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Difference between a "clause" and a "provision"? - Contract Administration - The Wifcon Forums and Blogs
Difference between a "clause" and a "provision"?
By FAR Fetched, October 15, 2009 in Contract Administration
I'm looking for a way to identify the difference between a 'clause' and a 'provision' and how it relates to Government contracting. Searching the web I've only found the definition of the word (obviously) and searching on this and other Government contracting sites has resulted in an overload of results.
I know the difference, but not enough to teach it to someone else. Again, apologize for the simple question, but someone asked me and I couldn't think of a straight forward answer.
Solicitation "provisions" and contract "clauses"
The third column of the Matrix in the back of the FAR (52.301) also lists whether it is a provision ("P") or a clause ("C").
Are you saying a contract will never contain a provision and a solicitation will never contain a clause?
Thank you, but I'm well aware of it. Does one have more power than the other? Is one held to a higher legal standard?
Also - here's a quote from Don in another thread:
Excellent post. One correction, though. FAR 52.215-21 is a clause, not a provision.
By the correction Don makes here, does it mean more than just a correction in terms or is the FAR reference more or less important?
parkerr 0
FAR 2.101:
?Contract clause? or ?clause? means a term or condition used in contracts or in both solicitations and contracts, and applying after contract award or both before and after award."
?Solicitation provision or provision? means a term or condition used only in solicitations and applying only before contract award."
...and if the aforementioned will not suffice, see also:
The Government Contracts Reference Book: A Comprehensive Guide to the Language of Procurement, Third Edition, Softcover, Ralph C. Nash Jr., Karen R. O'Brien, Steven L. Schooner, Vernon J. Edwards; Pages 99 and 466:
Clause: A term or condition used in CONTRACTs ? or in both SOLICITATIONs and contracts ? and applying after contract award, or both before and after award. FAR 2.101. A term used only in solicitations is called a PROVISION. FAR Subpart 52.2 sets forth the texts of all standard FAR clauses (as does DFARS Subpart 252.2 for DFARS clauses), each in its own separate subsection. The subpart is arranged by subject matter in the same order as, and keyed to, the parts of the FAR. All FAR clause numbers begin with ?52.2.? The next two digits correspond to the number of the FAR part in which the clause is prescribed. The number is completed by a hyphen and sequential number assigned within each section of FAR Subpart 52.2. The FAR clause number will be followed by the clause?s title and-in contracts-by its effective date (e.g. FAR 52.203-3, Gratuities (Apr. 1984)). FAR Subpart 52.1 contains instructions for using clauses, and FAR Subpart 52.3 contains extensive PROVISION AND CLAUSE MATRIX. See Farrell & Pankowski, FAR Contract Clauses-First Impressions, 24 Cont. Mgmt. 21 (Feb. 1984)
Provision: A written term or condition used only in SOLICITATIONs and applying only before contract award. FAR 52.101. Solicitation provisions are distinguished from CLAUSEs, which are terms and conditions in contracts. FAR Subpart 52.2 sets forth the text of all FAR provisions and clauses (as do DFARS Subpart 252.2 and NFS Subpart 1852.2 for DFARS and NASA provisions and clauses, respectively), each in its own separate subsection. The subpart is arranged by subject matter in the same order as, and keyed to, the parts of the FAR. All FAR provision numbers begin with ?52.2.? The next two digits correspond to the number of the FAR part in which the provision is prescribed. The number is completed by a hyphen and sequential number assigned within each section of FAR Subpart 52.2. For example, FAR 52.225-1 contains the BUY American Act ? Supplies clause prescribed at FAR 25.1101(a)(1), whereas FAR 52.225-2 contains the Buy American Act Certificate provision prescribed at FAR 25.1101(a)(2). The FAR provision number will be followed by the provision?s title, and, in solicitations, its effective date. FAR Subpart 52.1 contains instructions for using provisions, and FAR Subpart 52.3 contains extensive PROVISION AND CLAUSE MATRIX.
WOW!! Talk about a coincidence. This very subject was discusses in this office last week. I was going to start a thread today. Thanks to all who provided clarification.
the oft referenced Christian Docrine only applies to mandatory contract clauses not to solicitation provisions.
soboco 0
I have a question on a related 'provisions' topic...
We currently have a Solicitation out on the street... it?s for a recurring, non-personal, commercial, service (below SAT). However, after several weeks of market research we have concluded there are very, very few vendors in this particular arena. The major player in this market has received and reviewed the Solicitation and now insists that some of the provisions in the Solicitation be 'amended/revised/tweaked' to his satisfaction --- additionally he wants some provisions added and others deleted. I have attempted several times to explain to him that this is the Solicitation and NOT the contract --- and the 'mandatory' nature of this effort (and the required provisions) --- but this vendor is refusing to yield. The Contract Specialist and the end-user have searched high & low for one or two more competitors but (as stated earlier) they are seriously few & far between! (Also worth noting --- we are in an overseas location.)
