CONTRACTS 101 FOR STATE UNIVERSITY PROCUREMENT OFFICERS.
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Transcript of CONTRACTS 101 FOR STATE UNIVERSITY PROCUREMENT OFFICERS.
Presented by:Katherine A. Adams
University of Kentucky Office of Legal Counsel301 Main Building
Lexington, KY 40506
• State universities are independent agencies of the Commonwealth of Kentucky.
• The governance structure begins with the authority granted to the Board of Trustees or the Board of Governors in the Kentucky Revised Statutes (KRS) Chapter 164.
• The Board is the final authority in all matters affecting the University, within limits of State Constitution, federal and state laws.
• The Board has jurisdiction over the University’s financial, educational, and other policies and its relations with state and federal Government.
University Governance
The “LAW” of the University
• United States Constitution
• Federal Law• Federal Regulation• Kentucky Constitution• Kentucky Revised
Statutes (KRS)• Kentucky
Administrative Regulations (KAR)
• Governing Regulations (GR)
• Administrative Regulations (AR)
Human Resources Policy and Procedure (HRP&P)
Business Procedures Manual
University Senate Rules (SR)
Code of Student Conduct
Hospital Policy (HP) Other University
Policy and Procedure Local Ordinances
The “Law” of the University
August 2007
COUNCIL ON POSTSECONDARY EDUCATION (CPE)
KENTUCKY GENERAL ASSEMBLY
KY Revised Statutes (KRS)and Administrative Regulations (KAR)
BOARD
PRESIDENT
FEDERAL GOVERNMENT
Federal Law
ACCREDITING AGENCIES
Research, Hospital, Etc.
LOCAL ORDINANCE
STAFFHuman Resources
Policy & Procedure, AR, GR
STUDENTSCode of Student Conduct,
Rules of the University Senate, AR, GR
FACULTYRules of the
University Senate, AR, GR, HRP&P
Business ProceduresManual
Other, Other, Other
Procurement
Check your University Policy. At UK, all agreements and contracts involving procurement shall be requisitioned through the Purchasing Division and comply with KRS 45A.
What makes a contract?Offer and acceptance – in any
form• Letters• Memoranda of Understanding• Memoranda of Agreement• On-line agreements – “click” and “no-click”• Shrink-wrap license agreements• Purchase orders• Terms and conditions
Contracts and Signature Authority
Problematic Contract Clauses
Some contract clauses present particular legal or business issues for the University:
Use of proper name Arbitration Indemnity Choice of law Term and Termination Insurance Right of First Refusal Conflict of Interest Confidentiality Clauses Copyright Clauses
Indemnity-What is it?
• I will be liable for anything
• Vendors SHOULD indemnify UK
• UK CANNOT indemnify Vendors
• Absent other contractual limitations, even if a Vendor doesn’t agree to indemnify us, UK could still sue vendor for most types of harm
But It’s My Money!Vendors seek new and creative ways to limit liability.
•Caps on total liability (THE MOST DANGEROUS!)
•Limits on indemnity
•Exclusion of special damages and Punitive Damages
Choice of Law
• State agencies governed by state law
• Silence is permissible
• Specify Kentucky law if possible
Term and Termination
• How long?
• What happens if things don’t work out?
• What happens if there is no money?
• Kentucky Open Records Act (KRS 61.870-884) states:
“The General Assembly finds and declares that the basic policy of KRS 61.870 to 61.884 is that free and open
examination of public records is in the public interest and the exceptions provided for by KRS 61.878 or otherwise provided by law shall be strictly construed, even though such examination may cause inconvenience or embarrassment to public officials or others.”
Open Records
If you receive an Open Records Request, please forward it to the office responsible for it immediately, as Kentucky law mandates a response within 3 days of receipt of the request.