Contract Creation Essay

1098 WordsSep 3, 20125 Pages
Contract Creation and Management Assignment In the Contract Creation and Management simulation Span Systems and Citizen-Schwarz AG, hereby known as C-S, faced multiple issued concerning the contract governing their business interaction. The purpose of a contract is to define clearly each party’s expectations. Conditions that govern the contract need to be clearly understood. The lack of clarity contributed to the performance issues between the two companies. The contract between C-S and Span Systems could have been discharged for any of the following factors: complete performance, substantial performance, and inferior performance. “Most contracts are discharged by the complete performance, or strict performance, of the contracting parties” [ (Cheeseman, 2010) ]. Complete performance is defined as when a party performs exactly as stated within the contract. A fully completed contract is called an executed contract. “Complete performance discharges that party’s obligations under the contract” [ (Cheeseman, 2010) ]. Span Systems nor C-S had completed their full obligations as stated within the contract. Span Systems had failed to provide the software timely nor up to the expected level of quality. C-S had not made the agreed upon payments for services rendered. Therefore, the performance of both organizations could constitute a breach of contract. If the two parties cannot reach an amicable agreement, either party can decide to sue for breach of contract. “The most common remedy for a breach of contract is an award of monetary damages, often called the law remedy” [ (Cheeseman, 2010) ]. Next substantial performance is described as when a contracting party only slightly deviates from the agreed upon performance. This is considered a minor breach of contract. Substantial performance must not be intentional or a result of carelessness or negligence [ (LaMance,

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