Contract clauses

Research is also strongly influenced by the admittedly legitimate interests of the pharmaceutical industry examples of this include contract clauses reserving copyright, the initial selection of researchers and topics, and the recent consolidation of the position of companies specializing in clinical trials (to the detriment of academic centres). Frequently there is a conflict of interests between social welfare and private welfare that does not necessarily amount to fraud or malpractice, but which should be made public - through... 

Contract clauses should provide for interruptions of service, which may sometimes be offset by provisions releasing the purchaser from liability in case of strike or fire in his plant. The phase, frequency and voltage of current at the point of measurement should be specified. Services furnishing a high power factor should be somewhat more attractive to the vendor. 

In this chapter we present a discussion on convertible bonds, which have become popular hybrid financial instruments. Convertible bonds are financial instmments that give the bondholders the right, without imposing an obligation, to convert the bond into underlying security, usually common stocks, under conditions illustrate in the indenture at the time of issue. The hybrid characteristic defines the traditional valuation approach as the sum of two components the option-free bond and an embedded option (call option). The option element makes the valuation not easy, above all in pricing term sheets with specific contract clauses as the inclusion of soft calls, put options and reset features. The chapter shows practical examples of valuation in which financial advisors and investment banks adopts in different contexts. 

Over the ages many consulting engineers, in particular, have made an art form of such contract clauses, tested in court following legal dispute and found to be effective. 

Contract Clauses None Price in ovements Fixed future price Multiple fcx mula... 

The engineer tries to defend himself against such claims in hme by the following contract clauses ... 

Levine D (1996) Construction contracts clauses on health, safety and environment. Construction Law Journal vol 12 no 3 pp 146-155. 

First, quality Chinese suppliers quickly replace imports for major foreign OEMs in China. The Motorolas, GMs, DuPonts, etc. in China would all rather buy locally than import because it brings down costs and makes them more competitive. Most have formal policies stating as much. In some cases (e.g. Boeing), local content is required by the Chinese government in return for major purchases. (Such offset contract clauses are not Chinese inventions, incidentally. They have been common in the West for decades.) In other cases, it is pure... 

Recommend special clauses or revisions to contract if needed... 

Contracts usually contain clauses to govern the termination of projects upon completion at a specified renewal period or early termination for various reasons. Termination normally requires written notice with a specified time frame for conclusion and removal of... 

The note in clause 4.19.1 points out that any after-sales product servicing provided under the OEM contract or order would constitute servicing. 

Ensuring that the policy is relevant to the expectations and needs of the organization s customers is a little more difficult. Companies need to predict what their customer expectations and needs are (now a requirement in clause 4.1.4 under Business plans). They may be beyond what they specify in contracts although they may in fact be identical to such specifications. For companies to create satisfied customers they not only need to meet requirements specified by the customer but meet national and international legislation and have consideration for the needs and expectations of society. As explained in Part 1 Chapter 1 on Quality characteristics, customers are not only the buyers but comprise several other interested parties. You need to provide a means of determining what the customer expectations and needs are and then subject the written quality policy to a review against those expectations and needs to determine if there is any conflict. As part of your business planning procedure you should indicate how you determine your customer s current and future needs and expectations. 

The quality system developed to meet the requirements of ISO/TS 16949 is likely to be a generic system, not specific to any particular product, project, or contract other than the range of products and services which your organization supplies. By implementing the policies and procedures of the documented quality system, product, project, or contract specific plans, procedures, specifications, etc. are generated. ISO 9001 contains a series of quality system requirements, not product quality requirements. For a given product, project, or contract there will be specific product, project, or contract requirements and it is these requirements to which this clause of the standard refers. 

Although ISO 8402 defines quality as the totality of characteristics of an entity that bears on its ability to satisfy a stated or implied need, ISO 9001 does not require the required characteristics to be specified. Note 2 of clause 4.3.4 defines a contract and accepted order as agreed requirements but not specified requirements as used elsewhere in the standard. It would have made for less ambiguity if the term customer requirements had been used throughout and then there would be no doubt as to what requirements and to whose requirements these clauses refer. 

You could be forgiven for restricting your quality system to the products or services you supply because all the requirements in the standard except clause 4.3 focus on an end product or service conforming to specified requirements. Contract or order requirements will go beyond end product or service requirements. They will address delivery, quantity, warranty, payment, and other legal obligations. With every product one provides a service for instance one may provide delivery to destination, invoices for payment. 

Resources are not limited to human resources, as stated in Part 2 Chapter 1. You need to ensure that the design groups are equipped with the necessary design tools, equipment, and facilities with which to execute the tasks. Once you have asked each group to propose how they are to meet the requirements, you then need to ensure that they have the capability of doing so. This is less of a problem in-house as with subcontractors. Due to their remoteness and the keen competition, they may make claims they cannot fulfill. In controlling the design you need to ensure that adequate resources are deployed by the subcontractors and to do this pre-contract surveys and assessments need to be performed. This is implied in clause 4.6. 

