The loss of a grant and a critical financial situation may justify the termination of a public contract for reasons of general interest
One commune had entered into a project management contract with a group of companies for the construction of a cloakroom and a platform in the municipal stadium. The group began to work, until the final draft, before the municipality terminates the market for a reason of general interest. The representative of the group then filed an application with the administrative court of the municipality to repair the damage resulting from the termination. The administrative court having rejected this request, the agent of the grouping appealed.
Rule No. 1: The termination of the contract does not have the effect of breaking the contractual relations between the members of the group
The holder of the contract was a solidarity group represented by a representative. As such, the agent acted on behalf of the group to claim compensation for damages suffered as a result of the termination of the contract.
However, the municipality objected to this request submitted by the representative and the first judges considered that, following the termination of the contract, the contractual relations between the various members of the group had been broken.
The Administrative Court of Appeal censures this reasoning. Based on the provisions of Article 51 of the former Code des Marches Publics and Articles 12.13.3 and 12.1.4 of CCAG PI, the Court held that the termination of the contract did not have the effect to terminate the contractual relationship between the members of the group and that the agent was deemed to be able to exercise his action on behalf of the grouping in order to obtain the settlement of the contract. Consequently, the Court considers that the representative had standing to act on behalf of the members of the grouping and annuls the judgment of the administrative court on this point.
Rule No. 2: The loss of a subsidy and a critical financial situation justify the termination of a public contract for reasons of general interest
The municipality had terminated the market for reasons of general interest because of the impossibility of securing the financing of the operation initially planned for an amount of 694 445 € HT. It justified not being able to benefit from the extension of a grant of 479 000 € initially granted by the executive council of Corse-du-Sud. It also justified, in particular by producing a study from the treasury departments of Greater Ajaccio, to be in an unfavorable financial situation, the stock of its debt having doubled during the course of 2013 and reducing its room for maneuver in terms of self-financing. The representative reproached the municipality for not having done all the diligences to preserve the benefit of the subsidies granted.
The Administrative Court of Appeal rejects this argument. Recalling that the co-contracting administration has the power, that it has general rules applicable to administrative contracts, to unilaterally terminate the contract for reasons of general interest, it considers that in view of the justifications provided by the municipality, the termination general interest is well founded.
Rule n ° 3: In the absence of a specific clause, the compensation is based on the initial amount HT of the market
The estimated cost of the works was set at the signing of the project management contract at the sum of € 694,445 excluding tax. Subsequently, the municipality wanted the evolution of the initial project to allow the classification of sports equipment in a higher category, increasing the estimated cost of work to an amount of 1 206 000 € HT. The agent of the group claimed compensation based on the latter amount.
The Court rejects this contention, recalling that the provisions of Section 33 of the GCC PI expressly provide that the termination indemnity applies to the original amount of the contract, excluding the modifications made to the program, which can not be taken into account in determining the amount of this allowance. The Court thus holds that after application of the flat-rate remuneration contractually fixed at 11,2 % and deduction of the amount excluding taxes of the services already settled by the municipality of an undisputed amount of 30,063.05 € HT, the compensation of termination must be set at € 2,385.75 excluding taxes. In addition, it notes that the group incurred costs of € 48,811.89 excluding VAT for the performance of the contract and that the applicant does not establish that he suffered a loss of gross margin nor can claim compensation for costs. committed to the drafting of the documents of the consultation, this service not being foreseen by the market. It considers that the settlement amount must be set at € 51,197.63 excluding taxes.
CAA of MARSEILLE
6th room - training 3
Reading of Monday, June 12, 2017
IN THE NAME OF THE FRENCH PEOPLE
Considering the following procedure:
Previous litigation procedure:
- C ... A ... asked the administrative court of Bastia to condemn the municipality of Bocognano (Corse-du-Sud) to pay the solidarity group A ...- Sudetec-Sinetic the sum of 87 556,40 euros in compensation for damages resulting from the termination of the project management contract for the construction of changing rooms and a platform at the communal stadium.
