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SECRETARY OF STATE FOR SOCIAL
SECURITY
- and -
POST OFFICE COUNTERS LTD
- and -
PATHWAY GROUP LIMITED
INFORMATION TECHNOLOGY
SERVICES AGREEMENT FOR
BRINGING TECHNOLOGY TO
POST OFFICES AND
BENEFITS PAYMENTS
VOLUME 1
Bird & Bird
90 Fetter Lane
London
EC4A 1JP
Tel: 0171 415 6000
Fax
Ref: HRS\BPOCL\001\mainpwy.5-0
AUTHORITIES VERSION 5.0 15 May 1996
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INFORMATION TECHNOLOGY SERVICES AGREEMENT
FOR BRINGING TECHNOLOGY TO
POST OFFICES AND BENEFITS PAYMENTS
Table of Contents
Clauses Page Numbers
RECITALS ¢ ¢ 056 6 SEG HES DHE REDE S RSE ROSE EHAE RHEE DHE E HET REET RHE A,
PART L & INTRODUCTION. secs eses ches urec eed sabes Bnes ends ees e ane 2
Clause 101. Contract Structure... ... cece ee eee eee cece teens 2
Clause 102. Interpretations........ cee eee eee eee eee ee ee ee eee 8
Glause 108. Severability. «cia csascrsesise sees eran eran snaw sia 9
Clause 104. Law and Jurisdiction... ..... cece eee e cece eee eeee 9
Clause 105. Entire Agreement... .... cc eee eee eee eee ee ee eens 10
Clause 106. General Principles... .... ee eee eee ee eee eee ee eee 10
PART 2 : PERFORMANCE OF SERVICES AND SUPPLY OF PRODUCTS..... 10
Clause 201. Performance of ServiceS...... sees cece eee e ee eeee 10
PART 3 3 CONSIDERATION « nas vice nnee ime Cee Ce ew HOw SHO wo 14
Clause 801. Charges «suse cases a6 ww Ose Oe BOE Oe oe ae 14
Clause 302. Value Added Tax......cscecceccccc cesses sscncces 14
PART 4 : DEVELOPMENT AND IMPLEMENTATION OF STEADY STATE
SERVICES 6. ccc cece cece eens sence cece wane ase e eres ses enssenseses 15
Clause 401. Development Services... .... cee eee cece eee eee eens 15
Clause 402. Operational Trial... . cc cece cece eee cece ee eee eee LS
Clause 403. Roll Out of Service...... eee eee eee e eee 18
Clause 404. Roll Out of Steady State Services............... 20
PART 5 : OWNERSHIP, LICENCES AND RISK.........eeeeeeeeeeeeee 21
Clause 501. Ownership of Intellectual Property Rights in the
design of the Service Architecture 2 . 21
Clause 502. Licences to use Intellectual Property Rights.... 21
Clause 503. Databases ~ 22
Clause 504. Riposte 32 Software ~ 22
PART 6 : CONTRACT AND SERVICE MANAGEMENT... « 23
Clause GOL. MONLEOTANGs: + .ccresuessueusnossnresenecznegs as 23
Clause 602. Management Interfaces and Services Management... 23
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Clause 603. Communications.........cccccccrerccccceecccrcenes 23
Clause 604. Transfer and Sub-Contracting...............-.6.- 25
Clause 605: Time... ccc ces eee sce cc sce ccs vcs sesscssssssscssces 28
Clause 606. CONFIGENCIALILY..<. cicssicsessssrce cass snes visssa 31
Clause 607. Health and Safety Hazards............... eee ee eee 34
Clause 608. Protection of Personal Data and Social Security
Administration Act... ... ee cece ec eee eee eee ee eee eee eeee 34
Clause C09. PULLEY. 6 oes cic w yom Soe Hee Hee Hole SHE Ore Oe 35
Clause 610. CONTRACTOR's Personnel........eeeeee eee ceecsecee 36
Clause 611. Waiver... cc cc ccc scc ese ce ccs ncarsascasesssscnsens a7
Clause 612. Access to PreMisSeS..... 2s eee ee ee cere cee ecceees 37
Clause 613. Security Requirements... .... ee cece eee ee ee ee eee 38
Clause 614. CONTRACTOR’s Key Personnel.............ee eee eee 38
PART 7 WARRANTIES AND STANDARDS.........ceeeeececeeseseeee 38
Clause 701. Authority and Approval... ... sec eee cece eee ee wees 38
Clause 702. Performance of ServiCeS....... cece cece e eee ee eens 39
Clause 703. Performance of PrOdUCtsS.......see eee eee eee ceecee 39
Clause 704. Intellectual Property Rights.................... 40
C€latse 705. Industry Standards, .icsscssasesassssassosssnce ze 40
Clause 706. Statements and Representations................6.. 40
Clause 707. Disclaimer of Implied Terms...............--.22- 41
PART 8 65004 1D bs 41
Clause 801. AUdGit.... eee cece e cece eee eee etre eee eeees 41
Clause 802. Liquidated Damages and Delay..................2.. 43
Clause 803. Additional ReSources....... eee eee e cece eee eceecee 44
Clause 804. Recovery of Sums Due........ eee eee ee cee ee ee eee 44
Clause 805. Intellectual Property Rights Indemnity.......... 44
Clause 806. Remedies Cumulative........ cece eee ee ee ee eee eens 48
Clause 807. Alternative Dispute Resolution Procedure........ 48
Clause 808s Liabila ys sacs snae sacs seas snseenee eves snes sande aa 50
Clause 809. Injury to Persons; Loss of Property............. 51
Clause 810. Limitation of Liability............. cee ee eee eee 51
PART 9 TERM AND TERMINATION. ........2 222 ceeece cece eee eeees 54
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Clause 901. Terms. cies nesceses aes cous eves cose aees eves aeesae 54
Clause 902. Termination of AUTHORITIES' Agreement........... 55
Clause 903. Rights on Termination of AUTHORITIES’ Agreement. 59
Clause 904. Transfer Services... ..cceceeeesesccesceccecssces 63
PART 10 : MISCELLANEOUS... .... ccc ccc cc cere cccccecccccerecccs 63
Clause 1001. Corrupt Gifts and Payments of Commission....... 63
Clause 1002. Discrimination. ......cceececcsccccecsecsscesces 65
Clause 1003. Guarantee... .cc sec seeseecs sce rcnscsssecsscevens 65
Clause 1004. Insurance....... cece eee ee cee c eee reer ccc eeeee 65
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FOR BRINGING TECHNOLOGY TO
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Schedules Clause Reference
1. Service Environment 703.3
2. Extrapolation and Transposition of Schedules 201
35 Assumptions 102.5
Al. Interpretations 102.1
A2. Policies and Standards 613, 703.1
A3. Audit 801
A4. Contract Management 602, 807.1
AS. Change Control 101.3
Ab. Charging Structure 301.1
A7. Acceptance Procedures 403.1
A8. Approach to Remedies 802
AQ. Contract Termination 904
Al10 Sub-contractors 604.2
All Guarantee 1003
Al2. CONTRACTOR’s Key Personnel 614
BL Requirements Catalogue 201.1
B2. Solutions Catalogue 201.1
B3 Service Levels and Remedies 201
B4. Double Key Requirements 101.3
BS. Double Key Solutions 101.3
B6 Service Infrastructure Acceptance Criteria 403
BT. Timetable 605.1
B8 Benefit Encashment Fraud 808
C1. Operational Trial Objectives 402.2
