Significance of the Order of Precedence Clause in Federal Contracts

Since federal contracts typically contain many documents, clauses, and materials outlining the rights, duties, and responsibilities of the contracting parties, it is often difficult to interpret the intent of the parties at the time of drafting or formation. In such situations, an order of precedence clause is used to establish the priority of various documents forming the federal contract. The Federal Acquisition Regulation (FAR) contains order of precedence clauses to resolve inconsistencies between contract documents. Depending on the type of procurement at issue, the contract may include the Order of precedence clause at FAR 52.214–29 or FAR 52.215–8. FAR 14.201–7(d) requires contracting officers to insert the order of precedence clause at FAR 52.214–29 in all solicitations and contracts involving sealed bidding where the uniform contract format is applicable. Similarly, FAR 15.209(h) instructs contracting officers to insert the order of precedence clause at FAR 52.215–8 for negotiated procurements. Notably, these order of precedence clauses are often supplemented by agency-specific precedence clauses and provide a structured framework for the resolution of inconsistencies between various contract documents.

When in doubt as to the proper authority of inconsistent contractual documents, contractors should first refer to the contract to determine whether it contains an order of precedence clause. Depending on the nature of the contract and the specific circumstances, contractors may be able to rely on the included order of precedence clause to resolve the inconsistency in their favor. However, contractors should be mindful that the order of precedence clauses may only be used to resolve inconsistencies in different documents within a contract. Such clauses may not be utilized to fill gaps in contract terms or performance specifications. The FAR’s order of precedence clauses are helpful in systematically resolving inconsistencies stemming from seemingly conflicting contract documents. The included schedule takes precedence over all other contractual documents under the clause. Representations and other instructions then take precedence, followed by contract clauses and other documents, exhibits, and attachments. Finally, even if part of the schedule, the included specifications take the lowest precedence when establishing the order of precedence between contract documents. The clauses at FAR 52.214–29 and FAR 52.215–8 provide that inconsistencies between different solicitation or contract documents should be resolved by giving precedence in the following order.

• Schedule (excluding the specifications)
• Representations and other instructions
• Contract clauses
• Other documents, exhibits, and attachments
• Specifications

While relatively rare, situations may arise where the contract at issue does not include an applicable order of precedence clause. In such situations, common law rules of interpretation and universally recognized order of precedence rules may be applied to resolve conflicting terms. For instance, in case of a conflict between a general term or provision and a specific one, the specific term or provision will usually prevail. Similarly, any terms or provisions that are separately negotiated or specifically added in a contract through later modifications will generally be given a higher order of precedence. Similar interpretive techniques may be employed in situations where inconsistencies exist due to conflicting terms contained in the same document. Adjudicative forums may also utilize other applicable rules of interpretation for resolving contractual inconsistencies and ambiguities.

In the case of contract disputes where there are seemingly conflicting instructions included in different contract documents, contractors must first remember to consult the order of precedence clause in the contract to determine whether the document favoring their interpretation takes precedence. However, contractors must also recognize that the clause is just one of many interpretive tools that may be utilized to understand and implement the intent of the parties. Furthermore, contractors must be mindful that the order of precedence clause addresses inconsistencies between different contract documents. To resolve inconsistencies within a single contract document, adjudicative forums are likely to use techniques similar to those used in resolving patent and latent ambiguities. By understanding the order of precedence of documents in a federal contract and the general framework of other interpretive rules and principles, contractors can fulfill the intended performance objectives and be better prepared in case of contract disputes.

This Federal Procurement Insight is provided as a general summary of the applicable law in the practice area and does not constitute legal advice. Contractors wishing to learn more are encouraged to consult the TILLIT LAW PLLC Client Portal or Contact Us to determine how the law would apply in a specific situation.