CAP · Question #233
Eric is the project manager of the NQQ Project and has hired the ZAS Corporation to complete part of the project work for Eric's organization. Due to a change request the ZAS Corporation is no…
The correct answer is D. It depends on what the terminationclause of the contract stipulates. In contract law and project procurement management, the termination clause defines the conditions and financial obligations when a contract is terminated early-particularly a 'termination for convenience' clause, which allows a buyer to end a contract without cause. If such a…
Question
Eric is the project manager of the NQQ Project and has hired the ZAS Corporation to complete part of the project work for Eric's organization. Due to a change request the ZAS Corporation is no longer needed on the project even though they have completed nearly all of the project work. Is Eric's organization liable to pay the ZAS Corporation for the work they have completed so far on the project?
Options
- ANo, the ZAS Corporation did not complete all of the work.
- BYes, the ZAS Corporation did not choose to terminate the contract work.
- CIt depends on what the outcome of a lawsuit will determine.
- DIt depends on what the terminationclause of the contract stipulates
How the community answered
(48 responses)- A2% (1)
- B13% (6)
- C4% (2)
- D81% (39)
Explanation
In contract law and project procurement management, the termination clause defines the conditions and financial obligations when a contract is terminated early-particularly a 'termination for convenience' clause, which allows a buyer to end a contract without cause. If such a clause exists, the seller (ZAS Corporation) is typically entitled to payment for work completed plus any reasonable costs incurred. Without examining the specific contract terms, no definitive answer can be given. Option A is incorrect because non-completion alone does not void payment obligations. Option B is an oversimplification. Option C incorrectly implies litigation is the only path; the contract terms govern first.
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