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Www.cityofmiddletown.com CASBO October 4, 2002 Phyllis Prokop, CPPB Supervisor of Purchases City of Middletown, Connecticut.

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Presentation on theme: "Www.cityofmiddletown.com CASBO October 4, 2002 Phyllis Prokop, CPPB Supervisor of Purchases City of Middletown, Connecticut."— Presentation transcript:

1 CASBO October 4, 2002 Phyllis Prokop, CPPB Supervisor of Purchases City of Middletown, Connecticut

2 Contracts- basic overview For Purchasing Professionals-- Contracts and contract administration is the most difficult but necessary aspect of the job A CONTRACT is the written document signifying an agreement between two parties—it details the promises or agreements for which the law has enforceable duties and remedies CONTRACT ADMINISTRATION- the process by which purchasing ensures that the contract is performed in accordance with the stipulated terms

3 Contracts- continued Contracts can be both Express or Implied EXPRESS CONTRACT—can be written or oral and must have elements of a formal contract IMPLIED IN FACT CONTRACT – the elements occur through actions/conduct rather than words PURCHASE ORDER is considered a contract

4 ESSENTIAL ELEMENTS OF A CONTRACT CONSIDERATION OFFER and ACCEPTANCE OBLIGATION LEGALITY COMPETENCY DEFINITIVENESS

5 TYPES OF CONTRACTS  CONSTRUCTION  SERVICE COMMODITY TERM TIME AND MATERIALS CONSULTANTS

6 UCC ENACTED 1952 Contracts are regulated by UCC - provide uniformity in laws among states to support interstate commerce All contracts over $500 - must be in writing deals only with sale and purchase of goods or sale /purchase of REAL ESTATE— does not apply to services or intangibles Duration must be greater than 1 year Application of reasonableness Distinguishes between Merchant and Non- Merchant PAROLE EVIDENCE RULE

7 Common law generally provides one remedy for a mistake --- if mistake is not obvious, the party making the mistake is required to perform the contract if the other party wants it. The party making the mistake may be relieved of the obligation to perform it under certain conditions --- party accepting the offer may not enforce it if the offer contained is a mistake that was obvious or should have been obvious or detected. MISTAKES IN CONTRACTS

8 DUTIES AND OBLIGATIONS OF RECEIVER Inspection : buyer must inspect goods in a timely fashion, defects must be reported promptly Buyer has several options 1.) reject all goods 2) Accept all goods 3.) reject non conforming goods 4.) accept conforming goods Latent Defects

9 PAROLE EVIDENCE RULE court will not admit evidence, either written or oral, of prior understandings or negotiations to vary or contradict the contract’s terms ***Verbal commitments cannot be used to modify or contradict a written contract.

10 IMPLIED WARRANTY—that the goods will meet certain standards, that they will perform as they are intended. IMPLIED WARRANTY FOR A PARTICULAR PURPOSE—seller knows about the buyers needs, buyer is relying on sellers expertise /knowledge to provide product to fit purpose Merchant and Non- Merchant– the UCC rule becomes extremely important in this scenario. WARRANTIES

11 BREACH OF CONTRACT when party fails to perform in accordance with the contracts terms, the breach gives the other party a legal basis to pursue monetary damages Lawsuits / Mediation Liquidated Damages Clause : they specify a predetermined dollar amount assessed usually per day of delay Performance Bonds

12 CONTRACT CLOSEOUT Contract closeout requires the following: 1. Contractual issues must be settled 2. All changes incorporated into final document 3. All deliverables items received 4. All borrowed equipment returned 5. All classified documents must be returned 6. Final payment must be made Contract Administrator must write formal closure document for file

13 CASBO October 4, 2002 Phyllis Prokop, CPPB Supervisor of Purchases City of Middletown, Connecticut

14 PRIVATE SECTOR Stay within legal regulations PUBLIC SECTOR Adhere to local regulations as well as legal TRENDS IN PURCHASING

15 TRENDS IN PURCHASING AUTOMATION COMPUTERIZATION E-COMMERCE EBULLETIN BOARDS ONLINE BIDDING

16 TRENDS IN PURCHASING RULES MUST BE ENFORCED LATE BID IS LATE- DO NOT ACCEPT INCREASED EFFICIENCIES COST SAVINGS

17 TRENDS IN PURCHASING PROCUREMENT CARDS Accepted widely Easy to use Financial controls Reporting/ Financial integration

18 TRENDS IN PURCHASING Misconception-Stumbling Block Diverse Functions Responsive to Customers- internal/external Broad Knowledge

19 TRENDS IN PURCHASING Resourceful: DODGE REPORTS / THOMAS REGIONALS Networking: PPAC- Public Purchasing Association of CT- 100+members

20 NATIONAL INSTITUTE OF GOVERNMENTAL PURCHASING - (N.I.G.P) A PREMIER TRAINING AND CERTIFICATION ORGANIZATION FOR PUBLIC PURCHASING OFFICIALS PROVIDES OVERSIGHT FOR PUBLIC PROCUREMENT ETHICS AND POLICY CONVENES BEST PRACTICES FOR PUBLIC SECTOR PURCHASING PROVIDES CERTIFICATION FOR PUBLIC PURCHASING AGENCIES TRENDS IN PURCHASING

21 State of CT- DAS CT Gov Center--Orderlink CRCOG—cooperative contracts (natural gas) U.S. COMMUNITIES- ECONOMIES OF SCALE- multi-state contracts TRENDS IN PURCHASING

22 KEY CONTACTS Web Information :


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