Effect of an indefinite obligation to supply on Avanti
Effect of an indefinite obligation to supply on Avanti
Avanti says that such an obligation would in fact be unworkable because it would mean that Avanti could be held to supplying services to EE even if the satellites originally specified were now unusable because their operating lives had expired, unless EE was prepared agree a change. EE’s answer to this is to say that the parties would no doubt act commercially in such a case to avoid this happening and come to an agreement. Further, Mr Lavy KC contemplated the possibility that there may be implied on the part of Avanti a right to terminate on reasonable notice, or even that the doctrine of frustration might apply. But as with the idea of an indefinite contract for services to be provided for a reasonable charge, the idea that a contract of this kind would be terminable on reasonable notice seems to me to be commercially very unlikely, where there are detailed express provisions for when it can be terminated. So I do think that Avanti has a point here.
- Heading
- INTRODUCTION
- Nature of the services to be provided by Avanti
- The contractual framework
- the facts
- Section 5
- The Purchase Orders (“POs”)
- Changes to the SOW
- The Parties’ Negotiations
- The Present Position
- the law
- serious issue to be tried
- Clause 2 of the GSA
- The SOW
- The “Mandatory” Point
- The “Agreement” Point
- The Term and Duration Point
- The EE-HO Contracts
- Effect of an indefinite obligation to supply on Avanti
- EE’s ability to migrate to a new supplier
- CCN5
- The GSA/SOW as an “evergreen” contract
- Conclusion on factual matrix and other points
- Conclusions
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