C2 Operational Trial Milestones and Plans 402.1
C3. Operational Trial Acceptance 402.1
C4. AUTHORITIES’ Operational Trial Responsibilities 402.8
C5. Operational Trial Remedies 802.1
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THIS AGREEMENT is made the fifteenth day of May 1996
BETWEEN:
(1) The Secretary of State for Social Security, acting through
and on behalf of the Department of Social Security and on
behalf of the Department of Health and Social Services for
Northern Ireland ("DSS");
(2) Post Office Counters Ltd whose registered office is
situated at Drury House, 1-16 Blackfriars Road, London SE1l 9UA
("POCL") 7
(DSS and POCL being referred to collectively as "the
AUTHORITIES"); and
(3) Pathway Group Limited whose registered office is at ICL
House, Putney, London, SW15 ("the CONTRACTOR").
RECITALS
WHEREAS :
(a) The AUTHORITIES wish to contract for the design,
development, integration and establishment of the Service
Infrastructure (as defined herein) and for the Services (as
defined herein);
(b) On 30 August 1994 the AUTHORITIES placed an advertisement
in the Official Journal of the European Communities for the
supply of the Service Infrastructure and the Services;
(c) All parties recognise and commit to the overall service
objectives of the Related Agreements which can be expressed as:
e a fraud-free method of paying benefits at post offices
that is automated, has lower end-to-end costs than the
current paper-based process, with continuously reducing
overall administration costs year on year;
e extending automation to POCL’s other client transactions,
its products and its support processes to improve
competitiveness, increase efficiency, and to enable
greater commercial opportunities for POCL;
e full and speedy reconciliation of benefits payments, with
accounting arrangements consistent with recognised
accounting practices;
ean improved overall service to the AUTHORITIES’
customers.
(d) On 13 April 1995 the AUTHORITIES issued their Statement of
Service Requirements to potential suppliers (including the
CONTRACTOR) in respect of the supply of the Service
Infrastructure and the Services;
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(e) The CONTRACTOR submitted its Proposal dated 8 June 1995 in
response to the Statement of Service Requirements;
(f) On 29 February 1996 the AUTHORITIES invited potential
suppliers (including the CONTRACTOR) to submit Tenders in
respect of the supply of the Service Infrastructure and the
Services;
(g) The CONTRACTOR submitted a Tender on 21 March 1996; and
(h) On 16 April 1996 the AUTHORITIES invited potential
suppliers (including the CONTRACTOR) to submit Retenders in
respect of the supply of the Service Infrastructure and the
Services;
(i) The CONTRACTOR submitted a Retender on 22 April 1996;
(j) On the basis of the CONTRACTOR's Proposal, Tender and
Retender, the AUTHORITIES have selected the CONTRACTOR to
supply the Service Infrastructure and the Services and the
CONTRACTOR undertakes to supply the same on the terms set out
below.
NOW THEREFORE IT IS HEREBY AGREED as follows:
PART 1 : INTRODUCTION
Clause 101. Contract Structure
101.1 The Related Agreements
This agreement forms part of a suite of three related
agreements between the parties (“the Related Agreements”)
comprising:
(a) this agreement between DSS, POCL and the CONTRACTOR
(“the AUTHORITIES’ Agreement”);
(b) a separate agreement between DSS and the CONTRACTOR
(“the DSS Agreement”); and
(c) a separate agreement between POCL and the CONTRACTOR
(“the POCL Agreement”).
101.2 Precedence of the Related Agreements
In the event of and to the extent only of any conflict or
inconsistency between the provisions of this AUTHORITIES’
Agreement and the provisions of the DSS Agreement or the
POCL Agreement, the provisions of this AUTHORITIES’
Agreement shall prevail.
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101.3 Amendments to Clauses and Schedules of the Related
Agreements
101.3.1 The provisions of the Related Agreements may not
be amended unless such amendment is approved on behalf of
the relevant parties at the appropriate levels of authority
as follows:
(a)
(b)
(c)
(d)
(e)
(f£)
subject to the change control procedures specified in
Schedule A5, amendments to the Clauses, Annexes and
Schedules of the AUTHORITIES’ Agreement must be
approved by the BA Project Director or his successor
on behalf of DSS and by the POCL Development Director
or his successor on behalf of POCL and by the
Managing Director or his successor on behalf of the
CONTRACTOR;
except as provided by paragraph (d) below, and
subject to the change control procedures specified in
Schedule A5, amendments to the Clauses and Schedules
of the DSS Agreement must be approved by the
BA.Project Director or his successor on behalf of DSS
and by the Managing Director or his successor on
behalf of the CONTRACTOR;
except as provided by paragraph (e) below, and
subject to the change control procedures specified in
Schedule A5, amendments to the Clauses and Schedules
of the POCL Agreement must be approved by the POCL
Development Director or his successor on behalf of
POCL and by the Managing Director or his successor on
behalf of the CONTRACTOR;
any amendment to the Clauses or Schedules of the DSS
Agreement which conflicts or is inconsistent with the
Double Key Requirements in Schedule B4 or the Double
Key Solutions in Schedule B5 in whole or in part
shall be subject to the approval of all three parties
in accordance with paragraph (a) above;
any amendment to the Clauses or Schedules of the POCL
Agreement which conflicts or is inconsistent with the
Double Key Requirements in Schedule B4 or of the
Double Key Solutions in Schedule B5 in whole or in
part shall be subject to the approval of all three
parties in accordance with paragraph (a) above;
notwithstanding the foregoing provisions of this
Clause, but subject to the change control procedures
specified in Schedule A5, in the event of a future
change in policy by the Government, DSS may release
the CONTRACTOR from its obligations to both
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AUTHORITIES under Clause 106.1 without POCL’s
approval.
101.3.2 (a) If the CONTRACTOR and DSS agree any amendment
to the DSS Agreement without the approval of POCL
being obtained to such amendment, and POCL’s approval
should have been obtained pursuant to Clause
101.3.1(d), such purported amendment shall _ be
invalid, and DSS shall indemnify the CONTRACTOR for
all costs and expenses reasonably incurred by the
CONTRACTOR as a direct result of such purported
amendment.
(B) If the CONTRACTOR and POCL agree any amendment to the
POCL Agreement without the approval of DSS having
been obtained to such amendment, and DSS’s approval
should have been obtained pursuant to Clause
101.3.1(e), such purported amendment shall be
invalid, and POCL shall indemnify the CONTRACTOR for
all costs and expenses reasonably incurred by the
CONTRACTOR as a direct result of such purported
amendment.
101.3.3 The CONTRACTOR need not agree to any amendment
to any Related Agreement if such amendment would place it
in breach of any of its obligations under any other Related
Agreement.
101.4 Other Changes
Changes in connection with the Related Agreements which do
not require any amendment to the Related Agreements may be
approved by the parties to the relevant contract, subject
to the change control procedures specified therein as
follows:
(a) changes under the AUTHORITIES’ Agreement may be
approved by the BA/POCL Procurement Manager or his
successor on behalf of DSS and on behalf of POCL and
by the Managing Director or his successor on behalf
of the CONTRACTOR in accordance with the change
control procedures specified in Schedule A5;
(b) changes under the DSS Agreement may be approved by
the BA/POCL Procurement Manager or his successor on
behalf of DSS and by the Managing Director or his
successor on behalf of the CONTRACTOR in accordance
with the change control procedures specified in
Schedule A5 of the DSS Agreement;
(c) changes under the POCL Agreement may be approved by
the BA/POCL Procurement Manager or his successor of
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POCL and by the Managing Director or his successor of
the CONTRACTOR in accordance with the change control
procedures specified in Schedule AS of the POCL
Agreement.
101.5 Rights and Remedies of the AUTHORITIES under the
Related Agreements
101.551 The rights and remedies of each AUTHORITY
against the CONTRACTOR under the AUTHORITIES’ Agreement are
concurrent and may be exercised concurrently or separately
by either AUTHORITY with or without the consent of the
other AUTHORITY.
101.522 Except as provided by Clause 101.5.4, the
rights and remedies of DSS against the CONTRACTOR under the
DSS Agreement are not concurrent with those of POCL and may
only be exercised by DSS.
101.5.3 Except as provided by Clause 101.5.5, the rights
and remedies of POCL against the CONTRACTOR under the POCL
Agreement are not concurrent with those of DSS and may only
be exercised by POCL.
101.5.4 If in the event of Default by the CONTRACTOR
under the DSS Agreement, DSS elects not to exercise any of
its rights and remedies against the CONTRACTOR under that
Agreement, such rights and remedies shall be exercisable
against the CONTRACTOR by POCL in DSS’s name within three
(3) months of such election as if POCL were DSS and the
CONTRACTOR shall be liable to POCL as if POCL were DSS,
provided that POCL has suffered or risks suffering direct
loss or damage as a result of such Default which is not
remediable under the POCL Agreement and provided, further,
that the POCL Agreement has not been terminated. In any
such action, the CONTRACTOR shall be entitled to the same
substantive defences and procedural rights and remedies
against POCL as it would have had against DSS if such
action were brought by DSS (including the right to obtain
discovery from POCL and DSS of those documents in relation
to which the CONTRACTOR would have had a right of discovery
if the action had been brought by DSS) in addition to those
it is entitled to against POCL itself. However, POCL shall
not be entitled to exercise DSS’s rights and remedies
against the CONTRACTOR under the DSS Agreement (a) without
first having consulted fully with DSS, or (b) where DSS has
settled its own claim against the CONTRACTOR in respect of
such Default and POCL has approved such settlement. POCL
shall promptly notify the CONTRACTOR in writing of its
approval of such settlement.
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101.5.5 If in the event of Default by the CONTRACTOR
under the POCL Agreement POCL elects not to exercise its
rights and remedies against the CONTRACTOR under that
Agreement, such rights and remedies shall be exercisable
against the CONTRACTOR by DSS in POCL’s name within three
(3) months of such election as if DSS were POCL and the
CONTRACTOR shall be liable to DSS as if DSS were POCL,
provided that DSS has suffered or risks suffering direct
loss or damage as a result of such Default which is not
remediable under the DSS Agreement and provided, further,
that the DSS Agreement has not been terminated. In any
such action, the CONTRACTOR shall be entitled to the same
substantive defences and procedural rights and remedies
against DSS as it would have had against POCL if such
action were brought by POCL (including the right to obtain
discovery from DSS and POCL of those documents in relation
to which the CONTRACTOR would have had a right of discovery
if the action had been brought by POCL) in addition to
those it is entitled to against DSS itself. However, DSS
shall not be entitled to exercise POCL’s rights and
remedies under the POCL Agreement (a) without first having
consulted fully with POCL, or (b) where POCL has settled
its own claim against the CONTRACTOR in respect of such
Default and DSS has approved such settlement. DSS shall
promptly notify the CONTRACTOR in writing of its approval
of such settlement.
101.5.6 The CONTRACTOR shall not be liable to either
AUTHORITY for any failure to perform or delay in performing
any of its obligations to that AUTHORITY under the Related
Agreements where the CONTRACTOR proves that such failure or
delay has been directly caused by the failure of either
AUTHORITY to perform any of the obligations applicable to
that AUTHORITY or to both AUTHORITIES under the Related
Agreements. This Clause shall not apply to Clause 808,
which shall be governed by the specific rule stated in
Clause 808.2.
101.5.7 Before settling any claim by it under the
Related Agreements, the relevant AUTHORITY shall first
consult fully with the other AUTHORITY. Settlement by
either AUTHORITY of a claim by it against the CONTRACTOR
under the Related Agreements shall protect the CONTRACTOR
from the other AUTHORITY making a claim in respect of the
same Default, provided that such AUTHORITY has approved
such settlement. The AUTHORITY approving such settlement
shall promptly notify the CONTRACTOR in writing of such
approval.
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101.6 Obligations and Liabilities of the AUTHORITIES under
the Related Agreements
101.6.1 For the avoidance of doubt, the parties
acknowledge that nothing in the Related Agreements shall
be deemed or construed to create a partnership between the
AUTHORITIES, and neither AUTHORITY shall be jointly or
severally liable for any of the obligations of the other
AUTHORITY under the Related Agreements.
101.6.2 Without limitation to Clause 101.6.1, where any
obligation under the Related Agreements is expressed to be
binding on both AUTHORITIES, such obligation will be
binding on each AUTHORITY individually and one AUTHORITY
shall not be liable for any failure by the other AUTHORITY
to comply with that obligation.
Clause 102. Interpretations
102.1 As used in the AUTHORITIES’ Agreement:
102.1.1 the terms and expressions set out in
Schedule Al shall have the meanings ascribed therein;
102.1.2 the masculine includes the feminine and the
neuter; and
102.1.3 the singular includes the plural and vice
versa.
102.2 A reference to any _ statute, enactment, order,
regulation or other similar instrument shall be construed
as a reference to the statute, enactment, order, regulation
or instrument as amended by any subsequent’ statute,
enactment, order, regulation or instrument or as contained
in any subsequent re-enactment thereof.
102.3 Headings are included in the AUTHORITIES’ Agreement
for ease of reference only and shall not affect the
interpretation or construction of the AUTHORITIES’
Agreement.
102.4 References in this AUTHORITIES' Agreement to Clauses,
Parts, Annexes and Schedules are, unless otherwise
provided, references to the clauses, parts, annexes and
schedules of the AUTHORITIES’ Agreement.
102.5 In the event and to the extent only of any conflict
or inconsistency between the Clauses and Schedule Al and
the Schedules (other than Schedule Al), the Clauses and
Schedule Al shall prevail. In the event and to the extent
only of any conflict or inconsistency between the Schedules
(other than Schedule Al), the provisions of Schedules 2, A2
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to Al2, B3, B7 and B8 shall prevail over those of all other
Schedules (other than Schedule Al) and the provisions of
Schedules Bl and B4 shall prevail over those of Schedules
B2 and B5. Notwithstanding the foregoing, if and only to
the extent that Schedule 3 expressly states that a
particular requirement in Schedule Bl and B4 will be met by
Schedules B2 and BS in a particular form, manner or
quantity, or at a particular time or place, the provisions
of Schedule 3 will prevail. Moreover, for the avoidance of
doubt, the AUTHORITIES acknowledge that a particular
solution in Schedules B2 or BS shall not be treated as
being in conflict or inconsistent with any requirement in
Schedule Bl or B4 merely because the solution states that
the requirement will be met in a particular form, manner,
quantity, time or place.
102.6 The Recitals are not legally binding, but are
intended as a guide to the interpretation and construction
of the AUTHORITIES’ Agreement.
Clause 103. Severability
If any provision of the AUTHORITIES’ Agreement is held
invalid, illegal or unenforceable for any reason by any
court or regulatory body of competent jurisdiction, such
provision shall be severed and the remainder of the
provisions hereof shall continue in full force and effect
as if the AUTHORITIES’ Agreement had been executed with the
invalid illegal or unenforceable provision eliminated. In
the event of a holding of invalidity so fundamental as to
prevent the accomplishment of the purpose of the
AUTHORITIES’ Agreement, the AUTHORITIES and the CONTRACTOR
shall immediately commence good faith negotiations to
remedy such invalidity. However, if the AUTHORITIES and
the CONTRACTOR fail to conclude such negotiations within a
reasonable period of time, the AUTHORITIES’ Agreement shall
terminate without further liability to any party (subject
to Clause 902.7).
Clause 104. Law and Jurisdiction
104.1 The AUTHORITIES’ Agreement shall be considered as a
contract made in England and according to English Law and,
subject to Clause 807, shall be subject to the exclusive
jurisdiction of the English Courts to which the parties
hereby submit.
104.2 Except as specified in Clause 101, the AUTHORITIES’
Agreement is binding on the relevant AUTHORITIES and their
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successors and permitted assignees and on the CONTRACTOR
and the CONTRACTOR's successors and permitted assignees.
Clause 105. Entire Agreement
The Related Agreements constitute the entire understanding
between the parties relating to the subject matter of the
Related Agreements and, save as may be expressly referred
to or referenced herein, supersede all prior
representations, agreements, negotiations or understandings
with respect thereto, whether oral or in writing, except in
respect of any fraudulent misrepresentation made by any
party.
Clause 106. General Principles
106.1 The CONTRACTOR will not have the right to seek and
arrange for the Card to be used in retail outlets other
than in post offices and DSS offices in normal
circumstances.
106.2 The CONTRACTOR shall deliver and continue to provide
a secure system in respect of all transactions which as far
as the Related Agreements require eliminates the potential
for benefit payment fraud and any other fraud or
unauthorised disclosure of data and provides pro-active
detection processes and significant barriers to attacks
from internal conspiracy and collusion to defraud the
AUTHORITIES.
106.3 The Services and the Service Infrastructure shall be
capable of introduction in all post offices.
PART 2 : PERFORMANCE OF SERVICES AND SUPPLY OF PRODUCTS
Clause 201. Performance of Services
201.1 Until transposed in accordance with Clauses 201.4 and
201.5, the CONTRACTOR shall be responsible for meeting the
requirements specified in Schedule Bl in the manner
specified in Schedule B2 by performing the Services to be
more particularly described in the relevant Schedules of
the DSS Agreement and the POCL Agreement. The AUTHORITIES
shall perform at their own cost and expense the AUTHORITIES
Responsibilities listed in Schedules B2 and B5 and as
otherwise expressly specified herein, and shall use all
reasonable endeavours to perform such AUTHORITY
Responsibilities in accordance with any agreed timetable
specified in Schedule B7 or elsewhere herein. However, for
the avoidance of doubt, and subject to Clause 102.5, the
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parties acknowledge that the AUTHORITIES’ acceptance of the
CONTRACTOR’s solutions in Schedule B2 and B5, and their
agreement to the service descriptions contained in the
relevant Schedules of the DSS Agreement and the POCL
Agreement, shall not relieve the CONTRACTOR of its
obligation to meet the requirements specified in Schedules
Bl and B4, as modified by Schedule 3.
