Dispute of Contract

Contract Dispute The Data Processing Agreement was entered into between Big Bank and Systems, Inc. And the agreement involved Systems Inc. agreeing to render data processing services to Big Bank. In this dispute the services rendered are not under dispute but instead the time that it took for the data services to be in place and all data converted. The contract sets out that the date services would be rendered "within a reasonable time following execution" of the Agreement.

Big Bank agreed within the framework of the contract to cooperate with Systems Inc. And to make provision of all information and assistance that Systems Inc. might require to conduct a successful conversion of Big Bank's information files to "a form compatible with System Inc.'s systems and equipment so that System Inc. could provide the Services. Specifically, Big Bank agreed to "deliver conversion input information, in its entirety, in a mutually acceptable medium, within one week of the request of the information." I.

Contingencies in the Contract There are several contingencies included in this contract. The first contingency states that System's Inc. retains the right to make the determination according to System's Inc.'s own procedures when the successful conversion of Big Bank's information files has been accomplished in terms of them being operation and ready for use by Big Bank. In addition Big Bank is under a requirement according to the terms of the contract to provide the necessary information within one (1) week's time upon request by Systems, Inc.

In addition, according to the terms of the contract, Big Bank has entered into an agreement in which System's Inc.

has the right reserved to postpone conversion of the information files of Big Bank if Big Bank is late in delivering the input information required for the conversion or if "any other circumstances arise that might jeopardize the successful completion of big Bank's information conversion of the processing of the Big Bank's following day's transactions for any other customers of Systems, Inc." The contract goes on to state the requirement for Big Bank to be responsible for "providing to Systems, Inc.

all input data and other information necessary for systems Inc. To perform the Services and to prepare the reports. Under the terms of the contract, Systems Inc. is "solely responsible for the accuracy and delivery of all information to be provided to Systems Inc. For processing. II. Limited Liability Clause The statement of limited liability in the contract also serves to protect Systems Inc. In terms of the delay caused by the ice storm. Specifically the 'Limited Liability' clause in the contract states as follows: "Systems Inc.

shall not be responsible for any failure in providing the Services, any delays in processing, or any failure or delay in the delivery of any Reports that may be caused, in whole or in part, by strikes, lockouts, riots, epidemics, governmental actions or regulations, natural disaster, fire, inclement weather, acts of God, computer breakdown or failure, communications failure, interruptions in telephone or electrical service, courier's failure to timely deliver, or any other causes beyond its reasonable control.

In the event such delays exist without interruption for a period of more than thirty (30) days, Big Bank or Systems Inc. may elect to terminate this Agreement without breach. Big Bank is under no duty to make any payments to Systems Inc. For any period exceeding five (5) consecutive business days in which the Services are not performed by Systems Inc. As a result of a natural disaster or other phenomenon mentioned above." Therefore, Systems, Inc.

is protected from the delay resulting from the ice storm and due to the failure of Big Bank to submit the needed data information thereby causing the delay for completion of the services performed by System Inc. IV. Defense of Systems Inc. Big Bank's president cannot rescind the contract alone because rescinding a contract requires the agreement of each side to the contract.

Big Bank could sue for breach of contract however, Big Bank would not be successful in this suit because Big Bank breached the contract from the beginning when it failed to provide the necessary data information for conversion to Systems, Inc. It is not in Big Bank's best interest to rescind the contract because according to the Agreement contained in the contract, Big Bank will be required to pay the services of Systems, Inc.

However, rescinding the contract would result in the Big Bank failing to receive the five days of training provided for in the contract and Big Bank would not have any idea how to utilize the converted data. V. Three Types of Contract Performance There are three types of contract performance or failure to perform resulting in a breach of contract. The first type of contract performance is complete or where all conditions of the contract have been met.

The second type of contract performance is substantial performance, meaning that the majority of the conditions of the contract have been met. Finally, there is what is termed as a material breach of the contract meaning that there has been a failure to perform the contract and that the failure "strikes so deeply at the heart of the contract that it renders the agreement 'irreparably broken'. (NOLO, 2014, p. 1)This has not occurred in the contract between Big Bank and Systems Inc. The performance of.