University Policy 62

Contract Review and Execution

Formerly Executive Memorandum 96-120
Initially approved: November 1, 1976
Revised: April 1, 1987
Revised: October, 1996
Revised: June 17, 2002
Revised: March 30, 2005
Revised: August 24, 2009
Revised: October 1, 2010

Policy Topic: Governance and Administration
Administering Office: Legal Counsel

I. GENERAL POLICY

Pursuant to North Carolina General Statutes and The Code of the Board of Governors of the University of North Carolina, the execution of all contracts and agreements on behalf of the University is the responsibility of the Chancellor. Contracts and agreements must be signed by the Chancellor unless he/she delegates and permits the further delegation of such authority as provided in Section III below.

For purposes of this policy, a contract means an agreement between two or more persons that creates an obligation to do or not to do a particular thing. A contract may be titled as an agreement, a memorandum of understanding, a memorandum of agreement, a promise to pay, or may use other terminology.

II. ADMINISTRATIVE REVIEW

Prior to presentation to the Office of the Chancellor for execution, the responsible Division manager (i.e., Provost, Vice Chancellor, Chief Information Officer, and Athletic Director) and the University Legal Counsel will review all contracts and agreements. Their approval will be noted by their stamps on the contract or agreement.

The responsible Division manager will review the program and financial commitments and ensure that the contract does not violate university policies or state and federal fiscal policies, paying specific attention to purchasing regulations.

After approval by the Division manager, prior to execution, all contracts and agreements must be reviewed and approved as to legal form and validity by the University Legal Counsel, unless

University Legal Counsel review is not required because standard forms of contracts or agreements have been developed for use, as provided in Section III below. NOTE: University Legal Counsel shall review all proposed statewide and agency term contracts for supplies, materials, printing, equipment, and contractual services that exceed one million dollars ($1,000.000) to ensure that the proposed contracts are in proper legal form, contain all clauses required by law, are legally enforceable, and accomplish the intended purposes of the proposed contract. (NCGS §114-8.3(b) as effective October 1, 2010).

In order to become a University "Standard" Agreement, a form must be reviewed and approved by University Legal Counsel. Only agreements that have been reviewed and approved as Standard Agreements may be processed as an exception to the general policy.

If any Standard Agreement in any category is modified during negotiations, the modified agreement must be signed by the Chancellor after review by University Legal Counsel in accordance with the general policy.

The Standard WCU Independent Contractor Agreement will be produced by the Office of Administration and Finance.

Prior to presenting a contract to the Division manager for approval, persons wishing to enter into contract negotiations must have the cooperation and approval of any unit which may be directly or indirectly implicated in performance of the contract (e.g., Information Technology, Finance, Facilities Management, Telecommunications, etc.).

The party initiating the contract for the University is responsible for reading the contract entirely and determining that: the contract language accurately reflects the current state of negotiations; the contract meets programmatic and University mission requirements; the contract is in the best interests of the University; he/she can ensure compliance with the obligations it places on the University; and the contract is sufficiently clear and consistent.

Any employee who executes a contract or agreement without authority under this policy may be personally responsible for performance of the contract or agreement's terms, including any payments due thereunder, and may be subject to University disciplinary action.

The original contract or agreement containing the original signatures of the parties is to be maintained in the originating office, department or Division. Each originating office, department or Division will keep records of all contracts and agreements executed, which are subject to audit by the Office of the Internal Auditor.

Effective immediately, all delegations of authority to execute contracts previously granted are hereby revoked.

III. EXCEPTIONS TO ADMINISTRATIVE REVIEW AND EXECUTION

Exceptions to the general policy described above are as follows: