It may be recalled that prior to the dispute, Sears and CSC has confirmed their agreement for a 10-year contract of $1. 6 billion-dollar deal on IT outsourcing bilateral deal in June 2nd 2004. According to the “general agreement”, Sears “will retain responsibility for its overall technology standards, architecture and service policies, as well as for its mainframes and core retail systems, which it will maintain in-house”.
On the other hand, CSC Chairman and CEO Van B. Honeycutt quoted on the general agreement that “CSC shall provide and apply its knowledge, best practices, process excellence, established methodologies and continual innovation, towards achieving Sears’ business vision” (Sliwa, C. , 2004). As further cited, CSC believed that strategic partnership will flourish a” win-win situation” for Sears and CSC to accessibly lead the technological-edge in IT outsourcing.
The general agreement that binds Sears and CSC were embedded in their proposition to compete with IBM Global Services, Hewlett-Packard Co. , Electronic Data Systems Corporation and Affiliated Computer Services Incorporated. At hindsight, the “preferential option” to leading the technological-edge in IT outsourcing could have encouraged much CSC’s venture to contract with other stakeholders, in which CSC has established its IT outsourcing business.
The delinquency and faulty on the general agreement could have been resulted by the preferential options of both contracting parties for merger firms and investments, from which the termination clause offers flexibility to “rendering” options of contracting parties, and thereby could be a “fracture” to the legal fulfillment of obligations in accord of the contract. Sanctions on terms of reference It may be said that sanctions on terms of reference of obligation is an essential part of a contract, treaty and agreement.
As defined by the Cornell University Law School, contracts are primarily ruled by “state statutory and common (judge-made) law and private law”. Which means, private law primarily comprise “the terms of the agreement between the parties” that are [vice-versa] giving and receiving pledge of allegiance or commitment. As cited from the US Uniform Commercial Code, Article 9 (201) of the Secured Transactions, states: “as otherwise provided by the security agreement act is effective according to its terms between the parties; extends the application of any such statute or regulation to any transaction”.
Therefore, the “terms of agreement” is binding beyond commitment and effective to the fulfillment of “application”, in which could be referring to the general agreements made by and between Sears and CSC. The sanctions on the terms of reference [of obligations] of the contracting parties could however meet its “petition” to appeal reconsideration, which is provided under Federal Rules on Bankruptcy and Procedures that do not only provides reconsideration to nullify the obligations in the event of bankruptcy [within the partnership or covered within an agreement].
The appeal for reconsideration is for involuntary petition affecting the partnership, as provided under Rule 1004 that states: “after filing of an involuntary petition under USC 303(b) (3), the petitioning partners or other petitioners shall promptly send to or serve on each general partner who is not a petitioner a copy of the petition”, in which provided that the documented or written appeal have been coursed through the adjudicating agency referred to as the US-SEC.