ARCHIVED United States Purchases

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Legal text for SACC item

1011A  00     (01/12/00)    United States Purchases

Public Works and Government Services Canada

01     Interpretation
02     Progress Reports
03     Alterations of Patterns, Drawings
04     Inspection
05     Packing
06     Invoices, Shipping Documents
07     Risk of Loss and Damage
08     Assignment
09     Bankruptcy or Insolvency
10     Warranties
11     Delayed Deliveries
12     Members of Parliament
13     Security and Protection of Work
14     Sabotage
15     Arbitration
16     Price Control
17     Taxes
18     Termination
19     Accounts
20     Certification - Contingency Fees
21     Interest on Overdue Accounts

1011A  01     (16/02/98)    Interpretation

1.     The words "we", "us" and "our" when used herein mean the purchaser 
       named in the purchase order or the acceptance of tender of which 
       these general conditions form a part.

2.     The words "you" and "your" when used herein mean the seller named in 
       the said purchase order or acceptance of tender.

3.     The purchaser may act in relation to this contract by the Minister 
       of Public Works and Government Services, the Deputy Minister or any 
       Assistant Deputy Minister of Public Works and Government Services or 
       any authorized representative of the Minister of Public Works and 
       Government Services.

1011A  02     (01/06/91)    Progress Reports

You agree to supply us on request with reports as to the progress of 

1011A  03     (01/06/91)    Alterations of Patterns, Drawings, and 

We reserve the right to request alteration of the patterns, drawings and 
specifications from time to time and, unless you shall make reasonable 
objection thereto, the supplies thereafter supplied or work thereafter 
executed by you shall be altered accordingly, with such necessary changes 
in price and of the time or times for delivery as may be agreed upon 
provided, however, that you shall not be obligated to make any such 
alteration in respect of supplies which are customarily manufactured by you 
for commercial sale.

1011A  04     (01/06/91)    Inspection

You agree to permit our representatives to inspect the supplies or any part 
thereof covered hereby at any time during the preparation, manufacture, 
assembly, boxing or packing thereof, and you agree to advise us at least 
ten (10) days prior to the date when such supplies shall be ready for final 
inspection. Our representative shall sign or countersign a certificate of 
inspection as to supplies which shall have passed final inspection, but no 
supplies shall be accepted or paid for which do not conform in all respects 
to the requirements of the specifications and drawings or samples, if any, 
or which shall not be of sound quality and workmanship and with respect to 
which we shall not have received a certificate of inspection so signed or 
countersigned by our representative.

When required for the purpose of inspection, except where prevented by the 
laws, rules or regulations of the United States, you agree to give, or 
arrange to be given, to our representatives, reasonable assistance and free 
access at reasonable hours to your premises, and to those of your suppliers 
and subcontractors, and agree to afford to such representatives, all 
reasonable accommodations and facilities.

1011A  05     (01/06/91)    Packing

The supplies which you have agreed to provide under this contract shall be 
suitably packed by you in accordance with the terms and conditions of this 
contract and in such a manner as shall reasonably assure the transportation 
of the said supplies undamaged to their destination, it being understood 
and agreed that there shall be no additional charge for packing the said 
supplies, unless otherwise specifically provided in the contract.

1011A  06     (01/06/91)    Invoices, Shipping Documents

You agree to follow our instructions with respect to invoices and shipping 
documents. We will not be bound by any provisions in your acknowledgment 
forms or invoices which may purport to impose upon us conditions at 
variance with the terms of this contract.

You agree to mark on all containers, invoices, packing lists, shipping 
documents, and all other papers relating to this contract all identifying 
numbers or symbols appearing at the head of the purchase order or the 
acceptance of tender of which these general conditions form a part.
If delivery terms of the contract are FOB your place of shipment, 
deliveries of mailable matter which meets the size, weight and other 
limitations prescribed by the United States Post Office Department shall be 
forwarded by parcel post. You shall not divide delivery quantities into 
mailable parcels for the express purpose of avoiding shipments by other 
modes of transportation.  Prepaid postage charges shall be shown as a 
separate item on the invoice for the supplies shipped.  Shipments by other 
modes of transportation shall be shipped with freight charges collect.

