What the Legal Check-Up covers
The focus is on the documents that actually govern day-to-day procurement. These include general terms and conditions of purchase, framework and supply contracts, quality assurance agreements, order forms, order confirmations, as well as provisions relating to warranty, liability, late delivery, contractual penalties, prices, the supply chain, compliance and intellectual property. It is not just a question of whether an individual clause is legally sound. It is equally important to determine whether the documents contradict one another, whether they fit the business model and whether the operational teams can apply them reliably.
A common weak point is the incorporation of the terms and conditions of purchase. Under Sections 305 et seq. of the German Civil Code (BGB), it is not sufficient simply to publish a legally sound text on the intranet. The terms and conditions must be effectively incorporated at the time the specific contract is concluded. We therefore examine the sequence of the enquiry, purchase order, order confirmation and the supplier’s general terms and conditions, and determine which terms are likely to apply in the event of a so-called ‘battle of forms’. This also applies to individually negotiated framework agreements and subsequent individual purchase orders.
The review also covers the practical management of contracts. If contractual penalties are not reserved, defects are not documented within the specified time limit, or price changes are accepted without the required approval, even the best contract will be rendered ineffective. A brief review of processes reveals whether responsibilities, escalation procedures and documentation are aligned with the contractual situation.
