What is considered the heart of a settlement for a contract terminated for convenience?

The core aspect of a settlement for a contract terminated for convenience is rooted in business judgment. In these cases, the government or the contracting authority may decide to terminate a contract before its completion, often due to changing circumstances, policy shifts, or budgetary concerns. This decision is generally made based on a strategic overview of the benefits and necessity of continuing the contractual relationship versus the practicality and ramifications of terminating it.

Business judgment encompasses the assessment of various factors, such as the potential risks and rewards associated with the contract's continuation versus termination. It involves considering the best interests of the government while also being mindful of the contractor's position. The goal is to reach a settlement that satisfies both parties through a well-considered decision-making process that reflects the realities of the current situation rather than just strict legal obligations or financial numbers.

While mutual agreement and cost-benefit analysis can play roles in the settlement process, the ultimate selection of a strategy hinges on the broader context of business judgment, which guides the decision-making as to how best to settle the termination and manage the contractual relationships moving forward.