1011A  07     (01/06/91)    Risk of Loss and Damage

All risks whatsoever, including risk of loss of or damage to the supplies 
(including material supplied by us) or to any third parties or their 
property, shall be upon you until the supplies are delivered hereunder FOB 
at the point specified in the contract.

1011A  08     (01/06/91)    Assignment

You agree not to assign, sublet or delegate this contract or any part 
thereof without our prior written consent, but you may, without our consent, 
purchase such parts, accessories or associated equipment as you do not 
normally manufacture, and you may sublet such portions of the work as is 
customary and usual in the carrying out of similar work.

1011A  09     (01/06/91)    Bankruptcy or Insolvency

In the event that you should admit in writing your inability to pay your 
debts as they become due, or should file a petition in bankruptcy, or in 
the event that a petition in bankruptcy should be filed against you and you 
should be adjudicated a bankrupt, or that you should have a receiver or 
trustee appointed, either in voluntary or involuntary proceedings, or that 
you should make an assignment for the benefit of creditors, we reserve the 
right, without prejudice to our right to damages, to consider this contract 
as breached and terminated ipso facto upon such event, with respect to any 
or all supplies not delivered prior to such termination and to recover any 
amounts theretofore paid on account thereof.

1011A  10     (06/06/94)    Warranties

You warrant that the standards of all workmanship and material will be 
consistent with the established and generally accepted standards for 
supplies of the type covered by the contract, in full conformity with the 
specifications, drawings, or samples, if any, and free from defects in 
material and workmanship under proper assembly, use and maintenance. You 
agree that this warranty will survive acceptance of and payment for the 
supplies and we agree that your obligation under it consists of repairing 
or replacing the supplies or any part or parts thereof which shall, within 
twelve (12) months from the date of delivery, become defective as a result 
of faulty material or workmanship.

You warrant that all supplies furnished hereunder (and the normal use 
thereof) are and shall be free and clear of infringement of any United 
States or Canadian patent, copyright or trademark and that you will, at 
your own expense, defend, if required by Her Majesty, any and all actions 
and suits charging such infringement and will save us harmless from any 
loss, damage or expense whatsoever, including attorneys' fees, in case any 
suit, action or claim is commenced or made alleging any such infringement. 
If any suit, action or claim alleging such infringement is commenced or 
made, we reserve the right to cancel this contract and return to you all 
supplies delivered to us under the contract and to recover the amount or an 
equitable portion of the amount, theretofore paid on account of such 
supplies. We agree to indemnify you against any such loss, damage or 
expense resulting from any such infringement or alleged infringement in 
respect of any article or parts thereof supplied to us under this contract 
the design of which shall have been supplied by us, but this indemnity 
shall apply to this contract only.

You warrant that you have not made and will not make any gift to any person 
in connection with the solicitation or performance of this contract. Any 
breach of this warranty shall entitle us to cancel this contract and to 
recover from you the amount of any loss resulting from such cancellation.

You warrant that you have power and authority to execute and perform this 

You warrant that you have given us a full statement of all royalties 
payable by you to residents of Canada on supplies covered hereby and that 
any royalties payable on such supplies to persons other than residents of 
Canada are not in excess of those charged to and accepted by the United 
States Government on similar supplies.

1011A  11     (01/06/91)    Delayed Deliveries

Time is of the essence of this contract.

If you should fail or refuse to make deliveries on the dates herein 
specified, as such dates may be extended by any cause of excusable delay, 
we may, at our option, terminate this contract as to any supplies not then 
delivered hereunder and recover any amounts theretofore paid on account 
thereof and may purchase other supplies of a similar description charging 
you with any excess cost incurred by us by reason of such purchase.