201.2 To support the performance of the Services, the
CONTRACTOR shall supply the Service Architecture Design
Document in accordance with Schedules Bl and B2 and all
other applicable provisions hereof.
201.3 The CONTRACTOR shall be responsible for meeting the
Double Key Requirements specified in Schedule B4 in the
manner specified in Schedule B5 by performing the Services
to be more particularly described in the relevant Schedules
of the DSS Agreement and the POCL Agreement.
201.4 Schedule Bl and Schedule B2 shall cease to have
effect from three (3) months after execution of the
AUTHORITIES’ Agreement, provided that Schedules Bl and B2
shall have been
(a) clarified pursuant to Clause 201.10; and
(b) transposed and/or extrapolated to the relevant
Schedules of the Related Agreements as specified in
Schedule 2.
The foregoing process of clarification, transposition and
extrapolation shall not add to the CONTRACTOR’s obligations
under the Related Agreements as at the date hereof. Any
variation (including additions, reductions and
modifications) to the CONTRACTOR’s obligations under the
Related Agreements arising out of such clarification,
transposition and extrapolation may only be made in
accordance with Clause 101.3.
201.5 Schedule B3 shall cease to have effect three (3)
months after execution of the AUTHORITIES’ Agreement,
provided that Schedule B3 shall have been extrapolated into
the relevant Schedules of the POCL Agreement and of the DSS
Agreement as specified in Schedule 2. The foregoing
process of extrapolation shall not add to the CONTRACTOR’s
obligations under the Related Agreements as at the date
hereof. Any addition to the CONTRACTOR’s obligations under
the Related Agreements arising out of such extrapolation
may only be made in accordance with Clause 101.3.
201.6 Schedules 3, A6, B4, B5, B7, B8 and C5 shall be
extrapolated into the relevant Schedules of the Related
Agreements as specified in Schedule 2, but shall still have
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effect after such extrapolation. The foregoing process of
extrapolation shall not add to the CONTRACTOR’s obligations
under the Related Agreements as at the date hereof. Any
addition to the CONTRACTOR’s obligations under the Related
Agreements arising out of such extrapolation may only be
made in accordance with Clause 101.3.
201.7 The CONTRACTOR and the AUTHORITIES shall use all
reasonable endeavours to reach agreement on the
clarification of Schedule Bl, the extrapolation and
transposition of Schedules Bl and B2 and the extrapolation
of Schedules 3, A6, B3, B4, B5, B7, B8 and C5 as soon as
reasonably practicable after the date of execution hereof.
201.8 In the event that the parties hereto are unable to
reach agreement on the clarification of Schedule Bl, the
extrapolation and transposition of Schedules Bl and B2 and
the extrapolation of Schedules 3, A6, B3, B4, B5, B7, B8
and CS within three (3) months of the date of execution
hereof:
201.8.1 (a) the AUTHORITIES may at any time up to
six (6) months after such failure to reach
agreement jointly by notice in writing to
the CONTRACTOR terminate the AUTHORITIES’
Agreement as from the date of service of
such notice or such later date as may be
specified therein without further liability
other than pursuant to Clause 201.9; and
(b) DSS may at any time up to six (6)
months after such failure to reach
agreement by notice in writing to the
CONTRACTOR terminate the DSS Agreement and
POCL may at any time up to six (6) months
after such failure to reach agreement by
notice in writing to the CONTRACTOR
terminate the POCL Agreement as from the
date of service of such notice or such
later date as may be specified therein
without further liability other than
pursuant to Clause 201.9; or
201.8.2 the CONTRACTOR may at any time up to six
(6) months of such failure to reach agreement
terminate the Related Agreements by notice in writing
as from the date of service of such notice or such
later date as may be specified therein to the
AUTHORITIES without further liability other than
pursuant to Clause 201.9; or
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201.8.3 the parties may agree pursuant to Clause
101.3 to extend the period of three (3) months
specified in Clauses 201.4, 201.5 and 201.8; or
201.8.4 if requested by the CONTRACTOR as part of
and at the same time as any agreement to extend the
three (3) month period referred to in Clause 201.8.3,
the AUTHORITIES shall agree to extend the timetable
specified in Schedule B7 at paragraph 2 and table
entries (vi) and (vii) for a period not exceeding the
period of the extension agreed under Clause 201.8.3.
201.9 In the event of termination of the Related Agreements
pursuant to Clause 201.8, the AUTHORITIES shall indemnify
the CONTRACTOR for all costs and expenses reasonably
incurred by the CONTRACTOR after the date of execution
hereof directly in connection with performing (but not
tendering for) the Related Agreements (excluding any costs
for cancellation of supply contracts for items ordered but
not delivered and the CONTRACTOR’s overheads in relation to
its sites, other than in relation to staff) up to a limit
of ten million pounds (£10,000,000) until the end of the
three month period specified in Clauses 201.4, 201.5 and
201.8 and up to a limit of one third of that amount for
each of the three (3) consecutive additional months (pro-
rated for periods of less than a month) for which such
period is extended pursuant to Clause 201.8.3, up to a
maximum of twenty million pounds (£20,000,000) overall.
The CONTRACTOR shall provide documentary evidence in
support of all claims hereunder. The CONTRACTOR shall take
all reasonable steps to mitigate such costs and expenses
including without limitation ensuring that any sub-contract
entered into in connection herewith affords the CONTRACTOR
rights of termination equal to those enjoyed by the parties
under Clause 201.8.
201.10Before or as part of the process of extrapolation and
transposition referred to in Clause 201.4, Schedule Bl
shall be clarified so far as reasonably possible to remove
any typographical errors, inconsistencies, ambiguities and
imprecise or contractually unenforceable language, and to
provide agreed mechanisms for completing any blank spaces
and agreements to agree.
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PART 3 : CONSIDERATION
Clause 301. Charges
301.1 Charging Structure
The overall charging structure for the Related Agreements
shall be as specified in Schedule A6.
