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IT Contract Disputes and How To Avoid Them in Your Business

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Posted in: Dispute resolution
Date published: 06/07/2022

IT has become a huge part of our everyday lives and business operations. As a result, IT services can be business-critical, and you must ensure that a dispute does not disrupt your IT. IT contract disputes can vary greatly, but some common issues that we see arise can often be avoided. In this article, we look at the most common IT disputes, how to avoid them, and what you can do to get your business back on track as soon as possible.

Ambiguous specifications

You should ensure that you have clear, detailed instructions of what you need from your IT solutions provider – this is essential to keep operations running smoothly and avoid misunderstandings. It may take some time, but be sure to go into detail about exactly what is required and try to anticipate what should happen if problems arise. You must not leave any room for misinterpretation, as this is where disputes often arise. We would recommend seeking advice from an experienced solicitor when drawing up the contract.

Ensure the contract is understood and signed before work begins

Once you have agreed with an IT contractor to work together, it is understandable that you may want to get things up and running as soon as possible. However, in many cases, the contract is forgotten and never signed, or in some cases, never even drawn up. It can be difficult to rely on what has been said and agreed at a meeting, and parties may forget or misunderstand what has been agreed to. The contract is the central document which governs the relationship between your business and the IT contractor; without one, you leave your business vulnerable to disputes. You should get the relationship off to the right start by ensuring the contract is complete and understood by all relevant parties before any work begins.

Failure to check exclusion or limited liability clauses

It is common in technology contracts for contractors to mitigate their risk of taking on the project by limiting liability or including certain exclusion clauses. You should consider these clauses carefully and seek legal advice on the consequences for your business should anything go wrong.

Appoint someone in your business to ensure the contract is complied with

Even if you have a carefully drafted contract, it can be easy to fail to check whether the contract is being adhered to. You should appoint someone in your business to conduct regular checks to ensure the contractor is sticking to what has been agreed. This person should be familiar with the contract, and understand the IT contractor’s role.

Ensuring that someone has an eye on the IT contractor’s obligations can mean that any discrepancies are spotted quickly and can be easily rectified. The longer a project continues where the IT contractor is not doing what you understood they would, the more complex a dispute can be. Failure to pick up on an error or failure to act may even prevent you from being able to take legal action if left too late.

If you believe an agreement with an IT contractor has gone wrong, we would recommend taking legal advice at the earliest possible stage. It is important that you take legal advice before taking remedial action into your own hands, such as withholding payment. The earlier you take legal advice, the more opportunity your solicitor has to protect your position and obtain a favourable outcome for you. Taking legal advice doesn’t mean you have to go to court or even cancel the contract. Your solicitor will listen to you and take the time to help you understand the best outcome for you and your business. They will then advise you as to what to do next to achieve this outcome.

Contact IMD Solicitors

Disputes with your IT supplier can have a devastating impact on your business, particularly when the services they provide are essential to what you do or your operational efficiency. We can help to find quick and commercially sensible solutions to get you back on track contact our team of dispute resolution lawyers today. You can call us on 0330 107 0106 or complete our online contact form, and we will get back to you right away.

This article is for general information only and does not constitute legal or professional advice. Please note that the law may have changed since this article was published.

Published by:

Marcin DurlakManaging Partner

Business Services – IMD Corporate

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