RUNNING HEAD: CONTRACT CREATION AND MANAGEMENT SIMULATION

Contract Creation and Management Simulation Eugene Humphrey LAW/ 531 Business Law Mark Reed May 12, 2013

CONTRACT CREATION AND MANAGEMENT SIMULATION The simulation Contract Creation and Management demonstrates issues potentially capable of existing between business entities. The simulation emphasizes the importance of

creating details and clear contracts for parties reviewing and existing new business contracts. The simulation provides information on Span Systems and the client Citizen Schwartz and also provides an opportunity to amend the contract to resolve the transaction software dispute (University of Phoenix/Contract Creation and Management Simulation, 2002). Various alternative solutions that Span could pursue endure an evaluation process and solution recommendations with the objective to salvage the contract and continue a positive business relationship (University of Phoenix, 2002). This paper identifies the legal issues and principals present, note legal principles that apply to legal issues. The paper identifies basic contract elements; contract formation, breach, and remedy. Additionally, the following information is for review, how the contract formation achieves in the simulation, how the contract administration gathering should be, and methods in use for contract dispute resolution in the simulation. Furthermore, different actions to make those decisions again with an explanation are for review. The various risks and opportunities present in the simulations and the best resolution to the advantage of both parties with maximum mutual outcome is for review. Legal Risks and Opportunities Legal risks and opportunities that arise in the simulation provide options for strategies to minimize the risks, minimize the liabilities, and take maximum advantage of the opportunities include three legal violations. First, risk of lawsuit for breaching of contract under substantial performance of contract. This breach of contract describes more than 50% of work should be completed by the party (University of Phoenix, 2002). If CS rescinds the contract there would be

CONTRACT CREATION AND MANAGEMENT SIMULATION unfavorable implications because more than 50% of the project schedule is complete. However,

Span suffers not obtaining pay for the work the company completes and CS could allege that the Span has not performed substantially because the quality of the deliverable on account leaving both parties facing the legal action of breach of contract. Span should engage CS in a dialogue, to show that they appreciate the issue and are working toward solving it with high priority. Second, risk of lawsuit for breach of contract under intellectual property rights, which in this case surround the code of finishing work products and risk of loss of IP because sharing code with other vendor (University of Phoenix, 2002. If CS rescinds the contract, it is not in the company best interest not to pay the remaining balance to Span and get the IPR transfer to CS. If CS decides to look to another vendor to complete the project and maintain the system, the proposition to forego the code and rescind the contract is not a good option either (University of Phoenix, 2002). In the event that CS follows what should not take place the actions can lead to risk of Span losing its intellectual property to a third party (University of Phoenix, 2002). The outcome of this action has severe negative long-term implications in addition to losing a valuable customer. Span can mitigate and address this situation by, including a clause in documentation within the contract with CS, which is somewhat complete but needs to be more efficient. The contract states that the work product remains vest in Span until sum due to Span is in full pay (University of Phoenix, 2002). The contract should incorporate CS is to not transfer code and other IP during the development by Span per authorization of an outline for unrestricting to the codes that are unique. Furthermore, contractually to protect the IP or codes, the best approach to incorporate this measure is ensure both companies come to agreement, which is an acceptable

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solution to prevent lawsuit in court, which is the mitigation strategy in this context (University of Phoenix, 2002). Third, risk of lawsuit for breach of contract under requirements change and lucrative opportunity of large order and future business. In the long-term, effective performance by Span to CS originally considers ordinary changes to system and user requirements in the current project this could translate into much larger and very lucrative deal for Span systems functional requirements and enhancement (University of Phoenix, 2002). For CS this opportunity can find an effective technology partner for entering into the competitive and dynamic software market. The amount of time the project is consuming present the opportunity for Span system to increase revenue and profitability. The risk is CS inability to be patient with Span despite change of project and management structure. CS is on the verge of canceling the contract because of the slipping schedule (University of Phoenix, 2002). To ensure that the Span avoids a lawsuit and performs better than expectations to satisfy demanding customers, Span must try to solve the situation. Perhaps Span solves issue through hiring a third party, employees working overtime to complete the project, or communicating the delays and requesting more time, and decreasing the contract cost to satisfy the needs of CS (Cisco, 20111). CS can mitigate a potential counter to the lawsuit for the defense of lapse schedule lead by CS review time through using a flowchart, timeline, and action plan for the review process (Cisco, 2011). The options potentially can lay a strong foundation for a future business relationship. Evaluation of Alternatives To overcome the problems and address the situation, the contract, and creation simulation bring forth various alternatives. First, designating project managers to review change requests

CONTRACT CREATION AND MANAGEMENT SIMULATION and inform executives of result and potential change in project scope provides enough time to

shift deadlines (Cisco, 2011). This action or communication by Span and CS would show respect for communication and appreciate the think forward attitude and taking action to address project changes (Cisco, 2011). The conscious effort to address causes that led to the delay helps businesses readjust market plans and schedules. However, Span can address this aspect to ensure no schedule slippages in the future, the proactive solution does not provide to CS an excuse to complete the project successfully and likewise for CS. Second, Span can appoint professional quality control panel to evaluate claims of deliverable defects and determine remedies within the project given the quality of the deliverable is a major issue that led to the lawsuit (Cisco, 2011). This implementation ensures that problems that led to the situation are identifiable early so that claims of poor quality do not arise in the future. Span should put in measures to check the companys work before the release. Third, daily project updates should be a routinely schedule for Span to CS personnel. The breakdown in communication leads to lawsuit. Following the project and clarity between both parties is the responsibility of both parties. This alternative ensures that Span and CS establish a platform of communication and proactive issue resolution with customers. This approach permits working together as partners whom ensure objectives of the contract are met (University of Phoenix, 2002). As Span provides project updates CS should correspond in a timely manner creating time to keep everyone functioning and progressing with any issues being faced within the project. Fourth, inviting the CS project manager at Span to serve in a quality control capacity and additional employees within Span to deliver the project on time prevents legal actions and disputes. These options provide CS onsite feedback to problems the project is experiencing and

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the amount of work it takes to fix those (WordPress, 2011). CS obtains reasonable information or feedback from Span immediately. This insight to project deliverables closely tracks the project completion and validates Span claims to changing information technology requirements. However, Span should be able to inspect deliverables and are solely responsible for production. In addition to quality and schedule Span can cover lost ground and attempt to bring the project back to speed with more employees working on the project. This is a good alternative to pursue to as this will prevent CS from taking legal action and start making progress toward a productive solution. Conclusion Contract should be clear in responsibilities and modification to make it very clear so that both parties can have common expectations as they are working as business partners. A contract is not a reporting to measures such as filing for lawsuits. Business should communicate expectations in writing and gain agreement. Potential resolutions, principles, and alternatives depict how working on a project and objectives of businesses can require detail for protection of a lawsuit and fair practice for partnerships.

CONTRACT CREATION AND MANAGEMENT SIMULATION References Cheeseman, H.R. (2010). Business law: Legal environment, online commerce, business ethics, and international issues (7th ed.). Upper Saddle River, NJ: Pearson Prentice Hall. Cisco (2100) Change Management: Best Practices Retrieved http://www.cisco.com/en/US/technologies/collateral/tk869/tk769/white_paper_c11458050.html University of Phoenix (2002). Legal Environment of Business Contract Creation and Management Retrieved Apollo Group Inc.

https://ecampus.phoenix.edu/secure/aapd/vendors/tata/sims/legal/contract/legal_contract_ frame.html WordPress (2011) Basic Quality Control Concepts Retrieved http://philosophe.com/testing/qc/