Transcript CONTRACT MANAGEMENT at William & Mary

4/6/2015
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Board of Visitors By-Laws delegates signature authority
for all transactions to the President and specific areas
to the Provost and the Vice President for Finance.
They have authority to sub-delegate.
Sub-delegations may include contract type and dollar
limits as defined by the individual delegating.
All sub-delegations are subject to review and approval
by the President, Provost, and Vice President for
Finance.
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The President has the authority to conduct the business of the
university and, as such, has the authority to sign any contract,
unless reserved to the Board of Visitors.
The Provost holds the principal signature authority for:
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sponsored projects (grants and contracts)
employment contracts and letters of intent
articulation agreements
intellectual property rights
student or faculty exchange agreements
financial aid agreements
any other contracts or agreements necessary to carry out and support
the operations of the College, with the exception of matters reserved
by the Board of Visitors and those matters delegated to the Vice
President for Finance
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The Vice President for Finance holds the principal
signature authority for:
◦ the transfer, conversion, endorsement, sale, purchase, assignment,
conveyance and delivery of any and all shares of stocks, bonds,
debentures, notes, and subscriptions warrants, cash or equivalent
assets, and evidence of indebtedness.
◦ the purchase of real estate and other property or other securities or
assets now or hereafter standing in the name of or owned by the BOV
or bearing any similar designation indicating ownership by the College.
The sale of real property requires the approval of the Board of Visitors.
◦ agreements that set terms for acceptance of gifts
◦ any other contracts or agreements necessary to carry out and support
the operations of the College, with the exception of matters reserved
by the Board of Visitors and those matters delegated to the Provost
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The Vice President for Finance (continued) :
◦ agreements for the purchase or rental of services, supplies and equipment,
including software and hardware
◦ construction and professional services
◦ nondisclosure or confidentiality agreements
◦ real estate and property leases or rental agreements
◦ capital leases
◦ easements
◦ equipment leases or (fixed asset) rental agreements
◦ student room contracts
◦ licensing and trademark agreements
◦ any other contracts or agreements necessary to carry out and support the
operations of the College, with the exception of matters reserved by the Board
of Visitors and those matters delegated to the Provost
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Procurement-goods, equipment and/or services
◦ Contracts over $5000 total spend must be processed through
procurement office
◦ Contracts under $5000 delegated authority must follow
contracting and signatory authority policies.
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Office of Sponsored Programs (OSP)-sponsored
funding (grants), external funding and research
collaborations
Technology Transfer Office –NDAs and data transfer
Real Estate Services-Property Leases
University Counsel-all others
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By signing a contract you are obligating the university to
any and all terms of the agreement
◦ Internal consequences-you are accountable for acting in the best
interest of the university including the financial considerations
◦ External consequences-your official capacity makes you a formal
representative of the university to the business community
Thus…….
 Contracting and Signature Authority Policy
 To sign a contract an employee must have written
delegation to do so.
 Delegation is granted to specific position & individual and
 Training is required to receive and retain authority
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A university contract is any agreement between the
university, or any of its subunits (such as the Mason School
of Business or the Department of Physics), and a third party
that involves a commitment on the part of the university
regardless of the source of funds. An agreement is a
document that has legal effect, regardless of whether it is
called a “contract.”
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A contract may involve a commitment of university funds,
facilities, employees, or other resources, and/or the use of
the university’s name. It may be a commitment for the
university to give up a right it otherwise may have.
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OFFER An offer is a proposal to do a thing or pay an
amount anticipating acceptance or a counter-offer.
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ACCEPTANCE is active or inactive demonstration of
acceptance of the offer.
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MUTUAL CONSIDERATION exists when each party to a
contract gives up something of legal value.
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IN WRITING?
◦ To be enforceable, certain contracts must be in writing
 Contracts for the sale of goods over $500
 Contracts for the sale of real property
 Contracts that cannot be completed in one year
 Promises to answer for or discharge the debts of another
◦ COLLEGE practice demands all contracts are in writing
BUT
◦ Courts can and do enforce contracts that are not in writing
◦ A written contract is presumed to contain all the terms of
the contract.
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A contract by any other name………
◦ If there has been an offer and acceptance, mutual
consideration and it is in writing, it is a binding agreement.
◦ Typical College examples of contracts are called
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Agreement
Memorandum of Understanding
License
Statement Of Intent
Covenant
Lease
Understanding
Arrangement
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Anything and everything that matters!
