 IT Contracts – Risk Management Edmund Probert Marlene Naumann 21 March 2006

 Outline Contract and Risk Accepting the Risks Mitigation of Risk 1. Contract Specifications 2. Apportioning Risk 3. Contract Management General Issues Conclusion

 Contracts and Risks IT Contracts IT Supply/Integration Agreement Outsourcing Agreements Software Development Agreements Support and Maintenance Agreements Software Licences

 Contracts and Risks Principal Risks Uncertain obligations Non-Performance No Useful Remedy Unlimited Liability

 Accepting the Risk Due Diligence Credit Score Other suppliers’ experiences Accounts

 Contract Specifications Specification User’s Suppliers Change Timetable

 Apportioning Risk Acceptance Testing By the User or Supplier Procedure – who writes the test criteria? Mechanisms to Remedy

 Apportioning Risk Warranties/Indemnity An assurance or promise Breach = Damages Indemnity

 Apportioning Risk Limitation of Liability Death, personal injury, fraud Exclusion of types of Liability Capping Liability Insurance

 Contract Management Variation Facilitates a working relationship Avoids frustration and termination Regular reviews Project Manager Regular meetings

 Contract Management Dispute Resolution Senior staff / Mediation / Arbitration Exit Plan Assistance with data migration Additional payments Intellectual Property Rights Competitor Good Housekeeping

 Other Issues Confidentiality Intellectual Property Rights Existing rights New Rights

 Conclusions Risk v. Rewards Minimise Insure

 QUESTIONS?