Review of Contracts
What is a contract?
A contract is an agreement that two or more parties enter into with the intent to be legally bound by the terms of the agreement. Contracts can be called a number of names: agreement, contract, letter of agreement, letter of intent, memorandum of understanding* (*where the MOU creates legally binding obligations). Contracts are also formed when an individual clicks 鈥淚 Agree鈥� to terms online that bind the university to obligations.
Contracts between the university and third parties must undergo review by the appropriate university offices before (1) they are signed (clicked) on behalf of the university and (2) the transaction intended by the contract begins (i.e. before the item is purchased, service provided, or work begins).
1. Review by Responsible Unit
The department, faculty, or unit requesting the contract (Contracting Unit) must review the contract鈥檚 business terms and the potential risks associated with the contract. Business terms include (by way of example): fees, term of the contract, deliverables, services to be provided, cancellation, termination and renewal, etc. The Contracting Unit must be satisfied that the business terms are acceptable and that the terms of the contract are operationally viable.
The Contracting Unit must also ensure that review of the contract by the other university offices, as appropriate, has been completed. These reviews may include:
- legal review by the OGC
- privacy/personal information review by the OGC and Archives & Records Management
- indemnity, liability, and insurance review by Risk Management
- IT review by ITS
Contract reviews (and negotiations followed by final review) that protect the university鈥檚 interests take time. Please submit contracts for review as early as possible by all university offices whose review may be necessary.
Note that separate processes apply to research contracts, contracts for the provision of goods and services to the university, and employment contracts. In the case of:
- research contracts, Contracting Units should reach out to Research Services in the first instance;
- contracts for the provision of goods and services to the university, Contracting Units should reach out to Procurement Services in the first instance; and
- employment contracts, Contracting Units should work with their HR business partners in the first instance.
2. Legal Review
Section 4.1 of university policy B10.11 provides that legal review should be undertaken prior to the signing of any contract on behalf of the university. The OGC will determine whether legal review is performed by internally or by external legal counsel.
The OGC does not approve the business terms in a contract or provide approval to enter into any contract. The purpose of legal review by the OGC is to evaluate whether the contract is legally sufficient (i.e. it aligns with relevant federal and provincial laws, as well as the university鈥檚 policies and procedures; it reflects the University鈥檚 expectations; and it appropriately allocates risks among the parties). It is ultimately the Contracting Unit鈥檚 decision whether to enter into the business transaction reflected in the contract.
3. Approvals and Records Management
Once a contract is finalized following all necessary reviews, the Contracting Unit is responsible for obtaining any approvals (for example, Board of Governors鈥� approval) before the contract is signed by an authorized signatory of the university as set out in university policy B 10.11.
Once approved and signed on behalf of the university, the Contracting Unit is responsible for retaining a fully executed copy of the contract and for compliance with the terms of the contract. The OGC does not maintain a repository of executed contracts.