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L4 > L4M3- Chapter 1- Understanding the legal issues > Flashcards

L4M3- Chapter 1- Understanding the legal issues Flashcards

1
Q

What is a schedule?

A

Part of a contract that is time orientated and designed to be updated periodically

e.g. Annual price lists or a project delivery plan
Can also be the spec

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2
Q

What is an annex?

A

An attachment to a contract which is of direct relevance to the contract but is not updated regularly. E.g. addresses or org charts

Can also be the spec

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3
Q

What is an appendix?

A

Attachment to a contract which may be of interest but is independent of the contract (e.g. nice to know)

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4
Q

In law, a tender and quotation are essentially the same thing. In procurement what is the difference?

A

Quotation- used when the only variable is price, a simpler process and possibly even informal. Low value, lower risk items

Tender- Multiple variables (not just price). More formal, normally has deadlines

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5
Q

What is a framework agreement?

A

An agreement with one or more suppliers for the supply of an array of products, all with prices and T&Cs fixed for the duration of the agreement

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6
Q

What are the advantages and risks of RFQs?

A

ADV-
Formality- reduced spend on process because spec is clear and frees up resource
Speed- turnaround should be short as only variable is price. Quick to implement

DISADV
May be over simplified
Potential for a lack of an audit trail
Possible lack of transparency
Price may not be the only variable to consider
Need to comply with rules

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7
Q

What are the advantages and risks of ITT?

A

ADV
Full audit trail
Full robust process for transparency so reduces risk (e.g. conflicts of interest, bribery etc)
Forward planning as you need to think about timelines for an ITT
Clear and robust response schedules and timelines

DISADV
Requires documentation set up
Process driven so may not give specific thought
May be regulated by law
Long process
Lack of understanding of appropriate tender type

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8
Q

What are some of the issues that can be raised from sourcing? (seeking tenders and quotes)

A

Administrative costs
Audit trails
Transparency of process (ie. suppliers need to be sure its a fair process with no nepotism or coercion)
Urgency and speed (most procurement should be properly planned out not requiring immediate action scenarios)

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9
Q

Why are audit trails important?

A

Reduce bribery, corruption, collusion and extortion
Evidence for what actually has happened
Improved accountability
Trace errors

E.g. an RFQ may be less formal meaning less of an audit trail (unless using E-tenders), whereas an ITT will have a full robust audit trail

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10
Q

What is a waiver process?

A

A decision not to apply the normal rules.

To waive a tender process it needs high level authority and a business justification

May be caused by needing to do something urgently to maintain supply

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11
Q

If a specification is not clear, what could happen?

A

Poor bids (over or under priced)
Claims for extensions
Admin costs to clarify
Delay
Goods not meeting requirement

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12
Q

Why do you not want to over specify?

A

Miss opportunities for change or innovation
May refer to specific brands or manufacturers which are unnecessary
Wish list may be so specific that no supplier can meet it

Others I think:
Increased cost
Time and effort

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13
Q

What is PbR?

A

Payment by Results

This is a scheme where some or all of the payment depends on the provider achieving outcomes specified by the commissioner

This is used in the public sector in the UK

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14
Q

What are the main types of specification?

A

Performance
Conformance (also called prescriptive or technical)

Sometimes it can become a hybrid between the two

There is also outcome based schedule of outcome requirements- this is looser and more flexible than a specification and encourages innovation

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15
Q

What are the main differences between performance and conformance spec?

A

PERFORMANCE:
Focus on outputs
Sets out results
The ‘what’ not the ‘how’
Supplier has flexibility
Risk is with supplier

CONFORMANCE:
Focus on inputs
specifies methods, processes and materials
May use specific manufacturers, brands or components
It is the ‘how’ and the ‘what’
Ties suppliers to set details
Risk held by buyer

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16
Q

What are the 12 key things to think about when designing a specification?

