The procedures below are to be followed upon the death or legally adjudged incompetence of an individual contracting in his or her own name (sole proprietorship), or in the name of a corporation all of whose stock is substantially owned by the individual (closely held corporation) and the supplier is a highway or inland domestic water supplier. These procedures do not apply when the death or incompetence of an owner or officer of a corporation does not significantly impair the corporation’s ability to perform the contract service.
The CO must act to maintain continuity of service. If a prime contract is affected, the representative of the estate (administrator, executor, or immediate family member) must be contacted to ascertain whether the estate wishes to continue to perform the service. If a subcontract is affected, the subcontract may be terminated and the prime supplier is responsible for performance of the service.
The death of a sole proprietor terminates the contract, and the estate has no obligation to continue to provide the service. The representative of the estate may operate the route with the consent of the CO. If there is reason to deny consent, the CO must promptly submit a full written report to the manager, Transportation Portfolio, for determination. The CO must document the file with evidence of the representative’s authority to represent and assume control of the supplier’s business.
When an individual regains competence during the performance of the contract by a representative, the individual may apply to the contracting office for reinstatement as supplier. Any such application must be approved by the manager, Transportation Portfolio, before reinstatement.
When the supplier is a partnership, and the death or incompetence of a member of the partnership dissolves the partnership, the surviving partner or partners may continue to operate the route. At the request of the surviving partner or partners, the CO will order a simple name change to recognize the new contracting entity.
When the representative of an estate assumes a route, the contract rate remains the same. Pending pay adjustment requests are processed under instructions in effect at the time of adjustment. The operator of the route is entitled to all benefits of the adjustment.
The representative of an estate may subcontract all or part of the route in accordance with the discussion of subcontracts above.
If a contract expires while being performed by the representative of an estate, the contract cannot be renewed, unless the representative is the surviving spouse or child of the deceased, in which case the contract may be renewed in that individual’s name. If the representative of an estate does not want to continue the service, or if consent is denied for the representative to continue the service, the CO should purchase emergency service and issue a RFP for a new permanent service contract. Procedures for processing payments to deceased or incompetent suppliers are described in Handbook PO-513.
