Understanding Minor Contracts and Administrative Liability in Spain

Posted on Dec 18, 2024 in Law & Jurisprudence

Minor Contracts in Public Administration

Minor contracts are those for which there is, in principle, no formal procedure. Agility is prioritized in achieving government aims, granting a margin of confidence. Minor contracts may be applied to typical or nominee contracts, special contracts, mixed contracts, and private contracts.

Minor contracts are defined by their size, specifically an amount less than €50,000 for works contracts, or €18,000 for other contracts. While each contract will have a dossier, there will be a lack of formal tender and award procedures. The recruitment file will contain limited and basic information, as follows:

  • Definition of the contract’s object, which must not be divisible.
  • Quantification of the contract’s subject to ensure it does not exceed the limits set by law.
  • Approval of expenditure, subject to accreditation, and confirmation of sufficient available credit (in accordance with the second additional provision, in municipalities with less than 5,000 inhabitants, this approval is not explicit).
  • Direct award of the contract, after verification of the contractor’s capacity and empowerment.
  • Incorporation of the invoice to facilitate payment.

Key features of minor contracts include:

  • Their term shall not exceed one year, and extensions are not permitted.
  • Price revision cannot be established.
  • There is no formalization of the contract.
  • No report from the secretary is required in the absence of contract documents.
  • No security deposit is required.
  • The award agreement will not be published in any official record.

Administrative Procedure Concerning Liability

The general procedure has several stages:

  1. Initiation of proceedings, either automatically by the administration or by a claim from stakeholders.
  2. Examination of the applications (according to tests, reports, and hearings).
  3. Completion of the procedure.

The deadline to perform these actions is one year from the date of the incident. In cases of physical or mental damage, the period starts from the healing of injuries. The administration must resolve the proceedings within six months. Against this decision, there is no appeal, and one may proceed to contentious-administrative proceedings.

Besides the general procedure, there is a summary procedure for cases with a clear causal link between the injury, the operation of public service, the assessment of damage, and the amount of compensation.

Liability of Assets and Personnel Authorities

The responsibility of management is direct and objective. Indemnification will always be required, regardless of whether the authority, official, or service is identified, or if there is fraud or negligence causing damage by the officer or authority, whatever its degree.

Concurrent Responsibility of Several Public Administrations

In this case, the concurrent administrations will respond jointly and severally if the responsibility cannot be determined according to criteria of competence, public interest protected, and intensity of intervention.

The Negotiated Procedure

The negotiated procedure may only be used in two sets of circumstances:

  • General circumstances: If a previous open or restricted tendering procedure was unsuccessful because no acceptable offers were submitted, or for other reasons such as unknown price, protection of intellectual property rights, emergencies, or national security.
  • Based on the amount: This procedure can be used when the contract value is below a certain threshold, as follows:
    • Works contracts: estimated value of less than €1 million.
    • Public service management contracts: less than €500,000 with a term of less than 5 years.
    • Other contracts: less than €100,000.

Patrimonial Responsibility

The characteristics of the administration’s liability are:

  • The responsibility is direct and not subsidiary for damage caused by the activities of its authorities and officials.
  • The liability is strict and not based on the fault of the officer or authority responsible for the damage.
  • Liability exists if the damage is caused by the normal or abnormal functioning of public services.
  • Liability is excluded in cases of force majeure.
  • The responsibility of government action does not preclude the administration from seeking reimbursement from the responsible officer or authority.

Requirements for Management’s Responsibility

The overall and direct responsibility of the government can only be claimed when the damaging act or omission occurs, and the injured party is not obligated to endure it. If the injury is compensable, the following conditions must be met:

  • The injury or harm must result from the normal or abnormal functioning of public services. Article 139.1 of the LRJAP-PAC (Law on the Legal Regime of Public Administrations and the Common Administrative Procedure) provides force majeure as a cause that exonerates the administration from financial liability. The Supreme Court defines force majeure as an inevitable, unbeatable, and irresistible situation, even if it may be predictable.
  • There must be a causal link between the operation or inactivity of public services (whether by act or omission) and the lesion produced. The relationship must be direct, excluding damage caused by the actions of agents in their private lives.
  • The damage must be effective, economically assessable, and individualized.
  • The injury must be unlawful, i.e., it must derive from an action that the individual has no obligation to bear under the law, as required by Article 141.1 of the LRJAP-PAC. Therefore, only injuries from damage not considered supportable under the law are compensable. Reform 4/1999 introduces a final clause to this provision, stating that no damage will be indemnified if it arises from facts or circumstances that could have been foreseen or avoided based on the state of scientific or technical knowledge at the time of the events.