Ley de Contratos del Sector Público - 9/2017 - 7a parte

Name: Ley de Contratos del Sector Público - 9/2017 - 7a parte
Uploaded: 2021-10-11T16:53:12.000Z
Duration: 50 min 58 s

Effects, Execution, and Extinction of Administrative Contracts

Overview of the Video Content

The video discusses the effects, execution, and extinction of administrative contracts as part of a series summarizing contract law. It aims to condense complex information for better understanding.

Previous videos focused on the preparation and awarding phases of contracts; this video covers the remaining three phases: effects, execution, and extinction.

Key Articles and Concepts

Article 190: Contract Interpretation

The contracting authority has the prerogative to interpret administrative contracts, resolve doubts regarding compliance, modify them for public interest reasons, agree on their resolution, and determine effects.

Article 191: Authority's Supremacy

Decisions made by the contracting authority are final in administrative proceedings and immediately executable. This highlights the authority's power over contract interpretation and enforcement.

Article 192: Penalties in Contracts

Penalties outlined in contract documents cannot exceed 10% of the initial contract value (excluding VAT) or total more than 50% across all penalties specified. This sets limits on financial repercussions for non-compliance.

Delays by Contractors

If a contractor delays fulfilling contractual obligations, they may incur penalties amounting to €0.60 per €1,000 until reaching a maximum of 5% of the contract price; at that point, authorities can choose to resolve or continue imposing penalties.

Indemnifications and Responsibilities

Article 196: Damages to Third Parties

Contractors must indemnify third parties for damages caused during contract execution unless those damages result from direct orders from administration; in such cases, administration is liable. This establishes accountability between contractors and authorities.

Example Scenario

An example illustrates liability where a contractor damages community property while executing work due to poor planning versus when an administration directive leads to damage—highlighting shared responsibility based on circumstances.

Risk Principles

Article 197: Contractor Risks

Contractors assume risks associated with profitability; if a project becomes unprofitable or incurs losses post-agreement signing, it is not considered an administrative fault but rather part of their risk management responsibilities within contracts.

Modifications to Contracts

Articles 203 - 207: Modification Conditions

Contract Modifications and Assignments

Conditions for Contract Assignment

A contract can be assigned to another company only if at least 20% of the contract has been executed, or in service or works concessions, at least one-fifth must have been exploited.

The assignee (new contractor) must possess the necessary capacity and solvency, and may need to be classified if required.

The assignment must be formalized through a public deed, ensuring that the assignee inherits all rights and obligations from the original contract.

Subcontracting Regulations

Subcontracting is permitted under specific conditions outlined in Article 215; it should typically be mentioned in the bidding documents.

Any intention to subcontract must be communicated in advance and in writing. Subcontractors are only accountable to the main contractor, not directly to the contracting authority.

The contracting authority does not engage with subcontractors directly; they interact solely with the main contractor who manages payments.

Contract Termination Procedures

Grounds for Contract Termination

Contracts can terminate by completion or resolution as per Articles 209 and 210. Completion occurs when all contractual obligations are fulfilled.

Upon completion, a formal act of reception by the administration is required within one month after delivery or execution of services.

Confidentiality Obligations

Contractors are bound by confidentiality regarding any sensitive information acquired during their engagement with the administration for five years unless otherwise specified (Article 133.2).

Payment Processes and Delays

Payment Rights Post Completion

After fulfilling contractual obligations, contractors are entitled to payment as stipulated in both law and contract terms. Payments can be total or partial based on project specifics.

Administration's Payment Timeline

The administration has a maximum of 30 days from approval of work certifications or documents confirming compliance to process payments.

Handling Payment Delays

Contract Resolution and Administrative Contracts

Overview of Contract Resolution

The resolution of contracts can occur unless continued by agreement among heirs or successors. Various causes for resolution include the contractor's legal personality, mutual agreement between administration and company, insolvency declarations, and other administrative procedures.

