Minimizing the Risks Impacted by a Contract and by Potential Disputes

Minimizing the Risks Impacted by a Contract and by Potential Disputes

Length: 3153 words (9 double-spaced pages)

Rating: Excellent

Open Document

Essay Preview

More ↓
I. Introduction
Project management is a strategic source of profit for organizations (Mir and Pinnington, 2013). Nevertheless, its success depends of the performance of internal factors such as the employees skills (Legault and Chasserio 2012), as well as, other factors linked to its environment as customer’s expectation (Gil et al., 2011). A project cannot be done without contract.
As a consultant for a public sector of the supply of an IT project, the aim is to make the client aware of the law is abide by (Saxena 2008). In the aim to lead this project in proper contractual decisions, several elements involved in contract will be analyzed that report, therefore, will allow a better understanding of contracts under the common law and its potential risks. As the marketing manager in a diversification strategy aim, before getting implanted in new countries, analyses all the possible opportunities and threats that may be presenting by the potential new market, the consultant does the same on seeking and identifying the law the organization is bound by. The public organization will have to understand each words and principle involved in a contract to not be damaged, impacted negatively financially by that project. In this report several areas will be discussed to minimize the risks impacted by a contract and the ones impacted by potential disputes. It will be seen what’s an offer and acceptance, settlement of contracts, as letter of intent; areas of potential disputes, parties’ liabilities in a contract dispute and finally the risks and safety issues, title to property, tort law and the particularity for a project of supply of hardware and software. In addition, will be seen the good business planning regarding scheduling and project planning. The explanation of these principles will be reinforcing by cases law.
II. Hardware and Software
Hardware is all the physical equipments that are connected to a computer. As a matter of fact, they can be seen and touched, for instance a printer. Software is immaterial, can be defined as a computer language. It exist three types of software, system software, for example widows vista; programming software as java. The last one is application software, as word.
Their costs depend of their performance and their finality.

III. Offer, acceptance and consideration
A contract is defined by (Adams, 2010: 63) as an agreement enforceable in law between several parties; which involves sales of goods, service or land. There are three elements that make a contract justifiable: offer, acceptance and consideration (Keenan and Smith, 2006: 85-110).

How to Cite this Page

MLA Citation:
"Minimizing the Risks Impacted by a Contract and by Potential Disputes." 14 Dec 2019

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

A Business Is Without Signing A Contract Essay

- Running a business nowadays without signing a contract is impossible due to the numerous advantages and implications offered by a contract. Indeed the basic purpose of a contract is to offer a framework within which people, entities, can freely contract. For someone who wants to run a business or who is in charge of projects in a company, having an understanding of the common law of contracts and the potential risks associated with it can be the key to avoid many troubles. For example, as marketing manager in charge of a diversification project in new countries analyzes all the potential opportunities and threats that may arise from the new market, it is also important to seek and to identif...   [tags: Contract, Contract law, Option contract]

Research Papers
820 words (2.3 pages)

Application Of A Legal Contract Essay

- In regards to continuing business with Marshall, there are a few things I must do to ensure that future relations between both businesses and parties are taken care of. There is the option to write up a legal contract to present to Marshall which limits the amount products Marshall can request from my company for his business, the time he requests them, and a percentage of the profit we both generate from me being the supplier and him being the advertiser and seller. There was no written, formal contract presented from either party, but in this case, there is a possibility of an “implied contract” on my end, which is an agreement, created by actions of the parties involved, but is not writte...   [tags: Contract, Contract law, Gentlemen's agreement]

Research Papers
1453 words (4.2 pages)

Contract Law : A Contract Essay

- Contract Law A contract is an agreement between two parties in which one party agrees to perform some actions in return of some consideration. These promises are legally binding. The contract can be for exchange of goods, services, property and so on. A contract can be oral as well as written and also it can be part oral and part written but it is useful to have written contract otherwise issues can be created in future. But both the written as well as oral contract is legally enforceable. Also if there is a breach of contract, there are certain remedies for that which are discussed later in the assignment....   [tags: Contract, Contract law, Invitation to treat]

Research Papers
2266 words (6.5 pages)

