Disputes in IT contracts

Source, Impact and Resolution tactics in early stages



By Abhinay Kumar Jha

SKEMA Business School

Paris, France



Agreements and disagreements are part of everyday life and when it comes to contracts a disagreement can lead to some serious repercussions. The Information Technology sector in particular has been subjected to major contractual disputes, some leading to closure of businesses. The impact of dispute in this sector can be significantly reduced by understanding its sources and implementing effective methods of resolution in the contract documents. This paper describes the different techniques that if applied early in stages of a contract will help to scale down or even diminish an unpleasant situation. The paper provides enough evidences to support the use of Alternative Dispute Resolution techniques in combination with Litigation option in a contract. The results of this document will help to understand the benefits of using both techniques together, with reasoning and will prove that this is the method of the future.

Key words: Dispute, Information Technology, Early Stages, Resolution, Impact, IT, Solution, Tactics


The development of new technologies, the globalization of business and the current political uncertainty in the last 5 years has prompted international organizations to increase its resources to Informational Technology (“IT”).  IT frequently involves contracting with third parties. This is due to the specific and complex nature of this services and the need for different teams and systems.

IT contracts, like any other contract, will always entail legal and operational risks. Accordingly, for any organization one of the key focus areas to ensure sustainability of is legal dispute management. How well an organization handles the disputes that arise with growth and the entering into complex contracts determines the sound progress and development of the company.

The use of emerging technology and online programs has been critical in mitigating and/or resolving a material number of disputes. While there are international bodies and organizations that help to resolve disputes such as the World Trade Organization (“WTO”), the International Chamber of Commerce (“ICC”), and the National Center for Technology and Dispute Resolution (the “NTCDR”), these are organizations whose dispute systems are too specialized.

No doubt, when it comes to budgeting for a legal department, the need to cover for any IT legal fees will result in a significant part of the budget, a direct consequence of the drafting, negotiation and review of agreements. Having a carefully crafted contract may help in reducing the number of disputes arising out of it, but it will not guarantee that such agreement is free from dispute. How a contract works in practice will depend on how it was drafted, the actual underlying facts and eventually how the parties construe or interpret its terms. There may also be external aspects outside the contract which a company cannot foresee.


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Editor’s note: Student papers are authored by graduate or undergraduate students based on coursework at accredited universities or training programs.  This paper was prepared as a deliverable for the course “International Contract Management” facilitated by Dr Paul D. Giammalvo of PT Mitratata Citragraha, Jakarta, Indonesia as an Adjunct Professor under contract to SKEMA Business School for the program Master of Science in Project and Programme Management and Business Development.  http://www.skema.edu/programmes/masters-of-science. For more information on this global program (Lille and Paris in France; Belo Horizonte in Brazil), contact Dr Paul Gardiner, Global Programme Director [email protected].

How to cite this paper: Jha, A. K. (2018). Disputes in IT contracts – Source, Impact and Resolution tactics in early stages, PM World Journal, Volume VII, Issue VII – July.  Available online at https://pmworldjournal.net/wp-content/uploads/2018/07/pmwj72-Jul2018-Jha-disputes-in-IT-contracts-student-paper.pdf

About the Author

Abhinay Kumar Jha

Paris, France


Abhinay Kumar Jha
is a student of MSC. Project & Programme Management and Business Development from AACSB accredited SKEMA Business School, Paris. With nearly 11 years of extensive work experience in Information technology and Customer management, Mr. Jha has experience in both Private and Government sectors. A Post Graduate Diploma in Management, he was working for The Embassy of the United States of America in India as a System Administrator. He has many excellence performance awards under his belt from his previous employers. Working as Senior System Analysts in HCL technologies, Indian multinational service IT Service Company, he resolved technical issues for EMC customers. An experienced solution provider, Mr. Jha also handed disputes for British Gas Business customers under EXL services.com and British Telecom under HCL infrastructure in customer management. He can be contacted at [email protected] or www.linkedin.com/in/abhinaykjha