A

Purpose
Perspective
Scope
Improvement
Compliance (standards)
Type
Relevance
Performance
Clarity
Service conditions (once in situ what does operating/ storage look like)
Budget
Waste

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17
Q

What problems can occur if a spec is only mentioned in the RFQ/ITT and not in the contract?

A

If it is not in the contract it is not valid
Anything spoken about in the tendering process could be omitted, undermining the whole contract
Failure to use the most up to date documents

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18
Q

What are the 3 key components of a performance management framework?

A

KPIs
Targets
Consequences

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19
Q

What are some examples of tender submission aspects that could be included in a contract?

A

Purchase price factors (price, inflation, payment terms)
Time scales for production
Logistical aspects e.g. delivery, packaging
Location

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20
Q

What are some examples of KPI aspects that could be included in a contract?

A

Delivery performance
Quality performance
response times

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21
Q

What are some examples of specification aspects that could be included in a contract?

A

Material requirements
ISO e.g. ISO 9001 for quality management

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22
Q

What determined if a contract is formal?

A

used for detailed contracts
where law may need to be enforced
Evidence of both parties signing and sealing

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23
Q

What are the advantages of a standard/template contract?

A

ADV
Unlikely to miss key areas
Standard clauses prompt though on relevance
Legal meaning has been fully considered
Standard list of schedules will be included
Cheaper
Consistent

DISADV
Could be inappropriate for use
Could become complacent when writing
May fail to cross check
References may be obsolete
May be ambiguity

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24
Q

What are the advantages of a bespoke contract?

A

ADV
Precise needs considered
Avoids risk/ drawbacks of standard forms

DISADV
Language may be inconsistent with legal interpretation
Potential to omit areas of low risk
May identify risk but not consider wider consequences

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25
Q

What is CSF?

A

Critical success factors
Identify the key objectives of a contract and determine the conditions that will deliver them

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26
Q

What are warranties in a contract?

A

Lesser terms in a contract which result in damages but not termination

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27
Q

What are conditions in a contract?

A

The key elements in a contract which, if breached, can result in termination

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28
Q

What are innominate terms?

A

Could be warranties or conditions depending on judgements made as part of a dispute resolution process

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29
Q

What are the common 5 sections of a contract?

A

1) Articles- a summary of the basic agreement (party A is entering a purchase agreement with party B…)
2) Recitals- Context- what is the situation that the contract happens
3) Contract particulars- some specific parameters e.g. date of completion, insurance, conditions, warranties
4) T&Cs- ifs, buts and maybes and what will happen in different scenarios
5) Schedules- specific project detail

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30
Q

What is market leverage?

A

Another term for bargaining power

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31
Q

The purchaser usually takes the lead in delivery of contracts, what things should they be aware of?

A

Market leverage- suppliers can make changes if they hold power
Regulations in procurement- once advertised, it can be difficult to execute change

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32
Q

It is important that a buyer understands all terms in a contract, every term should do one of the following:

A

Protect the supplier
Protect the buyer
Balance the protection between them

Contracts should protect both parties but the degree to which they do will be based on the bargaining powers and their influence

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33
Q

What should key terms in a contract cover?

A

Price
Payment terms
Risk
Insurance
timescales
H&S
Actions and remedies

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34
Q

An informal contract can be difficult to understand the terms agreed, particularly if it was over the phone or was just an RFQ followed by payment and delivery, but how would the terms be esablished?

A

If there was a previous contract the terms could be assumed to apply again
If there were ‘normal’ sector expectations they may apply again
Either of the above could be discounted if there was evidence for other circumstances applying

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35
Q

What is a schedule?

A

A schedule to a contract is simply an attachment to the body of the contract form

It is an easier way to incorporate project specific information without having to impact the main body of a contract and allows for standardisation of the T&Cs

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36
Q

What are the benefits of using a schedule?

A

Simpler to draft a standard contract with a schedule specific to the project
Quicker and cost effective
Within an organisation specific clauses have identical wording to avoid risk
Uniform contracts are easier to understand

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37
Q

What are the most common types of schedule?