Essay about Contract Agreement For A Contract

- A contract is a written or spoken agreement, especially one about employment, sales, or real estate, which is intended to be enforceable by law. In order to form a legally binding contract the general requirements of a contract must be present, for example there must have been an offer, acceptance and an intention to form a legally binding contract. Without all of these elements a contract will not be legally binding. If all these elements are in place a contract will be legally binding, however, the law presumes that certain people do not have the power to enter into a contract, as is the case with Nancy....   [tags: Contract, Contract law, Void, Voidable]

Research Papers
768 words (2.2 pages)

Contract Agreement For A Contract Essay

- A contract is a written or a verbal agreement, which is intended to be enforceable by law. It is particularly related to employment, sales, and real estate. In order to form a legally binding contract the requirements of a contract must be present. There must have been an offer, acceptance and an intention to form a legally binding contract. Without all of these elements a contract will not be legally binding. If all these requirements are in place a contract will be legally binding. However, the law states that certain people do not have the power to enter into a contract, as is the case with Nancy....   [tags: Contract, Contract law, Voidable, Void]

Research Papers
767 words (2.2 pages)

Essay on College Tuition : A Binding Contract?

- College Tuition: A Binding Contract. With the skyrocketing costs of college education — at both state institutions and elite private colleges and universities — the breakdown of cost responsibilities between parents and students is becoming increasingly important, and in certain cases controversial. However, nowhere was it more heated than in a recent case that was resolved by a Connecticut court. In this case, the plaintiff — a twenty-something female student — sued the defendant (her father) over his failure to pay the final year of her college tuition, despite an explicit contract in which he had stated that he would assume all responsibility for her college....   [tags: Contract, Gentlemen's agreement]

Research Papers
736 words (2.1 pages)

The Importance Of Suspending Performance Under The Contract Essay

- We are extremely disappointed to learn that you do not intend to continue payments to Century Engineering, Inc. (“Century”) as required under the Subconsultant Agreement Between HDR Engineering, Inc. and Century Engineering, Inc., dated September 25, 2015 (the “Contract”). We recognize that Walsh Granite Joint Venture (“WGJV”) has made two claim against you, and is withholding payments to set off damages resulting from those claims. We further understand that our Contract provides that payment from WGJV is a condition precedent to your obligation to pay us....   [tags: Contract, Contract law, Money, Payment]

Research Papers
942 words (2.7 pages)

Proposal for Dr. Friedlander Contract Essay

- 1. Expertise With over 25 years in the field of special education Dr. Friedlander brings a unique perspective to the field of assistive technology. Through the lens of a Licensed and Certified School Psychologist, Dr. Friedlander has worked with many children who present with learning differences who have benefited from the use of assistive technology. Dr. Friedlander is presently an Associate Professor of Education at the College of St. Elizabeth where he teaches graduate level courses in assistive technology and coordinates the Graduate Programs in Special Education....   [tags: Contract ]

Research Papers
1058 words (3 pages)

Alumina Inc: Minimizing Tort Liability Arising Out of Regulatory Risks Essay

- Regulatory risks are risks associated with the failure to comply with a whole host of governmental regulations. Such risks impact a company’s existing assets, earnings, and often, reputation. In the context of tort liability arising out of non-compliance of government regulations, it is in every company’s business interest to allocate resources to identify those risks, and to implement action plans to avoid such risks. In the event those risks do materialize, the company needs to have system in place to properly manage and contain monetary and reputational loss to the company....   [tags: Alumina Inc Case Study]

Research Papers
1334 words (3.8 pages)

Contract Enforceability Essay

- Introduction Definition A contract is any legally binding agreement that is made between two parties. In the legal system an agreement must be between two people or more parties whereby the agreement must be entered voluntarily. In the agreement a lawful object must feature in and should create legal obligations which may either be one or more between the parties coming into an agreement. In the legal system, for a contract to become, it must involve two elements which are namely offer and acceptance....   [tags: Contract Law ]

Research Papers
2209 words (6.3 pages)

