Cengage Advantage Books: Law for Business 19th Edition by John Ashcroft,Katherine Ashcroft,Martha Patterson

Exercise 5

CIBER was competing on a bid to provide software services to the District of Columbia government and retained the services of CapitalKeys to help win the contract. CIBER and CapitalKeys entered an agreement that stipulated, among other things, that in the event CIBER was awarded the contract, CapitalKeys would be paid a 3 percent commission on the value of the contract. CIBER procured the contract worth $17,000,000, and CapitalKeys invoiced CIBER for $323,785 pursuant to their agreement. After CIBER refused to pay, CapitalKeys sued for breach of contract. CIBER responded that because the 3 percent fee was a contingent fee for the purpose of securing a public contract, that the clause was void and in violation of public policy. Were they correct?