By a judgment n ° 1400624 of February 4th, 2016, the administrative court of Bastia rejected its request.
Proceedings before the Court:
By an application and briefs, registered on 4 April 2016, 19 October 2016 and 29 December 2016, MA .., acting as representative of the group A ...- Sudetec-Sinetic, represented by MeD ..., asked the courtyard :
1 °) to cancel this judgment of the administrative court of Bastia of February 4, 2016;
2 °) primarily: to condemn the municipality of Bocognano to pay him the sum of 94 703.37 euros excluding taxes;
3 °) in the alternative: to appoint an expert to quantify the damage resulting for the grouping of the termination of the contract;
4 °) to enjoin the commune of Bocognano to produce the deliberation of the municipal council approving the amount of works for an amount of 1 206 000 euros HT;
5 °) to put a sum of 5,000 euros in charge of the municipality of Bocognano under Article L. 761-1 code administrative justice.
He argues that:
- he is entitled to act on behalf of the project management group;
- the group is entitled to full compensation for its loss, on the basis of the financial estimate determined in the detailed preliminary draft;
- the increase in the cost of the work results from the will of the municipality and has been validated by it;
- the public interest ground justifying the decision to terminate the contract is not justified;
- the municipality has not proceeded to the settlement of the ACT phase in the amount of € 3,571.27 including tax.
By memoranda in defense, registered on May 27, 2016 and November 26, 2016, the municipality of Bocognano concludes:
- the rejection of the request;
- that it is made aware of its commitment to pay the sum of 3 571,27 euros TTC to MA..in the regulation of the ACT phase;
- that a sum of 2 500 euros is charged to MA .. under Article L. 761-1 code administrative justice.
She argues that:
- MA .. lacks standing to act on behalf of the consortium of contractors;
- the pleas raised by MA .. are unfounded;
- it undertakes to pay the applicant the amount due under the ACT phase.
Considering the other parts of the file.
- the code of public contracts;
- Law No 85-704 of 12 July 1985;
- the order of 16 September 2009 approving the general administrative clauses applicable to public contracts for intellectual services;
- the code of administrative justice.
The parties were regularly notified of the day of the hearing.
The following were heard during the public hearing:
- Mrs Héry's report,
- the conclusions of Mr Thiele, public rapporteur,
- Considering that the municipality of Bocognano concluded on November 29, 2009 a project management contract with a consortium composed of MA .. and companies Sudetec and Sinetec for the construction of a cloakroom and a platform in the stadium municipal; that by decisions of April 18, 2014 and May 19, 2014, the municipality informed on the one hand MA .. and, on the other hand, the companies Sudetec and Sinetec the termination of this contract for a reason of general interest; that MA .., acting as agent of the grouping, raises appeal of the judgment of February 4, 2016 by which the administrative court of Bastia rejected his request for the sentence of the municipality of Bocognano to pay him the sum of 87 556, 40 euros in compensation for damages resulting from this termination;
On the end of non-reception opposed by the municipality of Bocognano:
- Considering that under Article 51 of the Code des Marches Publics: "I. - (...) The grouping is joint when each of the economic operators members of the group undertakes to perform the service or services that are likely to to be attributed to it in the market./ The grouping is solidary when each of the economic operators members of the grouping is financially committed for the totality of the market./II - In the two forms of groupings, one of the economic operators members of the grouping, designated in the act of engagement as representative, represents all the members vis-à-vis the contracting authority (...) / If the contract so provides, the representative of the joint group is solidary, for the execution of the the market, of each of the members of the group for its contractual obligations towards the public body, in respect of the contracting authority. (...) "; that Article 12.1.3. of the general administrative clauses applicable to contracts for intellectual services (CCAG-PI) provides that in the case of co-contracting, the authorized representative alone is authorized to submit to the contracting authority the payment request, Article 12.1.4. further specifying that the agent of the grouping alone has the power to formulate or transmit the claims of its members; that contrary to what the first judges thought, the fact that the contract of project management was terminated does not result to break the contractual relations between the different members of the grouping, the agent being considered in particular to be able to exert acting on behalf of this group to obtain the settlement of the contract;
