents a consequence of and response to the contractor\u2019s delinquencies, and could be perceived as punitive by the contractor or other parties. The government generally has discretion as to whether to employ any of these mechanisms in particular circumstances, and could employ multiple mechanisms in a given case. In some cases, though, the government must choose between particular mechanisms.\nRights Granted to the Government as Terms of Its Contracts\nGovernment contracts include standard terms granting the government certain rights that could be exercised if the contractor fails to perform as required under the contract, such as the right to assess liquidated damages and the right to terminate the contract for default. A specific right must generally be expressly provided for in the contract for the government to exercise it, although the government\u2019s right to terminate contracts for default may be read into contracts that do not expressly provide for it. The government\u2019s exercise of the right must also generally be in conformity with the terms of the contract. In addition, depending upon the facts and circumstances of the case, a contractor could challenge the government\u2019s exercise of a contractual right by bringing suit before a court or board of contract appeals, alleging that the contractor\u2019s deficient or delinquent performance must be excused because it was caused by an event that is beyond the contractor\u2019s control and without its fault or negligence. Alternatively, a contractor could assert that the government has waived particular contractual rights in specific cases. A waiver is an intentional or voluntary relinquishment of a legal right, or conduct that warrants an inference that the right has been relinquished. \nOther Agency Actions Not Necessarily Provided for as Terms of a Contract\nThe government could also take certain actions in response to contractors\u2019 failure to perform or other misconduct that are not expressly provided for as terms of a federal contract, but are authorized under federal statutes or regulations. In some cases, the government may take these actions on its own behalf, without resort to judicial proceedings, as is the case with debarment and suspension and consideration of agency evaluations of past performance in source-selection decisions. In other cases, the government must seek sanctions through the courts, as is the case with suits under the civil provisions of the False Claims Act. In either case, the government\u2019s recourse is generally limited by the controlling legal authority (e.g., suspension must be on a ground specified in statute or regulation). Agency actions could also be challenged on the grounds that the action deprives the contractor of certain contractual or other rights, or is arbitrary and capricious. In addition, in some cases, contractors are entitled to due process in the form of notice and an opportunity for a hearing before being subjected to agency action or sanctions.",
      "type": "CRS Report",
      "typeId": "REPORTS",
      "active": true,
      "formats": [
        {
          "format": "HTML",
          "encoding": "utf-8",
          "url": "http://www.crs.gov/Reports/R44202",
          "sha1": "bd65d0764de66b440078ef6129916006ab325666",
          "filename": "files/20150923_R44202_bd65d0764de66b440078ef6129916006ab325666.html",
          "images": null
        },
        {
          "format": "PDF",
          "encoding": null,
          "url": "http://www.crs.gov/Reports/pdf/R44202",
          "sha1": "d2d7e958c7d66bf90ab383cd5ace13821615cc99",
          "filename": "files/20150923_R44202_d2d7e958c7d66bf90ab383cd5ace13821615cc99.pdf",
          "images": null
        }
      ],
      "topics": []
    }
  ],
  "topics": [
    "National Defense"
  ]
}