Contracts from Hell; Donald Trump Clauses

Perhaps; no doubt; probably; certainly; damn sure, the least liked aspect of my job is reviewing contracts with which the buyers sentence their contractors to unlivable conditions.  Anyone watch The Donald lately describing people as “idiots” and “stupid”?  The Donald comes to mind when I read some of these contract terms and conditions.

First of all (and I don’t like to use that phrase because it sets the stage for conflict and ranting but this IS The Energy Rant), lawyers must get paid by the word of rambling, incomprehensible prose they produce.  Why not get paid to produce a contract that is reasonably just and readable?  Certainly, not all attorneys are as bad as others, and some of this diktat likely comes from the board or C-suites.

The following are examples of ridiculous terms and conditions.  Since sentences are rarely shorter than 96 words, I am paraphrasing to make them comprehendible by the average reader with a college degree.

Before I begin, it is also worth noting that terms and conditions are written to cover billion dollar giants in the industry and they do not bother removing irrelevant language that does not apply.

• Contractor shall have a designated representative with authority to legally bind the company on site at all times during work hours to supervise the work.

For most of the work we do, this would increase the cost by, oh, 150% minimum.

• Equipment used by the contractor shall be confirmed by the contractor to be in safe and reliable working order. Contractor shall indemnify and hold harmless the buyer for everything under the sun while equipment is in use.  Contractor shall conform that no part of the equipment has been damaged or unduly stressed.

Does this include paint scratches on a freshly painted backhoe bucket?

• Work products shall be the property of the buyer and there shall be no restrictions on the use thereof.

This is dangerous.  Most of what we produce is custom in nature and not meant for public or amateur use.  The first thing that would happen is they will make a mistake with our work and then sue us.  NO! NO! NO!

• Contractor shall submit all plans and documents for review before proceeding to implement the work. Contractor shall follow instructions (i.e. redlines and changes) of the buyer indicated on the documents and obtain the buyer’s approval to proceed.

This one blows away the previous clause.  This is the most egregious clause I’ve seen yet because it binds us to accept the buyer’s changes, and we are also bound by errors and omissions clauses in the same contract.

By the way, we are required to carry insurance for many things, including errors and omissions and their own contract includes uninsurable caveats.  This is one of those caveats.  Do you want insurance or not?  Beyond that, we have virtually no assets.  You can have our used coffee maker, and we can sell our used office furniture for the second time to scrape up a few dollars to cover uninsured losses.

• Contractor shall revise documents according to undefined standards and associated demands, at no cost to the buyer.

Sure.  We will just keep working ad nauseam to the sadistic delight of otherwise powerless scorned geeks within the organization – for free.  This is known as something that President Lincoln ended in 1863.

• Buyer is under no obligation to pay until the final work product is approved.

…according to no defined criteria whatsoever.  Sure.  This is fair and reasonable?  You work for free until we say it is ok per no stated criteria whatsoever.

• Any computer virus or malware introduced to the buyer shall be remedied at the expense of the contractor, without limit and at the buyer’s prevailing hourly rate – whatever that may be, outsourced or insourced.

Does anyone smell a scapegoat or see images of blank checks?  Can the buyer not afford its own virus and malware protection?  How does it know where it came from?

• Any acceptance of equipment, materials, or work shall not relieve the contractor for responsibility of contract requirements.

In other words, we can make your existence a living hell while you are performing the work, but we accept no responsibility.  And by the way, if we find something in non-conformance to undefined requirements sometime in the future, we will throw you into the lake of fire yet again.

• Buyer may at any time for any reason suspend the project with one day’s notice. Upon suspension, contractor waives all claims for damages including lost profit, idle equipment, labor, and facilities.  Contractor may receive demobilization reimbursement as determined by buyer.

No.  I am not making this up.

Closing Comments

As indicated above, most contracts are not this horrible, but nearly all include at least some very one-sided terms.  In this particular case, the RFP stated there would be no exceptions.  Bidders assume the warm-blooded folks on the buying end (actual clients) will not have issues that end up in their legal torture chambers.