Contract Creation and Management

In: Business and Management

Submitted By kimmie
Words 1618
Pages 7
Contract Creation and Management
The simulation begins in the middle of a major dispute between a software-developing company, Span Systems, and one of its customers, Citizen-Schwartz AG (C-S), a large German bank. The two companies are in dispute over the quality and timeliness of deliverables. There have been major bugs found by C-S during testing and are worried about Span not fulfilling the one-year contract, which is worth $6 million. Span's main concern is securing a larger contract with e-CRM, which is tangent on the outcome of the current contract. C-S has requested all code and asserted the rescission of the contract.
Future Business Opportunities
Performance of Contract
The contract states, "… neither party may cancel this agreement, in whole or in part, subsequent to more than 50 percent of the consideration having been tendered by the other" (UOP Simulation). Since C-S requested all code, it is in breach of contract because more than 50 percent of the deliverables have been delivered. By looking at the big picture, the e-CRM contract, Span is willing to discuss and give concessions regarding the quality issue.
Internal Escalation Procedure for Disputes
The current contract covers the internal escalation procedure for disputes. The party believing itself aggrieved shall call for progressive management involvement in writing to the other party (UOP Simulation). C-S requesting all finished and unfinished code is a direct violation of the current contract. Span is willing to set this aside if C-S rescinds its request.
Requirement Changes
Change Management. The current contract is written to cover a one-year time frame. C-S' user and system requirements have grown, especially in the software arena. The original contract should have addressed "out of the ordinary" changes, but it didn't. Span's Change Management office is responsible for reviewing,…...

Similar Documents

Contract Creation/Management Assignment

...Contract Creation and Management Assignment (Option 2) David Williams LAW/531 September 24, 2012 Michael Kelley Contract Creation and Management Assignment (Option 2) Recently I reviewed a video about a Software company suing another Video company because they did not pay the amount owed for leasing editing equipment. According to personnel at the Video Company, the equipment did not work properly and they didn’t know the company signed a lease. They thought the equipment was provided for free on a 30-day trial basis. However, an employee of the company signed documents to receive the equipment and found out later that she actually signed the lease for the equipment. The Software Company assumed that the employee had the authority to act on behalf of the Video Company. However, she didn’t have the authority to sign the lease. The Video Company contacted their attorneys to review the case. The attorneys are trying to get the case reviewed through arbitration. One employee admitted that he told the salesperson “you can make the arrangements with her”. The attorneys stated that the acknowledgement gives the impression that the employee was allowed to act as an agent on behalf of the company. The following discussions in this paper will focus on contract formation, administration, and legal remedies. Contract Formation Based on my review of the video, the employee (Janet) did act as an agent for the company. She’s also ordered and received supplies and other...

Words: 1016 - Pages: 5

Contract Creation

...Contract Creation and Management Cheeseman (2010) stated, “Express agency is the most common form of agency. In an express agency, the agent has the authority to contract or otherwise act on the principal’s behalf, as expressly stated in the agency agreement. In addition, the agent may also possess certain implied or apparent authority to act on the principal’s behalf”(p.461). A business owner needs to clearly define the responsibilities and authority that each employee holds. The business owner also needs to clearly state which individuals within the organization have the authority to enter into a contract on the organizations behalf. The author will discuss “The Nature of Agency video” and issues regarding express agency. The Nature of Agency video In the scenario described in “The Nature of Agency video” Non-Linear Pro sued Quick Takes Video for breach of contract on a three month lease agreement. Quick Takes Video leased some video editing equipment from Non-Linear Pro that didn’t operate according to Quick Takes Video expectations. Apparently when the equipment was delivered Janet an employee of Quick Takes Video mistakenly signed a three month lease agreement thinking it was a shipping confirmation request. The management of Quick Takes Video called their legal representative and discovered that it may be reasonable to assume by a third party that Janet had the authority to enter into a contract on behalf of the organization. Authority Within an organization......

Words: 1128 - Pages: 5

Contract Creation and Management Simulation

...Contract Creation and Management Simulation In completing the Contract Creation and Management Solution it was found that it is extremely important parties involved in a contract to understand all of the elements that fall within the contract. It was noted that Span Systems and Citizen-Schwartz were not on the same page in regard to the software contract that was set forth. Each company risks the cost of litigation because of alleged breaches of contract. In an effort to remedy the situation, Span Systems amended the contracts to work for both company’s and to ensure that no litigation proceedings would have to take place. Span Systems and its customer Citizen-Schwartz AG (C-S), a large German bank, are in a major confrontation about legal issues that result from a breach of contract. The company’s are in difference of opinion over the quality and timeliness of deliverables of the company’s software. The software that Span Systems has delivered to C-S was questionable in the regard that the software had major bugs that were discovered during the testing process of C-S. C-S is concerned about the contract between them and Span Systems, because it is worth $6 million. C-S has requested that all codes and asserted the rescission of the contract. This is concerning to Span Systems because the purpose of this contract is to advance to a larger contract with e-CRM which is based on the success of the C-S contract. The contract between both companies states “that neither party......

