Overview
This section mandates the inclusion of the "Differing Site Conditions" clause in fixed-price construction and demolition contracts exceeding the simplified acquisition threshold, while providing discretionary authority for its use in smaller contracts.
Key Rules
- Mandatory Inclusion: The Contracting Officer (CO) must insert clause 52.236-2 in fixed-price construction, dismantling, demolition, or removal contracts expected to exceed the Simplified Acquisition Threshold (SAT).
- Discretionary Inclusion: For contracts at or below the SAT, the CO has the option—but is not required—to include the clause.
- Contract Type Specificity: These rules apply specifically to fixed-price contract vehicles rather than cost-reimbursement arrangements.
Practical Implications
- Risk Management: By standardizing the inclusion of this clause, the FAR ensures there is a clear mechanism for equitable adjustments if a contractor encounters subsurface or latent physical conditions that differ materially from those indicated in the contract.
- Administrative Oversight: Contractors bidding on small-scale projects (below the SAT) should verify if the clause is included, as its absence shifts the risk of unknown site conditions entirely to the contractor.