What 'options' do we have available in dealing with this obstinate vendor? The Solicitation is due to close in 3 days.
Your thoughts/comments/questions welcomed...
K-Law Atty 0
Because the solicitation does not constitute a binding agreement; therefore there is no need to "read" anything into it. Yes, the government has to comply with the terms of the solicitation but can also change them at any time while the solicitation is still open. We don't have the same flexibility with contracts.
And, to answer an earlier question about whether a "provision" has more legal effect than a "clause," from a lawyer's standpoint, we don't care what you call it, we just care what it says, where you find it and how it got there. Same thing with "terms and conditions." I can't tell you whether a term is more important than a condition; I'm just going to look at the order of precedence clause in 52.212-4(s) in most cases and go from there.
If it's a commercial service and the "major player in this market" (and apparently the only one willing to bid) is complaining about the clauses, then I would be asking whether FAR 12.301(a) comes into play: Are you including clauses that are inconsistent with customery commercial practice? Unless it's a mandatory term under FAR 12, then you have a fair amount of leeway. You certainly don't want to require "provisions" in a solicitation when you aren't going to include the corresponding "clauses" in your contract, because then you open yourself up to charges that you awarded a contract based on terms other than those in the solicitation. And of course you have to protect the government, while also obtaining the needed services, so you have a balancing act here. What if you call the vendor's bluff and don't change the provisions? Will he forgo this opportunity by refusing to submit an offer?
Are you asking if you should insert the provisions now, or if you should insert them after receipt of proposals? If you agree with the contractor?s request to include the ?provisions?, put them in now. This is particularly true as you are dealing with overseas contractors who miss the subtleties of the FAR vocabulary. If not, wait with your fingers crossed until the due date for submission of proposals. If you receive multiple proposals, you can negotiate with a stronger hand. If he submits the sole proposal and attaches a letter of exceptions, then include or delete the ?provisions? in the PO and send it to him for signature. If you receive no proposals, modify the solicitation to accommodate the contractor?s wish and send it back to him for signature.
Are you sure you are dealing with solicitation provisions and not contract clauses, or elements of the SOW?
BTW, I once dealt with an overseas contractor who refused to sign a contract because various clauses said the ?Secretary? was empowered to take certain actions. The Secretary was the Secretary of Defense or Navy, not a clerk.
After another review of the provisions contained in this Solicitation (and in conjunction with the WIFCON input/feedback) I have determined the provisions to be in line with the requirement and do not necessitate revisions. Therefore, I have amended the Solicitation --- solely to extend the deadline for the submission of quotes. Last Friday I instructed the CS to issue the Amendment and to contact the two other sources to determine whether/not they had received our Solicitation (and to enquire as to their intent --- to bid or not). One vendor will "No-Bid", however, we do now have another vendor who definitely intends to submit his bid --- and he has no 'issues' with any of the clauses! RESULT...!!!
Thanks WIFCON for your time, consideration and contributions on this one... once again you have come up trumps!!!
Much appreciated...!!!
(PS: Sorry, if I hijacked the topic... it was completely unintentional! Mea culpa.)
Can you give us one example of a "must have" provision and/or clause that you need in your solicitation/contract without modification - against what language the contractor is proposing. Just curious.
Christian Doctrine does not apply because the solicitation does not constitute a binding agreement.
I have seen that explanation before. However, I am interested in its basis. I would appreciate it if you could provide a little insight.
In my limited attempt at an explanation, I see several cases that make the following reference:
"The "Christian Doctrine" provides for the incorporation by law of certain mandatory contract clauses into an otherwise validly awarded government contract; it does not stand for the proposition that mandatory provisions may or should be incorporated by law into a solicitation."
I was able to track this cite back to B-163753, however nothing in that case, that I can follow, appears to support the statement that the Christian Doctrine does not apply because the solicitation does not constitute a binding agreement.
I am obviously missing something. Thanks for the help.
not sure wh; therefore there is no need to "read" anything into it. Yes, the government has to comply with the terms of the solicitation but can also change them at any time while the solicitation is still open.
I think you're trying to make it too difficult. An RFP is a "REQUEST" for proposals; a "solicitation" similarly "solicits" someone to provide something; an "invitation for bids" "invites" the contractor to make a bid. Yes, the government has to comply with the terms of the solicitation, but there is no MUTUALLY binding agreement. No contractor HAS to do anything. Conversely, the government owes the contractor no "consideration" (in the contractual sense of the word). All the government has to do is evaluate IAW the RFP, solicitation, etc. Thus, all the basic requirements for a binding agreement--aka a CONTRACT--are missing: offer and acceptance, mutual consideration, a meeting of the minds, etc. While you could argue that offerors are required to comply with the terms submitted in their proposal, the offer/proposal alone doesn't rise to the level of creating a contract. Plus, it can't constitute a binding agreement or every time the government issued a soliciation or RFP and didn't have all the necessary funds available, it would be incurring an unfunded obligation, which we all know is a bad thing.
