Administrative Contracts and Other Forms of Contracts: General Overview

Because of the need to carry out its functions, government, via its branches, will embark upon different activities which inevitably will invite the interplay of its branches and the private sector. These branches other wise known as administrative agencies assist government to properly take its tasks of service provision among other things. It is therefore while these agencies carry out their functions that they use the law of administrative contracts to their ends. The ends are public services, the means administrative contracts.

If this is so, administrative contracts are contracts under the strict sense of the law but only an” administrative” one (see for example Art. 1676(2) cum Art.1675 of Ethiopian civil code with Art.3131 of the same).

But this nature of the contract i.e. being an administrative contract makes the same different from the beginning to the end from other types of contracts that we know.

Our inquiry therefore will be what is there in administrative contracts? What grain of difference does the qualification administrative add over non-qualified contracts?

One basic addition by the qualification is associated with prerogative matters. Because administrative agencies favorably enjoy the presumption of acting on behalf of the public and because public interest is overriding enough to put aside even basic principles of the law the agencies will enter into an arrangement where the platform is squarely fitted to their play than to the other contracting party.

When talking about administrative contracts, hence, one is talking about a contract where the two parties are unequal. Being a contract between unequal parties from the onset, at the end of the day, it will end up entitling parties in unequal manner.

If this is so, how should we define administrative contracts? Well as noted earlier the general contract title of the civil code is applicable to this case because of Articles 1676, 3131 and Art. 1675.

Definition

Art.1675

“A contract is an agreement whereby two or more persons as between themselves create, vary or extinguish obligations of a proprietary nature”.

Administrative contracts do share all of the above elements. The differences, however, extend beyond the requirements of Art. 1675 far in to the requirements of Art.3132 which  partly reads as: “A contract shall be deemed to be an administrative contract where”

a)    It is expressly qualified as such by the law or by the parties; or

b)   It is connected with an activity of the public service and implies a permanent participation of the party contracting with the administrative authorities in the execution of such service.

Let us examine the elements of Art.3132: “Expressly qualified as such by the law or the parties”

According to this expression, a contract (remember Art.1675) will be an administrative contract if the law expressly qualifies it as an administrative contract. To this end, the law clearly enumerates what can be considered as administrative contract. But what if the law expressly disqualifies a contract to be an administrative contract? Both instances are the experiences of Ethiopia. Let us begin with the first. In the civil code we have such articles as Article 3207 and 3244 which expressly qualify contracts as administrative contracts. As to the second instance, we have the Mining Proclamation No.52/1993 which disqualifies contracts concluded by the administrative authorities with other parties under Art. 55(2).

The second implication of Art.3132 (1) is that parties may qualify expressly a contract as an administrative contract. An issue worth raising at this juncture will be ‘are all contracts administrative contracts merely because they are qualified as such by the parties? ’

Among other things, a contract qualified as such by the parties on face value cannot be considered as an administrative contract unless one of the parties is an administrative authority.

For one other reason to be consequently discussed i.e. for content consideration a contract merely qualified as an administrative contract by the parties will not also be an administrative contract. What about a contract that involves an administrative authority but not qualified as such by the parties?  Stated otherwise are all contracts that make one of the parties an administrative authority administrative contracts? René David says

As a French legal scholar and as I think it fit, in our classification of law, public law should be distinguished from private law. Especially it is important to separate civil law from administrative law…contracts made by public officials have this [special trait] which enable us call them administrative contracts and treat them separately from civil law.[emphasis]

This, as it may, the civil code proceeds to say-“ … Connected with an activity of the public service and implies a permanent participation of the party contracting with the administrative authorities in the execution of such service”

The previous element is more or less concerned with the form of the contract, meaning the name the parties give to their contract when they first form it. The form it takes confers the contract a special nature.

Here we are concerned with the content of the contract, that is its object which determines the nature of the contract. Based on the object and the manner of meeting their object together with the type of the parties and their manner of participation in executing the object of the contract, we have another mechanism of distinguishing administrative contracts from ordinary contracts.

The object: this is one of the ways which is helpful to distinguish administrative contracts from the rest of the contracts. Art.3207 (1) identifies one of the objects as an activity of a public service”. In turn we have to consider what a public service is in our law.