The High Court in De Beers UK Ltd v Atos Origin IT Services UK Ltd [2010] EWHC 3276 (TCC) had to consider competing claims relating to a software development contract. Progress on the development of the software had been well behind schedule and an instalment was not paid. There had also been cost overruns on the fixed price contract (which followed a preliminary contract) and there was a factual dispute about the responsibility for the developers failure to establish the full complexity of the project. The case turned on competing assertions from the parties to the contract that the termination was the result of a repudiatory breach of contract by the other which it accepted.
Mr Justice Edwards-Stuart ruled for the claimants, awarding net damages of just under £1.5 million. In a judgment of 382 paragraphs, there are a number of points of interest for IT lawyers – not least the lessons to be learned about the applicability of an agile-style development to a waterfall-style situation and, unsurprisingly, the intrusion of personal agendas when cool heads were needed as the contract came to be terminated. The calculation of the net damages is also of interest.
We hope to cover the case more fully with an article early in 2011.
