Relationship or project steering committee clause, useful in relational contracts such as long-term supply, simple joint development, distributorships or project-oriented services agreement.
Many agreements characterise as a relational contract. While a collaboration agreement, consortium or other joint venture-type of cooperations contain management and coordination aspects all-over the agreement, there are also the more light-weight versions of working together that deserve an express provision addressing account management and project-level decision-making. This model steering committee clause is a helpful addition for your clause library.
The model steering committee clause first of all establishes the steering committee (aka project committee, steering group). It permits (or requires) each party to appoint one or more representatives to the steering committee. Obviously, given the informal format, appointed representatives may also be resigned (and typically, no strong formalities would apply to replacing members).
It is important that the steering committee be granted rights to act on behalf of their principals. Note that if this formulated as a power of attorney (as is done in this model clause), under common law, the entire agreement should be signed as a deed (and maybe the agreement retitled ‘deed’ and be signed as a deed).
To enhance the authority and ability to act, as well as to be explicit about the scope of authority of the steering committee, it is helpful to enumerate key aspects of the steering committee’s responsibilities (and authority). Like with the interpretation principle eiusdem generis, the narrowness of the listed items gives guidance to aspects that have not been listed. Generally, if the steering committee cannot be deemed to be authorised in a certain matter, the contract will require ‘amendment’ (applying the rules of the boilerplate amendments clause).
In larger relational contracts, a steering committee may go as far as appointing working groups for sub-packages of the work to be completed under the agreement. In such case, it is important that the steering committee be made responsible for appointing and defining the scope of work for such working group, probably including the required time schedule for completing their work.
Obviously, the model steering committee clause serves as a sample, starting-point for the particular context and relationship.