Diocesan Contract Policy

Following is information containing guidelines regarding contracts between parishes/locations and third parties (contractors, tenants, vendors, et al).  

DIOCESE OF BELLEVILLE - CONTRACTS POLICY

(Revised August 2016)

A.CONTRACTS

Whenever a Parish/Location enters into a contract of any kind with a third party, certain liabilities arise. Therefore, it is important that any contract be reviewed by a qualified attorney and/or the Risk Management office.

Regardless of the purpose of the contract (building lease, construction, maintenance, et al), there are two provisions which should be included: a Hold Harmless/Indemnity clause, and an Insurance clause.  The Hold Harmless/Indemnity clause should provide that the Parish/location is held harmless by the other party for any claims for injury or damage arising out of the other party’s activities.  The indemnity provision should clearly state that the other party will indemnify the Parish/location in the event that the Parish/location has to pay damages.

In order to strengthen and support the Hold Harmless/Indemnity clause, there must also be an Insurance clause. The language in this clause should clearly state that the other party will carry liability insurance which will protect both parties against the liabilities involved.  The requirement for a Certificate of Insurance should be included in this clause.  Specific information on Certificates of Insurance is contained in the next section.

The most common types of contracts that a Parish/Location encounters include the following:

1)  LEASE OF PARISH BUILDINGS

If a parish-owned building is rented or leased to a third party (e.g., public school, social agency, etc.), a written Lease or Rental Agreement is required.  A copy of this document is to be sent to the Chancery and the Risk Management office for review and approval.

2)  RENTAL/USE OF PARISH FACILITIES

If parish facilities (halls, gyms, athletic fields) are rented or loaned to outside organizations on a regular basis, a written agreement should be used.  A copy of an approved Agreement Form is enclosed in Section III of this document.  A copy of the completed Agreement Form should be sent to the Risk Management office.

A Hall Use/Rental form appropriate for use for small private events (weddings, anniversaries, etc.) is enclosed in Section III.  These forms may be used in conjunction with existing written agreements (rules & regulations, rental fees, etc.).

Renters/users who do not have their own liability insurance should be required to purchase Special Events Liability Coverage.  See Section III for more information.

3)  OUTSIDE CONTRACTORS & SERVICES

Commercial enterprises operating on parish/Diocesan property, such as amusement ride operators, food service companies, building cleaning services, etc., should be governed by a written contract.  Care should be taken to ensure that the contract requires the Contractor to assume liability for all loss and damage resulting from its operations.  

Frequently, contracts provided by outside service providers contain language which exempts them from liability, or even shifts liability for their negligent actions to the Parish/location.  Therefore, it is important to send a copy of this type of contract to the Risk Management Office for review.

4)  BUILDING CONSTRUCTION AND REPAIRS

New construction, building additions and major repairs are governed by the Diocesan Building Commission.  Refer to the Construction and Renovation Policy Manual for specific information.

Whenever construction or repairs in excess of $5,000 is performed at a Parish/location, a written contract should be used.  There is a variety of construction contracts, from simple one-page agreements, to multi-volume project manuals.  The Construction and Renovation Policy Manual provides specific requirements for various levels of project costs, and should be consulted for specific information.

A frequently used clause in construction contracts is entitled Waiver of Subrogation.  The effect of this waiver is that the contractor is held harmless from liability for damage caused by the contractor’s negligence.  These clauses should be eliminated from contracts involving Diocesan locations.

B.CERTIFICATES OF INSURANCE

Whenever a Parish/location enters into a contract, there is usually a requirement for a Certificate of Insurance for one or both parties.  The Certificate of Insurance verifies that the parties have the required insurance coverage as stated in the contract.

The most common situations involving Certificates of Insurance that are required by this Risk Management policy are as follows:

1)  LEASE OF PARISH BUILDINGS   

The tenant must provide a Certificate of Insurance verifying that they have Comprehensive General Liability insurance coverage, with minimum limits of $1,000,000.  The Certificate must name the Parish/Location and the Diocese of Belleville as Additional Insureds.

2)  RENTAL/USE OF PARISH FACILITIES

Outside groups or organizations that rent or use parish facilities (halls, gyms, athletic fields, etc.) must provide a Certificate of Insurance verifying that they have Comprehensive General Liability insurance coverage, with minimum limitsof $1,000,000.  The Certificate must name the Parish/Location and the Diocese of Belleville as Additional Insureds.  Copies of this Certificate are to be sent to the Chancery and the Risk Management Office.

For use of halls for weddings, showers, private parties, and other non-parish social events, the responsible individual must provide proof of liability insurance.  A copy of the user's Homeowners Insurance Policy provided to the parish will usually satisfy this requirement.

If the renter (group or individual) does NOT have liability insurance, they should be required to purchase Special Events Liability Coverage.

3)  OUTSIDE CONTRACTORS & SERVICES

Commercial enterprises operating on parish/Diocesan property, such as amusement ride operators, food service companies, building cleaning services, etc., must provide a Certificate of Insurance. Contractors should have a minimum of $1,000,000.00 general liability coverage, and State-required Workers Compensation Insurance.  Both the Parish/location and the Diocese should be named as additional insureds.  Copies of Certificates are to be sent to the Chancery and the Risk Management Office.

4)  BUILDING CONSTRUCTION AND REPAIRS

Contractors working on a location property must furnish a Certificate of Insurance, verifying that they are insured for both General Liability and Worker's Compensation.  In addition, the Diocese and parish must be named as Additional Insureds.  Certificates are to be sent to the Chancery and Risk Management offices before the planned work begins.

Specific Insurance Requirements for contractors' insurance and bonding are contained in Section III.  Please refer to these requirements before beginning a construction project.

5)USE OF NON-OWNED PREMISES BY A PARISH/LOCATION

Sponsored activities often take place at locations owned by a third party.  Examples of such activities include parish-sponsored food booths at community festivals; school or youth groups participating in events at other facilities.  Occasionally, a written agreement or contract is involved, and the third party requires that they be insured by the parish/location liability coverage.

The Risk Management office may issue Certificates of Coverage from Catholic Mutual for off-premises activities, subject to the following requirements:

A)a minimum of two weeks notice must be given;

B)a copy of any written contract or agreement with the third party must be sent to the Risk Management Office for review before the Certificate can be issued

NOTE:It is extremely important that the above procedures be followed.  The purpose of reviewing written contracts and agreements is to prevent inadvertent exposure to liability situations over which the Diocese has no control, and for which there may be no coverage.

Contact


Deacon Bill Johnson, Director of Facilities and Risk Management
Catholic Pastoral Center
2620 Lebanon Avenue, Building 6
Belleville, IL 62221
618-233-1090
Fax: 618-233-1696
Bjohnson@diobelle.org