Conditions of the Resulting Contract

Conditions of the Resulting Contract are the clauses and conditions that apply to, and form part of, any contract awarded as a result of a solicitation. They set out the terms a successful supplier agrees to carry out, including obligations, contract period, payment, security and dispute resolution.

The term is Canadian federal procurement terminology. It most often appears under the heading "Resulting Contract Clauses" in requests for proposals, standing-offer documents and supply-arrangement solicitations issued by Public Services and Procurement Canada (PSPC) and by departments that use PSPC procurement methods.

Where the Resulting Contract Clauses sit in a bid solicitation

PSPC's bidding guidance identifies Part 6, "Resulting contract clauses," as the part containing the clauses and conditions that apply to a contract resulting from the solicitation. A federal request for proposals on CanadaBuys states that the clauses and conditions in Part 6 apply to and form part of any contract resulting from the bid solicitation.

The part number is not fixed. A Department of National Defence solicitation on CanadaBuys places the same content in Part 7, titled "Resulting Contract Clauses," and uses the same wording to say the clauses form part of any resulting contract. Bidders should read the table of contents of each solicitation rather than assume a part number.

What the clauses cover

The content varies with the requirement, but the same building blocks recur. PSPC's standing-offer template identifies these elements of the resulting contract:

• The statement of work or requirement
• Standard clauses and conditions
• The contract term
• Payment

PSPC's Solution-Based Supply Arrangement lists further provisions that can appear in resulting contracts:

• Security requirements
• Invoicing
• Dispute resolution
• Insurance
• Representations and warranties
• Liquidated damages, where applicable

Many of these clauses are incorporated by number, date and title from the Standard Acquisition Clauses and Conditions Manual, the Government of Canada's source for standard clauses. A short reference in the bid document can therefore carry a full set of contractual terms.

Standing offers and supply arrangements

Resulting Contract Clauses are not limited to one-off competitions. The standing-offer template states that the resulting-contract clauses apply to and form part of any contract arising from a call-up against the standing offer. The clauses are set once in the umbrella document and then govern each individual call-up.

Supply arrangements work the same way. The Professional Audit Support Services supply arrangement has a dedicated "Resulting contract clauses" section. The Solutions-Based Supply Arrangement states that the conditions of contracts awarded under the arrangement must follow the specified resulting-contract clauses. Departments can adapt the exact clauses to their requirement, but the resulting contract must incorporate the clauses specified in the solicitation or the applicable arrangement.

What this means for a supplier bidding on Canadian public contracts

Read and price the resulting-contract conditions before you submit a bid. These clauses become binding if you are awarded the contract, so each one is a cost, a risk or a compliance task you are accepting in advance.

• Check the contract period and payment terms against your cash flow.
• Confirm you can meet any security requirements by the stated dates.
• Note insurance, warranty and liquidated damages provisions and price them in.
• Look up each standard clause cited by number, date and title.
• Raise questions about unclear or unworkable terms during the solicitation period, before the bid closes.

If you win, you must perform the work, deliver the goods or services, and follow the standard clauses and administrative requirements built into the contract.