By Jeremy Holt; Jeremy Newton; Sarah Ellacott; Andrew Katz; Jean Morgan; All authors
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Extra resources for A Manager's Guide to IT Law
Albans received no inducement to agree to the limitation and there was evidence that all ICL’s competitors imposed similar limitations of liability; ● when St Albans tried to negotiate the limitation, albeit at the last moment, ICL in effect said that this was not possible because it would delay the provision of the software to St Albans beyond the date for implementation of the community charge. The judge accordingly found that ICL had not discharged its burden of proving that the term was fair and reasonable and also that financially ICL was better placed to bear a risk of this kind through insurance and spread it across its client base.
CAP Financial Services Ltd. In that case, a contract to supply bespoke software contained a warranty, which also provided that a limitation of liability would apply ‘if CAP fails to perform its obligations under [the warranty]’. The wording of the warranty was sufficiently ambiguous that the court could interpret it as meaning that the warranty did not come into effect until after acceptance of the system by the client. As acceptance had never in fact occurred because the dispute began before the contract’s acceptance procedures were reached, the court decided that the warranty never came into effect and so the exclusion of liability never came into effect either.
Commercial highlights: what is the price, who owns the resulting intellectual property rights, what warranties are given in respect of the system? ● Problem management: what happens if the project goes wrong and what remedies are available? BEWARE THE STANDARD CONTRACT The dangers of agreeing unquestioningly to the standard supply terms (or for that matter, to a client’s standard terms of procurement) are illustrated by the case of Mackenzie Patten v. British Olivetti. A law firm bought an Olivetti computer system to run their accounts.
A Manager's Guide to IT Law by Jeremy Holt; Jeremy Newton; Sarah Ellacott; Andrew Katz; Jean Morgan; All authors