Excusable delay as used herein shall mean any delay caused by force majeure, 
act of God and by any other events independent of your will and beyond your 
control. Any excusable delay shall extend the delivery dates set forth 
herein by the amount of such excusable delay but shall not relieve you of 
your obligation to make any such deliveries so delayed. 

1011A  12     (01/06/91)    Members of Parliament

No member of the House of Commons of Canada shall be admitted to any share 
or part of this contract or to any benefit to arise therefrom other than a 
benefit derived solely by virtue of being a security holder in your company.

1011A  13     (01/04/92)    Security and Protection of Work

You agree to keep confidential and to use every reasonable endeavour to 
prevent any publicity concerning the existence of this contract.

If the contract or the drawings, specifications or information issued, used 
or disclosed in connection with the contract are classified as to the 
degree of precaution necessary for their safeguarding, you shall safeguard 
the same in accordance with the laws and regulations of the United States 
of America pertaining to such classification.

If any drawings, specifications or information are issued by us in 
connection herewith, the same are confidential and shall not be disclosed 
to any person other than your company or firm without previous written 
consent from the Government of Canada, nor shall they be used by any person 
for any purpose other than that for which the said drawings, specifications 
or information were provided. All drawings and specifications and all 
copies thereof shall be returned to us on demand or when their use is 

1011A  14     (01/06/91)    Sabotage

You agree to take all reasonable measures to protect from sabotage the 
supplies covered hereby, to keep the United States authorities and us 
advised of the precautions taken by you and forthwith to report to the 
United States authorities and us any information coming to your attention 
which indicates any danger of sabotage in connection therewith or that any 
act of sabotage has been committed.

1011A  15     (01/06/91)    Arbitration

All questions and controversies arising in connection with this contract 
shall be submitted to arbitration, in accordance with the rules of 
arbitration of the American Arbitration Association.

1011A  16     (01/06/91)    Price Control

You certify that the contract price of the supplies is not in excess of any 
applicable maximum price established under any statute, regulation or order 
to which you are subject and you agree that if, at any time, the contract 
price is in excess of such a maximum price, then the contract price shall 
be automatically reduced to the extent required, and you will make any 
necessary refunds to us.

1011A  17     (01/06/91)    Taxes

Unless otherwise specified in this contract, the prices herein include no 
amount for any federal excise tax, state or local sales or use tax, or any 
other tax of a similar nature, or any Canadian tax whatsoever. Such prices, 
however, include all other taxes. If the supplies are normally subject to 
federal excise tax, we will, upon request, furnish you with a certificate 
of exemption from such federal excise tax in the form prescribed by the 
Federal Regulations. We undertake to supply you with such evidence of 
export as may, from time to time, be properly requested by the tax 
authorities.  If, as a result of our failure to do so, you are compelled to 
pay such federal excise tax, we shall reimburse you therefor, provided, 
however, that you will thereafter take such steps as we may require in an 
effort to recover such payment, and shall refund to us any amount so 

1011A  18     (01/06/91)    Termination

We shall have the right to terminate this contract at any time by giving 
you notice to that effect by registered mail.  In that event, all supplies 
completed and ready for delivery when said notice is received by you will 
be duly purchased and paid for by us as set forth in this contract. As to 
all supplies not so completed and ready for delivery, we shall have the 
option (with respect to all or any part thereof) of requiring their 
completion and of taking delivery thereof, paying the full contract price 
therefor, or of paying you, in full settlement of all our obligations with 
respect thereto, a sum equal to the cost actually incurred by you in 
connection with the manufacture of such supplies to the date of termination 
and, in addition, an amount representing a fair and reasonable profit in 
respect of the work done thereon, less any advance payment previously made 
by us with respect thereto, and less the salvage value of any supplies 
remaining unfinished.  The amount of such cost will be determined from your 
books of account in accordance with good accounting practice.