An offer is the willingness of a party to enter into business with another party. Thus, the acceptance is the decision of the other party to receiving this offer and entering into contract with that one (Cheshire et al., 2012). The consideration is regarding as the value of this exchange between parties (Andrews 2011). The offer should not be mistaken with an invitation to treat; which can be illustrated by the goods displayed in shops, see from the outside for instance (Peter Marsh, 2003:65). It can be either an offer to a large public or to a specific person (Elliott and Quinn 2007).It has to be clear defined, to not be source of disputes between parties, as it has been the case for Gibson v Manchester City Council 1979.
Thus, in this case law, Mr. Gibson brought the case to the court seeking a specific performance of the agreement that he thought has been made. It’s important to bear in mind the case. Well, in 1979, Manchester city council was selling council houses to its tenants by sending forms to be filled by them. Here an extract of the form: “please inform me of the price of buying my council house. I am interested in obtaining a mortgage from the corporation to buy the house. Please send me the details” (Beale et al., 2008). After filling the form, Gibson sent it back to the council. In response, the latter replied in stating the selling price they were willing to pay to Gibson, which was 2.725 pounds less 20%. Adding that the maximum mortgage that the organization will may grant will be 2.177 due over 20 years (Gibson v Manchester City Council 1979). At the end of that letter, was written “this letter should not be regarded as a firm offer of a mortgage. If you would like to make a formal application to buy your council house, please complete the enclosed application form and return it to me as soon as possible”. Mr. Gibson filled the form and sent it to the council. The latter replied, saying that the selling price will remain unchanged. Finally Gibson re sent the form, without filling the price part writing: “I would be obliged if you will carry on the purchase as per my application already in your possession”. Nevertheless, afterwards the council removed the house from their maintenance list and sorted it in their purchase list (Beale et al., 2008). In effect, Mr. Gibson was told that Manchester city council would not be carrying on business with him (Beale et al., 2008).
The court first gave reason to the plaintiff. Undoubtedly for the court, there was a contract, even if it wasn’t written. Indeed, according to the council there was no need to analyses the contract on the offer and acceptance principles, instead it should be looked at “the correspondence and the conduct of the parties as a whole”. However, this city council made appealed and won the case. One of the reasons is the word written in that letter which didn’t constitute an offer “this letter should not be regarded as a firm offer of a mortgage” (Gibson v Manchester City Council 1979). Basically, it’s important to have a clear negotiation stage, with a clear offer on the supply of IT and both parties supplier and buyer have to show a willingness to contract together, without forgetting to be aware of elements such as the price, quantity, time (Mulchachy, 2008) prevent a misunderstanding ask the other party to commit themselves to the organization. That’s why before the creation of a contract, it’s justifiable to use documents such as letter of intent (Fransson 2004).
IV. Settlement of contract including letter of intent
Indeed a letter of intent is a written document used in the pre contract stage, negotiation period, called also tenders (Dunne et al. 2005). It expresses the will of parties to enter into business together. It will be relevant to use this document for any projects, especially on the supply of hardware and software. It’s relevant because, this project involves large transaction, as intellectual property rights get involve, which are source of huge profit for businesses (Furmston et al., 1998). Nevertheless, it is not a contract yet, and is not considered as a legal binding (Furmston et al., 1998). Inside the UK law it could be used in court but it’s not always considered by the court; as it has been the case for the case study that follow. The case is British Steel Corpn v Cleveland Bridge and Engineering Co Ltd (1984). British Steel Corpn was the plaintiffs and Cleveland Bridge and Engineering Co Ltd the defendant. Both in the pre negotiation stage used a letter of intent. (BSC) was supplying (CBE) of steel nodes for the construction of a steel- framed building. Nevertheless, (CBE) was doing the construction with another contractor. Meanwhile, (BSC) sent the nodes to the other company, unfortunately one delivery was delayed. Follow to that, the buyer didn’t accept to pay and sought damages. The court didn’t recognized contract. Although, despite its “no legal” binding character, it has influenced some courts decisions. Indeed, for Emcor Drake and Scull v Sir Robert McAlpine (2004).
Contracting for the supply of goods or services is source of risks. In the common law, this type of contract finds itself being under “The Sale of Goods Act 1979” (Mark and Mance 2011). Indeed, the purpose of this act is to discuss the terms in contract for the sales of good and protect the purchaser (Keenan Richies 343). Part II of this act underline the implied terms for the supply of services. In other term, the supplier in accepting to provide the goods to the buyer, at the same time, has the responsibility of providing him an associated service. For instance, for this IT project, the supplier will have to install the equipments require by the organization, in a defined time decided by the parties.
V. Areas of potential dispute
In contract, disputes arise when there’s no performance realized (Turner et al. 1999). Indeed, when one of the parties doesn’t respect its obligations it is source of conflicts. Either the buyer doesn’t pay the supplier or the supplier doesn’t provide the goods in time for instance (Furmston 1992). This, constitute a breach of contract, will means the no performance of a party. Additionally repudiation is a potential area of dispute, that could be defined by the not willingness of a party to honor his obligations for a contract to be lead in the future and the expression of the party to not being a part of a contract (Mahoney Jr 2004). In contract, it’s happen that a party decides to end the contract without any reasons.
VI. Health and Safety
In the supply of hardware and software most of the time elements are buying from abroad (Pfannenstein and Tsai 2004). The health and safety act at work of 1974 protects the buyer. Generally, the supplier has to inform the buyer of the product composition, as well as the risks it could be exposed at using it (Humphreys 2007). This practice is called “General duty” (Chen-Wishart 2005). Besides, measures will also have to be implemented to protect in one hand the workers of the supply company and in the other hand the users. Organizations should refer to the health and safety at work act of 1974 which protect professionals. Looking at the workplace, hardware and software which are the mix of physical components and immaterial elements exposed the users to various hazards (Turner and Callaghan 2006). Some of them are linked to the electrocution risk or could be in term of the worker’s position to the computer. It’s necessary for the organization deliver training to the employees of the public organization. They have to be aware of the behaviors to adopt in case of computer oxidation for instance. The key word is “protection”. It’s important to be working in a proper, comfortable environment. It has been argued that the environment influence the performance, as well as the quality on the customer (Griffin and Neal 2000). Some measures have to be implemented to protect the buyer, the supplier and the final client to avoid a negative impact on both organizations. It’s clear that a physical protection is needed. Nevertheless, an immaterial protection is required to protect the rights of the supply organization (Smith 2003).
VII. Title to property
As said earlier, IT elements are a large source of profit for organizations. Therefore having rights on it, is a commercial activity. First, it’s relevant to know the meaning of the word ‘right’ in intellectual property. Intellectual property is the right of a person’s property to protect his good. Therefore it’s source of huge profit, especially when it comes to software and hardware, which is a part of a powerful industry (Richies and Allen, 2013: 435). Indeed using this material is costly for the organization that decides to use it. The supplier in entering into business with the purchaser for the supply of this product will give licenses to the latter. Through the licenses the owner of a property gives the right to a tiers person to use its property and to make a profit (Smith 2003). Nevertheless, the receive party of these rights; will have to pay some royalties to the proprietary of the product or service. It’s compulsory for the organization to find out either if she can be able to benefit of the owner’s rights or no. At that, to always be updated regarding these rights as it’s not the same in every country (Chissick, 2012: 139). A patent is one of the protection uses by an owner of an invention. This creation has to be original and new to be protected by law. It is under the patent Act 1977 (amended by the Patent Act 2004). The supplier may have a specific design for its equipments and as well as a given them a brand. The latter is called in intellectual property trade mark. It is under the design patent Act of 1988 and trademarks act of 1994. The life cycle of the patent is 20 years and the design 4 year.