301.2 Variation of Charges
The Charges governed by the overall charging structure for
the Related Agreements shall be subject to variation in
accordance with the procedures set out in Schedule A6.
Clause 302. Value Added Tax
The Charges are exclusive of Value Added Tax, which the
relevant AUTHORITY shall pay to the CONTRACTOR at the rate
and in the manner prescribed by law from time to time,
subject to the production by the CONTRACTOR of a valid tax
invoice giving the requisite details of the taxable supply.
PART 4 : DEVELOPMENT AND IMPLEMENTATION OF STEADY STATE
SERVICES
Clause 401. Development Services
401.1 The CONTRACTOR shall perform the following
Development Services in accordance with Schedules Bl and
B2:
401.1.1 development of the Service Architecture
Design Document;
401.1.2 the development of all necessary interfaces
to allow the full integration of the Service
Infrastructure and the Steady State Services into the
Service Environment, so as to create the Service
Architecture.
Clause 402. Operational Trial
402.1 The CONTRACTOR shall, during the Operational Trial
Period, make available the Operational Trial System (which
for the purposes of this Clause 402 shall include the
Service Architecture Design Document) for the Operational
Trial as set out in Schedules Cl to C5 to be performed in
accordance with the timetable set out in Schedule C2. The
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AUTHORITIES shall be entitled to subject all Basic DSS
Services, Basic POCL Services, Optional DSS Services and
Optional POCL Services to the Operational Trial, but, in
relation to Optional DSS Services and Optional POCL
Services, the rights of termination granted pursuant to
this Clause shall apply only to the particular Optional DSS
Service or Optional POCL Service being tested.
402.2 The objectives of the Operational Trial shall be as
specified in Schedule Cl.
402.3 The AUTHORITIES shall accept the Operational Trial
System in accordance with the Operational Trial Procedures.
402.4 The Operational Trial shall be recorded as successful
and the CONTRACTOR notified accordingly where all the
Operational Trial Criteria are met in accordance with the
Operational Trial Procedures.
402.5 The Operational Trial shall be recorded as
unsuccessful and the CONTRACTOR notified accordingly where
any of the Operational Trial Criteria are not met in
accordance with the Operational Trial Procedures.
402.6 If the Operational Trial in respect of the
Operational Trial System has not been’ recorded as
successful pursuant to Clause 402.4 by the end of the
Operational Trial Period (including any extension to the
Operational Trial Period pursuant to Clauses 402.6.2.2 or
402.6.3.2):
402.6.1 DSS shall have the right to terminate
the relevant DSS Services or the DSS Agreement and
POCL shall have the right to terminate the POCL
Agreement or, if appropriate, the relevant POCL
Application Service, pursuant to Clause 902.2; or
402.6.2 the AUTHORITIES shall have the right,
without prejudice to their other rights and remedies:
402.6.2.1 to accept such part of the Operational
Trial System as the AUTHORITIES may decide and
pay a pro-rated Charge therefor or such other
charge as may be agreed between the parties;
402.6.2.2 to extend the Operational Trial Period
for up to two (2) consecutive additional periods
of the same duration or of such shorter duration
as the AUTHORITIES may notify to the CONTRACTOR,
during which the CONTRACTOR shall use reasonable
endeavours to correct the deficiency or
Acceptance Incident which caused the Operational
Trial to be recorded as unsuccessful; or
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402.6.2.3 (subject to Clause 402.13) to
terminate this AUTHORITIES" Agreement in
accordance with Clause 902.2.
For the purposes of the foregoing, the “relevant” DSS
Services or POCL Application Services mean the Services in
respect of which the Operational Trial has been recorded as
unsuccessful.
402.7 If, pursuant to Clause 402.6.1, DSS terminates any of
the DSS Services and/or POCL terminates any of the POCL
Application Services, but neither terminates all of the DSS
Services or POCL Services, as appropriate, nor terminates
the DSS Agreement or the POCL Agreement (as appropriate)
the AUTHORITIES shall have the right without prejudice to
their other rights and remedies:
402.7.1 to accept such part of the Operational
Trial System as the AUTHORITIES may decide and pay a
pro-rated Charge therefor or such other charge as may
be agreed between the parties;
402.7.2 to extend the Operational Trial Period for
up to two (2) additional consecutive periods of the
same duration or of such shorter duration as the
AUTHORITIES may notify to the CONTRACTOR, during
which the CONTRACTOR shall use reasonable endeavours
to correct the deficiency or Acceptance Incident
which caused the Operational Trial to be recorded as
unsuccessful; or
402.7.3 (subject to Clause 402.13) to terminate
this AUTHORITIES’ Agreement in accordance with Clause
902.2.
402.8 If, pursuant to Clause 402.6.1, DSS terminates all of
the DSS Services or DSS or POCL terminates the DSS
Agreement or the POCL Agreement (as appropriate), the other
AUTHORITY shall have the right without prejudice to its
other rights and remedies:
402.8.1 to accept such part of the Operational
Trial System as the relevant AUTHORITY may decide and
pay a pro-rated Charge therefor or such other charge
as may be agreed between it and the CONTRACTOR; or
402.8.2 to extend the Operational Trial Period for
up to two (2) additional consecutive periods of the
same duration or of such shorter duration as the
AUTHORITIES may notify to the CONTRACTOR during which
the CONTRACTOR shall use reasonable endeavours to
correct the deficiency or Acceptance Incident which
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caused the Operational Trial to be recorded as
unsuccessful; or
402.8.3 (subject to Clause 402.13) to terminate
this AUTHORITIES' Agreement in accordance with Clause
902.2.
402.9 In the event that either AUTHORITY extends the
Operational Trial Period for a period pursuant to Clause
402.8.2 and the Operational Trial has not been recorded as
successful by the end of that period, the relevant
AUTHORITY shall have the right without prejudice to its
other rights and remedies:
402.9.1 to accept such part of the Operational
Trial System as the relevant AUTHORITY may decide and
pay a pro-rated Charge therefor or such other charge
as may be agreed between it and the CONTRACTOR; or
402.9.2 to extend the Operational Trial Period for
a further period in accordance with Clause 402.8.2 up
to a maximum of three (3) consecutive periods in
total; or
402.9.3 (subject to Clause 402.13) to terminate
this AUTHORITIES' Agreement in accordance with Clause
902.2.
