Policy on Contracting for Middlebury

Responsible Executive(s):
Executive Vice President for Finance and Administration & Treasurer, and the General Counsel

Responsible Office(s):
Business Services

Policy Contact(s):
Director of Business Services

Effective Date:
September 1, 2017

Last Update:
October 6, 2017

Next Policy Review Date:
As needed, or summer 2019


I. Policy Statement

To appropriately steward Middlebury resources as well as to protect Middlebury, including any of its schools or programs, against various risks, this Policy establishes minimum requirements for contracts entered into on behalf of Middlebury. This Policy is intended to provide employees with a framework for appropriate contract creation, contract review, and execution of contracts. Contracts are required to satisfy this Policy regardless of whether money is being exchanged. Other Middlebury Policies, such as the Procurement Policy, the Purchasing Card Policy, and the Policy on Travel, Entertainment, and Expense, etc. may also have requirements that must be satisfied.

II. Who Is Affected By This Policy

All employees of the institution known as the President and Fellows of Middlebury College, in all schools and programs, whenever entering into or negotiating contracts for goods or services for the institution.

Exclusions: Not Applicable

III. Policy

a. Contract Creation

i. Authority

Departments and programs contracting for goods or services should consider whether they have the appropriate authority for the type of commitment being considered. For example, the use of Middlebury’s trademarks and logos is under the authority of the Vice President for Communications and Marketing. Certain types of specialized agreements may only be authorized by particular senior administrators of Middlebury, so consultation at the outset of negotiations is advised.

ii. Negotiating Terms

      1. The operational unit entering the contract is responsible for determining the type of contract (goods, services or other) and using the appropriate agreement.
      2. The operational unit is also responsible for the business terms of the agreement, such as price, schedule, scope of services, deliverables, statement of work, etc. 
      3. Contracts must carefully specify the obligations of the contracting party to provide goods or perform a service for Middlebury, including defined outcomes such as operation standards for equipment, or objective measures of workmanship.
      4. The operational unit purchasing the goods or services must specify absolute timeframes for completion of work.
      5. Middlebury requires that certain terms be included in its contracts for goods or services. Use of the template contracts available at “/go/contracting” satisfies this requirement and requires no additional review to approve the legal terms in the contract. Revisions to any of the required terms identified in Section III.a.iii. below for a contract with a value of more than $10,000 requires review by the Office of Business Services, which may choose to escalate the issue to the General Counsel. 

iii. Required elements for Middlebury Contracts

Middlebury requires that certain essential elements must be incorporated into all contracts to which Middlebury is a party, and additional resources about those elements can be found at http://go.middlebury.edu/contracting. Required terms include the following (full text can be found in the Contracting Checklist):

      1. Proper Use of Middlebury’s Legal Name
      2. Termination in the Event of Default
      3. Termination for Convenience
      4. Term of Agreement (automatic renewals are not permitted)
      5. Use of Middlebury’s Trademarks clause
      6. Insurance Requirements
      7. Indemnification
      8. No limitation of liability 
      9. Governing Law
      10. Force Majeure clause
      11. Entire Agreement clause 
      12. Reimbursement of expenses (in compliance with Middlebury’s policy)

iv. Prohibited Provisions

Middlebury prohibits the inclusion of certain terms that are not in the institution’s best interests. They include:

      1. Automatic Renewal – No contract should include an automatic renewal clause 
      2. Single Indemnification Clause (benefiting third party only) – Middlebury does not allow single indemnification clauses that only protect the outside contracting party 
      3. Limitation of Liability – No contract should contain language allowing the outside contracting party to limit their potential liability. 
      4. Serving of alcohol – Except for approved Caterers, no contract should specify the provision of alcoholic beverages. 

See the Contracting Checklist for additional information.

b. Contract Review

i. Reviewing a Vendor Contract

Contracts entered into on behalf of Middlebury must be reviewed and approved by designated Middlebury personnel to ensure compliance with this Policy, whether the agreement was originally drafted by Middlebury or the vendor/service provider. Administrators charged with managing contract activity for Middlebury will frequently find themselves faced with pre-formatted contracts prepared by vendors or their attorneys, which they may indicate are not subject to negotiation. These staff are responsible for ensuring that the contract either complies with this Policy (i.e., includes the required terms, etc.) or has been approved by the appropriate secondary reviewer, in accordance with the following section.

A Note on Software Contracts: Software vendors often present contracts as non-negotiable. ITS is responsible for contracting for software that it supports to meet Middlebury’s institutional needs, and should be consulted even when software is being purchased for a small group or specialized use (including if the software will be supported outside our ITS). Consultation with ITS is required in order to ensure the software can be integrated into Middlebury’s networks/systems appropriately. They also have expertise in negotiating such contracts.

ii. Secondary Review Required

Secondary review by the Office of Business Services is required when a vendor of goods or services seeks a modification of Middlebury’s required terms, and Business Services may refer the issue to the General Counsel for key contracts. For contracts specified in the Table of Responsible Senior Administrators, only the identified senior administrators or their designees can approve a modification from Middlebury’s required terms.

c. Execution of Contracts

i. No performance of work prior to execution

The performance of work, ordering of goods, or provision of services encompassed by a contract between Middlebury and a third-party vendor may not commence prior to the execution of a contract that complies with this Policy.

ii. Signatory Authority

Contracts may only be executed by designated signatories as specified in this Policy. The signature of one of the following officers and administrators is required on any contract binding Middlebury, according to the schedule of monetary value below:

Value of Contract & Authorized Signatories

      • $100,000 and above President; Executive Vice President for Finance and Administration & Treasurer; Provost; Assistant Treasurer, General Counsel
      • More than $10,000 but less than $100,000 Director of Business Services; Vice Presidents; Facilities Management Project Managers
      • Up to $10,000 Directors, Managers, Chairs, and Deans with signatory approval delegated by a member of the Senior Leadership Group with appropriate authority

IV. Definitions

Contract - A legally enforceable agreement, contract, lease, or license between two or more parties (for the purpose of this policy, binding letters of intent, memoranda of understanding, and other agreements with third parties such as schools, vendors, companies, etc., should be treated as contracts). “Contract” includes all agreements for the purchase of goods and services, including entertainment and professional services, as well as agreements to allow student exchanges, use of Middlebury facilities, and contracting for Middlebury use of third-party facilities.

Signatory Authority - The authority of specifically designated (groups of) employees/representatives to sign on behalf of Middlebury according to the tiers of financial limits set forth by this Policy.

Delegated Signatory Approval - The delegation of signatory authority to authorized representatives to execute contracts on behalf of a Middlebury unit where the total contract amount is less than $25,000.00. Signatory approval may be granted to employees by the terms of this Policy or in letter form by the President or a Vice President.

Sponsored Research Activities - All grant funding agreements, contracts or subcontracts under a sponsored research agreement must comply with the applicable policies as well as contract terms of the master contract.


V. Related Documents and Forms

Template contracts and other resources can be found at http://go.middlebury.edu/contracting 

VI. Related Policies

Vice President for Finance & Assistant Treasurer

152 Maple Street
Marble Works Office Complex
Suite 102
Middlebury College
Middlebury, VT 05753
Phone: 802-443-5504
Fax: 802-443-5299