VIII. Tort of law, liability of each party in a contract dispute
For the common law a tort in business, tort means the breach of duty of a party which is imposed by the law (Keenans and Richies). Though, if victim of tort, the victim party has to prove that the defendant had committed a wrongful act (Kee and R). There are two circumstances where tortuous liability may be forced in spite of the litigant not being at fault: Tort of strict risk and vicarious obligation. Tort of strict liability implies that the clamant can get payment for misfortune or harm without to demonstrate having blamed or plan to the piece of the litigant. Part 1 of the consumer protection act 1987 provides that a manufacturer is strictly liable for injuries caused by defective products. The rule in Rylands v Fletcher, breach of statutory duty and conversion is a case law of tort imposing strict liability. Vicarious liability, one person may be held by the tort caused by another. Liability is brought about by the individual best capable fiscally to meet any honor of harm (normally on the grounds that the danger is secured by the protection). The inquirer is given an alternate respondent to sue who is more inclined to have the capacity to fulfill any judgment. Damage may be anticipated by forcing liability on the individual in control of the action.
Proof to damage, causation has to be proved.
The Barnett v Chelsea & Kensinghton Hospital Management committee (1998) is an illustration of the former notion. A night watchman was complaining of vomiting and seeks care at Chelsea & Kensighton hospital. Unfortunately one of the doctors of the hospital denied to look after Barnett and advised hi to see his GP the morning if he didn’t feel better. 5 hours later Mr. Barnett died from arsenic poisoning. The court didn’t condemn the hospital because, even if Mr. Barnett would have been looked after by the hospital, he would have passed away.
Having guarantees and warrantees is essential to protect both parties in case of tort.