A

Pricing schedule- could be the fees payable at different stages

Specification- Exactly what is to be delivered

Preliminaries (costs that are needed to complete a project but are not tied to specific work e.g. project management) or contraction/operational matters- usually included to cover all associated overheads and risks

Performance management framework- KPIs, targets, incentives, disincentives, bonuses

Delegated authority and contractual management

Site lists, maps and plans

H&S

Method statements- describe how the desired result is to be achieved

Sub contractors- could be simply agreeing to certain manufacturers or the supply chain

Alliancing agreements- also called contractual joint ventures- setting up joint supply chains between contractors and sub contractors

Core lists or exclusion lists- linked to schedule of rates and overview the items that may be included as part of a discount

Suppliers staff- This is where the provision of services is reliant on the skill of an individual e.g. the contract may be terminated if they no longer participate

Codes of conduct

Data management- NDAs, cyber security, rules on GDPR, IPR

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38
Q

What is a schedule of rates?

A

A list of prices associated with the products or services to be provided. it can differ by volume

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39
Q

Contract variations are required in contracts because conditions may change, but what should be set out in the contract?

A

Who can request change
Who can authorise change
Who can accept change
Mechanisms for price adjustments
What happens if a variation/ change order is rejected
Details of variance management and configuration control processes
Responsibilities for notification of affected parties

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40
Q

What is a variation/change order?

A

Change orders are also called variations or variation orders. Any modification or change to works agreed in the contract is treated as a variation.

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41
Q

What are the 6 basic rules for contract formation? OACICB

A

Offer
Acceptance
Consideration
Intention to create legal relations
Capacity to contract
Be legally binding

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42
Q

What is a common law, sharia law ,civil law and case law system?

A

Common law = in UK, a body of unwritten laws based on legal precedents and established by courts
Sharia law = also uses courts but guided by the Quran for Islamic states
Civil law = A comprehensive system of rules and principles usually arranged in codes and easily accessible to citizens and jurists. Used in Austria and Poland
Case law = Case law (or judicial precedent) is law which is made by the courts and decided by judges.

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43
Q

What is an ITN?

A

Also called an invitation to treat

Effectively a seller showcasing a product or service that is available for sale and inviting the buyer to submit a price or initiate negotiations.

In the way a buyer sends an ITT to a seller, an ITN is a seller submitting to a buyer

An ITN alone IS NOT AN OFFER, the buyers response to an ITN constitutes the offer

Similarly, an ITT alone is not an offer, it is an invitation and only becomes an offer once the parties have responded with a bid

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44
Q

Give some examples of ITN

A

Advertisement of goods

Displaying goods for sale in a shop

Auctions/ E-auctions

Online catalogues

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45
Q

What is an offer?

A

A statement of what the offerer is willing to provide and the terms in which they will provide it

46
Q

What is case law?

A

the law as established by the outcome of former cases

47
Q

Give examples of what is not an offer in case law?

A

ITT or ITN
Fisher vs Bell 1961

Declaration of intention- defined as an aim or plan
Harris v Nickerson 1872

Mere puff or boast- something that is not intended to be taken seriously
Carlill v Carbolic smoke ball company 1892

Provision of information (providing information not an offer)
Harvey v Facey 1893

48
Q

What is a mere puff (or a boast)?

A

This is anything that is intended not to be taken seriously, such as advertising slogans

49
Q

An offer must be communicated to become an offer, but what are the 6 ways that an offer could end?

A

1) Withdrawal/ Revocation- Offerer withdraws
2) Lapse- if the time limit set for acceptance elapses then it ceases to be valid (if no end date then the contract will lapse after a ‘reasonable’ period
3) Death
4) Rejection- Once a party has rejected an offer then cannot later accept. A counter offer is a rejection (e.g. A offers £1, B says they will buy for £0.9 then the original has been rejected)
5) Failure of conditionality- Express or implied terms not met
6) Acceptance

50
Q

What does ‘without prejudice’ mean when making an offer?