Thanks for the quick response - I guess we were both looking at the forum at the same time.
It is strange to me however that none of the cases that I briefly came across made use of that straightforward logic "solicitation is not a binding agreement" in their basis for not applying the Christian Doctrine to provisions.
In B-163753:
DESPITE THE STATEMENT IN THE CHRISTIAN CASE AT 320 F.2D 345, 351, THAT "IN THE PROCUREMENT FIELD AS IN OTHERS, AN AUTHORIZED REGULATION CAN IMPOSE SUCH PEREMPTORY REQUIREMENTS ON FEDERAL OFFICIALS AND THOSE WHO SEEK TO ENTER INTO TRANSACTIONS WITH THE GOVERNMENT," WE BELIEVE THAT THE COURT'S DECISION MUST OF NECESSITY BE LIMITED TO SITUATIONS WHEREIN MANDATORY CONTRACT PROVISIONS IMPOSED BY STATUTORY PROCUREMENT REGULATIONS ARE INCORPORATED BY OPERATION OF LAW IN OTHERWISE PROPERLY AWARDED GOVERNMENT CONTRACTS AS TO WHICH SUCH REGULATIONS CLEARLY APPLY. THE WRITTEN EXCLUSION OF A MANDATORY SOLICITATION PROVISION--- EVEN THOUGH INADVERTENT--- WAS ACTUAL NOTICE TO PROSPECTIVE CONTRACTORS THAT AN OTHERWISE APPLICABLE REGULATORY PROVISION WOULD BE EXCLUDED FROM THE EVALUATION OF BIDS. WE THEREFORE CAN AGREE THAT IT WAS REASONABLE FOR BRISTOL TO REGARD THE SPECIFIC DELETION OF THE "ALL OR NONE" RESTRICTIVE CLAUSE AS A CONSCIOUS DETERMINATION BY THE CONTRACTING OFFICER NOT TO IMPOSE "ALL OR NONE" RESTRICTIONS.
http://redbook.gao.gov/3/fl0011585.php
It is not going to keep me at night.
The Christian Doctrine does not apply to solicitations because it is case law, and the deciding court applied it only to contracts. The court never considered applying it to solicitations. What the GAO has done is refuse to extend it to solicitations. Why?
The question about applying the Christian Doctrine to solicitations appears to have come up often in connection with the Service Contract Act. In the most recent GAO decision pertaining to application of the Christian Doctrine to solicitations, Bug Control Unlimited, Inc. Comp. Gen. Dec. B-277739, 97-2 CPD ? 104, the agency issued an invitation for bids for services to which the Service Contract Act applied. The agency cited the proper wage determination in IFB section J, but did not attach it to the IFB. When informed of this by a prospective bidder, the agency amended the IFB to attach the wage determination. The low bidder did not acknowledge the amendment with its bid, so the agency rejected the bid as nonresponsive. The low bidder protested, arguing that (1) the proper wage determination had been cited, even if not attached, and (2) the Christian Doctrine effectively included the wage determination in the solicitation, so the amendment was not material. The GAO rejected that argument as follows:
[C]ontrary to the protester's assertion, the Service Contract Act's requirement for inclusion of the wage determination in the IFB does not incorporate the applicable wage determination into the IFB by operation of the ?Christian doctrine.? See G.L. Christian & Assocs. v. United States, 312 F.2d 418, 424-427 (Ct. Cl.), cert. denied, 375 U.S. 954 (1963). Operation of the Christian doctrine is limited to the incorporation of mandatory contract clauses into otherwise validly awarded government contracts; it does not extend to incorporating inadvertently omitted mandatory provisions into an IFB for purposes of interpreting the IFB or curing a defective bid. See American Imaging Servs., Inc.--Recon., B-250861.2, Jan. 5, 1993, 93-1 CPD ? 13 at 2; Parsons Precision Prods., Inc., B-249940, Dec. 22, 1992, 92-2 CPD ? 431 at 6. Since Bug Control seeks incorporation of the wage determination into the IFB to render its bid responsive, the Christian doctrine is not applicable. See Parsons Precision Prods., Inc., supra.
