Ohio Admin. Code 153:1-3-02 - Form of subcontract
(A)
The contractor
shall use the subcontract form when entering into any subcontract.
(1)
A public
authority may supplement the subcontract form to include project-specific
requirements that do not conflict with the requirements set forth in this
chapter.
(2)
A contractor may supplement the subcontract form to
include terms and conditions that do not conflict with the requirements set
forth in this chapter.
(3)
In the event of a conflict between the subcontract
form and any part of a contract between the contractor and the subcontractor,
the provision of the subcontract form prevails.
(4)
Unless the
public authority takes assignment of the subcontract under paragraph (B)(2) of
this rule, the subcontractor will not have any contractual rights against the
public authority.
(5)
A contract between a contractor and subcontractor
failing to include the subcontract form shall not relieve the contractor or
subcontractor of their obligation to fully comply with all required provisions
set forth in this chapter.
(6)
The subcontract
form shall require compliance with all applicable federal, state, and local
law, including but not limited to sections
153.03,
1311.25 to
1311.32,
2305.31,
4113.61,
4113.62, and
4115.03 to
4115.21, and Chapters 4703. and
4733. of the Revised Code.
(B)
The subcontract
form shall address the following terms and conditions:
(1)
Mutual rights
and responsibilities: The subcontract form shall contain a provision requiring,
to the extent that the contract between the public authority and the contractor
applies to the subcontract work:
(a)
The contractor and the subcontractor to be mutually
bound by the terms of the contract documents;
(b)
The contractor
to assume toward the subcontractor the rights, remedies, obligations, and
responsibilities that the public authority has and assumes toward the
contractor;
(c)
The subcontractor to assume toward the contractor the
rights, remedies, obligations, and responsibilities that the contractor assumes
toward the public authority; and
(d)
The
subcontractor to perform its portion of the work in accordance with the
contract documents.
(2)
Contingent
assignment: The subcontract form shall contain a provision providing for the
assignment of the subcontract to the public authority, at the public
authority's option, upon the termination of the contractor's contract and
written notice to the subcontractor.
(3)
Intended third
party beneficiary: The subcontract form shall contain a provision indicating
that the public authority is an intended third party beneficiary of the
subcontract, entitled to enforce any rights thereunder for its benefit.
(4)
Insurance: The subcontract form shall contain a provision requiring the
subcontractor to maintain insurance in accordance with the contract
documents.
(5)
Right to audit: The subcontract form shall contain a
provision entitling the public authority and any agents designated by the
public authority to have access to and the right to audit and the right to copy
at the public authority's cost all of the subcontractor's books, records,
contracts, correspondence, instructions, drawings, receipts, vouchers, purchase
orders, and memoranda relating to the work for not less than three years
following completion of the work consistent with section
149.43 of the Revised Code with
regard to the public authority's obligation to maintain confidentiality of
trade secrets.
(6)
Indemnification: The subcontract form shall contain a
provision requiring the subcontractor to indemnify, defend, and hold harmless,
to the fullest extent permitted by law, the public authority, its consultants,
and employees from all claims and expenses for bodily injury and property
damage other than to the work itself that may arise from the performance of the
subcontract work, but only to the extent caused by the negligence of the
subcontractor or a person or entity for whom the subcontractor may be liable.
The subcontract form shall not require a subcontractor to waive its immunity
under the workers' compensation laws of this state from claims brought against
the subcontractor by the subcontractor's employees.
(7)
Prompt payment:
The subcontract form shall contain a provision requiring the contractor,
notwithstanding a contingent payment clause in a contract, to make payments to
the subcontractor in accordance with applicable law, including section
4113.61 of the Revised Code, and
that progress payments to the subcontractor for satisfactory performance of the
subcontract work shall be made no later than ten days after receipt by the
contractor of payment from the public authority for that subcontract
work.
(8)
Retainage: The subcontract form shall contain a
provision requiring that retainage shall be at a rate equal to or less than the
percentage retained from the contractor's payment by the public authority for
the subcontract work.
(9)
Warranty: The subcontract form shall contain a
provision requiring that the subcontractor fully warrant, for the benefit of
the public authority, that all materials and equipment shall be new unless
otherwise specified, of good quality, in conformance with the contract
documents and free from defective workmanship or materials.
(10)
Non-waiver of
lien or payment bond rights: The subcontract form and any supplemental terms to
the contract between the contractor and subcontractor shall not include any
terms or conditions that seek to prohibit a subcontractor from exercising its
rights under Chapter 1311. of the Revised Code or under any contractor-provided
payment bond.
(11)
Nondiscrimination: The subcontract form shall contain
a provision specifically requiring the subcontractor to comply with applicable
law regarding equal employment opportunity, including section
153.59 of the Revised Code and,
to the extent applicable, all executive orders issued by the governor of the
state of Ohio.
(12)
Dispute resolution: The subcontract form shall require
the contract between the contractor and subcontractor to contain a dispute
resolution provision that is comparable to the dispute resolution provision in
the contract between the public authority and the contractor.
Notes
Promulgated Under: 119.03
Statutory Authority: 153.503
Rule Amplifies: 9.33 - 9.335, 153.50 - 153.581, 153.65 - 153.73
Prior Effective Dates: 12/26/2011
Promulgated Under: 119.03
Statutory Authority: 153.503
Rule Amplifies: 9.33 - 9.335, 153.50 - 153.581, 153.65 - 153.73
Prior Effective Dates: 12/26/2011
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