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Contracts made for software and hardware are difficult to reject

On Behalf of | Nov 23, 2018 | Contracts

Nearly all local county and city governments in Oregon and nationwide have by now switched to some form of a digital system of data retrieval and storage. For example, the old ways of having clerks type massive deeds by hand into heavy, burdensome record books are dead. Now vendors offer contracts where they provide high-tech scanning, indexing, and retrieval functions in one package of software.                                              

It is still necessary for consumers to know how to access and order copies of that material that is open to the public. Thus, when software is sold to a government agency, the purchase and sale contracts may provide for installation of the software, coordination of the network of machines and teaching the employees and even the consuming public how to use it. In addition, sometimes the vendor providing the software will also provide suitable hardware, especially where the agency is using outdated hardware.

Those factors may be litigated in a recent court filing by a software company against a local agency in another state. The company’s suit is based on a pretty straightforward breach of contract claim. It alleges that the county government failed to pay the plaintiff, SpartanTec, $139,524.04 for the products and services delivered to the county. Despite filling out a purchase order on July 31 of this year, and receiving the software and hardware on Aug. 8, the county refused to pay and eventually returned the products in September, according to the lawsuit filed in a state court.

If the facts alleged can be proved sufficiently, it appears that the plaintiff software company may have a case for breach of contract. If that is so, the main issues here will possibly concern largely the issue of damages. If the returned material has a market value that amount may be deducted from the balance due by the county. Under Oregon law, if there is no market for the items and especially if the software and hardware were specifically configured to the purchase order contracts, then the full amount may be authorized as damages due in the case.