Law531 Week 3

Establishing contracts between business partners is common practice to provide guidelines and stipulations on how two parties will conduct affairs with each other. In many business partnerships conflicts will arise during the course of a contract and both parties must analyze their positions to ensure contracts are honored and customers are happy. In some cases contracts must be amended or re-written to ensure parties can reasonably adhere to the requirements of the contract. In the contract creation and management business simulation a conflict arises between business partners and many legal principles and concepts are portrayed.

When the customer in the simulation Citizen Schwartz (C-S) claims that Span Systems has not kept up with deadlines and the quality of deliverable work is not satisfactory, the first two legal principles are identified. By claiming low quality of work, C-S is trying to show that Span systems may be in a material breach of contract for inferior performance. If that fact was proven, C-S would be entitled to rescind the contract and would be allowed to seek damages or enforce the contract. This would be a complete failure for Span Systems in the sense that they could be liable for compensation to C-S and lose the bank as a future customer. Steps that can be taken by management to prevent this type of situation are strictly functions of quality control. If previous attempts to perform at a certain level are not met, a manager must take steps to increase product quality by adding more experienced team members or forming a team of quality control monitors. In the business simulation, Span Systems forms a quality control board to monitor deliverable work and ensure quality standards are met. The two parties also agree to amend the contract to include measures where C-S will be given a thirty day testing period after the software in completed to ensure the requirements are met. The new contract also indicates the C-S will closely...