52.241-2
Order of Precedence-Utilities
In utility service contracts, the contract terms always take precedence over any conflicting rate schedules, riders, exhibits, or contractor rules.
Overview
FAR 52.241-2, Order of Precedence-Utilities, establishes the hierarchy of contract documents in utility service contracts. It clarifies that if there is any inconsistency between the contract terms (including specifications) and any incorporated rate schedules, riders, exhibits, or the contractor’s rules and regulations, the contract terms take precedence. This clause is designed to prevent disputes over which document governs in the event of conflicting provisions, ensuring that the government’s negotiated contract terms are always controlling.
Key Rules
- Order of Precedence
- The contract terms and specifications override any conflicting provisions in rate schedules, riders, exhibits, or contractor rules and regulations.
- Incorporated Documents
- Any documents incorporated by reference or otherwise, such as rate schedules or contractor policies, are subordinate to the contract terms.
Responsibilities
- Contracting Officers: Must include this clause in applicable utility service contracts and ensure all parties understand the order of precedence.
- Contractors: Must comply with the contract terms even if their own rate schedules or rules differ.
- Agencies: Should monitor for compliance and resolve disputes based on the established order of precedence.
Practical Implications
- This clause exists to eliminate ambiguity and potential disputes over which document governs contract performance.
- It impacts daily contracting by providing a clear rule for resolving conflicts between contract documents and contractor policies.
- Common pitfalls include assuming contractor rules or rate schedules can override contract terms—this clause makes clear they cannot.