Arkansas Administrative Code
Agency 216 - Arkansas Lottery Commission
Rule 216.00.09-004 - Rules for Claims in Contract and in Tort
Universal Citation: AR Admin Rules 216.00.09-004
Current through Register Vol. 49, No. 9, September, 2024
Arkansas Lottery Commission Rules for Claims in Contract or Tort
Preface: The purpose of these rules is to proscribe the process concerning the consideration of claims in contract or in tort against the Arkansas Lottery Commission (ALC). These rules apply to all contracts entered into with the ALC and are issued pursuant to the authority vested in the ALC under Ark. Code Ann. §§ 23-115-207 and 23-115-208.
Section 1. Definitions.
1.1 "Act" means the Arkansas Scholarship
Lottery Act.
1.2 "Contract" means
all types of state agreements, regardless of what they may be called, for the
purchase of commodities and services and for the disposal of surplus
commodities and services not otherwise exempt.
(a) "Contract" includes awards and notices of
award, contracts of a fixed-price, cost, cost-plus-a-fixed-fee, or incentive
type, contracts providing for the issuance of job or task orders, leases,
letter contracts, and purchase orders.
(b) "Contract" also includes supplemental
agreements with respect to any of these items.
1.3 "Contractor" means any person having a
contract with the ALC.
1.4
"Commissioners" means the members appointed to the Arkansas Lottery Commission
by virtue of Arkansas Code Ann. §
23-115-202.
1.5 "Director" means the Director of the
Arkansas Lottery Commission.
1.6
"Person" means any individual, corporation, partnership, unincorporated
association, or other legal entity.
1.7 "Negotiation" means a consensual
bargaining process in which the parties attempt to resolve a claim.
1.8 "Tort" means a claim arising in tort with
respect to which:
(a) The claimant is an
organization; or
(b) The claimant
is an individual and the claim:
(1) Arose in
the course of the claimant's business or profession; and
(2) Does not include damages arising out of
personal injury to or the death of an individual.
Section 2. Policies.
A. These rules do not waive
the ALC's sovereign immunity to suit or liability.
B. These rules apply to controversies between
the ALC and a contractor which arise under or by virtue of a contract between
them. This includes, without limitation, controversies based upon breach of
contract, mistake, misrepresentation, or other cause for contract modifications
or rescission.
Section 3. Pre-Hearing Negotiations.
3.1
Procedure.
A. A contractor (hereinafter "claimant")
asserting a claim of breach of contract or an action in tort against the ALC
must file notice of the claim as provided by this section.
B. The notice of claim shall;
1 Be in writing and signed by the aggrieved
party or the aggrieved party's authorized representative;
2. Be delivered by hand, certified mail
return receipt requested, or other verifiable delivery service, to the Director
of the ALC, and
3. State in detail:
a. The nature of the alleged breach of
contract or tortuous conduct, including the date of the event that the
aggrieved party asserts as the basis of the claim and if applicable, each
contractual provision allegedly breached;
b. A description of damages that resulted
from the breach or conduct, including the amount and method used to calculate
those damages;
c. the legal theory
of recovery, i.e., breach of contract, including the causal relationship
between the alleged breach and the damages claimed.
d. If the claimant is represented by an
attorney, each notice of claim, pleading or paper of such claimant shall be
singed by such attorney whose address and phone number shall be stated. The
signature of an attorney constitutes a certificate by the attorney that he or
she has read the pleading, document or paper; that he or she is authorized to
file it; and that to the best of his or her knowledge, information and belief
there is good ground for it; and that, with respect to a notice of claim, he or
she files it with the distinct knowledge and specific consent of the
claimant.
e. A notice of claim,
pleading or paper not signed by an attorney must be signed by the claimant with
the address and phone number stated. Any pleading, notice of claim or claim
filed on behalf of a corporation or other organization must be verified by an
executive officer of such corporation or organization.
f. In any notice of claim when, upon
inspection, the Director is of the opinion that the notice of claim, document
or pleading tendered for filing does not comply with these rules, does not
sufficiently set forth required information or is otherwise insufficient, the
Director may decline to accept the notice of claim, document or paper and may
return it unfiled, or the Director may accept it for filing and advise the
person tendering it of the deficiency and require the deficiency be corrected.
