12-3-315 - Authority of commissioner of general services. - Tennessee Statutes

12-3-315. Authority of commissioner of general services.

(a)  The commissioner may authorize the procurement of goods through a bid solicitation process in which a limitation of liability is authorized by the commissioner and set forth in the documents initiating the bidding process. Such procurement may be undertaken only in accordance with rules and regulations describing the circumstances in which such procurement will be permitted and what types of limitations of liability will be allowed. The commissioner has the power and shall be required to adopt and submit rules and regulations to the board of standards for approval.

(b)  The rules and regulations, as presented to the board of standards by the commissioner, shall describe the circumstances in which such procurement will be permitted, the types of limitations of liability to be allowed and shall be based on and include the following criteria. The commissioner shall not authorize limitation of the liability of a contractor unless the commissioner determines that:

     (1)  Allowing the limitation of liability is necessary to prevent harm to the state from failing to obtain the goods or services sought, or from obtaining the material at a higher price, if the state refused to allow a limitation of liability;

     (2)  The limitations and any alternative contract language are commercially reasonable in light of the risks to the state created by the type of goods or services purchased and the purposes for which they will be used; and

     (3)  The state will not agree to limit the liability of any contractor for intentional torts, criminal acts, or fraudulent conduct.

The rules and regulations shall also allow the commissioner to authorize negotiation of a limitation on a contractor's liability in circumstances where the applicable procurement process has failed to provide a qualified bidder.

(c)  In no event shall a limitation of liability permitted by this section be negotiated or authorized for an amount less than two (2) times the value of the contract.

(d)  Notwithstanding the foregoing or any other law to the contrary, the commissioner shall permit with respect to contracts for telecommunications and information technology goods and services a limitation of liability of not less than two (2) times the value of the contract provided that the limitation of liability shall not apply to intentional torts, criminal acts, fraudulent conduct or acts or omissions that result in personal injuries or death; provided, however, that if the commissioner determines that it is necessary to protect the interests of the state, the commissioner may petition the board of standards to approve contractor liability in excess of (2) times the value of the contract. If the board agrees with the commissioner, it may approve such a higher liability amount.

[Acts 2000, ch. 722, § 1; 2004, ch. 798, § 1.]