CONTRACTS
A Contract must be prepared each time a congregation, campground or other
church affiliated entity purchases services or equipment. In order to expedite
the processing of the agreement, please complete a
Contract Information Form with as much
detailed information as possible. The form and a copy of the business meeting
minutes approving the contract should be faxed to Legal Services at
816/521-3099. All vendors must provide the church with a current IRS form W-9
before any contract may be signed. Legal Services will then prepare the Contract
document.
1. Types of Contracts. Legal Services has a number of template
contracts. Contracts regularly prepared include services for major construction
jobs, architects, roofing jobs, lawn care, parking space use agreements,
cleaning services, painting, and consulting services.
2. Dangers of Using Contractor’s Proposals. Frequently a contractor
will attempt to use their proposal as the contract. While this may be faster
procedurally, the proposal will generally not adequately protect the church’s
interests, and may result in a lawsuit, the project not getting completed or the
project not meeting expectations. Terms frequently missing from proposals
include termination language, insurance obligations and indemnification
obligations.
3. General Contract Requirements. Before drafting a contract, Legal
Services will require specific information about the project. The more specific
the information is, the less likely there will be a misunderstanding between the
parties. Examples of information Legal requires include: a description of the
nature of the services, or equipment to be provided, how will the provider be
paid, and will the provider be able to submit a certificate of insurance naming
the church as an additional insured meeting the church’s insurance requirements.
For a complete list please see the Contract
Information Form.
4. Contract Termination Problems. Legal Services should be consulted
before contracts are terminated to determine if there are damage or penalty
provisions, which might adversely affect church interests. An improperly
terminated contract can trigger escalation provisions, obligating the
contracting church entity to a lump sum payment; and may create a cause of
action by which the other party sues the church.
5. Signature Authority and Execution. No contract may be signed
without review of Legal Services and approval of the congregation and Mission
Center officers. Once approval is given by Legal Services, in many cases
the contract can be signed by either the Congregation's Pastor or Financial
Officer, however for significant projects, a Mission Center officer may be
required. Individuals signing a contract should always sign in the capacity of
their office, i.e., "Joe Smith, Pastor."