Interesting Discussion The legal aspects of Customer Specific Requirements (Contract Law).

Marc

Hunkered Down for the Duration
Staff member
Admin
#11
I have the feeling the Tier 1 and below do not operate from the position of fear only, but also by lack of knowledge.
As someone who worked as a 'hitman' for many years (aka a consultant), I have seen so many situations that were totally dumbfounding that yes - It's common. Many times the company doesn't even realize it, though. E.g. #1: Company has someone reviewing prints and proposed print changes that doesn't have someone who fully understands GD&T. E.g. #2: Company making prints by person/people who do not understand GD&T.

I know that contract law is dispositive and there will probably be situations were new unilateral requirements will be valid. Normally the argument is that the supplier has in the past signed the “Supplier Quality Manual”, and therefor is bounded by all new CSR:s in the future.
NOTE: dispositive - If a buyer and seller end up in court, their relationship is on the rocks, at a minimum.

The argument is bogus. Prior to contract acceptance every company has to fully review all requirements. I'm not a lawyer. I did learn about contracts in the 1980's working at a company involved in DoD work. Talk about complex contracts... I remember working on a contract proposal that took the company over 6 months to prepare. Complex references, requirements, etc. It was a company wide project with multiple teams.

Automotive isn't any where near as complex. And
...that the supplier has in the past signed the “Supplier Quality Manual”...
is bull. Before a contract is agreed to a company has the opportunity to assess the full/complete terms and conditions. That is the time to assess whether or not they want the contract. If there is no provision in the contract by the buyer/customer which specifically states that, for example, future changes in CSR's will be applicable to this specific contract (and legacy contracts...), then unless the contract is amended changes to CSR's in the future are not applicable. Same with supplier quality manuals - If there are changes after the contract was agreed to, future changes are only applicable if that condition was so stated in the contract. Think about it - And I've seen it - Where a customer submits a revised print for a 'running change'. The changes will make the part cost 3x the original cost. The supplier can't be expected to just eat the costs. The change requires a contract review to assess the effects. I remember such a change where, had the company agreed, it would have been literally 'selling' the part at above below cost.

A contract is a contract and aspects such as 'intent' aren't really applicable. The contract says what it says. If a specific 'intent' was actually intended, it should have been called out/specified in the contract. I saw this back in 2016 when before a judge a lawyer started talking about the 'intent' of a contract provision. The judge said what I just said above - If there was a specific intent it should have been written in the contract. "What I meant at the time" isn't a valid argument.

I have written quite a few times in discussions in the forum of the importance of contract review. Whether a company agrees to "new unilateral requirements" being applicable to existing contracts is a choice the company has to make. I, for one, would not make that agreement if only because, unless there is a provision to allow cost/price revisions in such cases, there is no way to know how much "new unilateral requirements" would cost.

EDIT: Made some clarifications and corrected some typos.
 
Last edited:
Elsmar Forum Sponsor

Mike S.

Moved On
Trusted Information Resource
#12
I’ve done contract review from a QA perspective in aerospace for over 10 years. Stuff from the DOD, major primes, as well as smaller sub-tiers. It gets more ridiculous by the year. Bigger and more complicated – almost like they are paid by the word. No wonder lawyers get a bad name – the stuff they come up with is mind-boggling. It’s a wonder any business can get done at all as the “my T’s and C’s override all other T’s and C’s” pissing contests between sellers and buyers rages on.

I actually don’t know how our Contracts Dept handles some of this crap in the end – I just point out the concerns I see from a QA standpoint and turn it over to them. Thankfully, I don’t think any of it has ever reached the courts.

If anyone reading this has any say in the writing of contracts, T’s and C’s, customer specific requirements, quality provisions/clauses, etc. for God’s sake please, do everyone a favor, and make it as brief and clear as you can and don’t put it in there unless you can clearly explain WHY it is necessary.

The Golden Rule should apply – don’t impose it on your customer/supplier unless you would like it imposed on you. Don’t even think about trying to pull the unilateral changes crap.

JMHO.
 