402.10The AUTHORITIES will perform the AUTHORITIES' Trial
Responsibilities as set out in Schedule C4.
402.11 For the avoidance of doubt, the CONTRACTOR
acknowledges that successful completion of acceptance
testing of any part of the Operational Trial Systems shall
not relieve it of its obligation to continue to perform the
Services hereunder in accordance with all applicable
provisions hereof.
402.12Unless otherwise agreed by the AUTHORITIES, no part
of the Operational Trial System shall be tested under this
Clause until it has first successfully completed acceptance
testing under Clause 403 of the DSS Agreement or Clause 403
of the POCL Agreement (as appropriate).
402.13Notwithstanding the foregoing provisions of this
Clause, the AUTHORITIES shall have no right of termination
of the AUTHORITIES’ Agreement in relation to failure of the
Operational Trial System successfully to complete the
Operational Trial except in accordance with Schedules A7
and C5.
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Clause 403. Roll Out of Service Infrastructure
403.1 The AUTHORITIES shall accept the elements of the
Service Infrastructure in accordance with the Roll Out
Acceptance Procedures contained in Schedule A7. The
Acceptance Criteria for the Service Infrastructure shall be
as specified in Schedule B6.
403.2 The Roll Out Acceptance Test in relation to any such
element shall be recorded as successful and the CONTRACTOR
notified accordingly where all the Acceptance Criteria for
any such element are met in accordance with the Roll Out
Acceptance Procedures.
403.3 The Roll Out Acceptance Test in relation to any such
element shall be recorded as unsuccessful and_ the
CONTRACTOR notified accordingly where any of the relevant
Acceptance Criteria for any such element are not met in
accordance with the Roll Out Acceptance Procedures.
403.4 If the Roll Out Acceptance Test in respect of the
relevant element of the Service Infrastructure has not
been recorded as successful pursuant to Clause 403.2 by the
end of the Roll Out Acceptance Period (including any
extension to the Roll Out Acceptance Period pursuant to
Clause 403.4.2) , the AUTHORITIES shall have the right
without prejudice to their other rights and remedies
(excluding the right to terminate in accordance with Clause
902.2):
403.4.1 to accept such part of the Service
Infrastructure as the AUTHORITIES may decide ;
403.4.2 to extend the Roll Out Acceptance Period
for a period or periods, specified by the
AUTHORITIES, during which the CONTRACTOR shall use
reasonable endeavours to correct the deficiency or
Acceptance Incident which caused the Roll Out
Acceptance Test to be recorded as unsuccessful; or
403.4.3 to reject the relevant element of the
Service Infrastructure, in which case the CONTRACTOR
shall either provide a replacement element of the
Service Infrastructure, or repair the relevant
element of the Service Infrastructure (as agreed by
the parties, such agreement not to be unreasonably
withheld or delayed) in which case such replacement
or repaired element shall be subject to Roll Out
Acceptance Testing in accordance with this Clause
403.
403.5 Unless otherwise agreed by the AUTHORITIES, no
element of the Service Infrastructure shall be eligible
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for testing under this Clause until it has first
successfully completed acceptance testing under Clause 404
of the DSS Agreement or Clause 404 of the POCL Agreement
(as appropriate).
Clause 404. Roll Out of Steady State Services
404.1 The AUTHORITIES shall accept the elements of the
Steady State Services in accordance with the Roll Out
Acceptance Procedures contained in Schedule A7.
404.2 The Roll Out Acceptance Test in relation to any such
element shall be recorded as successful and the CONTRACTOR
notified accordingly where all the Acceptance Criteria are
met in accordance with the Roll Out Acceptance Procedures.
The Acceptance Criteria for the Steady State Services shall
be as specified in Schedules D2 and E2 of the DSS Agreement
and Schedules D2, E2, F2 and G4 of the POCL Agreement, as
appropriate.
404.3 The Roll Out Acceptance Test in relation to any such
element shall be recorded as unsuccessful and _ the
CONTRACTOR notified accordingly where the relevant
Acceptance Criteria are not met in accordance with the Roll
Out Acceptance Procedures.
404.4 If the Roll Out Acceptance Test in respect of the
relevant element of the Steady State Services has not been
recorded as successful pursuant to Clause 404.2 by the end
of the Roll Out Acceptance Period (including any extension
of the Roll Out Acceptance Period pursuant to Clause
404.4.2), the AUTHORITIES shall have the right without
prejudice to their other rights and remedies (excluding the
right to terminate in accordance with Clause 902.2):
404.4.1 to accept such part of the Steady State
Services as the AUTHORITIES may decide and pay a pro-
rated Charge therefor or such other charge, as may be
agreed between the parties; or
404.4.2 to extend the Roll Out Acceptance Period
for a period or periods, specified by the
AUTHORITIES, during which the CONTRACTOR shall use
reasonable endeavours to correct the deficiency or
Acceptance Incident which caused the Roll Out
Acceptance Test to be recorded as unsuccessful.
404.5 Unless otherwise agreed by the AUTHORITIES, no
element of the Steady State Services shall be eligible for
testing under this Clause until it has first successfully
completed acceptance testing under Clause 404 of the DSS
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Agreement or Clause 404 of the POCL Agreement (as
appropriate).
PART 5 : OWNERSHIP, LICENCES AND RISK
Clause 501. Ownership of Intellectual Property Rights in the
design of the Service Architecture
501.1 Ownership of any Intellectual Property Rights in the
overall design of the Service Architecture (as set out in
the Service Architecture Design Document) which arise as a
result of the performance of the Services shall vest in the
CONTRACTOR. Any use by the CONTRACTOR of the overall
design of the Service Architecture within the United
Kingdom other than in connection with the Related
Agreements shall be subject to the prior written agreement
of the AUTHORITIES on reasonable commercial terms (such
agreement not to be unreasonably withheld or delayed).
501.2 The CONTRACTOR shall not do anything to prejudice the
security of the Services, including the Cards and any
tokens issued in lieu thereof.
Clause 502. Licences to use Intellectual Property Rights
502.1 Any Software licensed to DSS under the DSS Agreement
is hereby licensed to POCL on the same terms and subject to
the same conditions as it is licensed to DSS under the DSS
Agreement to the extent necessary to permit POCL to use the
POCL Services and the Services hereunder.
