Post-Acceptance Liability for Latent Defects, Fraud and Gross Mistakes Amounting to Fraud in Government Fixed-Price Supply and Construction Contracts.

摘要

In the world of government contracts for supplies and construction, the method of insuring contract performance and protecting the buyer is different from private commercial contracts. It is government policy to obtain these objectives by establishing a specific contractual right to conduct or require intensive and comprehensive inspection and testing during the entire life of the contract. In exchange for this broad right of inspection, the Government has given up almost all non-warranty rights and remedies for defective work discovered after acceptance; it has, however, retained the right to seek redress for latent defects, or defects the acceptance of which were induced by fraud or gross mistakes amounting to fraud. The stated exceptions to finality of acceptance have been a continuous source of controversy between the Government and its contractors. This thesis examines the nature and meaning of latent defects, fraud, and gross mistakes amounting to fraud in fixed-price supply and construction contracts as established by the numerous decisions of boards and courts, and seeks to determine if these exceptions to finality have been an effective tool for the Government.