In an earlier decision that also involved the SCA and an IFB, Dismantlement and Environmental Management Co., Comp. Gen. Dec. B-257632, 94-2 CPD ? 151, an agency solicited bids for a contract that would have involved work to which the Act would apply. After bid opening, the agency discovered that several mandatory clauses were missing and so cancelled the solicitation. The prospective winner protested, arguing in part that the SCA provisions were incorporated by virtue of the Christina Doctrine and that the cancellation was not necessary The GAO denied the protest in part because it would not apply the doctrine to solicitations and explained its decision as follows:
An agency may cancel a solicitation after bid opening only where it has a compelling reason to do so. NonPublic Educ. Servs., Inc., B207751, Mar. 8, 1983, 83?1 CPD ? 232. We have held that the failure to include required SCA provisions and accompanying wage rate determinations is such a compelling reason. Id. The fact that the SCA provisions could be added after award (or automatically be incorporated in any awarded contract under the ?Christian Doctrine?) does not render the omission less than compelling, since the omission created the possibility of prejudice to bidders?some firms may have assumed the application of the SCA and bid on that basis, while others may not have made such an assumption. See R. S. Data Sys., Inc., B?225437, Mar. 11, 1987, 87?1 CPD ? 274.
In a protest against a negotiated procurement, QuesTech, Inc., Comp. Gen. Dec. B-255095, 94-1 CPD ? 82, an agency did not evaluate the winner?s proposal on the basis of a DFARS clause that should have been included in the request for proposals, but wasn?t. The protester argued that the clause was in the RFP by virtue of the Christian Doctrine and that the agency should have evaluated proposals accordingly. The GAO rejected the argument as follows:
QuesTech first protests that the agency's cost evaluation of SAIC's proposal was flawed due to SAIC's proposed use of uncompensated overtime and SAIC's alleged failure to comply with a solicitation clause, contained in section 252.237?7019 of the Defense Federal Acquisition Regulation Supplement (DFARS), which requires offerors to identify proposed uncompensated overtime in their proposals. QuesTech acknowledges that the clause in DFARS 252.237?7019 was not part of the solicitation, but argues that it should be ?read into? the solicitation on the basis of the ?Christian Doctrine.? See G.L. Christian & Assocs. v. United States, 312 F.2d 418 (Ct.Cl.), cert. denied, 375 U.S. 954 (1963)?
QuesTech's assertion that the cost evaluation was flawed due to SAIC's alleged failure to comply with DFARS ? 252.237?7019 is without merit. The ?Christian Doctrine? provides only for incorporation, by law, of certain mandatory contract clauses into otherwise validly awarded government contracts; it does not stand for the proposition that provisions are similarly incorporated, by law, into solicitations. See, e.g., American Imaging Servs., Inc.?Recon., B?250861.2, Jan. 5, 1993, 93?1 CPD ? 13; Data-products New England, Inc. et al., B?246149.3 et al., Feb. 26, 1992, 92?1 CPD ? 231; Diemaco, Inc., B?246065, Oct. 31, 1991, 91?2 CPD ? 414.
It thus appears that the GAO has refused to extend the Christian Doctrine to competitions because (a) the court that created the doctrine did not apply it to solicitations and ( applying it to solicitations could affect competitions in unpredictable ways, which the GAO thinks would be unfair. It would also be a way for protesters to get around the requirement to protest defective solicitations before the closing date.
As for the difference between solicitation provisions and contract clauses, the distinction is not always clear. In principle, solicitation provisions address firms competing for a contract, i.e., offerors, while contract clauses address a firm that has a contract, i.e., a contractor. Solicitation provisions are supposed to state ground rules for competing, while contract clauses stipulate the terms and conditions of a contract, with which the contractor must comply during performance. However, the FAR councils have muddied up the waters by including some texts in FAR Part 52 that do double duty, addressing both offerors and contractors. A prime example is the clause at FAR 52.204-7, Central Contractor Registration (APR 2008), which addresses offerors and the contractor. Another example is FAR 52.219-14, Limitations on Subcontracting (DEC 1996). Yet another is the clause at FAR 52.219-23, Notice of Price Evaluation Adjustment for Small Disadvantaged Business Concerns (OCT 2008). An additional problem is that while only solicitation provisions are to be incorporated into RFP Section K, FAR 15.204-1( says that Section K is incorporated into contracts by reference. So solicitation provisions become part of the contract.
Vern, Every time you post something, I learn something. While that of course could speak volumes about my own lack of knowledge, I think the real message is just how valuable these discussions--and your contributions, especially--are. I just hope that the federal government, in its infinite wisdom and search for the totally secure online environment, doesn't decide to block my access!
The tech weenies blocked my access to WIFCON when I first reported to my previous job with DHS. I went through my chain of command and once they saw how valuable it was, the removed the block for everyone. Of course that particular office has only a few who actually LOOK at WIFCON, but it wasn't like I didn't try to endorse this site!
Thank you, K-Law.