| (a) Purpose. This section is intended to serve as a
guideline for the negotiation and mediation of a breach of contract
claim asserted by a contractor against the Texas Department of Criminal
Justice (TDCJ) under Texas Government Code Chapter 2260. This section
is binding upon the TDCJ and is not intended to replace the TDCJ procedures
relating to a breach of contract claim that is mandated by state or
federal law, but is intended to provide procedures when none are so
mandated.
(b) Policy. It is the policy of the Texas Board of
Criminal Justice (TBCJ) and the TDCJ to resolve a breach of contract
claim as efficiently and as expeditiously as possible, consistent
with prudent stewardship of the state of Texas assets.
(c) Applicability. This section does not apply to an
action of a unit of state government for which a contractor is entitled
to a specific remedy pursuant to state or federal constitution or
statute.
(1) This section does not apply to a contract action
proposed or taken by a unit of state government for which a contractor
receiving Medicaid funds under that contract is entitled by state
statute or rule to a hearing conducted in accordance with Texas Government
Code Chapter 2001.
(2) This section does not apply to contracts:
(A) between a unit of state government and the federal
government or its agencies, another state, or another nation;
(B) between two or more units of state government;
(C) between a unit of state government and a local
governmental body, or a political subdivision of another state;
(D) between a subcontractor and a contractor;
(E) subject to Texas Transportation Code §201.112;
(F) within the exclusive jurisdiction of state or local
regulatory bodies;
(G) within the exclusive jurisdiction of federal courts
or regulatory bodies; or
(H) that are solely and entirely funded by federal
grant monies other than for a project defined in subsection (d)(9)
of this section.
(d) Definitions. The following words and terms, when
used in this section, shall have the following meaning, unless the
context clearly indicates otherwise.
(1) Claim is a demand for damages by the contractor
based upon the TDCJ's alleged breach of the contract.
(2) Contract is a written contract between the TDCJ
and a contractor by the terms of which the contractor agrees either:
(A) to provide goods or services, by sale or lease,
to or for the TDCJ; or
(B) to perform a project as defined by Texas Government
Code §2166.001.
(3) Contractor is an independent contractor who has
entered into a contract directly with the TDCJ. The term does not
include:
(A) the contractor's subcontractor, officer, employee,
agent, or other person who furnishes goods or services to a contractor;
(B) an employee of a unit of state government; or
(C) a student at an institution of higher education.
(4) Counterclaim is a demand by the TDCJ arising out
of the contract.
(5) Day is a calendar day. If an act is required to
occur on a date that falls on a Saturday, Sunday, or holiday, the
first working day that follows shall be counted as the required day
for purpose of that act.
(6) Event is an act or omission or a series of acts
or omissions giving rise to a claim. The following list contains illustrative
examples of events, subject to the specific terms of the contract.
(A) Examples of events in the context of a contract
for goods or services:
(i) the failure of the TDCJ to timely pay for goods
and services;
(ii) the failure of the TDCJ to pay the balance due
and owing on the contract price, including orders for additional work,
after deducting any amount owed the TDCJ for work not performed under
the contract or in substantial compliance with the contract terms;
(iii) the suspension, cancellation, or termination
of the contract;
(iv) the final rejection of the goods or services tendered
by the contractor, in whole or in part;
(v) the repudiation of the entire contract prior to
or at the outset of performance by the contractor; or
(vi) the withholding liquidated damages from final
payment to the contractor.
(B) Examples of events in the context of a project:
(i) the failure to timely pay the unpaid balance of
the contract price following final acceptance of the project;
(ii) the failure to make timely progress payments required
by the contract;
(iii) the failure to pay the balance due and owing
on the contract price, including orders for additional work, after
deducting work not performed under the contract;
(iv) the failure to grant time extensions to which
the contractor is entitled under the terms of the contract;
(v) the failure to compensate the contractor for occurrences
for which the contract provides a remedy;
(vi) the suspension, cancellation, or termination of
the contract;
(vii) the rejection by the TDCJ, in whole or in part,
of the "work," as defined by the contract, tendered by the contractor;
(viii) the repudiation of the entire contract prior
to or at the outset of performance by the contractor;
(ix) the withholding liquidated damages from final
payment to the contractor; or
(x) the refusal, in whole or in part, of a written
request made by the contractor in strict accordance with the contract
to adjust the contract price, the contract time or the scope of work.
(7) Executive Director is the chief administrative
officer responsible for the day-to-day operations of the TDCJ.
(8) Parties means the TDCJ and the contractor who have
entered into a contract in connection with which a breach of contract
claim has been filed under this section.
(9) Project as defined in Texas Government Code §2166.001,
is a building construction project that is financed wholly or partly
by a specific appropriation, bond issue, or federal money, including
the construction of:
(A) a building, structure, or appurtenant facility
or utility, including the acquisition and installation of original
equipment and original furnishing; and
(B) an addition to, or alteration, modification, rehabilitation,
or repair of an existing building, structure, or appurtenant facility
or utility.
(10) Services means the furnishing of skilled or unskilled
labor or consulting or professional work, or a combination thereof,
excluding the labor of an employee of a unit of state government.