There are four separate clauses to this part of the standard. The first applies to all purchases, the second only to subcontractors, the third to all purchases, and the fourth when specified in the contract. Subcontractors in the context of ISO 9001 are defined as providers of product, materials, or services. Although a subcontractor is normally an organization that supplies product to your specification and a supplier one who supplies product to their own specification, in the context of ISO/TS 16949 both are classed as subcontractors. 

The evaluation process, which starts with the request to purchase and ends with the placement of the order or contract. This is covered by clause 4.6.2 of ISO/TS 16949. 

The surveillance process, which starts with placement of order or contract and ends upon delivery of supplies. This is covered by clauses 4.6.2 and 4.6.4 of ISO/TS 16949. 

It is important that you inform the subcontractor through the contract of how the product or service will be accepted. Will it be as a result of receipt inspection at the specified destination or as a result of acceptance tests witnessed on site by your authorized representative These details need to be specified at the tendering stage so that the subcontractor can make provision in the quotation to support any of your activities on site. If you have invoked ISO 9001 in the subcontract, you are protected by clause 4.6.4.2. If you have not, you need to specify a similar provision in your subcontract, otherwise you may lose the right to reject the product later. There is no requirement for you to document your proposal to verify product at the subcontractor s premises but such a plan would indeed be a useful section in any quality plan that you produced. (See also Control of subcontractors in this chapter.)... 

In many cases these requirements will not apply but in some contractual situations the customer may provide products or services for use by the supplier in connection with the contract. This clause of the standard specifies requirements that apply in such situations. The product being supplied may have been produced by a competitor, by the customer, or even by your own firm under a different contract. These requirements apply to any product supplied to you by your customer and not only to what is to be incorporated into supplies. The customer may in fact supply facilities, equipment, software, or documentation for use in conjunction with the contract, which may be provided on loan, to be returned on completion of the contract or to be retained. Customer-owned tooling and returnable packaging also constitutes customer supplied product. If you use the customer s facilities, such use should be governed by the regulations imposed in the contract rather than these requirements. If the customer supplies documentation, unless it is required to be returned, you should assume it is yours to keep. Such documentation is not governed by these requirements although, if the customer requires the documents to be returned, you should assume that these requirements do apply, but apply them with discretion. 

The definition of nonconformity in ISO 8402 states that it is the nonfulfillment of specified requirements therefore a nonconforming product is one that does not conform to the specified requirements. Specified requirements are either requirements prescribed by the customer and agreed by the supplier in a contract for products or services, or are requirements prescribed by the supplier which are perceived as satisfying a market need. This limits the term nonconformity to situations where you have failed to meet customer requirements. However, ISO 8402 1987 suggests that nonconformity also applies to the absence of one or more quality system elements, but clearly the requirements of clause 4.13 cannot be applied to nonconformity with quality s /stem requirements. Both ISO 9001 and ISO 9004 only address nonconformity in the context of products, processes, and services and when addressing quality system elements the term deficiencies is used. Some auditors use the term nonconformity to describe a departure from the requirements of ISO 9001 but it would be preferable if they chose the term noncompliance to avoid any confusion. The requirements of clause 4.13 therefore only apply to products, processes, and services and not to activities, quality system elements, or procedures. 

Management review records (clause 4.1.3) Process verification records (clause 4.2.4.9.4) Contract review records (clause 4.3.4)... 

The impact of this requirement depends upon what constitutes the specified requirements. The standard does not require you to demonstrate conformance with every requirement of ISO 9001. However, if your customer has invoked ISO 9001 in the contract, this clause requires that you maintain sufficient records to demonstrate compliance. As stated elsewhere in this book, there is no definition clarifying what specified requirements are. If specified requirements are a//the requirements that you have specified in your quality system, your plans, procedures, specifications, etc., this requirement may well be viewed as the most onerous in the standard. A pragmatic approach to take is to declare in your quality manual that the specified requirements are specified customer requirements . 

The subcontractor records that are delivered to you should form part of your records. However, the controls you can exercise over your subcontractor s quality records are somewhat limited. You have a right to the records you have paid for but no more unless you invoke the requirements of this clause of the standard in your subcontract. Your rights will probably only extend to your subcontractor s records being made available for your inspection on their premises therefore you will not be able to take away copies. It is also likely that any subcontractor records you do receive are copies and not originals. Before placing the contract you will need to assess what records you will require to be delivered and what records the contractor should produce and retain. 

Conditions of Contract Technical Clauses Specification of the Works. 

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