Outsource Magazine Issue 29 - (Page 94)

TerminaTion for ConvenienCe Nobody likes to talk about breaking up when they’re just getting together – but planning for termination should be part and parcel of any outsourcing negotiation. Nevertheless, there could be a way out even when the requisite preparations haven’t been made… Lou Oliver, Stephenson Harwood Lou Oliver is an associate in the commercial, outsourcing and technology group at international law firm Stephenson Harwood LLP She regularly advises on ITOs/BPOs and a wide variety of commercial . arrangements. T 94 ● ermination is often the last thing on the parties’ minds at the outset of a new project or business relationship. Motivated by a need and excitement to just get started, the parties (and consequently the contract) may be focussed on the services to be supplied, on SLAs, on price and payment – essentially the core elements of performance. But what if you haven’t planned quite so elaborately for the end? “This is the end, Beautiful friend, […] the end, Of our elaborate plans.” (‘The End’ – The Doors) In this article, I consider how a party might terminate a contract in which the end has not been provided for. In particular, in circumstances where: the contract is of no specific duration; there is no serious breach or risk of breach by the other party; and there is no termination for convenience mechanism. First, however, let’s look at what a termination-for-convenience mechanism is and why it can be useful. It is sometimes easy for the parties to forget at the outset that they may not want to continue providing (or receiving) the services indefinitely, even in situations where there is no significant breach or threat of breach by the other party. Consider, for example, the following situations (particularly relevant to the current economic climate): market pressures and changes have impacted costs such that the contract is no longer as commercially viable or profitable as it was at the outset (and the parties cannot agree changes to the contract to account for this); or there has been a company restructuring and the services are either no longer needed by the customer or are no longer a “Law is nothing unless close behind it stands a warm living public opinion.” – Wendell Phillips www.outsourcemagazine.co.uk ●●●● http://www.outsourcemagazine.co.uk

Table of Contents for the Digital Edition of Outsource Magazine Issue 29

Call Me Maybe?
Optimising Your supplier Portfolio
Application Development Outsourcing
Are You Fat?
The Future of BPO
Digital by Default
The Face of Finance
Procuring Excellence
The Importance of Being Secure
NOA Round-Up
Steering the Flow
Changing Shape
Legal Transformation
Getting to the Real-Life Win-Win
What’s the Point of Outsourcing?
The Legal View
Top Ten
NelsonHall Round-Up
The Oral Review
Online Round-Up
Inside Source
The Last Word

Outsource Magazine Issue 29