Law and the IT industry often don’t go well together: the press delights in failed IT projects (especially failed Government IT projects) and the ensuing litigation rarely shows the legal profession at its best.

Recently - and quite exceptionally - the Court of Appeal overturned the judgment of Judge Seymour in the Co-operative Group Ltd v ICL case on the basis that the judge had appeared to lose his objectivity leaving the parties with an expensive re-trial.

What goes wrong? For too long, lawyers have not really understood IT, certainly not the minutiae of project management methods like PRINCE 2, and those involved in project management do not understand the law. From my viewpoint as a lawyer who has spent many years dissecting major IT projects in the context of legal disputes, there are some common themes when things go wrong. What follows is a personal view of just some of the commoner flashpoints.

Things can go wrong right from the early stages of Project Initiation. There are two problems with a PID (Project Initiation Document): firstly that it exists and secondly what it says.

A PID is well described by the PRINCE2 books and no-one can be in any doubt as to what should go into a PID: all sorts of descriptions about the work to be done, who is going to be doing it, when - some have a full risk analysis. Where does this leave the contract? For not just lawyers, but for business people generally, the commercial expectations are set by the contract, so why do project personnel set about redefining scope in the PID? If the PID duplicates the contract, why have it, and if it changes the contract, why not use change control?

The next problem is that lawyers (or whoever actually does the drafting) rarely concern themselves with the details of project management. Most draftsmen will take on trust (more or less) that the documents they are given to put in the schedules to define scope, timetabling, personnel etc. are correct in the sense that a lawyer cannot check or improve on them. It is for this reason that the “legal bit” i.e. the terms and conditions can be extensively drafted and negotiated for months, without anyone worrying too closely about what goes in the schedules. However, when it comes to a dispute, almost always the real problem will be over the definition of scope in the schedules which the lawyers never thought to check.

So the problems start right at the beginning: suppliers’ bid teams don’t talk to the project teams, so the one drafts the contract whereas the other drafts the PID. It’s a miracle that any projects get completed at all. What happens after the contract/PID can become even more messy.

Lawyers have drafted a self-indulgent document that is aimed at, well, other lawyers. It is not user-friendly. In any case, since it is rapidly superseded in practice by the PID (or other project planning documentation) the contract very soon becomes redundant as a working document. Indeed, few project personnel feel the need to refer back to the contract so it becomes something of a dead letter until a dispute arises.

It is a dead letter in other senses too. Lawyers don’t understand project methods, and so the commercial terms will often not make sense: the user will typically insist on fixed price, fixed deadlines, fixed deliverables as defined in the contract, all sorts of warranties about performance, yet if the project is using an evolutionary approach or any element of prototyping, these terms are simply inappropriate (at best) or wrong (at worst) as they do not describe what the parties are seeking to do.

Any dispute will therefore focus on not only establishing what happened, but then trying to map what happened onto a contractual regime which was never designed to deal with the facts. It is this inquiry into the facts and the resulting uncertainty that makes disputes so much more expensive and uncertain for the parties.

There has to be more sensible way of organising projects: if there could be some rapprochement between lawyers and projects people, contracts would be more meaningful and projects would be based on more solid commercial expectations. Until then, we must soldier on as best we can with the materials available - a costly exercise that does not in fact assist the people who ought to be the beneficiaries of IT services.

Richard Stephens - richard.stephens@lorsonline.com

The Law Office of Richard Stephens - L.O.R.S. Online