Whenever practicable, you shall procure materials and/or parts required for 
the performance of this contract on terms that will enable you to terminate 
any contracts entered into by you therefor upon terms similar to those 
herein provided for in respect of the termination of this contract by us 
and you will co-operate with us and do everything reasonably within your 
power at all times to minimize and reduce the amount of our obligations 
under the provisions of this section 18.

1011A  19     (01/06/91)    Accounts

You shall, during the performance of the contract, keep proper books, 
accounts and records of the cost to you of the work and of all expenditures 
and commitments made by you in connection therewith and the invoices, 
receipts and vouchers relating thereto.  If the price provided for in the 
contract is other than a firm fixed price, or in the event of termination 
of all or part of the work, you shall, unless otherwise agreed to by us, 
cause all such books, accounts, records, invoices, receipts and vouchers as 
aforesaid to be preserved and kept available for audit and inspection by 
our authorized representatives at any time until the expiration of six (6) 
years from the end of the calendar year in which the contract is terminated 
or completed, and shall afford all facilities for such audits and 
inspection and shall furnish our authorized representatives with such 
information as they may from time to time require with reference thereto.

1011A  20     (06/06/94)    Certification - Contingency Fees

1.     The Contractor certifies that it has not directly or indirectly paid 
       or agreed to pay and covenants that it will not directly or 
       indirectly pay a contingency fee for the solicitation, negotiation 
       or obtaining of this Contract to any person other than an employee 
       acting in the normal course of the employee's duties.

2.     All accounts and records pertaining to payments of fees or other 
       compensation for the solicitation, obtaining or negotiation of the 
       Contract shall be subject to the Accounts and Audit provisions of 
       the Contract.

3.     If the Contractor certifies falsely under this section or is in 
       default of the obligations contained therein, the Minister may 
       either terminate this Contract for default in accordance with the 
       termination for default provisions of the Contract or recover from 
       the Contractor by way of reduction to the Contract Price or 
       otherwise the full amount of the contingency fee.

4.     In this section:
"contingency fee" means any payment or other compensation that is 
       contingent upon or is calculated upon the basis of a degree of 
       success in soliciting or obtaining a government contract or 
       negotiating the whole or any part of its terms;

       "employee" means a person with whom the Contractor has an employer/
       employee relationship;

       "person" includes an individual or group of individuals, a 
       corporation, a partnership, an organization and an association and, 
       without restricting the generality of the foregoing, includes any 
       individual who is required to file a return with the registrar 
       pursuant to section 5 of the Lobbyist Registration Act R.S. 1985 c.44 
       (4th Supplement) as the same may be amended from time to time.

1011A  21     (01/12/00)    Interest on Overdue Accounts

1.     For the purposes of this section:

       "Average Rate" means the simple arithmetic mean of the Bank Rates in 
       effect at 4:00 p.m. Eastern Standard Time each day during the 
       calendar month which immediately precedes the calendar month in 
       which payment is made, where the "Bank Rate" means the rate of 
       interest established from time to time by the Bank of Canada as the 
       minimum rate at which the Bank of Canada makes short term advances 
       to members of the Canadian Payments Association.

       "date of payment" means the date of the negotiable instrument drawn 
       by the Receiver General for Canada and given for payment of an 
       amount due and payable;

       an amount is "due and payable" when it is due and payable by Canada 
       to the Contractor in accordance with the terms of the Contract; and

       an amount becomes "overdue" when it is unpaid on the first day 
       following the day upon which it is due and payable.

2.     Subject to the Contract, Canada shall be liable to pay to the 
       Contractor simple interest at the Average Rate plus 3 percent per 
       annum on any amount that is overdue, from the date such amount 
       becomes overdue until the day prior to the date of payment, 
       inclusive. Interest shall be paid without notice from the Contractor.

3.     Canada shall not be liable to pay interest in accordance with this 
       section if Canada is not responsible for the delay in paying the 

4.     Canada shall not be liable to pay interest on overdue advance