The IT contracting process is often fraught with difficulty and problems, which translate into lengthy negotiations and then lead to disputes and bad relationships.
This is according to John Giles, legal advisor at Michalsons, speaking at the ITWeb IT Sourcing and Vendor Management Summit 2016 in Johannesburg yesterday.
Giles said good IT contracts are essential to building good relationships between vendors, distributors and customers. They also help to manage risks and avoid disputes, he noted.
IT contracts should offer guidance and help the parties have a good relationship. They should be read, referred to and followed, and not packed away in a drawer, noted Giles.
To avoid pitfalls, contracts must be drafted in plain legal language and with the reader in mind.
"You must use plain language in all documents, including business-to-business documents and not just business-to-consumer documents. The contact must be structured in a way that makes negotiation easier."
He added the terms must be defined clearly - making sure the parties agree upfront to what the issues are. Giles believes most problems can be avoided if organisations involve lawyers early before any agreements are made.
Masego Khutsoane, head of procurement at the Johannesburg Stock Exchange, said it is important to understand what the requirements are from the start when drafting and implementing a contract and knowing how to manage suppliers thereafter.
"Understand the legal clauses in the contract, the requirements and the key stakeholders within the contract from the initial stage."
However, should a dispute occur, companies have to find a way to resolve it amicably without seeking litigation, said Giles.
He advised that parties must negotiate and seek mediation before they get carried away with winning the case.
"If you get into a fight, do not litigate. Nobody wins, except for the lawyers - any dispute is a waste of time and money, and you want to avoid that."
Giles explained that SA's courts are not designed for commercial disputes, particularly IT commercial disputes. "The SA courts are the wrong forum to try and resolve disputes that are not criminal matters; you need to find another way."
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