A

An expression used when negotiating a contract to ensure that original offers are preserved whilst other discussions occur

51
Q

What are express and implied terms?

A

Express- Contract terms specifically written into the contract

Implied- Contractual terms that exist in legislation and so are not written into the contract

52
Q

You can accept an offer, but what conditions are required?

A
  • Offer must be open
  • Absolute and unconditional
  • Intentional
  • Cannot be made by someone with diminished capacity (e.g. a minor, mental health, drugs etc)
53
Q

What does ‘subject to contract’ mean in offer acceptance?

A

Used on letters and indicates that matters are still being discussed and that the letter must not be taken as a formal offer or acceptance of terms

54
Q

What does ‘letter of intent’ mean in offer acceptance?

A

Indicates intention to accept a tender if certain preconditions are met e.g. legal or financial

55
Q

Why is it important to state the place of contract terms on the contract?

A

Acceptance of an offer creates the contract, so where you accept is important. With the rise of electronic contracts it could be unclear the place of contract is unless stated

56
Q

What is acceptance by performance?

A

Acceptance does not need to be explicit, if a purchaser starts using goods supplied it is implied that they have accepted the terms

57
Q

What are the two rules that override the need for acceptance to be communicated?

A

1) The seller can simply dispense of the need for a formal acceptance

2) Mailbox rule- this means if a letter accepting an offer has been properly posted, but not delivered, then it is effective from the date of posting
(mailbox rule does not apply to electronic comms as this is only valid from point of receival)

58
Q

what is the Vienna convention?

A

UN convention on the international sale of goods- recognised framework for international trade

59
Q

What is consideration in a contract?

A

In commercial contracts consideration can be thought of as the payment for goods or services (normally financial)

No consideration means no contract

60
Q

Give some examples of things that could/could not be considerations

A
  • Past consideration- something done in the past cannot act as a consideration
  • Implied consideration- can be a consideration
  • Promise to perform an existing obligation- if there is a legal obligation, it must be delivered
  • A promise to perform over and above an existing obligation- this is consideration
  • Promises to a third party
61
Q

What is the difference between adequate and sufficient consideration?

A

Sufficient- Consideration is capable of having monetary value and does not fall into any categories that could be referred to as no consideration (e.g. past consideration, implied, promises to a third party etc)

Adequate- refers to if payment is a reasonable and fair amount to be given in exchange (in commercial contracts the law tends to not intervene here) but examples are normally big organisations vs individual consumers where government steps in (e.g. energy companies)

62
Q

What is privity of contract?

A

A legally binding agreement between 2 or more parties which is private to those parties. This means that 3rd parties cannot claim damages directly from the contract

63
Q

What is collateral warranty?

A

An agreement under which a subcontractor agrees to fulfil an obligation

Collateral warranties are used as a supporting document to a primary contract where an agreement needs to be put in place with a third party outside of the primary contract

Only legally binding if executed alongside a deed

P44 if required to review

64
Q

What is a deed?

A

Agreement for the transfer of an asset

A document is a deed if it explicitly states that it is

65
Q

When is consideration not needed in a contract?

A

When the promise is made by way of deed

Collateral warranties generally do not involve consideration

66
Q

Why would a minimal consideration be added to a contract to prevent them becoming deeds?

A

Contracts have liability for 6 years whereas deeds are 12 years

67
Q

What are some differences between contracts and deeds?

A

deeds have to be written, whereas a contract can be verbal and written

contracts require ‘consideration’ (i.e. something is given in return), deeds do not
deeds must state that there is an intention to be a deed

deeds have a statutory limitation period of 12 years vs six years for a simple contract
certain transaction types have to be drawn up as deeds (see below)

a deed involves more formalities to be completed when being drawn up compared to a simple contract. This includes requiring witnesses to observe its formation.

