52.246-17 Warranty of Supplies of a Noncomplex Nature
Source: FAR 52.246-17 on acquisition.gov
Under FAR 52.246-17, acceptance does not end contractor responsibility: during the stated warranty period, the Government can require correction, replacement, price reduction, or charge excess costs for nonconforming noncomplex supplies.
Overview
- FAR 52.246-17 establishes a warranty clause for noncomplex supplies, preserving the Government’s right to require correction, replacement, price reduction, or other remedies even after inspection and acceptance.
- The clause defines the warranty period by a time period or specified event set by the Contracting Officer and covers both product quality and compliance with packaging, packing, marking, and shipment requirements.
Key Rules
- Warranty Coverage and Duration
- The Contractor warrants that delivered supplies will be free from defects in material or workmanship and conform to all contract requirements during the stated warranty period. Corrected or replacement items receive a new warranty period running from their delivery date.
- Transportation and Replacement Responsibilities
- Under the basic clause, the Contractor bears transportation costs and transit risk for return, correction, or replacement, subject to a cap based on usual commercial shipping between the delivery point and the Contractor’s plant. Alternate II shifts those transportation costs to the Government.
- Government Remedies for Breach
- After written notice within the specified notice period, the Contracting Officer may require correction or replacement, retain the supplies with an equitable price reduction, use sampling procedures for grouped supplies, or obtain replacement from another source and charge excess costs to the Contractor if the Contractor fails to act.
- Special Alternates
- Alternates address situations involving Government-paid transportation, sole-source replacement constraints, fixed-price incentive contracts, and disassembly/reassembly costs for larger items.
Responsibilities
- Contracting Officers: establish the warranty and notice periods, issue written breach notices, select appropriate remedies, and apply sampling procedures where the contract provides for them.
- Contractors: deliver conforming supplies, correct or replace defective items promptly, bear applicable transportation and related costs unless an alternate applies, and respond to cure notices within 10 days unless extended in writing.
- Agencies: enforce warranty rights, document breach and remedy decisions, and recover excess costs or disposal expenses when authorized.
Practical Implications
- This clause gives the Government post-acceptance protection for relatively simple supply items where defects may appear after delivery.
- Contractors should track warranty periods carefully, maintain quality records, and respond quickly to written notices to avoid price reductions, excess reprocurement costs, and disposal charges.
- Common pitfalls include missing cure deadlines, overlooking packaging/marking defects as warranty issues, and failing to recognize that replacement items restart the warranty period.
As prescribed in 46.710(a)(1), insert a clause substantially as follows:
Warranty of Supplies of a Noncomplex Nature (June 2003)
(a) Definitions. As used in this clause-
Acceptance means the act of an authorized representative of the Government by which the Government assumes for itself, or as an agent of another, ownership of existing supplies, or approves specific services as partial or complete performance of the contract.
Supplies means the end items furnished by the Contractor and related services required under this contract. The word does not include "data."
(b) Contractor’s obligations.
(1) Notwithstanding inspection and acceptance by the Government of supplies furnished under this contract, or any condition of this contract concerning the conclusiveness thereof, the Contractor warrants that for ________ [Contracting Officer shall state specific period of time after delivery, or the specified event whose occurrence will terminate the warranty period; e.g.,the number of miles or hours of use, or combinations of any applicable events or periods of time]-
(i) All supplies furnished under this contract will be free from defects in material or workmanship and will conform with all requirements of this contract; and
(ii) The preservation, packaging, packing, and marking, and the preparation for, and method of, shipment of such supplies will conform with the requirements of this contract.
(2) When return, correction, or replacement is required, transportation charges and responsibility for the supplies while in transit shall be borne by the Contractor. However, the Contractor’s liability for the transportation charges shall not exceed an amount equal to the cost of transportation by the usual commercial method of shipment between the place of delivery specified in this contract and the Contractor’s plant, and return.
(3) Any supplies or parts thereof, corrected or furnished in replacement under this clause, shall also be subject to the terms of this clause to the same extent as supplies initially delivered. The warranty, with respect to supplies or parts thereof, shall be equal in duration to that in paragraph (b)(1) of this clause and shall run from the date of delivery of the corrected or replaced supplies.
(4) All implied warranties of merchantability and "fitness for a particular purpose" are excluded from any obligation contained in this contract.
(c) Remedies available to the Government.
(1) The Contracting Officer shall give written notice to the Contractor of any breach of warranties in paragraph (b)(1) of this clause within ________ [Contracting Officer shall insert specific period of time; e.g.,"45days of the last delivery under this contract," or "45days after discovery of the defect"].
(2) Within a reasonable time after the notice, the Contracting Officer may either-
(i) Require, by written notice, the prompt correction or replacement of any supplies or parts thereof (including preservation, packaging, packing, and marking) that do not conform with the requirements of this contract within the meaning of paragraph (b)(1) of this clause; or
(ii) Retain such supplies and reduce the contract price by an amount equitable under the circumstances.
