Textron Defence Systems by V.Widnall - Essay Example

It was a struggle funding the project, since from the summer of 1985 up to the end of 1987 Textrons expenditures under the contract exceeded the allocated funding. Even before the award of the contract, the contracting officer made it clear to Textron that there was a possibility of the SDI[O] stopping the funding of EMRLD. The problem became worse in 1987 when both SDIO and Air Force stopped funding the project. After completing its close-up work, Textron on December 19, 1990, submitted a termination settlement proposal to the government requesting $13,428,348 over and above the $113,479,301 paid to date under the contract.

Legal Issue(s) Presented before CourtThe CPAF contract called for a zero base fee and an award fee not subject to the Termination or disputes clauses as to the payment and amount of the award fee. During the course of the contract, the contracting officer repeatedly reminded Textron that the LOF clause in the contract remained in effect. The language of the contract did not allow Textron to receive any extra amount after the terminal b of the contract. The holding of the CourtAccording to the facts presented in the case, the court affirmed the decision on the board that Textron was not eligible for any further payment for the termination of the contract.

Court’s Rationale or Reasoning for its DecisionAccording to the court’s rationale, Textron failed to prove beyond any reasonable doubt that it was indeed eligible for the extra payment. According to the language of the contract, the court ruled in favor of the government. Since Textron was aware of the likelihood of the government stopping the funding of the project, and as expressed in the contract that there would be no award of the termination fee, then the court ruled in favor of the government.

Projects Management Company V. DynCorp International LLC.12-2241. U.S. (2013)Key FactsDynCorp, contracted by the United States department of state to develop a civilian police force in Iraq entered into a subcontract with PMC. In the subcontract, PMC was to provide operations and maintenance support between August 1, 2008, and February 17, 2009. However, there was an option of extending the contract to February 28, 2010. In the terms of the subcontract, PMC was to provide DynCorp with periodic invoices and within 45 days of the invoice, DynCorp would tender its payments to the company through its account held at Kuwait Gulf Bank (the "Kuwait Account").

DynCorp tendered its payments to the account until December 2008 when PMC started directing DynCorp to tender its payments to its National Bank of Kuwait (Lebanon) account, located in Beirut, Lebanon and held in the name of Fawaz (the "Lebanon Account"). Close to the end of its initial contract, DynCorp contemplated on extending the contract, with the provision that all other terms would remain the same. After a few months, DynCorp issued a Cure Notice to PMC notifying it of performance issues.

Shortly after, DynCorp terminated the contract. In response, PMC requested a payment of $978,494.22, claiming $789,099.50 in unpaid invoices and $189,394.72 in other costs and expenses. Legal Issue(s) Presented before CourtAfter the termination of the contract, DynCorp realized that in fact, Fawaz was not a part-owner of PMC and that the actual owners of PMC were members of the Al-Muhanna family of Kuwait, most notably Rabea Al-Muhanna, who PMC contends had sole authority over the financial affairs of PMC.

During the discovery of the case, DynCorp realized that PMC had used part of the money paid to the Lebanon account to pay for its subcontractors. Further, the company refused to provide some of the evidence as requested by DynCorp, only submitting some of the materials two days late. The rest of the materials were submitted on the actual date of the hearing, and some of the materials were written in Arabic. The company further did not provide two key witnesses in the case, Rabea Al-Muhanna and Philip Zacharia.

The holding of the CourtThe court of appeal affirmed the ruling of the district court, which sought to terminate PMC’s case due to its misconduct. The ruling further issued sanctions to PMC. Court’s Rationale or Reasoning for its DecisionThe district court dismissed the PMCs suit on two alternate grounds. First, it took into consideration the sanction for PMCs repeated discovery abuses, where the company withheld crucial evidence required in the case and secondly, based on its conclusion that PMC was seeking damages contrary to the measure of damages provided by well-established law.