68
Q

What is an intention to create legal relations/ to be legally bound?

A

Intending that the agreement should be capable of being enforced by courts

Commercial arrangements are generally assumed to be enforceable whereas domestic agreements do not

69
Q

What is Ultra Vires?

A

This is in the commercial world where organisations may only legally be able to contract to do certain things

Often public sector organisations

Effectively do not have the capacity to legally enter into the contract

Ultra Vires means ‘beyond powers’ in latin

70
Q

What is an article of incorporation

A

The legal document creating a commercial company and setting out its purpose

71
Q

What is battle of the forms?

A

This is where orders, delivery notes etc issued in sequence may each have terms which appear to override each other.

Each issuing of forms effectively rejects the previously issued terms

In the sequence every time you provide a new form it is a counter offer in terms and once the final document is issued with terms it can be considered acceptance

Note, if a purchaser gets a quote (with terms) then the seller provides a quote (with their terms), then the purchaser issues a PO with its own terms, this is not acceptance but a counter offer and the seller would need to fulfil the PO with no further terms to accept, or provide another counter offer.

72
Q

Who usually wins the battle of the forms?

A

It is usually the most recently issued terms that take precedent
(may not always be the case)

73
Q

Contracts are complex and lots of people will have input, why is it important to ensure to explicitly outline things in a contract?

A

Usually anything explicit in a contract overrides anything implicit or previously agreed.

There may be a full agreement clause which explicitly states anything discussed prior shall be ignored.

Courts use rule of interpretation to decide outcomes with contract disputes

74
Q

What are rules of interpretation?

A

Defines how courts will interpret contracts

e.g. words will have their normal everyday meaning unless the definition is provided within the contract

75
Q

If a specific contract schedule is contradictory to another part of the contract how will it be interpreted?

A

Any specific clauses override any generic ones

This follows the logic that if the time was taken to write a specific rule, then it must be more important than generic

76
Q

What are some examples of clauses in a contract? (outside reading)

A

Confidentiality
Force majuere
Dispute resolution
Termination
Indemnity (related to who takes on risk of losses)
Order of precedence clause

77
Q

What is an order of precedence clause?

A

This is within a contract and outlines which terms take the lead, e.g. it may say that anything in the main document will take precedence over any drawing or schedules attached

It is applied rarely, and usually when the discrepancy is blatant

78
Q

When there is a monopoly or limited number of suppliers (e.g. energy) the contract can be weighted in the suppliers favour. Give some examples of terms that could be in the suppliers favour?

A

No warranty of quality
Spec is what the supplier wants to sell, not for the buyers specific need
All risks are with the purchaser
Payment terms
Exclusion of liability (for damages or injury)
Lack of protection of budget overruns
Inability to change (or subject to extra costs)
Lack of protection of IP
Inability to control shared data

79
Q

What are the risks of oral contracts?

A

Oral contracts are enforceable, it is just hard to prove what they were
Often they will be short telephone conversations so miss key areas of the contract (warranty, spec, timescales, cost, liabilities)
Uncertainty of whos terms are being agreed
Usually results in a battle of the forms (as documents begin to creep in)

80
Q

What is CISG?

A

Contracts for the international sale of goods which seeks to harmonise terms across different countries

Part of the vienna convention (UN treaty)

81
Q

What is the purpose of the vienna convention on CISG?

A

Set out a framework for international transactions based on a uniform approach and get around challenges with local laws

Interpretation continues to develop through case law

82
Q

When is the vienna convention on contracts applicable?

A

To goods (not services)
Applies to private commercial transactions (B2B) not to public services or sales to customers
Only applies if the places of business are in different contracting states (different countries signed up to the convention)

CISG can be excluded if the terms explicitly say so, or if the contract states that it is subject to the legal system of a specific country

83
Q

What does CISG cover?

