UNIT_6_LEGAL_ASPECT_OF_PROCUREMENT.pptx - UNIT 6 CONTRACT...

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CONTRACT MANAGEMENT UNIT 6
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Outline Fundamentals of contract law Contract terms Conditions of contract and breaches Law of Agency Authority of the Procurement Officer Reducing risk exposure and protecting organisation’s interest
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CONTRACT FORMATION Contract Award Process Once the Internal Procurement Committee has completed the evaluation of bids, the procuring entity should promptly proceed to award the contract to the lowest evaluated bidder subject to any required approvals The procuring entity sends a notice of acceptance to that effect to the successful bidder within the period of validity of its bid
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If the successful bidder fails to sign the contract or to provide the performance security within the time stipulated in the notice of acceptance, the award is nullified and the procuring entity may then re-award the contract to the next lowest evaluated bidder who meets the qualification requirements.
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What is a contract? The term “contract” is generally regarded as a form of agreement, specifically one which is enforceable by law. In other words, contract is an agreement between two or more parties with intention to create legal relationship.
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Essential Elements of a Valid Contract Offer and Acceptance The first step towards creating a contract is that one person shall signify or make a proposal or offer to the other, with a view to obtaining the acceptance of that another person to whom the offer is made. What is an offer? An offer, in law, is both a statement of the terms upon which a party is willing to contract and an expression of willingness to do so if an acceptance is given of those terms. An offer when accepted becomes a promise.
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An offer may come to an end in one of these seven ways: Acceptance Rejection Counter – offer Revocation Lapse of Time Death Failure of a Precondition Termination of Offers
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Acceptance A contract comes into being when the offer has been validly and unconditionally accepted by the offeree.
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Communication of acceptance Knowledge of the offeree Silence is not acceptance Acceptance can be by conduct Mode of communication Ought to be in the form stipulated by the offeror Communication of acceptance must be received by the offeror to make it valid. If acceptance is by post, it occurs when the letter is posted.
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