Simple "receipt" in the Commission office in no way implies an attempted claim
has been "filed" with the Commission. The decision to accept or decline for
filing an attempted, but deficient, claim is solely that of the
Director.
C.
In addition to the mandatory contents of the notice of claim as required by
subsection (c) of this section, the aggrieved party may submit supporting
documentation or other tangible evidence to facilitate the ALC's evaluation of
the aggrieved party's claim.
D. If
the claimant is an executor, administrator, guardian, or other representative
acting under judicial appointment, a duly certified copy of the record of
appointment shall be filed with the notice of claim.
E. The notice of claim shall be delivered no
later than one hundred and eighty (180) days after the date of the event that
the aggrieved party asserts as the basis of the claim.
G. Failure to assert a claim in a timely
manner will result in a waiver of those issues.
3.2
Timetable.
A. Following receipt of a notice of claim,
the Director shall review the claim(s) and initiate negotiations with the
claimant to attempt to resolve the claim (s).
B. The parties shall begin negotiations
within a reasonable period of time, not to exceed sixty (60) days following the
later of:
1. The date of termination of the
contract;
2. The completion date,
or substantial completion date in the case of construction projects, in the
original contract; or
3. The date
the ALC receives the claimant's notice of claim.
C. The ALC may delay negotiations until after
the 60th day after the date of the event giving rise to the claim of breach of
contract by:
1. Delivering written notice to
the Claimant that the commencement of negotiations will be delayed;
and
2. Delivering written notice to
the Claimant when the ALC is ready to begin negotiations.
D. The parties may conduct negotiations
according to an agreed schedule as long as they begin negotiations no later
than the deadlines set forth in subsections (B) or (C) of this section,
whichever is applicable.
E. The
parties shall complete the negotiations that are required by this Section as a
prerequisite to a claimant's request for a dispute hearing no later than ninety
(90) days after the ALC receives notice of a claim.
F. The parties may agree in writing to extend
the time for negotiations on or before the 60th day after the ALC receives
notice of the claim. The agreement shall be signed by representatives of the
parties with authority to bind each respective party and shall provide for the
extension of the statutory negotiation period until a date certain. The parties
may enter into a series of written extension agreements that comply with the
requirements of this section.
3.3
Conduct of Negotiation.
A. A negotiation under this Section may be
conducted by any method, technique, or procedure authorized under the contract
or agreed upon by the parties, including, without limitation, negotiation in
person, by telephone, by correspondence, by video conference, or by any other
method that permits the parties to identify their respective positions, discuss
their respective differences, confer with their respective advisers, exchange
offers of settlement, and settle.
B. The parties may, if the ALC agrees,
conduct negotiations with the assistance of one or more neutral third
parties.
C. To facilitate the
meaningful evaluation and negotiation of the claim(s) the parties may exchange
relevant documents that support their respective claims, defenses,
counterclaims or positions.
D.
Unless the parties agree otherwise, each party shall be responsible for its own
costs incurred in connection with a negotiation, including, without limitation,
the costs of attorney's fees, consultant's fees and expert's fees.
3.4
Settlement
Agreement.
A. A settlement agreement
may resolve an entire claim or any designated and severable portion of a
claim.
B. To be enforceable, a
settlement agreement must be in writing and signed by representatives of the
aggrieved party and the ALC who have authority to bind each respective
party.
C. A partial settlement does
not waive a party's rights as to the parts of the claims or counterclaims that
are not resolved.
D. The claimant
and the Director must certify in writing if they do not reach a settlement.
