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Policy on Contracting at Barnard

This policy provides guidance for the development and use of written contracts, describes situations for which they are required, and identifies exceptions to those requirements. Well-executed written contracts clarify and define the agreement between the parties and protect against unnecessary risks to the College’s resources and reputation.

Contract Definition

A contract is an agreement between Barnard College and another party that is intended to have a binding obligation and be legally enforceable. Contracts contain the terms and conditions under which goods or services are furnished by either party. Effective contracts provide a common understanding and the essential terms and mutual obligations defined within the agreement that exist between the parties. In addition to formal documents commonly understood to be contracts, documents such as purchase orders, service agreements, leases, and letters or memoranda of agreement, understanding, and intent are contracts if there is a College interest at stake and something of value is exchanged.

Applicability of the Policy

This policy applies to all agreements between Barnard College and any other party, with the following general exceptions:

  1. Employee contracts.
  2. Contracts involving financial aid and student loans.

When Written Contracts Are Required and When Are They Not Required

Not every arrangement involving the purchase of goods or services by the College, or the use of College facilities or resources by third parties, will require a written contract, but many do. In general, if the arrangement involves any significant risk or potential liability that needs to be allocated between the parties, or involves a situation where the duties and responsibilities of the parties are not so basic and obvious that they do not need to be spelled out in writing, then a contract should be used. In the following subsections, some common types or categories of commercial or business transactions are described, and situations requiring (or not requiring) a written contract are specified. Keep in mind that contracts may be originated either by the College or by the other party to the agreement. Regardless of where they originate, they are typically modified by the other party and the revision approved by both parties.

Purchase of goods: Finished (or "off the shelf") goods that are commonly purchased by check or credit card valued under $500.00 do not generally need a contract. However, if such finished goods or equipment are part of construction projects or require the vendor to deliver, install and/or service the goods on campus a contract will usually be required in order for the parties to be clear about issues such as specifications for the goods, the manner and timing of delivery, limitation of warranties, opportunity to cure defects, or payment terms. These should be purchased using the College purchase order form or other contract form which will set forth basic terms and conditions including insurance and indemnity clauses.

Provision of services: We require contracts in place for instances where the College is providing services, facilities or other resources to third parties. Examples include camps, conferences, persons or companies filming on campus, having other special events on campus such as receptions, seminars, etc.

Purchase of Services: In general, services which the College is procuring and which will be provided on campus for hire should have written contracts. This includes arrangements with independent contractors for facilities work, speakers, consultants, performers, videographers, etc.

As stated above, contracts should be used whenever the arrangement involves any significant risk or potential liability that needs to be allocated between the parties, or involves a situation where the duties and responsibilities of the parties are not so basic and obvious that they do not need to be spelled out in writing. A contract should also be used when other specific concerns need to be addressed, such as ownership of the work.

Entertainment: Any arrangement that commits the College to hire entertainers or provide entertainment services requires a written contract.

Art / Exhibits: Any agreement to borrow or lend works of art, special collections, archives or exhibits requires a written contract.

Miscellaneous: Any agreement with a third party that could create a condition that could result in more than a minor liability to the College (whether in favor of the contractor, its employees or others) or that could feasibly result in a dispute if the understandings and obligations of the parties are not clearly specified in advance, should be the subject of a written agreement. These arrangements should also be reviewed against these guidelines and against the contract template list to help you determine if a contract is appropriate or necessary.

Vendors may attempt to provide goods or services without a contract in order to avoid the cost and/or responsibility of negotiating and/or abiding by terms and conditions that would protect the College in a transaction. If there is any question about the need for a contract, consult the Director of Purchasing, who can assist in developing a contract and guiding it through the review and authorization process, prior to any negotiations.

Identification of the College

The College shall be identified as Barnard College in all agreements and contracts. Departments and individuals may not contract in their own name on behalf of the College, but must identify the College as the contracting party. (The department may be identified in the agreement as the office though which the contract is being made.) The official College address is 3009 Broadway, New York, NY 10027 and must be listed in all contracts and agreements.

Contract Language

Contract forms, templates and required language are stipulated in Contracting Procedures which may change from time to time. If the forms and templates provided do not seem appropriate for the transaction or arrangement being contemplated, or if such forms or templates are a good starting point but clearly need modification, you should consult as necessary with the Director of Purchasing or General Counsel, as appropriate, to define the proper language for your particular situation.

Contract Approval and Signatory Authority

Signatory Authority at Barnard College is sometimes delegated but contract approval authority and responsibility rests ultimately with the College’s Officers and those other employees specifically delegated by the Board of Trustees. When these Officers delegate their approval or signatory authority, they must still exercise reasonable oversight and maintain ultimate responsibility for the contracts, and they should limit or revoke the delegated authority whenever appropriate. Spending limits or payment approval for periodic payments specified within a contract can be delegated with significant variation depending on the nature of the contract. 