(e) Prerequisites to Suit. The procedures contained
in this section are exclusive and required prerequisites to suit under
Texas Civil Practice & Remedies Code Chapter 107 and Texas Government
Code Chapter 2260.
(f) Notice of Breach of Contract Claim.
(1) A contractor, asserting a breach of contract claim
under Texas Government Code Chapter 2260 shall file notice of the
claim as provided by this subsection.
(2) The notice of claim shall:
(A) be in writing and signed by the contractor or the
contractor's authorized representative;
(B) be delivered by hand, certified mail return receipt
requested, or other verifiable delivery service, to the TDCJ Director
of Contracts and Procurement, Two Financial Plaza, Suite 474, Huntsville,
Texas 77340; and
(C) state in detail:
(i) the nature of the alleged breach of contract, including
the date of the event the contractor asserts as the basis of the claim
and each contractual provision allegedly breached;
(ii) a description of damages that resulted from the
alleged breach, including the amount and method used to calculate
those damages; and
(iii) the legal theory of recovery, such as breach
of contract, including the causal relationship between the alleged
breach and the damages claimed.
(3) In addition to the mandatory contents of the notice
of claim as required by paragraph (2) of this subsection, the contractor
may submit supporting documentation or other tangible evidence to
facilitate the TDCJ's evaluation of the contractor's claim.
(4) The notice of claim shall be delivered no later
than 180 days after the date of the event that the contractor asserts
as the basis of the claim.
(g) Agency Counterclaim.
(1) The TDCJ, asserting a counterclaim under Texas
Government Code Chapter 2260, shall file notice of the counterclaim
as provided by this subsection.
(2) The notice of counterclaim shall:
(A) be in writing;
(B) be delivered by hand, certified mail return receipt
requested, or other verifiable delivery service to the contractor
or representative of the contractor who signed the notice of breach
of contract claim; and
(C) state in detail:
(i) the nature of the counterclaim;
(ii) a description of damages or offsets sought, including
the amount and method used to calculate those damages or offsets;
and
(iii) the legal theory supporting the counterclaim.
(3) In addition to the mandatory contents of the notice
of counterclaim required by paragraph (2) of this subsection, the
TDCJ may submit supporting documentation or other tangible evidence
to facilitate the contractor's evaluation of the TDCJ's counterclaim.
(4) The notice of counterclaim shall be delivered to
the contractor no later than 60 days after the TDCJ's receipt of the
contractor's notice of claim.
(5) Nothing herein precludes the TDCJ from initiating
a lawsuit for damages against the contractor in a court of competent
jurisdiction.
(h) Contract Disputes.
(1) To every extent possible, a dispute with a contractor
should be resolved during the course of the contract. However, after
completion of a contract, or when required for orderly performance
prior to completion, if a resolution of a contractor's dispute has
not been reached by the appropriate TDCJ division, the contractor
should file a Notice of Breach of Contract Claim with the director
of Contracts and Procurement per the requirements in subsection (f)
of this section.
(2) The executive director shall name the members and
chairman of a Contract Dispute Committee (the committee), which will
serve at the executive director's request. It shall be the responsibility
of the committee to gather information, study relevant facts and documentation,
meet with contractors and, if requested, to resolve any disputes between
a TDCJ division and the contractor, as set forth by the claim.
(3) The committee shall secure detailed reports and
recommendations from the appropriate TDCJ division and may confer
with TDCJ personnel, other persons, and outside entities that it deems
appropriate.
(4) The committee shall then afford the contractor
an opportunity for a meeting or hearing to discuss the claim and to
provide the contractor an opportunity to present additional relevant
information and respond to information the committee has received
from the appropriate TDCJ division.
(5) The committee chairman shall give written notice
of the committee's proposed disposition of the claim to the contractor
and the appropriate TDCJ division. If that disposition is acceptable,
the contractor shall advise the committee chairman in writing within
20 days of the date such notice is received, and the committee chairman
shall forward the agreed disposition to the executive director for
a final and binding order on the claim. If the contractor or TDCJ
division is dissatisfied with the proposal of the committee, either
party may appeal to the executive director.
(i) Appeal to the Executive Director.
(1) An aggrieved contractor or TDCJ division may file
a written appeal of the committee's decision to the executive director
within 20 days of the receipt of the committee's decision. The contractor's
appeal shall be submitted in writing and signed by the contractor
or the contractor's authorized representative and delivered by hand,
certified mail return receipt requested, or other verifiable delivery
service to the TDCJ Executive Director, P.O. Box 99, Huntsville, Texas
77342. The TDCJ division's appeal shall be in writing and signed by
the appropriate division director. The executive director or designee
may uphold, reverse, or modify the decision of the committee.
(2) The executive director or designee shall give written
notice of the disposition of the claim to the contractor and the appropriate
TDCJ division. If that disposition is acceptable to the contractor,
the contractor shall advise the executive director, in writing, within
20 days of the date such notice is received. The TDCJ division shall
have no right to object to the disposition of the claim or dispute
made by the executive director or designee.
Cont'd... |
