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FAR ClauseTermination

FAR 52.249-8Default (Fixed-Price Supply and Service)

Authorizes the government to terminate a fixed-price contract for the contractor's failure to perform (delivery, performance, or going-concern failures).

When This Clause Applies

Required in fixed-price supply and service contracts above the simplified acquisition threshold. Commercial items use 'Termination for Cause' in FAR 52.212-4 instead.

What This Means for Contractors

A default termination is a contractor's worst-case outcome — it exposes the contractor to reprocurement costs, debars-from-award liabilities, and severe past performance consequences. The government must usually provide a Show Cause notice and a 10-day cure period for performance failures. Contractors can challenge default terminations through the Disputes clause and convert them to Terminations for Convenience.

Common Pitfalls

  • 1Not responding substantively to a Show Cause notice within the cure period
  • 2Failing to document excusable delays (force majeure, government-caused delay)
  • 3Accepting the default rather than challenging it via the Disputes process
  • 4Underestimating the past-performance consequences for future bids

Related Topics

FAR 52.249-8termination for defaultdefault contract governmentshow cause notice

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