Common use of Contractor Liability for Government Property Clause in Contracts

Contractor Liability for Government Property. (1) Unless otherwise provided for in the contract, the Contractor shall not be liable for loss, theft, damage or destruction to the Government property furnished or acquired under this contract, except when any one of the following applies— (i) The risk is covered by insurance or the Contractor is otherwise reimbursed (to the extent of such insurance or reimbursement). The allowability of insurance costs shall be determined in accordance with 31.205-19. (ii) The loss, theft, damage or destruction is the result of willful misconduct or lack of good faith on the part of the Contractor’s managerial personnel. (iii) The Contracting Officer has, in writing, revoked the Government’s assumption of risk for loss, theft, damage or destruction, due to a determination under paragraph (g) of this clause that the Contractor’s property management practices are inadequate, and/or present an undue risk to the Government, and the Contractor failed to take timely corrective action. If the Contractor can establish by clear and convincing evidence that the loss, theft, damage or destruction of Government property occurred while the Contractor had adequate property management practices or the loss, theft, damage or destruction of Government property did not result from the Contractor’s failure to maintain adequate property management practices, the Contractor shall not be held liable. (2) The Contractor shall take all reasonable actions necessary to protect the Government property from further loss, theft, damage or destruction. The Contractor shall separate the damaged and undamaged Government property, place all the affected Government property in the best possible order, and take such other action as the Property Administrator directs. (3) The Contractor shall do nothing to prejudice the Government’s rights to recover against third parties for any loss, theft, damage or destruction of Government property. (4) Upon the request of the Contracting Officer, the Contractor shall, at the Government’s expense, furnish to the Government all reasonable assistance and cooperation, including the prosecution of suit and the execution of instruments of assignment in favor of the Government in obtaining recovery.

Contractor Liability for Government Property. (1) Unless otherwise provided for in the contract, the Contractor shall not be liable for loss, theftdamage, damage destruction, or destruction theft to the Government property furnished or acquired under this contract, except when any one of the following applies— (i) The risk is covered by insurance or the Contractor is otherwise reimbursed (to the extent of such insurance or reimbursement). The allowability of insurance costs shall be determined in accordance with 31.205-19. (ii) The loss, theftdamage, damage destruction, or destruction theft is the result of willful misconduct or lack of good faith on the part of the Contractor’s managerial personnel. (iii) The Contracting Officer has, in writing, revoked the Government’s assumption of risk for loss, damage, destruction, or theft, damage or destruction, due to a determination under paragraph (g) of this clause that the Contractor’s property management practices are inadequate, and/or present an undue risk to the Government, and the Contractor failed to take timely corrective action. If the Contractor can establish by clear and convincing evidence that the loss, theftdamage, damage destruction, or destruction theft of Government property occurred while the Contractor had adequate property management practices or the loss, theftdamage, damage destruction, or destruction theft of Government property did not result from the Contractor’s failure to maintain adequate property management practices, the Contractor shall not be held liable. (2) The Contractor shall take all reasonable actions necessary to protect the Government property from further loss, damage, destruction, or theft, damage or destruction. The Contractor shall separate the damaged and undamaged Government property, place all the affected Government property in the best possible order, and take such other action as the Property Administrator directs. (3) The Contractor shall do nothing to prejudice the Government’s rights to recover against third parties for any loss, theftdamage, damage destruction, or destruction theft of Government property. (4) Upon the request of the Contracting Officer, the Contractor shall, at the Government’s expense, furnish to the Government all reasonable assistance and cooperation, including the prosecution of suit and the execution of instruments of assignment in favor of the Government in obtaining recovery.