Contract Management

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Contract Risk and Opportunities
Richard S. Stainback Jr.
June 27, 2011
Ben Waggoner

Contract Risk and Opportunities
Clarity of contract is an essential element to creating a workable and executable agreement. C-S and Span entered into a business contract that was ambiguous from the start. It used words like “ordinary” in terms of production. Terms like this are often up to interpretation and can be the failing point of an agreement. Legal Issues Present

Breach of Contract under “Internal Escalation Procedure for Dispute”- C-S has failed to follow the agreed upon dispute resolution process in regards to the delays and quality concerns. C-S has tentatively threatened to terminate the contract in light of product delays and quality control issues. Had the agreed upon process been utilized the grievances could have been identified earlier and a resolution could have been reached. As a manager for Span, it would be pertinent to make upper management aware of the lack of progressive management but not to use that as a crutch to justify other contractual concerns. Management Responsibility (Span) - Span needs to revisit the escalation process with C-S and look to streamline it to make it more proactive in resolving disputes. This will allow for minimal impact on the timeline for project completion. By doing this it brings issues out into the open before they become to straining and result in a failed contract. Management Responsibility (C-S) – C-S needs to bring their grievances up for review by the progressive management process instead of just saying “quits” on the contract. They have a responsibility to Span to uphold this provision of the contract as it is written. There is no apparent recourse for C-S to not utilize this provision. Possible Resolution- A conflict management team comprised of both dedicated Span and C-S management is formed to handle disputes instantaneously as they arise. The members have weekly communication to discuss...
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