Contracts Management

Before starting any job, work, transaction or business, every individual or organization is subject to some form of contract. This is because a contract reflects the mutual agreement between two or more individuals for consideration or a specific performance. Government contractsare also part and parcel of this process.

Contracts can be of different types. There are government contracts, commercial contracts, legal contracts, business contracts, employment contracts, etc. It is important to define what a contract is before moving forward.

A contract is the legal agreement or promise between two or more persons for a consideration or performance of a task. It may be in writing to reflect the mutual consent or agreement between the parties. Usually, the parties, individuals or organizations sign the contract after accepting the terms and conditions of the offer. Once a contract is signed, it serves as a legal proof of the mutually agreed obligation. Every contract lays down certain principles which are inviolable. Therefore, one has to the follow all rules and regulations upon entering into a contract. Some contracts, however, are verbal and not in a written form.

A government also signs contracts. The government can sign a contract with another government, business firm, or individual, depending upon its objective. Those who sign the government contract are usually involved in performing or supplying goods and services for the government department. Profit generation is not always the primary motivating factor in government contracts although governments operate within the same commercial framework as other individuals and organizations.

Many contracts that are available with government departments are subject to a tender based process. This process applies to state government contracts and federal government contracts. Commercial parties that are interested in performing the work or supplying the service are required to submit a proposal known as a tender document. This document is judged according to price and the relevant qualifying criteria. The winning bid does not always go to the lowest bidder. The overall proposal is examined and judged according to the stated government criteria before the government contract is awarded.

A contact can be signed as an expressed or implied contract. Expressed contracts are those contracts where the terms and conditions are stated openly at the time of making the contract such as the price of real estate when the settlement takes place. With the implied contract, certain terms and conditions are not expressed in words but are deemed to be inherent to the nature of the contract. An example of this is a checkup with your local doctor. You are not charged prior to the consultation and the act of making the booking and submitting to examination constitutes an implied condition to pay the bill at the cessation of the appointment.

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