Home' micenet eMag : micenet AUSTRALIA August September 2014 Contents Most of us sell goods or services of one kind or another.
We are suppliers. We are also buyers of goods and
services – sometimes we use them ourselves and
often we on-sell them to our clients and customers.
One of the most common sources of trouble between
participants in the meetings and events and business travel sectors
is the failure to properly describe what we are selling and delivering
to the client – or on the flip side, what it is we want to buy.
The description of the goods or services is, of course, known
as a “specification”, or “spec” for short. The spec is, of course,
part of the contract and is thus legally binding. While the
responsibility for describing the product or service usually falls to
the supplier, sometimes it is necessary for buyers to describe
what it is that they wish to purchase, such as when issuing an
invitation to tender.
In this column (and in the next) I thought we could take a look
at how to write a specification – whether from the point of view
of a supplier or a buyer.
The consequences of a poorly written specification can be
dramatic. If you are a supplier and the spec does not properly
describe the goods or services, you will have a client with
expectations that do not match the product you actually supply.
The outcome? A disappointed client who is much less likely to give
you repeat business, or who may even sue you for his/her loss.
Equally if you are a buyer, you will not get the goods or
services you wanted or that you thought you were entitled to
receive. You may suffer losses of your own - or at the hands of
your client or others to whom you intended to resupply those
goods or services. The latter is a common scenario in the
meetings, events and travel sector SCIC where businesses are
often the “middleman”.
So what are the principles that govern the writing of a spec?
Here I offer you a short guide to the general principles that
should be applied to writing a spec – irrespective of whether you
are a supplier or buyer:
• Are you qualified to write the spec? This is most likely to arise
if you are buying goods or services that are not squarely in
your skillset. If you do not have the technical skill, consider
getting help from an expert in the relevant field who does.
While your lawyer can point out some issues, remember that
lawyers are usually not experts on the technical issues. For
example, I wouldn’t know a woofer from a tweeter if I tripped
over them when looking at a spec for AV services (a startling
admission, I know!).
• Write it, then edit and re-edit.
• It is always a good idea to get a colleague to review the spec.
Another pair of eyes may spot ambiguity or omissions that
you have overlooked – you may have lived and breathed the
project from the beginning, but may be too close to see the
wood for the trees.
• If there are any assumptions underlying the transaction they
should be stated. If the assumptions aren’t right, you will have
a means of dealing with the issue with your counter-party. If
assumptions remain unstated, there will be no recourse. If the
assumptions are so important that their failure to materialise
means a completely different landscape, you’ll need express
provisions in the contract to deal with alternate possibilities.
• Keep the spec as a description of the goods or services only.
Do not mix in provisions about liability or other legal issues –
the latter should be in the body of the contract only.I see this
often and the inevitable result is a contract that is hard to
understand and where the spec is inconsistent with the
substantive provisions of the contract – and the question is
always: “Which provisions prevail?”
• The “nuts and bolts” need to be clear and the details
accurate. For goods: What goods, what model, size, weight,
power, output, speed, design, colour? How many? New or
used? Do they need to comply with a particular standard?
• For services – again detail is important but there can be issues
if you stray into “how” the services will be supplied; more on
this next time.
• Where and when will the goods or services be supplied? Can
delivery dates be promised? For events this can be crucial.
What order will they be supplied in? Projects can be seriously
delayed if timing is not considered. How do timing and
delivery milestones affect price and invoicing?
Stay tuned – next time we’ll delve even deeper! m
Matt Crouch can be contacted via email - Matt.Crouch@hmclegal.com.au
A troublesome area in the meetings world is the failure to
properly describe what service providers actually sell.
A guide to writing
BY MATTHEW CROUCH
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