By Bruce Jervis
Can a public contract clause bind a contractor even when the clause is not stated or referenced in the contract? The answer is yes, if the clause is considered mandatory. Lower-level employees cannot alter the procurement process by accidentally omitting important clauses.
A federal government contracting officer, procuring construction services, used a contract form intended for the purchase of commercial items. The contract form did not include or refer to the standard clause requiring performance and payment bonds. But, the clause was incorporated into the contract by operation of law.
Under federal contract law, a clause expressing significant public procurement policy is considered mandatory. Regardless of whether it was omitted intentionally or inadvertently, it is automatically incorporated into a contract. Federal procurement policy cannot be avoided, deliberately or negligently, by lesser officials.
This seems like a harsh rule for public works contractors, particularly the inexperienced, who rely on the text of a contract to determine their responsibilities and obligations. Some state jurisdictions have adopted the same rule, citing federal precedent. Is this fair? Your comments are welcomed.