We aren't in the wild west. I've been doing these engagements for more than 20 years. There are well worn guidelines for how to structure the contracts and other rules of engagement to prevent or mitigate this sort of overreaction.

I suspect (with zero evidence) that an over-eager sales rep or sales management booked a deal without contract due-diligence and a pen-test team trusted that the due-diligence had been done.