41 U.S.C. § 107 : US Code - Section 107: Settlement of subcontractors' claims

Search 41 U.S.C. § 107 : US Code - Section 107: Settlement of subcontractors' claims

(a) Conclusiveness of settlement
Where, in connection with the settlement of any termination claim
by a contracting agency, any war contractor makes settlements of
the termination claims of his subcontractors, the contracting
agency shall limit or omit its review of such settlements with
subcontractors to the maximum extent compatible with the public
interest. Any contracting agency (1) may approve, ratify, or
authorize such settlements with subcontractors upon such evidence,
terms, and conditions as it deems proper; (2) shall vary the scope
and intensity of its review of such settlements according to the
reliability of the war contractor, the size, number, and complexity
of such claims, and other relevant factors; and (3) shall authorize
war contractors to make such settlements with subcontractors
without review by the contracting agency, whenever the reliability
of the war contractor, the amount or nature of the claims, or other
reasons appear to the contracting agency to justify such action.
Any such settlement of a subcontract approved, ratified, or
authorized by a contracting agency shall be final and conclusive as
to the amount due to the same extent as a settlement under
subsection (c) of section 106 of this title, and no war contractor
shall be liable to the United States on account of any amounts paid
thereon except for his own fraud.
(b) Supervision of payments to war contractors
Whenever any contracting agency is satisfied of the inability of
a war contractor to meet his obligations it shall exercise
supervision or control over payments to the war contractor on
account of termination claims of subcontractors of such war
contractor to such extent and in such manner as it deems necessary
or desirable for the purpose of assuring the receipt of the benefit
of such payments by the subcontractors.
(c) Group settlements
The Administrator of General Services shall prescribe policies
and methods for the settlement as a group, or otherwise, by any
contracting agency of some or all of the termination claims of a
war contractor under war contracts with one or more (1) bureaus or
divisions within a contracting agency, (2) contracting agencies, or
(3) prime contractors and subcontractors, to the extent he deems
such action necessary or desirable for expeditious and equitable
settlement of such claims. After consulting with the contracting
agencies concerned, the Administrator of General Services may
provide for assigning any war contractor to a contracting agency
for such settlement, and such agency shall have authority to
settle, on behalf of any other contracting agency, some or all of
the termination claims of such war contractor.
(d) Direct settlement by contracting agency
Any contracting agency may settle directly termination claims of
subcontractors to the extent that it deems such action necessary or
desirable for the expeditious and equitable settlement of such
claims. In making such termination settlements any contracting
agency may discharge the claim of the subcontractor by payment or
may purchase such claim, and may agree to assume, or indemnify the
subcontractor against, any claims by any person in connection with
such claim or the termination settlement. Any contracting agency
undertaking to settle the termination claim of any subcontractor
shall deliver to the subcontractor and the war contractor liable to
him written notice stating its acceptance of responsibility for
settling his claim and the conditions applicable thereto, which may
include the release, or assignment to the contracting agency, of
his claim against the war contractor liable to him; upon consent
thereto by the subcontractor, the Government shall become liable
for the settlement of his claims upon the conditions specified in
the notice.
(e) Amount of settlement
Any contracting agency may make settlements with subcontractors
in accordance with any of the provisions of this chapter without
regard to any limitation on the amount payable by the Government to
the prime contractor.
(f) Equitable payments
If any contracting agency determines that in the circumstances of
a particular case equity and good conscience require fair
compensation for the termination of a war contract to be paid to a
subcontractor who has been deprived of and cannot otherwise
reasonably secure such fair compensation, the contracting agency
concerned may pay such compensation to him although such
compensation already has been included and paid as part of a
settlement with another war contractor.