IX. Good Business Planning, scheduling and project planning
A project is high source of revenue for an organization. The success of the project depends of the realization of the project in time with in optimizing the resources. Firstly, a scope of work has to be clear defined and some processes need to be lead. In the aim of deadline respect, and mastering the scheduling phase, the society has to follow few steps as, Planning, scheduling, monitoring and controlling. Managers can use several organizational tools, mostly informatics software as ‘Gant Chatt’ which helps to the realization of the project on time. A marketing analysis tool called ‘SMART’ is useful. Basically, if the project matches the SMART criteria as, specific, measurable, achievable, realization and time object it means that it’s a pertinent project and hopefully successful (Nelson 2007). To motivate the supplier to achieve this project either before a deadline or on time, incentives are generally used. Penalties can be used as well but is not in favor in business partnership relationship. Internal analysis as financial or human has to be done. The key in all projects is the communication between every members of the project, intern to the organization or extern.
However there are some events causes by neither supplier nor buyer which can delay or in the more unfortunate case end the project (Keenan and Smith, 2006). It could be because of ‘act of God’ or natural disasters or changing country economic situation. To overcome these events, some clauses should be included in the contract to be protected in case of force majeure or act of God (Keenan and Smith, 2006). Force majeure is an event that happens independently of the parties. One example that can illustrate this notion is if a war occurs. Act of God is, events as well that is not liable to the parties, such as natural disaster.

X. Recommendation
In contracting, businesses should keep updated of the law they are under in, to be aware of their rights, obligations and law implication for their activities. Going to the court to resolve contract disputes involve many resources, financial, humans and it is time consuming. Opting for alternative resolutions method can avoid this disadvantage links to the resolution of problem in court. Courts themselves have encouraged companies to use this method (Mulcachy, 2008: 226). For the case Dunett v Railtrack plc (2002), the court has expected Railtrack to pay the costs of bringing the action to court, because he hasn’t considered to resolve his issues with Dunett with an alternative dispute resolution (Dunett v Railtrack).
XI. Conclusion
The aim of organizations is to stay competitive and survive in the market. It can be done without knowing the environment they are in. Contract is an important area to not be avoided while doing projects. A contract has to be valid. Offer and acceptance as well as consideration have to be clear defined in the contract. The pre negotiation phase has to be followed by the parties by the parties to enter into business and create a business relationship. Disputes will arise between the organizations, but, to resolve them, methods less costly that going before the court could be use (Mulcahy 2008). The warranties, guarantees and clauses are known minimize risks in case of litigation and aim protect the buyer, supplier or the final customer. A health and safety awareness is a more practical protection as well, to anticipate hazards. In the frame of IT, hardware and software, intellectual property defends the owner and sometimes gives rights to a third party. A success of a project depends of the managerial skills of the team members and the actors involve in that project (Frey 2005).
Buyer and supplier shouldn’t forget their main goal which is the survival in that competitive world.