Words: 1062 - Pages: 5

Contract Creation and Management Assignment

...Contract Creation and Management Assignment In this paper I will give my analysis of the issues presented in the Contract Creation and Management simulation. Within the paper I will provide contractual resolutions that will offer the development of a plan that will defuse possible contractual disputes. Citizen Schwartz will be given rapid and economical dispute resolution options, while Span Systems will be given the resources to recoup a significant business relationship following a contractual dispute. In the simulation Span Systems, a small software company has been hired by a large well-known German bank, Citizen Schwarz AG. Citizen Schwarz has always been amongst the leaders in their industry and to stay atop of the industry, the company has hired Span Systems to develop custom software for the bank. The development of this new software will be the largest, most important project that the small software company has acquired in its existence. The two companies have reached a contractual agreement that is legally valid and contains all of the elements critical for making the contract binding and enforceable. A written agreement containing specific details of the promises made by Span Systems for providing the software package and outlining the demands of Citizen Schwarz for the components of the software, expectations of delivery and price for the sum $6 million has been accepted by both parties. Eight months into the project, there were several......

Words: 1059 - Pages: 5

Contract Creation and Management

...Contract Creation and Management Classic Payroll LAW 531 December 14, 2012 Contract Creation and Management Creating a contract to perform services between two businesses requires both parties to consider stipulations presented to protect the respective companies. An offer is provided for the purchaser to accept and specifications on the price and timeline of the deliverables are confirmed. In the simulation regarding Span Systems and Citizen-Schwarz AG (C-S), a one-year contract worth $6 million dollars for the development of a software package was presented to negotiate through issues and amend the contract. Contract Formation The wording used to create a contract should carefully be considered to ensure one can legally void the contract because of a breach in terms. The contract created between the two companies had open terms in several areas because changes to requirements were anticipated on a project of this magnitude. The contract allowed changes in cost, timeliness, and deliverables on both sides. The contract included clauses that did not allow either party to rescind the contract for performance once 50% of the consideration had been tendered, internal escalation procedures to be followed in case of a dispute progressing through different levels of management, timelines for requirement changes to be supplied for adjustments, specifics on how monitoring would be reviewed from...

Words: 1013 - Pages: 5

Contract Creation & Management

...Contract Creation and Management Simulation LAW/531 January 4, 2012 Contract Creation and Management Simulation Eight months into a 1-year contract between Span Systems, a California e-banking software developer, and Citizen-Schwarz AG (C-S), a large German bank looking to break into the retail financial services market in America (University of Phoenix, 2009), C-S suddenly sent a letter to Span stating that deliverables were behind schedule and unacceptable. They wanted to rescind the contract and have all unfinished code transferred to them (University of Phoenix, 2009). The letter did not mention any of the problems that C-S was experiencing even though Span claims they have contributed significantly to the delays and quality issues. Span does not want to lose this contract because there is a bigger C-S contract in the works that Span would like to receive. They need to do some negotiating to be able to complete the current contract to C-S’s satisfaction and compete for the future contract. Breach of Contract Internal Escalation Procedure for Disputes According to the current contract, should any party believe itself aggrieved, that party shall file, in writing to the other party, for progressive management involvement. Depending on what level of management was requested to review the dispute, there was an associated allotted time period that needed to be observed. This was obviously violated when C-S demanded any unfinished code and threatened to rescind......

Words: 1124 - Pages: 5

Contract Creation and Management Simulation

...Contract Creation and Management Simulation The simulation begins in the middle of a major dispute between a software-developing company, Span Systems, and one of its customers, Citizen-Schwartz AG (C-S), a large German bank. The two companies are in dispute over the quality and timeliness of deliverables. There have been major bugs found by C-S during testing and are worried about Span not fulfilling the one-year contract, which is worth $6 million. Span's main concern is securing a larger contract with e-CRM, which is tangent on the outcome of the current contract. C-S has requested all code and asserted the rescission of the contract. Future Business Opportunities Performance of Contract The contract states, " neither party may cancel this agreement, in whole or in part, subsequent to more than 50 percent of the consideration having been tendered by the other" (UoP Simulation). Since C-S requested all code, it is in breach of contract because more than 50 percent of the deliverables have been delivered. By looking at the big picture, the e-CRM contract, Span is willing to discuss and give concessions regarding the quality issue. Internal Escalation Procedure for Disputes The current contract covers the internal escalation procedure for disputes. The party believing itself aggrieved shall call for progressive management involvement in writing to the other party (UoP Simulation). C-S requesting all finished and unfinished code is a direct violation......

