Latent Defects Definition

Latent Definition -- Avoid Costly Mistakes With Latent Defects in Government ContractsThe definition of a latent defect in government contracting is a hidden defect in the purchased material or the quality of the services (including construction) and worked performed.

A huge problem with getting paid in government contracting is when the agency rejects payment due to final acceptance of the material or service. The contracting officer, with the advice of her technical representatives, will allege that there is a latent defect.

How to deal with allegations of construction under the latent defects definition can be problematic for government contractors.  To claim that merely because the agency has accepted and paid for the work would bar a government claim or an adverse action against a contractor.

  •  Final acceptance of the material or work does not prevent the contracting officer from pursuing your company.

Definitions are legal requirements: The question and resolution turn to whether or not there was a latent defect. Embedded in the latent definition is that there a requirement that defect was not, and could not have been, discovered during the final inspection.

  • Defects that are substantial and obvious most likely will not meet the “latent definition.”
  • If the government was aware of the defect at the time of final acceptance, then it may be precluded for litigating a construction latent defect issue.

FAR 52.246-1  Contract Inspection Requirements

Under FAR 52.246-1, government contractors are responsible for performing inspections and tests to support its position that services and supplies furnished to the federal government meet the demands of the contract.

 This also includes any applicable technical requirements for specified manufacturers’ parts. FAR 52.246-1 will take precedence over any Government inspection and testing required in the contract’s specifications, except for specialized examinations or tests specified to be performed solely by the Government.

  Latent Defect Construction – Defenses available: It is important to realize that there are some defenses and approaches to dealing with the government allegations of latent defects in federal contracts. Companies should be mindful that the government’s approach may also turn to allegations of fraud and may also turn to alleging gross mistakes, fraud, or merely claiming that it has rights under a warranty or guarantee clause.

Companies should be mindful that the government’s approach may also turn to allegations of fraud and may also turn to alleging gross mistakes, fraud, or merely claiming that it has rights under a warranty or guarantee clause.

To Avoid Costly Mistakes, Get a Free Government Claims Checklist

For help dealing with latent defects mistakes in government construction under FAR 52.246-1, materials or services call Watson’s government contract law attorneys at 1-866-601-5518.