Reference list
 Chen-Wishart, M. (2005) Contract Law. 1st edn. Oxford [UK]: Oxford University Press
 Dunne, P., Wooldridge, M. and Laurence, M. (2005) 'The Complexity Of Contract Negotiation'. Artificial Intelligence 164 (1), 23—46
 Elliott, C. and Quinn, F. (2007) Contract Law. 1st edn. Harlow: Pearson Longman
 Fransson, K. (2004) Letter Of Intent.
 Frey, R. (2005) Successful Proposal Strategies For Small Businesses. 1st edn. Boston: Artech House
 Furmston, M. (1992) 'Breach Of Contract'. Am. J. Comp. L. 40, 671
 Furmston, M., Cheshire, G. and Fifoot, C. (2012) Cheshire, Fifoot And Furmston's Law Of Contract. 1st edn. Oxford, United Kingdom: Oxford University Press
 Gil, N. & Tether, B. S., (2011) Project risk management and design flexibility: Analysing a case and conditions of complementarity. Research Policy, 40(3), pp. 415-428
 Griffin, M. and Neal, A. (2000) 'Perceptions Of Safety At Work: A Framework For Linking Safety Climate To Safety Performance, Knowledge, And Motivation.'. Journal of occupational health psychology 5 (3), 347
 Hall, C. (1973) 'International Sales And The Supply Of Goods (Implied Terms) Act 1973'. International and Comparative Law Quarterly 740—748
 Humphreys, S. (2007) 'Health And Safety At Work Act 1974: Is It Too Late To Teach An Old Dog New Tricks?'. Policy and Practice in Health and Safety 5 (1), 19—35
 Legault, M. and Chasserio, S. (2012) 'Professionalization, Risk Transfer, And The Effect On Gender Gap In Project Management'. International Journal of Project Management 30 (6), 697—707
 Mahoney Jr, B. (2004) 'Contract Law-Anticipatory Repudiation And The Running Of The Statute Of Limitations'. Suffolk UL Rev. 37, 1235
 Mark, M. and Mance, J. (2011) Sales Of Goods ACT 1979.
 Mir, F. and Pinnington, A. (2014) 'Exploring The Value Of Project Management: Linking Project Management Performance And Project Success'. International Journal of Project Management 32 (2), 202—217
 Mulcahy, L. (2008) Contract Law In Perspective. 1st edn. London: Routledge-Cavendish
 Nelson, R. (2007) 'IT Project Management: Infamous Failures, Classic Mistakes, And Best Practices.'. MIS Quarterly Executive 6 (2)
 Pfannenstein, L. and Tsai, R. (2004) 'Offshore Outsourcing: Current And Future Effects On American IT Industry'. Information Systems Management 21 (4), 72—80
 Riches, S. and Allen, V. (2013) Keenan And Riches' Business Law Mylawchamber Pack. 1st edn. [S.l.]: Pearson Uk
 Saxena, A. (2008) Enterprise Contract Management. 1st edn. Ft. Lauderdale, Fla.: J. Ross Pub.
 Smith, D. J. K. K., (2006) Chapter 6 and 7 Law of contract making the contract I-II. In: Smith & Keenan's law for business. Harlow, New York: Pearson Longman, pp. 85-119.
 Smith, R. (2003) Property Law. 1st edn. Harlow, England: Longman
 Turner, D., Turner, A. and Turner, D. (1999) Building Contract Claims And Disputes. 1st edn. Harlow: Longman
 Turner, J. (2003) Contracting For Project Management. 1st edn. Aldershot, Hants, England: Gower
 Turner, M. and Callaghan, D. (2006) 'Will IT In The UK Become Greener In 2006?--The Impact Of The New UK Regulations On The Use Of Hazardous Substances In Electrical And Electronic Equipment'. Computer Law \& Security Review 22 (2), 172—175

 Anderlini, L., Felli, L. and Riboni, A. (2008) Statute Law Or Case Law?. 1st edn. München: CESifo, Center for Economic Studies & Ifo Institute for economic research
 Arnheim, M. (1994) Common Law. 1st edn. New York, NY: New York University Press
 O'Hara, T. (2002) The Economy. 1st edn. Philadelphia: Chelsea House Publishers
 Weatherill, S. (2006) Cases And Materials On EU Law. 1st edn. Oxford: Oxford University Press

Return to