Key reasons for contract resolution include unjustified delays in compliance by the contractor exceeding six months, failure to fulfill primary obligations under the contract, and administrative decisions not to tolerate such failures.

Specific Characteristics of Contract Resolutions

Special characteristics regarding the resolution of construction contracts are outlined in articles 245, 279, 294, 306, and 313. These articles detail specific causes for contract resolutions beyond general ones previously discussed.

The contracting authority is responsible for formalizing the resolution agreement either ex officio or at the contractor's request. This highlights the authority's role in managing contract terminations.

Types of Construction Contracts

Articles 231 to 315 elaborate on key features of administrative contracts. While most have been covered, nuances remain that warrant review.

Construction works are classified into categories: new establishment works, reform/restoration/rehabilitation works versus simple repairs/maintenance/demolition. Understanding these distinctions is crucial for exam preparation.

Execution and Modifications in Contracts

The execution of construction contracts begins with an act of verification (acta de comprobación de replanteo), a critical point often tested in exams.

If modifications reduce work units below 20%, contractors cannot claim compensation. This emphasizes financial risk management within contractual agreements.

Completion and Warranty Period

Upon completion of construction work, an act of conformity is issued confirming satisfactory work quality. A warranty period begins post-confirmation lasting no less than one year during which defects may be addressed.

The definitive guarantee held by administration must be returned within two months after the warranty period ends if no issues arise during that time frame.

Liability for Hidden Defects

Contractors are liable for hidden defects that cause significant deterioration incompatible with normal wear over a fifteen-year period from project acceptance. This long-term liability underscores accountability in construction quality.

Special Causes for Contract Resolution

Four special causes exist for resolving construction contracts: unjustified delays in verification processes; total suspension exceeding eight months; and withdrawal from projects—each having distinct implications on contractual obligations.

Contracts Related to Services and Supplies

Overview of Service Concession Contracts

Articles covering service concession contracts provide insights but will not be explored deeply here; however, article 291 discusses reversion rights back to public administration which merits attention.

Supply Contracts Characteristics

Contractor Responsibilities and Administration Procedures

Contractor Accountability in Supply Management

The contractor is responsible for the proper accounting of goods delivered to administration; if items are not in acceptable condition, they cannot be received.

If delivered goods are incorrect, an act of reception must be opened to address discrepancies; the contractor cannot claim losses or damages during supply unless instructed by administration.

The contractor's right to payment arises only when goods are correctly delivered; payment can be made in cash or through equivalent goods, capped at 50%.

Contract Termination Conditions

Special conditions for contract resolution include withdrawal by administration before initiation (over four months) and withdrawal after execution begins (over eight months).

Service Contracts Duration and Employment Regulations

Duration Limits on Service Contracts

Service contracts have a maximum duration of five years, including extensions; this is a common query among stakeholders.

Employment Implications Post-Contract

Contractors cannot use service contracts to employ personnel directly within the contracting entity; upon contract termination, workers return to their employer.

Workers provided under service contracts do not become part of the administration despite working there; they remain employees of the contracting company.

Administrative Oversight and Contracting Bodies

Structure of Administrative Contracting

The administrative structure overseeing contracts includes various officials such as ministers and directors from public entities responsible for centralized contracting.

Delegation and Financial Thresholds

Public Procurement and Contracting Regulations

Overview of Public Contracting Bodies

The Consultative Board plays a crucial role in public contracting, addressing doubts related to contracts as outlined in Article 328.

There are two main assistance bodies involved in public procurement processes, ensuring compliance and guidance for contracting entities.

Official Registries Related to Public Contracts

Three official registries are highlighted:

Registry of Bidders and Classified Companies (Article 337), widely utilized by contracting authorities.

Public Sector Contract Registry (Article 346), which tracks all public sector contracts.

The Public Procurement Platform, where all contracting profiles from various administrations are published, facilitating transparency.

Conclusion on the Law of Contracts

The discussion wraps up with a reflection on the complexity of the law governing contracts, emphasizing that despite its challenging nature, understanding it is essential for upcoming examinations.