More and more often I encounter disputes in the IT industry. This shouldn’t be surprising. The ever-growing IT market must bring with it more and more court disputes. They usually concern issues related to the implementation of IT projects or contracts for the provision of IT services. Each court dispute is not only a time-consuming and costly matter, but also a risk of losing the reputation and trust of clients. In practice, every IT project raises a significant risk of litigation. In this article, we will provide best practices for IT contractors to prepare for a dispute.
What did we actually agree on?
It can be said that the vast majority of disputes begin with the parties asking each other the question “What did we really agree on?”. Most often, it is the ordering party who is dissatisfied with the results of the contractor’s work and tries to prove to him that he performs his services in a manner inconsistent with the provisions of the contract or with the specification. If the parties agreed to create a computer program based on a contract for specific work, the matter seems to be quite simple to settle. If there is a specification, it is known whether the contractor complies with it or not. On the other hand, the IT market currently looks like that most projects are implemented in the form of contracts for the provision of services (contracts of mandate).
In this case, it is not the result of the work that is important, but the careful/professional action of the contractor. Such contracts, although they seem to be clear, in the event of a dispute in the vast majority of cases lead to the fact that the contracting party tries to forcefully prove that the concluded contract is not a contract for the provision of services but a contract for specific work. Therefore, the contractor should firstly remember to sign the contract in writing, secondly, clearly indicate the subject of the contract from which it will be clear whether it is a contract for specific work or a contract for the provision of services, and thirdly, specify this provision regarding the subject of the contract by directly indicating how the parties interpret the contract. Then, in the event of a court dispute, it will be easy to prove and defend yourself in most cases.
Communication in most IT projects is now less formal. This involves the use of various types of communicators and project management systems. As a contractor, you should archive such communications on an ongoing basis in case it is lost due to technical issues or simply deleted by the contracting party.
You will then be able to clearly demonstrate what this communication looked like, whether there were any additional arrangements, how the ordering party behaved, whether the ordering party cooperated with you in order to perform the contract or whether the ordering party demanded the performance of services going beyond the subject of the contract. Evidence in the form of printouts or electronic records from such systems and communicators are an invaluable source to prove one’s arguments during court proceedings.
In addition, remember that if you feel or anticipate that the contracting party will try to remove such evidence, it is worth – in particular when a contentious situation has already occurred – to secure the evidence by a notary public by making a copy certified for compliance by a notary public.
A separate category of evidence is evidence from recorded conversations. Very often, contracting parties make claims against contractors, claiming that they agreed something with them during a telephone conversation. This is of course unprovable and hard to defend against. A frequent question he gets is whether it is possible to record conversations with the client. The answer very often surprises some people because the mere recording of conversations in which you participate is not prohibited and is not a crime.
Moreover, you do not have to inform the other party that you are recording such a conversation. Of course, this applies to situations where you will not use such recordings for any purpose other than to protect your rights and pursue your claims, as well as to defend yourself in court proceedings. It would be illegal for you to record conversations you are not in. This is the use of the so-called eavesdropping and is punishable. Recorded evidence is very often used in civil proceedings.