Contracts concluded by the state/state organs

Abstract

Abstract provided by author

Administrative law as a subject prescribes the rules and principles that regulates the exercise of public authority or power and thus falls under the public law domain. On the other hand,contracts are based on consensus ad idem between the parties to it and is part of private law. Administrative agreements are contracts that are concluded by the state and or its functionaries, to which the principles of the law of contract apply. Having said that the question for determination is: are administrative principles also applicable, i.e. can an individual so aggrieved under a contract concluded by it with the state or state organ, also have recourse in administrative law or is it purely only remedies under the private law of contract?

Contracts concluded by the state and or its organs are said to be subject to the principles and rules of administrative law by operations of the law and that the exercise of contractual obligations of public bodies are still subject to the administrative law requirements of lawfulness, reasonableness and fairness

This is because, unlike cases involving private contracts, where individuals enjoy equal bargaining powers, which may be used to advance their private interests, public powers may not be used or abused at the personal whim of the official or body upon whom they have been conferred: they must be used to advance the public and private interests for which they have been conferred in the contract so concluded by the state. This means that contractual parties under an administrative agreement can never be on equal standing as in purely private contracts because of the existence of an unequal relationship.