Creating a Contract

Essay by mrh6504University, Bachelor'sA-, October 2009

download word file, 4 pages 0.0

Corporations of all sizes often face challenges involving contract development. As a result organizations most develop a process when negotiating contracts to ensure minimal risk. Disagreements which are unable to be compromised can create a financial burden for all parties involved. All parties involved most work together when finalizing all aspects of a contract in an effort to create a long term business relationship. Each party involved has an obligation to fulfill all terms of a contract in order to avoid a breach.

Contract Creation and Management MemorandumOrganizations like Span Systems (SS), an organization that is in the forefront of banking software, and Citizen Schwartz (CS), a European bank, should have a system in place for avoiding breach of contract. Span Systems was approached by Citizen-Schwarz AG to develop a Java-based transaction processing software program. Span Systems and CS signed a one year contract in which Span Systems is to develop a Java-based transaction processing software program for $6 million.

C-S has stated to Span Systems that there is an e-CRM order which is dependant on the performance of the Java-based transaction processing software. SS is hopefully that they can perform up to CS expectations and earn this. In the contract terms SS is to develop system software which will be owned by CS. The fully functional system must be completed by a specified date. Problems began between the two parties when the timeframe for the deliverables was amended. Due to these new findings the contract is on the verge of being breached by both parties. CS is now claiming that performance by SS is unacceptable and as a result there should be a reversal in the drawn up contract. Legal teams for both organizations do have the opportunity to renegotiate the contract which can lead to amendments which will...