A

Formation of contract (offer, acceptance, consideration)

Does not cover the validity or enforceability of the contract e.g. illegalities in certain countries

Does not require amendments in writing

Does include the provision of risk but can be overridden by INCOTERMS

84
Q

What is a misrepresentation in a contract and what are the three levels?

A

A false statement of fact made by one of the contracting parties before or which encouraged the other party to contract

1) Intentional/ Fraudulent- meant to do it and knew consequences
2) Ignorant/ negligent- meant to do it and should have known the implications/consequences
3) Innocent- you did it but did not know you did

85
Q

One off purchases can be divided into either simple or complex purchases. What are the reasons for a simple or complex purchase?

A

Simple- low value spend, standard terms, urgent need and lack of planning

Complex- Lack of fully developed strategy for the spend area and an inability to predict future funding (if you could do those things you would likely form a framework agreement or something greater than a one off purchase)

Note that despite being one off, the contract may not be simple.

86
Q

Why would a one off purchase still have a complex contract?

A

The complexity of the one off purchase contract will be depending on the complexity of the product

Warranty for considerable life of the product
Insurance
Licensing an future updates on software
Specifications required
Quality standards
Ability to extend the scope/duration of the contract
Data security

87
Q

What are the benefits and risks to one off contracts for the buyer and the supplier?

A

ADV
Buyer:
Can be fast
Could be local suppliers
Tap into falling market prices or time limited offers

Supplier:
One off spot purchase may reduce competition giving them a better price
If one off purchases are regular, their spend can still be significant

DISADV
Buyer:
Pricing may be on the day and unable to demonstrate value for money
Contract volume may be limited
Limited relationship
May be limited in public sector

Supplier:
Planning may be difficult with ad hoc purchases
If you fail one off contract, you may not get future business

88
Q

What is a framework arrangement?

A

No legal standing and is usually where an organisation itself has decided to limit the number of suppliers it works with but there are no commonly agreed terms for working with those suppliers

AKA an approved supplier list or an approved panel

89
Q

What is a formal framework agreement?

A

It differs from an arrangement as it does have some legal standing.

It is not a contract as there is no consideration

It is an overarching/umbrella agreement under which contracts can be created and is legally binding once that contract under the framework is created

The framework will set out the T&Cs but IF a contract is created but is not a contract itself

It can have a mechanism for determining price, but will not be as detailed as a schedule of rates

It will be set up in the same way as a contract e.g. through a tender or a series of negotiations

90
Q

What does a framework agreement set out?

A

How call offs will be made
How price is calculated
Spec
Duration
Who can access the agreement (traditionally a closed system)
Limitations
Main terms of the contract

91
Q

What is a direct call off?

A

The act of placing an order under a framework agreement without having further competition

92
Q

What is a closed system?

A

A system or process that does not allow new entrants

A framework agreement is an example as there may be multiple buyers and suppliers but once set up no additional buyers or suppliers can be added

93
Q

Thinking about the number of suppliers and buyers in a framework agreement, what are the different types

A

One to one (ie one purchaser to one supplier)
One to many
Many to one (ie many purchasers to one supplier)
Many to many

94
Q

What is a mini competition

A

Limited tender exercise usually only on price

It can apply under a framework and apply only to the suppliers involved

The framework agreement will set out the process to be followed

95
Q

What is the purpose of a mini competition under a framework agreement?

A

Specific needs can be priced
Contract specific terms can be refined
Maintain an element of competition amongst suppliers
Quicker than a full tender
Less resource than a full tender

96
Q

What is a call off and when is it used?

A

AKA a term contract

The call off states the actual order (ie item, quantity and place of delivery) but all other aspects of the contract will remain

Exists for a fixed period of time rather than for a specific purchase

Used when there is a regular requirement for goods or services that you want to have provided by a single supplier

e.g. servicing equipment, services which cannot be done on site, regular requirement but stock holding is limited

Price is usually agreed quarterly or annually if it is the same requirement

97
Q

What is the difference between a Framework Agreement and a Call off Contract (Term contract)?

