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Recognizing Contract Risk and Opportunities Memo
Jelena Knowles
University of Phoenix
Business Law
BUS/531
Professor Jason Johannes
August 09, 2010
MEMO
To: Span System Managers
From: Jelena Knowles
Date: August 09, 2010
Re: Citizen-Schwarz AG (C-S) Project/Contract Creation
Hello All,
I am sending this memo to help guide you in avoiding unnecessary risks, minimizing liability, and realizing legal opportunity by describing a recent project related issue with our biggest client Citizen –Schwarz AG (C-S). I hope that you will find benefit in the below scenario.
Situational Analysis
Span Systems was facing a major issue regarding a possible cancellation of contract from C-S. The contract was worth six million dollars and was to be completed within a 12-month period. During the point of conflict, Span Systems was eight months into the project but they were faced with un-anticipated challenges due to an ambiguously worded contract between the two organizations. Fortunately, I was able to mitigate the legal issues and save the business relationship by addressing the issues and identifying legal opportunities as they arose.
C-S Issues vs. Span Issues
The first legal threat came in form of a letter from C-S’ negotiator Mr. Ther, asking for o immediate transfer of all unfinished code. Mr. Ther also stated that he was asserting the rescission of contract by C-S. The grievances listed by Mr. Ther included:
• Span’s deliverables in last two months have been behind schedule
• C-S can't afford schedule slips due to deadline of release of transaction software
• Quality has been unacceptable: major bugs detected during testing stage
Based on Mr. Ther’s letter, we knew that there were serious issues. Before considering our legal options and responses to Mr. Ther’s letter, I reviewed the metrics below:
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After reviewing the metrics, I also considered the issues that Span Systems was having with the C-S Project. The issues I...