While the subject of IT contracts is mainly dealt with in the laws that broadly make up civil law, there are major restrictions on the parties’ freedom to formulate the wording of an IT contract in the case of public tenders.
The law provides for a specific list of clauses that cannot be used in a public procurement contract. Due to differences between legal systems, and specific reference made to Polish law in clauses, TKP’s foreign clients often have queries about these issues.
IT contracts may not provide for the following:
- liability of a contractor for delay, except when justified in the circumstances or due to the scope of the tender contract
When the time limit for performance of a contract is exceeded, liability can be for ‘delay’ or ‘default’. In the case of default, a contractor is only liable for missing a deadline for reasons for which they are culpable, while in the case of a delay liability is unrelated to culpability. For this reason, for example, contractual penalties cannot be charged when the acceptance of a milestone in implementation of an IT system occurs behind schedule. Unfortunately for contractors, the law leaves some leeway – liability for delay is possible provided that this is “justified in the circumstances or due to the scope of the tender contract”.
- contractual penalties for a contractor’s conduct that has no direct or indirect connection with the subject of the contract or proper performance of the contract;
A Contracting Authority cannot charge contractual penalties for unrelated conduct on the part of a contractor, i.e. conduct that has no direct or indirect connection with the subject of the contract or proper performance of the contract; A penalty cannot be imposed if there is no link, whether direct or indirect, between the penalty and the subject of the contract or proper performance of the contract.
- liability of a contractor for a situation for which the contracting authority bears sole responsibility
Liability cannot be shifted to the contractor for errors, failure to act, or delays in decision-making or in providing information or documents for reasons for which the contracting authority is responsible.
- the option of the contracting authority limiting the scope of a tender contract while not stating the minimum value or volume of services to be provided by the parties
The subject of the agreement must be defined in a way enabling the contractor to determine the minimum, and thus definite scope of the services it is to provide. This means that the contracting authority may limit the scope of the tender contract provided that it states precisely in the tender contract documentation the minimum volume of the service to be rendered and the resultant guaranteed remuneration of the contractor. To give an example, it has been ruled in case law that a contracting authority is not permitted to unilaterally impose suspension of a portion of services indefinitely under an agreement for maintaining and developing an IT system.
Author: Marta Pasztaleniec