Should the proposal for a project be separate from the contract?
I’ve seen samples of proposals that are 5 pages long. The first pages deal with the proposal and the last 3 pages consist of terms and conditions and a place to sign and date which would be the exact same language in the actual contract.
It seems to me that a lot of the language in both the contract and proposal is redundant. Is it necessary to keep them separate or will a combined 5-page proposal/contract be the more efficient route?
Are the terms contract and proposal interchangeable?
That is what I understood as well.
However, I’m seeing many examples of a combined multi-page documents that cover the language that exists in both proposal and contract.
Given the redundancies that exist between both documents, would it not make sense for them to be combined?
I guess my question is, why ISN’T this combination a good idea?
They are usually two totally different things. Under what circumstances are you seeing them combined?
A proposal is what’s submitted when you are competing with others for a project.
The contract is signed after you are awarded the project.
It’s not very often that everything in the proposal is carried over into the contract and sometimes things are added upon award too.
But maybe this is just a result of the world I work in – a very weird segment of the design industry.
Even so, if a client accepts a proposal, parts of the proposal (along with any subsequent changes to that proposal) will obviously work themselves into the contract since the contract will need to describe the work that’s being agreed upon.
For example, if I needed a landscaper to fix up my yard, the landscaper might drop by look things over, listen to what I had to say, then go away and come back a few days later with a proposal. I would look at the proposal, ask a bunch of questions, maybe want a few things changed here and there and we would negotiate the price.
After we agreed on just what needed to be done, a contract would be drawn up that described the job in contractual terms, not in terms more appropriate to a proposal. In many ways, both would describe the job to be done, but one would be the initial proposal with various ideas and options, while the other would be the contract that incorporated only those parts of the proposal that were accepted and agreed upon and were relevant to tightly defining the scope of work and the payment for that work.
They are 2 separate legal documents. The first to bid for projects. The second to set terms. Often there will be aspects that overlap: quantity, processes, price brackets…
Here’s and example of what SEEMS like a combined proposal / contract.
If you were to read each page the first pages read like a proposal and the remainder reads exactly like a contract. In addition to this, I’ve also seen invoices with plenty of the terms and conditions that exist on a contract. Not sure how necessary that is.
How often have to run in to clients that quibble over that fact that the price quoted in the proposal does not match the price in your contract or final invoice?
OR
Do you go through great pains to make sure that doesn’t happen?
Do potential clients need to sign the proposal… and if so are you legal bound to the proposal price?
You are legally bound to whatever is in the final contract. If that contract includes the proposal, you are legally bound to match that price.
However, things do change over the course of a project. When that happens you make an amendment to the Contract using a Change order, to which you both must agree and sign. The final invoiced price NEVER differs from the quoted price without first agreeing on a change order.
In specific cases, you may have to sign a client-side contract where you agree to deliver regardless of changes. In that case, you have to prove to the client that it was their fault, not yours, that the price will change, and again, you have to have a change order drawn up and agreed on.
I’ve done legal negotiation mediation and arbitration on an international level for over 10 years. Often, if someone is sending a contract along with the proposal, they really want that job.
That can be a positive in that they might really like that job specifically, or like the work a company does, even completely altruistic as a convenience.
The negative is that it can be taken as presumptive and the contract will almost never be signed as-sent (there’ll be markups all over the document - I gair-on-T it.).
They serve different purposes, but my proposals contain my contract, and the client can electronically sign it and make a payment. So it’s one step, as opposed to, “Now I’ll send over the contract.” It’s helped me get a better acceptance rate on projects from new clients as well.
On the other side, I’ve sometimes sent out a contract that references an estimate, which wasn’t a full proposal.
No, both are completely different terms proposal is the primary stage and it can be altered with the mutual consent between both parties whereas contract is the secondary stage which can’t be changed after both parties agreed on some terms and conditions.
You can still change a contract after it is signed. It’s called a Change Order and again requires and agreement and signing by both parties. For instance an add-to-scope or an item deletion will require a change order to reflect the new price. You never make a change to a contracted agreement without one (welllll, “never” might be a little harsh, but with some clients, if you don’t follow protocol, like the US .gov, you might not get paid.)