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Saturday 8th July, 2023 | Author: Secretariat | Filed under: Good practice policies

Inter-Agency Assignments - The Contractual Relationship

The global professional investigation sector is made up of a complex network of agencies interacting business. This article drills deeper into the relationships that develop through the network and the legal basis on which the agents interact.

First, for ease of reference we breakdown the phases that take place prior to the start of any operation:

1. The requirement to subcontract.
2. An invitation to tender.
3. A creation of a formal contract.

1. The requirement to subcontract.

The guidance published by the Association of British Investigators (ABI) in July 2022 delves into the intricacies of Inter-Agency Assignments, including its purpose and benefits. Inter-Agency work is often sought after by sole traders who look to collaborate with other sub-contractors for several reasons such as geographical location, volume of work, availability, and expertise.

By exchanging instructions, agents can increase their coverage and provide clients with varied services. Additionally, sub-agents can indirectly earn fees from clients they have no direct relationship with while also creating mutual arrangements for future assignments.

The guide can be found here.

2. An invitation to tender.

In UK contract law, the principle that is key here is the need for there to be an “offer” and that offer to be “accepted”.

Usually, following on from the above phase on the requirement, it is the prime agent that has the requirement, as part or all of an assignment entrusted to them by a client.

It is likely that when the prime agent reaches out to a potential subcontractor, they have themselves only been invited to tender by their own client and before responding to their client with a proposal, they need to assess the capabilities, in other words, which subcontractor(s) can undertake what part of the assignment on their behalf that they do not have the capacity to fulfil internally. This is quite common and normal business practice in the professional investigation sector.

When a professional investigator looks to subcontract, they should use clear and precise language to avoid mistaking an invitation to tender for firm instructions. Here are some tips to avoid confusion:

a) Use clear language:

The language used in the subcontracting invitation to tender should be clear and unambiguous. Avoid using legal jargon or technical terms that may be unfamiliar to the subcontractor.

b) Use specific terms:

Use specific terms to describe the work required to be carried out, the timeframe, and invite the subcontractor to confirm availability, capability and their payment terms. This will help to avoid misunderstandings.

c) Be explicit about the nature of the requirements:

Make it clear what the subcontractor is being invited to tender for, and that it is not a firm instruction until the tender is accepted by the prime agent. Perhaps be specific that no fees are to be incurred until the tender has been accepted formally.

d) Include an express disclaimer:

Include an express disclaimer in the subcontracting invitation to tender, stating that it is not intended to create a contractual relationship between the parties. However, when confidential data is being shared, it is advisable for both parties to enter into a non-disclosure agreement prior to the sharing of any data.

e) Seek legal advice:

Where necessary and if in doubt, seek legal advice. They can help to ensure that the language used in the subcontracting tender invitation is appropriate and legally sound. This is unlikely to be feasible in routine matters, but ABI members do have the facility of free legal advice as a member’s benefit.

f) Be transparent about the selection process:

If the subcontractor is being invited to tender for work, be transparent about the selection process and the criteria that will be used to evaluate submissions. This will help to ensure that the subcontractor understands the process and can submit a competitive and comprehensive proposal.

g) Clarify deliverables and expectations:

Clearly define the deliverables that the subcontractor is expected to provide, as well as the timeline and expectations for completion. This will help to avoid misunderstandings and ensure that the work is completed to the satisfaction of all parties.

h) Outline dispute resolution procedures:

Include provisions in the subcontracting tender invitation that outline the procedures for resolving disputes or disagreements that may arise during the course of the work. This will help to ensure that any issues are resolved in a timely and efficient manner.

For inter-agency activity among ABI members this is reasonably straight forward as members are in the event accountable to the ABI and default terms of business are binding as written into the ABI bylaws. However, when contracting outside the ABI greater attention may be required.

i) Use a qualified translator if necessary:

If the subcontractor speaks a different language, use a qualified translator to ensure that all parties have a clear understanding of the terms and conditions of the tender requirements. Whilst English is the common language for professional investigators globally, it should not be taken for granted that an overseas subcontractor will be sufficiently fluent to grasp more technical points and requirements.

By using appropriate and clear language, professional investigators can avoid misunderstandings and ensure that their invitations to tender from potential subcontracted agents are legally sound and effective.

3. A creation of a formal contract.

The legal implications of a professional investigator employing a subcontractor are the same, regardless of the complexity or value of the work.

When a subcontractor is hired, a legally binding agreement is established between the contractor (prime agent) and subcontractor, with the terms set out in a written contract.

This contract typically details the roles and obligations of both parties, including the work to be undertaken, timelines, compensation, and compliance matters such as the UK GDPR roles and responsibilities.

In some cases, the contractor will provide a detailed brief to the subcontractor outlining specific requirements and expectations.

Once the terms have been agreed upon, both parties are obliged to fulfil their obligations according to the contract.

Should either party breach the contract, there may be legal remedies such as damages or specific performance available. Therefore, it is crucial for both parties to thoroughly review and understand the terms of the contract before signing it.

In essence, subcontracting is a legally binding agreement under contract law which establishes the roles and obligations of both the contractor and subcontractor.