- Whereas in the present case it appears from the notice of engagement that the contract was concluded with a consortium represented, as regards the execution of the contract, by MA ..; that consequently the latter has standing to act on behalf of the members of this group; that, therefore, the end of non-reception opposed by the municipality of Bocognano must be dismissed;
On the merits of the termination:
Considering that the co-contracting administration has the power, that it has general rules applicable to administrative contracts, to unilaterally terminate the contract for reasons of general interest, subject to the contractor's rights to compensation; that it follows from the investigation that the municipality of Bocognano proceeded to the termination of the contract of project management on the grounds that it was impossible for the financing of the operation initially planned for an amount 694,445 euros excluding taxes; that it justifies not being able to profit from the extension of a grant of 479 000 euros initially granted by the executive council of Corse-du-Sud; that the municipality also establishes, in particular by the production of a study emanating from the services of the treasury of Greater Ajaccio, to be in an unfavorable financial situation, the stock of its debt having doubled during the year 2013 and reducing its margins maneuver in self-financing; that, under these conditions, and without it can be usefully reproached the commune not to have done all the diligences to preserve the benefit of the subsidies granted, the termination of said contract for reasons of general interest is justified;
On the amount of the termination indemnity:
- Considering on the one hand that under the terms of article 9 of the law of July 12th, 1985 relative to the contracting of public work and its relations with the private project management: "The project management mission gives contract, the amount of this remuneration takes into account the scope of the assignment, its degree of complexity and the estimated cost of the work. "; that under the terms of article 30 of the decree of November 29, 1993 relating to the project management tasks entrusted by the public owners to private law providers: "(...) III. program or services decided by the contracting authority, the project management contract is the subject of an amendment which sets the modified program and the estimated cost of the works concerned by this modification, and adapts accordingly the remuneration of the contractor and the terms of its commitment on the estimated cost (...) ";
- Considering that the holder of a contract of project management is remunerated by a fixed price covering all of his duties and missions, as well as the profit that he expects; that only a modification of program or a modification of services decided by the master of work can lead to an adaptation and, if necessary, to an increase of its remuneration; that the prolongation of the mission of the supervisor is likely to justify additional remuneration only in the event of modifications of program or services decided by the owner of the work;
- Considering furthermore that under Article 33 of the CCAG-PI, to which reference should be made in the absence of specific contractual stipulations: "When the contracting authority terminates the contract for reasons of general interest, the holder is entitled to a termination indemnity, obtained by applying to the initial amount excluding market taxes, less the unrevised amount before taxes of the services received, a percentage fixed by the particular documents of the contract or, failing that, by 5 %./ In addition, the holder is entitled to compensation for any costs and investments, possibly incurred for the contract and strictly necessary for its performance, which would not have been taken into account in the amount of benefits paid. to provide all the necessary justifications for the fixing of this part of the compensation within a period of fifteen days after notification of the termination of the contract. are charged to the termination statement, without the holder having to make a specific claim in this respect. "
- Considering that the estimated cost of the works was fixed at the signing of the contract of project management to the sum of 694 445 euros; that it follows from the instruction and in particular the building permit issued by the mayor of Bocognano and elaborated on the basis of the final draft, consultation documents published by the municipality during the procedure of appeal to compete with a view to the conclusion of works contracts and the letter by which the municipality informed the members of the project management group of the termination of the contract, that the client wished the evolution of the initial project in to allow the classification of sports equipment in a higher category, thus increasing the estimated cost of the works to an amount of € 1,206,000 excluding taxes; whereas, however, since the aforementioned stipulations of the CCAG-PI expressly provide that the termination indemnity shall apply to the initial amount, excluding taxes, of the contract, the modifications so made to the program may not be taken into account in determining the amount of the this allowance;