Words: 1233 - Pages: 5

Memorandum: Contract Creation and Management

...MEMORANDUM: CONTRACT CREATION AND MANAGEMENT TO: John Sullivan FROM: Jon Sorrell DATE: October 27, 2006 SUBJECT: Legal Environment of Business: Contract Creation and Management The Issues In the case of Span Systems of California and Citizen-Schwarz AG of Germany, management is essential in forging the proper attitudes and remedies necessary to maintain the current contract. The facts of the case is that Span Systems are under a one-year contract worth $6 million to produce a Java-based transaction processing software for Citizen-Schwartz's $20 billion banking interests. Eight months into the contract, Span is currently running behind production schedule due to the many changes in C-S’s product demands and various “bugs” found in the software. C-S is asking for a rescission of the contract based on performance and has asked Span to transfer the remaining code so that they may proceed with another company. Damages could be substantial to C-S if the contract is not fulfilled within the given time frame. Assuming that C-S is guaranteed the contract with customer e-CRM, any product delay could spell possible consequential damages e-CRM could be due. “Consequential damages are damages that result because of the breach and generally involve such damages as lost business, lost profit, or late penalties” (Business, 568). C-S could seek compensatory damages from Span to cover their loss if affected by this delay. Remedies Contract ambiguity has left Span and...

Words: 928 - Pages: 4

Contract Creation and Management

...Contract Creation and Management Jim Long University of Phoenix LAW 531 Elizabeth McVicker July 06, 2011 Contract Creation and Management Contracts are signed every day. There are contracts between two companies looking to achieve a mutually beneficial business goal. There are contracts signed between a client and an entity that will perform a service for that client. We sign contracts when we buy cars, lease equipment and get a new cell phone. So what happens when one of the entities in the agreement does not feel like the other side is holding up their end of the bargain? In this paper, a situation will be discussed where that exact scenario takes place. First, the situation which started the contract issues will be looked at. Then the negotiation process will be analyzed from initial talks through to agreement. Finally, the paper will look at any amendments that will be added to the new contract. Span Systems and Citizen-Schwarz AG Span Systems has entered into a one year, six million dollar contract to supply software solutions to Citizen-Schwarz AG (C-S), a large German bank. This is an important contract on its own but there is also a larger e-CRM contract down the line which hinges on Span’s performance during this contract. Eight months into the contract, there are issues on both sides. C-S had been receiving product with major bugs in it and the product has been delivered behind schedule. Spar maintains that the requirements have changed......

Words: 1471 - Pages: 6

Contract Creation and Management

...Contract Creation and Management Contracts are made, negotiated, and broken every day in business situations. They are the backbone of many businesses proposals and they set the standards for which they get the process started. There are many issues that have to be negotiated and discussed for a contract to work for both parties. Both parties must have the ability to communicate and have the patience to work through many of the complications that may occur during the process. This paper will discuss the analysis of the contract problems between Span systems and Citizen – Schwarz AG. After reviewing the simulation we have to come to the following response and conclusion to the issues at hand. Being the project manager in this simulation it would show that I would be trying to keep this contract with C-S so that we will be in the running for the other contract that may be in play. The problem that has occurred is the fact the process has not being completed at a quick enough pace for C-S and they want to get out of the contract and look into changing to another company located in India. This process is not a good move for C-S due to the fact that they have made changes and Span has compiled with every move that have made. The only problem is that Span has also had some internal programming issues that will have to be handled so that C-S can see that we are moving forward with the process. “Good negotiators do their homework. Here are some tips for making your next......

Words: 668 - Pages: 3

Creation and Contract Management

...Contract Creation and Management In the University of Phoenix simulation (2011), Contract Creation and Management the author of this paper has become the project manager at Span Systems, leading its biggest and most prestigious banking software project with Citizen-Schwarz a large German bank. Span and C-S has agreed to a one-year contract that is worth $6 million dollars. In the past months Span and C-C’s has had conflict over the differences on the quality and dates received of deliverables. In the past months C-S’s deliveries have been late and the qualities are inadequate with substantial errors. With all of the delays and concerns; C-S is demanding for unfinished code and rescinding of the contract. The CEO at Span has advised that they would like to settle this dispute with C-S amicably. Span does not want to lose the contract; they want to negotiate new terms for the existing contract to resolve the quality and deadline issues. According to the University of Phoenix simulation (2011), Contract Creation and Management the contract states, “neither party may cancel this agreement, in whole or in part, Subsequent to more than 50 percent of the consideration having been tendered by the other.” More than 50% of the deliverables were delivered; C-S violates the contract by asking for the unfinished code and rescinding of the contract. In the month of December Span evaluate and select negotiation points from the contract clauses that pointed out Breach of Contract under......