Clearly and completely lay out expectations
◦ Who
◦ What
◦ When
◦ Where
◦ Why
◦ How
◦ How much
◦ What If
◦ Says who
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The College of William and Mary in Virginia
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The other party’s legal name
◦ That is the legal name of the College
◦ Various Schools, Departments, Offices Centers are not legal entities
and thus do not possess the authority to contract.
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Individual
Sole proprietorship
Partnership
Limited Liability Partnership (L.L.P.) or Company (L.L.C.)
Corporation
Governmental entity
State Corporation Commission: www.scc.virginia.gov
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This is the heart of the contract-what the parties will do
Clear-who is supposed to do what
Complete
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Everything that matters
Everything that should or should not happen
Think about what is not in the contract but should be
If it is not in the contract, it can not be enforced.
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Clarity of College’s expectation of timing
◦ Window of performance or
◦ Deadline or
◦ Specified date
If meeting a deadline is critical, the contract should specify
“Time is of the essence.”
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Be specific
Include enough detail that there is no
misunderstanding of where the activity takes place
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Not always necessary to include
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Often used to define the objective
◦ Goal
◦ Purpose
◦ Context
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Expectation of how work is performed
If nothing is mentioned, contractor can do as they
please and the College cannot compel otherwise
Can also be in terms of prohibiting a certain type of
activity without specifying how work is done
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Amount
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Manner
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Timing-standard Commonwealth terms are Net 30 upon
completion and receipt of invoice in Accounts Payable
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Down payments and/or deposits are normally
unacceptable.
◦ Fixed cost
◦ Term
◦ Cap
◦ Hourly
◦ Job
◦ Time and materials
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Termination clause necessary
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Nonperformance or substandard work
How to deal with external factors such as weather
Ability to terminate contract with notice
Define procedure and obligations
Typical termination clause
 Written notice
 Opportunity to cure
 Right to terminate
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For the College-Those who have signatory authority!
Unauthorized individuals who sign contractual agreements
on behalf of The College may be held personally liable for
those contracts.
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For the contractor- must be someone with authority
to bind the contractor to the terms and conditions of
the contract.
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College form contracts
◦ Independent Contractor/Consultant
◦ Hotel addendum
◦ Standard addendum
◦ Speakers
◦ Entertainment
http://www.wm.edu/offices/procurement/forms/index.php
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Contractor form contracts
◦ Prefer not to use but if they insist require college addendum
The necessary clauses protect the College
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Entire agreement-number the pages
Sovereign Immunity
Modification only in writing by both parties
Applicable Law and Choice of Forum-Virginia
Force Majeure
Remedies
Collection and Attorneys fees
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Indemnification/Hold Harmless-we cannot indemnify
Insurance-insured by Commonwealth
Binding Arbitration not allowed
Confidentiality-subject to FOIA
Liquidated Damages/lost profits
Limited Liability
Modification without our written approval
Complete list in Contracting Guidebook
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A Contract Administrator (CA) is assigned to every contract
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For contracts through Procurement, the Contract
Administrator letter is sent to and signed by the CA
Read the contract!
ID critical clauses, Terms and Conditions
ID team members and responsibilities
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Coordinate contract start up
Inspect and evaluate progress
◦ Coach by pointing out noncompliance
◦ Start documentation process
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Note needed contract improvements
◦ Request contract changes through Procurement Services
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Initiate remedial action if necessary
Annual formal evaluation of contract deliverables
Excludes changes to contract provisions
Excludes terminating a contract
Excludes supervising contractor’s personnel
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Identify deliverables
◦ Quality, quantity, price, place, time
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Understand responsibility for deliverables
◦ W&M’s and the contractor’s
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Determine the frequency of the actions needed
◦ Daily, weekly, quarterly, etc.
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Assign actions to meet deliverables
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For contracts executed by Procurement
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Answer questions
Mediate problems
Modify contract terms
Renew contracts
Terminate contracts
For contracts executed under delegated signatory authority
◦ Answer questions
◦ Mediate problems
◦ Assist with modifying contract terms and renewing or
terminating contracts
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Do not assume that:
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Previous contractor left at required performance level
Contractor knows procurement laws or policies
Contractors will police themselves
Contractor will remember or even understand all the
contractual terms
◦ Contractor shares our culture
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If the parties intend the agreement to be binding, it is a
contract.
A written delegation of authority is required to sign a
contract.
As an agency of the Commonwealth, W&M is subject to the
laws of the Commonwealth.
If it is not written in the contract, it probably is not
enforceable.
The details matter.
When in doubt – ask the Procurement Office or University
Counsel first. It saves time and trouble.