51.106
Title
Title to property acquired by contractors is determined by contract terms, with special rules for educational institutions and property under $5,000.
Overview
FAR 51.106 addresses how title (ownership) to property acquired by contractors under government authorization is determined. The section clarifies that, unless otherwise specified, title to such property is governed by the terms of the contract. For contracts with educational institutions that use the Government Property clause at 52.245-1, Alternate II, property with a unit acquisition cost under $5,000 will vest in the contractor, unless agencies set a higher threshold. This provision ensures clarity on ownership and accountability for property acquired through government supply sources.
Key Rules
- Title Vesting by Contract Terms
- Ownership of property acquired by contractors is determined by the contract unless stated otherwise.
- Special Rule for Educational Institutions
- For contracts with educational institutions using clause 52.245-1, Alternate II, title to property under $5,000 (or higher if set by the agency) vests in the contractor.
Responsibilities
- Contracting Officers: Must specify title provisions in contracts and apply appropriate property clauses.
- Contractors: Must comply with contract terms regarding property ownership and manage property accordingly.
- Agencies: May set higher thresholds for vesting title to property with educational institutions.
Practical Implications
- This section clarifies property ownership, reducing disputes and ensuring proper accountability.
- Contractors must pay close attention to contract clauses regarding property title, especially when dealing with educational institutions.
- Failure to follow these provisions can result in property mismanagement or compliance issues.