Contract Creation and Management

Contract Creation and Management

Melody Nelson

LAW 531

December 13, 2010

Rob Reimer

MEMORANDUM

It has become apparent that Span Systems (Span) has not been living up to the terms of the contract. Over the past several months, deliverables have been behind schedule and the quality has been subpar with numerous major bugs.

There is a valid bilateral contract between Citizen-Schwarz AG (C-S) and Span as there has been a written agreement between the parties, there is legal sufficient consideration for the performance by Span, both parties have contractual capacity, and it creates a lawful object (nothing illegal in the contract) (Cheeseman, 2010). It is obvious that the problems lie at both ends and therefore it is essential to look at the legal risks involved and remedies available under the contract in order to enforce performance.

C-S Contributing Factors

Scope. The scope covered by the original contract has grown due to changes in the user and system requirements which are a contributing factor to the timing of the presentation of the deliverables for testing. Although the contract did address ordinary requirement changes, the change requests have been well beyond the original scope determined in the system study stage.

C-S Timing. C-S has undergone a change in the structure of its project management team which has affected the timing for approval and review of the changes and deliverables.

Release of Software. C-S is facing a deadline for release of the software in the market. Consideration is being given to asking for immediate transfer of all code, both complete and in process as well as asserting rescission of the contract.

Span and Contributing Factors

Timing. Even with the changes to the original scope, Span has exerted extra effort in order to meet deadlines.

Quality. Span is concerned about meeting the deadlines as they are in line to receive an even bigger contract that is currently in the pipeline. This sense of...