- Considering that thus, after application of the flat-rate remuneration fixed contractually to 11,2 % and deduction of the amount without taxes of the services already settled by the municipality of an undisputed amount of 30,063.05 euros without taxes, the compensation of termination due pursuant to Article 33 of the CCAG-PI shall be set at EUR 2,385.75 excluding taxes;
- Considering that under Article 34 of the GCC-PI: "34.1 The termination is the subject of a termination statement, which is drawn up by the Contracting Authority and notified to the holder./ 34.2. following a termination decision pursuant to Articles 31 and 33 shall include: / 34.2.1 In the case of the holder: - the amount of the sums paid in advance, down payment, final partial payment and balance (...) / 34.2.2 To the credit of the holder: / 22.214.171.124 The value of the services provided to the contracting authority, namely: - the contractual value of the services received, including, where applicable the value of the services provided at the request of the contracting authority, such as the storage of supplies (...) 126.96.36.199 If the termination is taken pursuant to Article 33, a lump sum calculated by applying a percentage to the difference between e amount excluding unrevised VAT of the contract and the unrevised VAT amount of the services received. In the silence of the market, this percentage is 5 %. The amount so calculated shall be revised on the effective date of termination in accordance with the provisions of the contract. / 188.8.131.52. More generally all damages suffered as a result of the termination by the holder (...) ";
- Considering that Mr. A. .. justifies, in particular by the production of projects of count of cancellation addressed to the commune within the time prescribed by article 33 of CCAG-PI, that the group of master of work incurred expenses strictly necessary to the execution of the contract for a total amount of € 48,811.89 excluding taxes;
- Whereas the applicant does not establish that he suffered a loss of gross margin; that he can not claim compensation for the costs incurred in drafting the consultation documents, since this service is not provided for by the contract;
- Considering that thus, the count of cancellation must be fixed at the total amount of 51 197,63 euros excluding taxes; that considering the indemnity of cancellation already paid by it of an amount of 2 279,38 euros without taxes, the municipality of Bocognano must be condemned to pay to the group of project management the sum of 48 918,25 euros without taxes ;
On the payment of the ACT bill:
- Considering that it results from the instruction and that it is not disputed by the municipality of Bocognano that this one did not proceed to the settlement of the sum of 3 571,27 euros TTC due for the benefit bid analysis; that this sum should also be borne by the commune;
- Considering that it follows from all the foregoing and without it being necessary to order an expert opinion or to issue an injunction to the commune, that Mr. A. is justified in maintaining that it is wrong that, by the impugned judgment, the administrative court of Bastia rejected his request;
The claims seeking the application of the provisions of Article L. 761-1 of the Code of Administrative Justice:
- Considering that in the circumstances of this case it is appropriate to accede to the conclusions of MA .. and to charge the commune of Bocognano a sum of 2,000 euros for costs incurred by him and not included in the costs; that the provisions of Article L. 761-1 code administrative justice preclude the right to the conclusions of the municipality of Bocognano, losing party in the present case;
Article 1: The judgment of the administrative court of Bastia of February 4, 2016 is canceled.
Article 2: The municipality of Bocognano is sentenced to pay the sum of 48 918.25 euros excluding taxes to MA, acting as representative of the group, under the termination indemnity.
Article 3: The municipality of Bocognano is condemned to pay the sum of 3 571,27 euros TTC to MA .., acting as agent of the group, in payment of the invoice on the provision of analysis offers.
Article 4: The municipality of Bocognano will pay a sum of 2,000 euros to MA .., acting as an agent of the group, under Article L. 761-1 code administrative justice.
Article 5: The surplus of the parties' submissions is dismissed.
Article 6: This judgment will be notified to MC..A ... and to the municipality of Bocognano.