Words: 1195 - Pages: 5

Contract Creation and Management

...The simulation “Contract Creation and Management” describes the issues and challenges in creating and maintaining the contract between Span Systems and its customer, Citizen-Schwarz AG (C-S), a German Bank. C-S hired Span Systems to create a transaction software package for use in banking transactions and signed a one-year, $6 million contract. During the course of this simulation, several issues regarding contract management arise. These issues include the quality of the product as well as the timeliness of its delivery. Ambiguity in requirements is a key contributing factor in delivery delays and negotiations are arduous. Span Systems is aware of these issues and needs to identify approaches to correct these problems to the satisfaction of C-S. The original contract lacks in specifics regarding many of the obstacles that Span Systems and C-S experience, such as performance, change control, communications and reporting, as well as product structure. The student who is working within this simulation has to decide between several approaches to resolve the situation in the best interest of Span Systems. The timeliness of Span System’s is largely due to the changes in user and system requirements that were underestimated during the contract creation stage. The growth of requirement was unanticipated and Span Systems staff now finds itself overwhelmed to some extend while trying to keep up with the changes and delivering the results on time. Because Span Systems staff is......

Words: 995 - Pages: 4

Contract Creation and Management

...Contract Creation and Management Assignment Paper George Van Hoosier LAW 531 June 26, 2012 Dr. Beverly Spencer Contract Creation and Management The scenario presented is on contractual conflicts. In summary, a software development company and a hotel company entered into a business partnership to develop an electronic reservation system for the hotel company. The groundwork of the plan changed and obfuscated what was expected by both parties. These changes were not communicated well enough, both internally and externally, to accommodate these changes (University of Phoenix, 2002). This case presented how a contract between parties was prepared, but what was required was not clear to either party. To further complicate matters, as the project requirements became clearer, no contract revision occurred to discuss how the expanding requirements could be negotiated. The increasing requirements and scope of work meant the original resources assigned to the project were rapidly becoming insufficient. Project delays and poor quality products were the result. Instead of addressing the changes and the need to revisit and negotiate the changing requirements, and additional compensation, the two parties filed suits and counter suits against each other (Cheeseman, chapter 16, 2010). The scenario points out how devastating the resultant legal costs were to both parties, and how the end result was a failed project that could have been resolved with less contract......

Words: 963 - Pages: 4

Contract Creation and Management

...Contract Creation and Management Brian J Louf LAW/531 July 31, 2012 William C Johnson J.D. Contract Creation and Management The Nature of Agency video continues the story of a business relationship between Quick Takes Video and Non-Linear Pro. Quick Takes, dissatisfied with the current video editing software owned initiates contact with a salesperson from Non-Linear Pro to discuss a software product that Quick Takes believes may be a solution for updating their present equipment. The first meeting between the two companies becomes the basis of a subsequent law suit by which both parties dispute the terms of agreement in the use of the software product. The issue is one that involves determining if a contract is formed. Additionally the definition of agencies within a small business must be examined to determine if the actions of a Quick Takes employee may in fact validated the terms of a contract. Elements of a Contract In determining if a contract has been formed between two parties, the elements of a contract are examined to determine its enforceability. For a contract to be enforceable, the following four basic requirements must be met: agreement, consideration, conceptual capacity, and lawful object (Cheeseman, 2010, p. 154). During the initial meeting Non-Linear Pro (offeror) made an offer to an owner of Quick Takes (offeree) the use of an editing software on a one-month trial basis. Quick Takes accepted the offer with the understanding that the trial would...

Words: 1532 - Pages: 7

Contract Creation Management

...The Contract Creation and Management simulation presented two different business creation contract situation that displayed issues within business contracts (University of Phoenix, 2002). One contract creation presented was difficult to work around the legality because the contract was unclear and decision made seemed hard to reach. Another contract creation example displayed similar core components of issues within the contract and its management but solution were able to be rectify this contract disputes between parties. Contract creation and management of those contracts need to be properly formulated and reviewed before agreeing and signing any contract. To begin the first simulation analyzed was a contract creation and management dispute between InfoBuild and Majestic hotels. Some if the issues presented could have been avoided if a firm review processes would have been performed when creating the contract between the two parties. As the contact between InfoBuild and Majestic was being created, agreements were difficult to reach making for a rough contract of negations. As the creation of the contract was signed and established in the line of business between the two parties, breaches within the contract began to be seen. The issues presented in this simulations breach of contract was the “quality of deliverables, delivery of schedule slips, and ever-growing end-user requirements” (University of Phoenix, 2002). InfoBuild was contracted to set up the......

Words: 916 - Pages: 4

George C. Scott | Sequestered | King of Food