Such a certification will serve as an automatic request to the Director for a
decision on the merits of the Claim.
3.5
Prerequisites to Any Other Remedy.
The procedures contained in Section
3 are exclusive and required
prerequisites any other remedy.
Section 4. Dispute Hearing.
A. If the Director receives an automatic
request for a decision pursuant to Section
3 of these rules, the Director
shall issue a written decision within ten (10) business days.
1. The decision shall state the reasons for
the action taken.
2. A copy of the
decision shall be mailed by overnight mail or otherwise furnished immediately
to the aggrieved party.
B. A Claimant aggrieved by a decision of the
Director may request a hearing before the Commissioners within fifteen (15)
days after the written decision is issued by the Director. The Claimant must be
granted a hearing before the Commissioners or their designee as soon as
practicable but not later than sixty (60) days after the decision of the
Director.
C. The Commissioners,
pursuant to the power granted to them in Arkansas Code Ann. §
23-115-205,
may authorize its Legal Committee to hear and dispose of administrative appeals
from the Director as the Committee deems appropriate, including, but not
limited to, designating one of its members to consider an act on an appeal on
behalf of the Commissioners. Therefore, references herein to "Commissioners"
shall be read to take this delegation of authority into account.
D. All dispute hearings shall be open to the
public and the press.
E. The
hearing need not be conducted or controlled by either the Arkansas Rules of
Evidence or the Arkansas Rules of Civil Procedure. The hearing will be
conducted to the extent and fashion deemed appropriate by the
Commissioners.
F. All hearings will
be recorded by a certified court reporter. If a claimant desires the testimony
be transcribed into a transcript or files an appeal, the claimant shall order
directly from the reporter an original and one copy, both of which are the
financial responsibility of the complainant ordering the transcript. The
original transcript shall be filed by the reporter directly with the
ALC.
G. Based upon the evidence
presented at the dispute hearing, the Commissioners may reverse a decision of
the Director if the appellant proves the decision to be:
1. In violation of Constitutional or
statutory provisions;
2. In excess
of the statutory authority of the Director;
3. In excess of the authority granted to the
Director by the Commissioners;
4.
Made upon unlawful procedure;
5.
Affected by other error of law;
6.
Clearly erroneous in view of the reliable, probative, and substantial evidence
of the whole record; or
7.
Arbitrary or capricious or characterized by abuse of discretion or clearly
unwarranted exercise of discretion.
H. The Commissioners may remand an appeal to
the Director for further consideration or investigation. This decision of the
Director shall be considered final and appealable only to the Arkansas Claims
Commission.
I. The Commissioners'
determination must be in writing and must:
1.
Be sent by United States Postal Service certified mail, a commercial overnight
delivery service or hand delivered to the appellant; and
2. Explain the basis for the Commissioners'
determination.
Section 5. Appeals.
5.1
Generally. A claimant may appeal the decision of the
Commissioners of the ALC to the Arkansas Claims Commission, pursuant to
Arkansas Code. Ann. §§
23-115-208 and
19-10-201.
The claimant may;
(a) Within forty (40) days
after the decision is rendered, file with the Arkansas State Claims Commission
a notice of appeal of the decision of the ALC;
(b) Within forty (40) days after the decision
is rendered, file with the ALC a motion for reconsideration requesting the ALC
to reconsider its decision; and
(c)
Within twenty (20) days after the ALC's reconsideration or denial of the motion
for reconsideration, file with the Arkansas State Claims Commission a notice of
appeal of the decision of the ALC.
5.2
Exclusive Remedy. These
rules provide the exclusive procedure for asserting a claim against the ALC
arising out of or relating to any matter related to contract or torts. Neither
an aggrieved person, nor any other interested party has a right to any remedy
against the ALC with respect to any matter in contract or tort except in
accordance with the procedures set forth in these rules.
Disclaimer: These regulations may not be the most recent version. Arkansas may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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