Breach of Contract

Week 5 – Breach of Contract Span vs. CS

Tracy Perez

December 3, 2012

University of Phoenix – Online

LAW/531 – Business Law

Bradley Romig

Breach of Contract Span vs. CS

Breach of Contract is “failing to perform any term of a contract, written or oral, without a legitimate legal excuse.” It is one of the most common causes of law suits for damages. In a contract dispute over a breach of contract, Span Systems needs to present and negotiate as many legal defenses as possible. It is not enough to simply deny legal wrongdoing; Span must respond to C-S with every plausible argument that justifies their position. Negotiation is the first round of defense. The relationship with C-S is very important to Span Systems, therefor it is imperative to go above and beyond to resolve the conflicts at hand. The quote “We won the battle but lost the war,” applies in this scenario. Span Systems needs to take a proactive approach to the problems addressed in the contract and present an alternative that will improve the health of the project not further damage it. The proposed resolutions and attitude used in negotiations will dictate the outcome.

Span Systems (Span) has a six million dollar contract agreement to manufacture banking software for Citizen-Schwartz (C-S). Eight months into the contract C-S presented Span with the stance to rescind the contract for software development based on issues related to schedule slips and quality issues. Span Systems countered with negotiations relating to the following:

1. Breach of Contract under “Internal Escalation Procedures for Disputes.”

2. Breach of Contract under “Communications and Reporting.”

3. Breach of Contract under “Requirements Change.”

Breach of Contract under “Internal Escalation Procedures for Disputes”

Internal Escalation Procedures for Disputes is one of the three contract clauses countered...