Just as any individual or corporation can, towns and other municipalities have the ability to enter into contracts. In fact, most municipalities wouldn’t be able to get by without entering into a least the occasional contract. Contract law can be confounding enough on its own: what law governs, common law or the U.C.C.? Was there a valid offer? Was the offer terminated? Was there a valid acceptance? Was a contract ever actually formed? What is the proper way to construe the terms of the contract? Are there any external factors that have any impact of the contract or its terms? Was the contract ever breached? What are the consequences of that breach?

When one of he contracting parties is a municipality, matters may only become more complex. There may be third party issues that arise: are there any third party beneficiaries? Was there any assignment of rights? Was there a delegation of duties? Who is ultimately liable on the contract?

As important as the contracts municipalities enter into may be for the good of that municipality and it citizens, it may be just as important (if not more important) for a contracting municipality to seek competent advise from competent counsel –not only before entering into the contract into the first place, but when and if there is ever an alleged or actual breach.

Copyright (C) 2012 The Munilaw Group