A

In a term contract the supplier is committed to meeting all orders placed whereas a framework the supplier is not obliged to ender into a given call off.

98
Q

What are the benefits and risks of call off contracts for the buyer?

A

ADV
Guaranteed delivery
Agreed price
Simple order mechanism
Electronic order systems
Longer term contracts allows collaboration

DISADV
If prices fall, you may be locked in at a higher rate
Technology may change

99
Q

What are the benefits and risks of call off contracts for the supplier?

A

ADV
Easier to plan resources as you have some certainty of future demand
Simple order systems
Agreed spec can reduce spend on short runs
Align working practices with a longer contract

DISADV
If raw materials increase, the contract may make a loss
May need to use old technology to meet spec if tech changes

100
Q

As well as classifying a contract by one off or term contracts, they can be split by their subject matter, what is a good, service or work?

A

Goods: products, tangible items, can be stored and moved

Services: Intangible, done by a person or group

Works: Special type of service contract, specifically construction, buildings, civil engineering etc

101
Q

The majority of a contract areas for a good, service or work will be the same, what are some examples of differences with regards to contracts for a service?

A

Public sector may have more regulation and spend caps
International trade- e.g. vienna convention only applied to goods not services
Key personal- may be that a service contract is dependent entirely on the skills of one individual (and if they leave you may want to terminate)
Local knowledge- may be ruled that a supplier cannot be selected purely on location
Data sharing- may need more protocols as services will have a lot more personal data
Insurance
Conflicts of interests
Codes of conduct

102
Q

What is the difference between a hire and a lease?

A

Hire- short term

Lease- legal commitment with T&Cs where the lessor (owner) charges fees to a lessee (who will use the asset)

103
Q

What are some of the key things to consider when you set out a hire or lease contract?

A

The reason for the approach
If you are hiring as its a high expense then what does payment look like
Risks of ownership being applied
What maintenance is required
Period of hire
Financial impacts
Extension/reduction of the scope

104
Q

What is a hire purchase?

A

Where the asset is hired for a period of time, but at the end there will be a transfer of ownership

105
Q

What is the difference between an ITT and an RFQ in the eyes of the law?

A

Both are the same, in the eyes of the law both are offers

106
Q

What are contractual terms?

A

Referred to as T&Cs

make up the main body of the contract

Contract terms may be the smallest part of the contract and will not be understood without schedules and supporting documents

Could be standard of bespoke terms

107
Q

What are the 3 types of contract?

A

Standard

Bespoke

Model form- Standardised contracts used within certain industries to create a stable and consistent contract which are affordable and broadly equitable

108
Q

How do you avoid losing the battle of the forms?

A

Careful control of documentation handling

Use of tendering procedure (insistence on buyers terms being basis of award/non compliant bids if the buyers terms are tampered with)

Use of framework agreements, where standing offer by supplier is subject to buyers terms as agreed in original agreement (Framework works like agree to enter and brose a store, but only enter a contract when you purchase, but the framework of how to purchase etc is set up ahead of time/is predetermined- think about ordering stationary and it is useful to not have to set up a relationship and new terms every time- it is good for low importance of supplier)

109
Q

What is the difference between a framework and a call off contract?

A

Call off contract is legally binding for the stock- even if you are taking it in waves- you are still liable for all of the stock

In a framework agreement is not binding, you do not need to take the stock

110
Q

What is a mini competition and what are the ADV/DISADV?

A

A tender process that is run under a framework agreement. The framework agreement will set out the process to follow. It is only open to suppliers on the framework and they should all be invited. Can be to be more precise with requirements and maintains competition amongst the framework suppliers

ADV
Quicker and take fewer resources than a full tender
Key terms are already defined
No need to repeat due diligence
Suppliers are already pre-qualified

DISADV
Due diligence or other checks may be outdated
There are risks if the framework agreement is not managed properly

L4 (18 decks)

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