(3)
(i) If the contract provides for inspection of supplies by sampling procedures, conformance of supplies or components subject to warranty action shall be determined by the applicable sampling procedures in the contract. The Contracting Officer-
(A) May, for sampling purposes, group any supplies delivered under this contract;
(B) Shall require the size of the sample to be that required by sampling procedures specified in the contract for the quantity of supplies on which warranty action is proposed;
(C) May project warranty sampling results over supplies in the same shipment or other supplies contained in other shipments even though all of such supplies are not present at the point of reinspection; provided, that the supplies remaining are reasonably representative of the quantity on which warranty action is proposed; and
(D) Need not use the same lot size as on original inspection or reconstitute the original inspection lots.
(ii) Within a reasonable time after notice of any breach of the warranties specified in paragraph (b)(1) of this clause, the Contracting Officer may exercise one or more of the following options:
(A) Require an equitable adjustment in the contract price for any group of supplies.
(B) Screen the supplies grouped for warranty action under this clause at the Contractor’s expense and return all nonconforming supplies to the Contractor for correction or replacement.
(C) Require the Contractor to screen the supplies at locations designated by the Government within the contiguous United States and to correct or replace all nonconforming supplies.
(D) Return the supplies grouped for warranty action under this clause to the Contractor (irrespective of the f.o.b. point or the point of acceptance) for screening and correction or replacement.
(4)
(i) The Contracting Officer may, by contract or otherwise, correct or replace the nonconforming supplies with similar supplies from another source and charge to the Contractor the cost occasioned to the Government thereby if the Contractor-
(A) Fails to make redelivery of the corrected or replaced supplies within the time established for their return; or
(B) Fails either to accept return of the nonconforming supplies or fails to make progress after their return to correct or replace them so as to endanger performance of the delivery schedule, and in either of these circumstances does not cure such failure within a period of 10 days (or such longer period as the Contracting Officer may authorize in writing) after receipt of notice from the Contracting Officer specifying such failure.
(ii) Instead of correction or replacement by the Government, the Contracting Officer may require an equitable adjustment of the contract price. In addition, if the Contractor fails to furnish timely disposition instructions, the Contracting Officer may dispose of the nonconforming supplies for the Contractor’s account in a reasonable manner. The Government is entitled to reimbursement from the Contractor, or from the proceeds of such disposal, for the reasonable expenses of the care and disposition of the nonconforming supplies, as well as for excess costs incurred or to be incurred.
(5) The rights and remedies of the Government provided in this clause are in addition to and do not limit any rights afforded to the Government by any other clause of this contract.
(End of clause)
Alternate I [Reserved]
Alternate II (Apr 1984). If it is desirable to specify that necessary transportation incident to correction or replacement will be at the Government’s expense (as might be the case if, for example, the cost of a warranty would otherwise be prohibitive), substitute a paragraph substantially the same as the following paragraph (b)(2) for paragraph (b)(2) of the basic clause:
(2) If correction or replacement is required and transportation of supplies in connection with correction or replacement is necessary, transportation charges and responsibility for the supplies while in transit shall be borne by the Government.
Alternate III (Apr 1984). If the supplies cannot be obtained from another source, substitute a paragraph substantially the same as the following paragraph (c)(4) for paragraph (c)(4) of the basic clause:
(4) If the Contractor does not agree as to responsibility to correct or replace the supplies delivered, the Contractor shall nevertheless proceed in accordance with the written request issued by the Contracting Officer under paragraph (c)(2) of this clause to correct or replace the defective or nonconforming supplies. In the event it is later determined that the supplies were not defective or nonconforming within the terms and conditions of this clause, the contract price will be equitably adjusted.
Alternate IV (Apr 1984). If a fixed-price incentive contract is contemplated, add a paragraph substantially the same as the following paragraph (c)(6) to the basic clause:
(6) All costs incurred or estimated to be incurred by the Contractor in complying with this clause shall be considered when negotiating the total final price under the Incentive Price Revision clause of this contract. After establishment of the total final price, Contractor compliance with this clause shall be at no increase in the total final price. Any equitable adjustment made under paragraph (c)(2) of this clause shall be governed by the paragraph entitled "Equitable Adjustments Under Other Clauses" in the Incentive Price Revision clause of this contract.
Alternate V (Apr 1984). If it is anticipated that recovery of the warranted item will involve considerable Government expense for disassembly and/or reassembly of larger items, add a paragraph substantially the same as the following paragraph (c)(6) to the basic clause. Redesignate the additional paragraph as "(c)(7)" if Alternate IV is also being used.
(6) The Contractor shall be liable for the reasonable costs of disassembly and/or reassembly of larger items when it is necessary to remove the supplies to be inspected and/or returned for correction or replacement.