Recognizing Contract Risk and Opportunities
As part of a the Business Law class 531 we were requested to perform a simulation of “Contract Creation and Management” found in the course materials on the main page of the classroom. This simulation required that we analyzed a business situation between two parties. One was software developing company named Span Systems, for which I was the project manager. The other was a Bank, named Citizen-Shwartz AG (C-S).
The company Span Systems was hired to develop transaction software for C-S. They had a contract which specified the timeframe of the deliverable and quality goods to C-S. At the eight month mark the C-S’s complained about the product and the fact the Span is not delivering the product on time. The recession orders have a time when eight months gave already elapsed. There has also been a breakdown of internal escalation of processess at C-S’s end. The internal escalation clause should force the C-S is to reconsider its stand. There was a change in the project management at C-S that has affected schedules.
We encountered a few claims from C-S’s. The most important are reflected in the table below:
Claim from C-S Response by Span Legal principles involved Possible solution
Span has only completed 40% of the software when they should have completed 60% The change in the project management on C-S’s behalf have affected the delivered product Breach of contract under “Communication and reporting” We have communicated that we will scale up a team of programmers to deliver the project within a reasonable timeframe.
C-S’s wants to finish all relations with Span and take all the right of the software with them. We have informed them that this is not possible until the complete payment of the contract. Brach of contract under substantial performance of contract The Uniform Computer Information Transactions Act protects their right to not deliver the rights of the software until complete payment.(Jennings, p....