Thread starter Similar threads Forum Replies Date
C Legal or Regulatory Requirements as identified in our Environmental Aspects ISO 14001:2015 Specific Discussions 9
S Legal Requirements and 'Connecting' with Environmental Aspects (4.3.2) ISO 14001:2015 Specific Discussions 2
U Legal Requirements - How Legal Requirements apply to environmental aspects? ISO 14001 ISO 14001:2015 Specific Discussions 7
R The Legal Aspects of Auditing - Risks that auditors may face and practices to avoid Registered Visitor Articles Archive 2
N Address of Legal Manufacturing Site in ISO 13485 certificates? ISO 13485:2016 - Medical Device Quality Management Systems 1
A Donating sterilizing gel - Is it legal in Europe? EU Medical Device Regulations 1
A MDR Article 22 applicability - Legal manufacturer EU Medical Device Regulations 6
Q Legal Manufacturing Address Change – multiple registrations at same address 21 CFR Part 820 - US FDA Quality System Regulations (QSR) 2
J Complaints and not the legal manufacturer? 21 CFR Part 820 - US FDA Quality System Regulations (QSR) 20
Ronen E Legal counselling and Medical Devices Regulatory Affairs Other Medical Device Regulations World-Wide 2
A What if Contract Manufacturers does not have an ISO 13485 certificate? Where will the NB audit take place, at legal mfg. site or contract mfg. site? Other Medical Device Regulations World-Wide 3
G QMS requirements for legal manufacturer when outsourcing manufacturing process Other Medical Device Regulations World-Wide 22
G ISO 9001 Legal Compliance and Legal Register Requirements ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 4
Sidney Vianna Interesting Discussion Legal compliance as part of ISO 45001 accredited certification. Major OSHA penalties in the USA. Occupational Health & Safety Management Standards 15
S Necessity of Legal Register to conform to ISO 9001, ISO 14001, IATF 16949 ISO 14001:2015 Specific Discussions 6
M End of Life or Device transfer regulations for Legal Manufacturer Other Medical Device Regulations World-Wide 1
S Legal Manufacturer FDA Reporting Obligations for Using New Contract Sterilization Site Other Medical Device Regulations World-Wide 0
R In this type of Legal Manufacturer-CMO arrangement, what happens to the DHR? ISO 13485:2016 - Medical Device Quality Management Systems 1
J What are a Taiwanese Medical device subcontractor's legal responsibilities with Taiwan regulations? Other Medical Device Regulations World-Wide 2
D EU MDR - Contract Manufacturer vs Legal Manufacturer EU Medical Device Regulations 4
A Risks and Opportunities associated to Legal Compliance - 6.1.3 ISO 14001:2015 Specific Discussions 4
C Legal requirement for same indications as in Country of Origin Other Medical Device Regulations World-Wide 4
B Quality Policy does not include a commitment to comply with legal requirements Quality Management System (QMS) Manuals 5
J Medical Devices sourced from Contract Manufacturers - Who is the legal manufacturer? EU Medical Device Regulations 13
amjadrana Legal Representation in Canada (Medical Devices) Canada Medical Device Regulations 1
R Is it legal to attend a trade show while you have a 510(k) application pending? 21 CFR Part 820 - US FDA Quality System Regulations (QSR) 2
M Bankrupt Legal Manufacturer and Its Products EU Medical Device Regulations 8
H Who is the Legal / Labeled Manufacturer? (Contract Manufacturers shipping to the EU) ISO 13485:2016 - Medical Device Quality Management Systems 1
L ISO 14001:2004 - Legal and Other Requirements ISO 14001:2015 Specific Discussions 4
B List of Legislation - Legal Register for ISO14001 ISO 14001:2015 Specific Discussions 3
A Is the Labour Code one of the legal requirements of ISO 9001:2015? ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 4
S Definition Legal Hold Notice - What is a Legal Hold Notice? Definitions, Acronyms, Abbreviations and Interpretations Listed Alphabetically 3
B Taiwan Medical Device registration - Production or legal office Other Medical Device Regulations World-Wide 6
K ISO 9001:2015 and its Legal Ramifications ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 6
S What is the Legal Limits of Fungi in Poultry Feed Food Safety - ISO 22000, HACCP (21 CFR 120) 2
R Legal Register - Does anyone have an example of a legal register? ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 3
somashekar Applying legal requirements in hazardous waste management. Miscellaneous Environmental Standards and EMS Related Discussions 1
A Active Implantable Medical Devices - Legal Traceability Requirements ISO 13485:2016 - Medical Device Quality Management Systems 7
O Medical Devices - Legal Manufacturer and Real Manufacturer EU Medical Device Regulations 5
J Legal source to purchase a copy of the 9001:2015 Draft ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 3
C Battery Powered Beauty Products minimum Legal Certifications Requirements CE Marking (Conformité Européene) / CB Scheme 7
S OHSAS 18001 - 4.3.2 Legal and Other Requirements - Working document or template Occupational Health & Safety Management Standards 2
A One Medical Device - Two Legal Manufacturers ISO 13485:2016 - Medical Device Quality Management Systems 5
cscalise Legal Obligation to report ISO 13485 Finding to FDA? Registrars and Notified Bodies 1
M Changing a Chinese Legal Agent China Medical Device Regulations 5
G How to approach ISO 50001 Legal Requirements Sustainability, Green Initiatives and Ecology 1
U Do we have to have foreign legal documents? (ISO13485 4.2.3 document control) ISO 13485:2016 - Medical Device Quality Management Systems 3
S Evaluation of legal compliance to ISO 14001 and OHSAS 18001 ISO 14001:2015 Specific Discussions 18
I International Sales Legal/Regulatory Gray Area? CE Marking (Conformité Européene) / CB Scheme 3
B What does this clause mean? 4.2.3 - Legal and Other Requirements ISO 14001:2015 Specific Discussions 7
Similar threads


















































Top Bottom