Cure Notice

A cure notice is the first formal step in the government's termination for default process, required under FAR 49.607 when a contractor fails to make progress on performance or fails to perform any contract provision, giving the contractor a defined period to correct deficiencies before further action.

What is a Cure Notice?

A cure notice is a written notice issued by the contracting officer under FAR 49.607(a) when it becomes apparent that the contractor's performance is endangered, either by failure to make satisfactory progress or by failure to comply with a material contract requirement. The cure notice must: identify the specific performance deficiencies; give the contractor a specific period (minimum 10 days, unless otherwise required) to cure; and advise the contractor that the government is considering termination for default unless the deficiency is cured within the stated period.

Cure notices are required before termination for default based on "failure to make progress" or "failure to perform any other provision" of the contract. They are not required before terminating for failure to deliver on time (a pure delivery default), though contracting officers routinely issue show cause notices in those situations as well.

The cure period gives the contractor an opportunity to demonstrate that it can recover performance. A strong cure response should: acknowledge the deficiency; document root cause; present a specific, credible recovery plan with milestones; and show the resources committed to correction. An inadequate cure response, or cure with no real recovery, leads directly to a show cause notice and potentially to termination for default.

Receiving a cure notice also typically triggers a Marginal or Unsatisfactory CPARS rating for the relevant performance categories, because the notice is documented in the contract administration record.

Why Cure Notices matter for government contractors

A cure notice is the last formal warning before termination, contractors should treat it as a contract emergency requiring immediate escalation to senior management and legal counsel. The 10-day cure period is short. Responding with a weak or vague corrective action plan, or failing to respond at all, virtually guarantees termination for default and its severe financial and reputational consequences.

Example

A medical equipment supplier is 21 days into a 30-day delivery schedule for hospital diagnostic equipment when the COR notifies the contracting officer that the supplier is requesting a 60-day extension due to manufacturing delays. The contracting officer issues a cure notice identifying: failure to make progress toward the contract delivery date; specific diagnostic equipment line items not shipped; and the 10-day cure period. The supplier responds within 5 days with a written cure plan: partial delivery of 40% of units within 10 days, factory schedule showing remaining units shipped by original deadline plus 14 days, and a commitment to bear any government expedite costs. The contracting officer accepts the partial cure and works out a modified delivery schedule.

Frequently Asked Questions

What is the difference between a cure notice and a show cause notice?

A cure notice is used when there is still time to correct the performance problem, it gives the contractor an opportunity to recover. A show cause notice is used when the contracting officer has already determined that the contract may need to be terminated for default and is asking the contractor to show why that termination should not occur. In practice, a cure notice often precedes a show cause notice if the contractor's cure is inadequate.

Does receiving a cure notice mean termination is inevitable?

No. Many contractors receive cure notices and successfully recover performance, resulting in satisfactory contract completion. The cure notice is a formal warning, not a termination notice. A credible, well-documented cure response and actual recovery of performance can resolve the situation without termination.

Can a contractor reject a cure notice?

No. A cure notice is a formal contract administration action to which the contractor must respond. Failure to respond is effectively a failure to cure, which accelerates the path to termination for default. Contractors should respond in writing within the cure period even if they cannot fully resolve all deficiencies within that period.

Is a cure notice public record?

Cure notices are internal contract administration documents and are not routinely published in public databases. However, they are part of the official contract file and can be relevant in protest proceedings, Freedom of Information Act requests, and litigation. The CPARS record that may result from the underlying performance issue is available to future contracting officers through the past performance database.