Only authorized signatory may enter into binding contract negotiations.  People who are not authorized signatories may only enter into binding contract negotiations with permission from an authorized signatory who is also the Vice President of their Area or their Department Head or Chair.  Anyone signing a contract on behalf of the College without signature authority may incur personal liability, and/or may be subject to discipline by the College, including termination.

More specific guidance on Signature Authority is available at the following link: http://barnard.edu/general-counsel/Contract-signing-authority

Contract Review

The office or department initiating a contract is responsible for reviewing the contract to ensure that the contract accurately reflects the intent and mutually agreed upon terms and obligations of the parties.

Further review of the contract shall be completed by the Director of Purchasing and the Office of the General Counsel, as appropriate.  Additional information on contract review is provided in Contracting Procedures. (INSERT WEB LINK)

General Counsel Review

Review of a contract or agreement by the Office of the General Counsel shall be limited to those provisions which are legal in nature, pose a substantial risk to the College or are new, non-standardized clauses which the initiating departments’ representative is not familiar and/or comfortable with. Additional information on contract review is provided in Contracting Procedures.

Vice-President for Campus Services (Risk Manager) Review

Review of a contract or agreement by the Vice President for Campus Services (in his or her capacity as Risk Manager) shall be limited to those provisions which pose a substantial risk to the College. Additional information on contract review is provided in Procedures

Clauses not Permitted

Automatic Renewal: The College does not allow contracts to contain an automatic renewal clause unless there is also a clause permitting the College to terminate the contract at will.

Exclusivity: The College needs to be very careful when awarding contracts that promise the vendor that they will be the exclusive vendor for the goods and services to be provided under contract. Such an award may conflict with a contract that has already been entered in a different department or division, or it may conflict with other operational needs.  Exclusivity agreements require an institution-wide awareness of contracts on campus, and may require fine tuning over time.

Limitation of Liability: The College does not allow a contracting party to limit their potential liability except in rare or specific circumstances. All rights of recovery against others are automatically transferred to Barnard College’s Property and Liability insurance carriers. Limiting this recovery could adversely impact the College’s insurance coverage.

Single Indemnification Clauses to benefit the contracting party only:  The College does not allow single indemnification clauses that only protect the contracting party.  Section 5-322.1 of the New York State Consolidated Laws states “A covenant, promise, agreement…in connection with or collateral to a contract or agreement…purporting to indemnify or hold harmless the promisee against liability for damage arising out of bodily injury to persons or damage of property contributed to, caused by or resulting from the negligence of the promisee, his agents or employees, or indemnity, whether such negligence be in whole or in part, is against public policy and is void and unenforceable…”

Exceptions for State and Federal Agencies

The Federal Government and most states will not provide insurance or indemnity in their agreements with their contracting partners. In such instances, the College normally will accept the agency’s contract without such provisions. When entering into a contract with such a governmental entity, it is recommended that the contracting party attach the College’s standard addendum and any other desired language which may act as a guideline for the parties to follow in the event of an adverse event or outcome, however such attachment is not likely to be considered binding. Contracting departments also need to be very careful in considering whether or not the other party is truly a state agent or not – many state universities or colleges do not have the same immunity protections as other state agencies (e.g., the State Police), and some quasi-public entities may not be precluded from providing insurance or indemnification to other parties they do business with.   Questions regarding appropriate language for such agreements should be directed to the Office of General Counsel.

Requirement of an Arm’s Length Transaction

See the College's Policy on Conflict of Interest and Commitment for additional information.

If a contract directly benefits the employee forming the contract or the employee who is responsible for managing the contract, or such a person’s relative or personal friend, or poses other potential conflicts of interest whether real or perceived, (e.g., the contract initiator or a key department member serves as a paid consultant to the contractor), the contract must be reviewed by both an authorized person with signatory authority who is unconnected with the agreement and the area Vice President, with all potential conflicts of interest disclosed to the Vice President. The risks for such agreements include self-dealing, operational difficulties, financial loss to the College and damage to the reputation of the College.

Any agreement that involves revenue sharing (including commissions, fees, or other payment) with the College, department or an individual from sales by the outside party to other third parties (including students, alumnae or employees) must be reviewed by the Chief Operating Officer  or his/her designee. If the agreement is being entered into by the Finance and Administration Division, it must be reviewed by another Vice President as well. Such arrangements are rare and generally discouraged, since they normally signify a commercial joint venture in which the College may assume risk of loss, and may implicate non-profit tax questions or concerns.

Policy on Reporting Suspected Fraud and Abuse

If a person believes that a supervisor, colleague, subordinate or any other person is acting outside the College policy on contracting, s/he should report the concerns to their area Vice President or Associate Vice President for Finance.  For more information see the College’s Policy on Reporting Suspected Fraud and Abuse.

 

Effective: March 4, 2013