502.2 Any Software licensed to POCL under the POCL
Agreement is hereby licensed to DSS on the same terms and
subject to the same conditions as it is licensed to POCL
under the POCL Agreement to the extent necessary to permit
DSS to use the DSS Services and the Services hereunder.
502.3 Any DSS Software licensed to the CONTRACTOR under the
DSS Agreement is hereby licensed to the CONTRACTOR on the
same terms and subject to the same conditions as it is
licensed to the CONTRACTOR under the DSS Agreement to the
extent necessary to permit the CONTRACTOR to perform the
POCL Services and the Services hereunder.
502.4 Any POCL Software licensed to the CONTRACTOR under
the POCL Agreement is hereby licensed to the CONTRACTOR on
the same terms and subject to the same conditions as it is
licensed to the CONTRACTOR under the POCL Agreement to the
extent necessary to permit the CONTRACTOR to perform the
DSS Services and the Services hereunder.
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Clause 503. Databases
POCL shall have the right to use the POCL Services and the
Service Infrastructure to capture, develop and use
databases containing information in relation to its
customers. Any use of DSS Data in the development of such
databases shall be subject to the prior written consent of
DSS (such consent not to be unreasonably withheld or
delayed). Any assistance provided by the CONTRACTOR
pursuant to this Clause over and above the performance of
its other obligations hereunder shall be treated as an
Additional POCL Service.
Clause 504. Riposte 32 Software
504.1 The CONTRACTOR shall ensure that, within seven (7)
days after execution hereof, a copy of the source code of
the Riposte 32 Software is provided to the CONTRACTOR’s
Eurpoean Development and Support Centre.
504.2 The CONTRACTOR shall within seven (7) days after
such copy of the source code is provided to the
CONTRACTOR’s European Development and Support Centre
provide to the AUTHORITIES a certificate signed by the
CONTRACTOR’s Managing Director that this has occurred, and
provide to the AUTHORITIES a copy of the relevant
contractual documentation confirming the CONTRACTOR’s right
of access to such source code and that the CONTRACTOR has
all other rights to such source code necessary for the
performance of its obligations under the Related
Agreements. For the avoidance of doubt, such supporting
documentation shall not include details of the prices paid
by the CONTRACTOR to its sub-contractors or licensors.
PART 6 : CONTRACT AND SERVICE MANAGEMENT
Clause 601. Monitoring
The AUTHORITIES shall be entitled to monitor the
performance by the CONTRACTOR of its obligations under the
AUTHORITIES’ Agreement in accordance with the procedures
set out in Schedule A4.
Clause 602. Management Interfaces and Services Management
The parties shall establish the management interfaces set
out in Schedule A4. All contract management of the
AUTHORITIES’ Agreement shall be performed in accordance
with the provisions of Schedule A4.
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Clause 603. Communications
603.1 Except as otherwise expressly provided no
communication from one party to another shall have any
validity under the AUTHORITIES’ Agreement unless made in
writing by or on behalf of DSS, POCL or the CONTRACTOR, as
the case may be.
603.2 Any notice or other communication whatsoever which
any party hereto is required or authorised by the
AUTHORITIES’ Agreement to give or make to another shall be
given or made either by post in a prepaid letter, or by
telex or by facsimile transmission confirmed by post in a
prepaid letter, addressed to such other party in the manner
referred to in Clause 603.3 below and if that letter is not
returned as being undelivered that notice or communication
shall be deemed for the purposes of the AUTHORITIES’
Agreement to have been given or made after two days, for a
letter, or four hours, for a telex or facsimile
transmission.
603.3 For the purposes of Clause 603.2 above the address of
each party shall be:
603.3.1 For DSS:
3rd Floor
Terminal House
52 Grosvenor Gardens
London SW1W OAB
For the attention of
Andrew Stott
Telephone I
Facsimile }
603.3.2 For POCL:
3rd Floor
Terminal House
52 Grosvenor Gardens
London SW1W OAB
For the attention of
Andrew Stott
Telephone!
Facsimile
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603.3.3 For the CONTRACTOR:
Pathway Group Limited
Forest Road
Feltham
Middlesex TW13 7EJ
For the attention of
J H Benne irector
Telephone
Facsimile
603.4 Any party may change its a
notice as provided in this Clause 603.
ress for service by
Clause 604. Transfer and Sub-Contracting
604.1 The AUTHORITIES’ Agreement is personal to the
CONTRACTOR. The CONTRACTOR shall not assign, novate,
sub-contract or otherwise dispose of the AUTHORITIES’
Agreement or any part thereof without the previous consent
in writing of the AUTHORITIES.
604.2 The AUTHORITIES hereby consent to the CONTRACTOR's
sub-contracting of its obligations specified in Schedule
Al0 to the respective sub-contractors specified therein on
the date hereof. Additional or substitute subcontractors
may be approved from time to time in accordance with Clause
604.1 after the date hereof, in which case Schedule A10
shall be amended accordingly. Notwithstanding any sub-
contracting permitted in the Related Agreements, the
CONTRACTOR shall remain primarily responsible for the acts
and omissions of its sub-contractors committed by them in
the course of performing or purporting to perform any of
the Services hereunder on the CONTRACTOR’s behalf as though
such acts or omissions were its own.
604.3 Subject to Clause 604.4, DSS shall be entitled to:
604.3.1 assign, novate or otherwise dispose of its
rights and obligations under the AUTHORITIES’
Agreement or any part thereof (including, where
appropriate, requiring the grant by the CONTRACTOR or
its licensors of a direct licence of any Software
other than Third Party Software, and requiring the
CONTRACTOR to use all reasonable endeavours to
procure the grant of a direct licence of any Third
Party Software) to any contracting authority (as
defined in Regulation 3(1) of the Public Services
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Contracts Regulations 1993) (a "Contracting
Authority"); or
604.3.2 novate the AUTHORITIES’ Agreement to any
other body (including but not limited to any private
sector body) which performs any of the functions that
previously had been performed by DSS,
provided that any such assignment, novation or other
disposal pursuant to Clause 604.3.1 or 604.3.2 shall not
increase the burden of the CONTRACTOR’s obligations
pursuant to the AUTHORITIES’ Agreement.
604.4 If the AUTHORITIES’ Agreement is novated to a body
which is not a Contracting Authority pursuant to Clause
604.3.2 (in the remainder of this Clause any such body is
referred to as the "transferee"):
604.4.1 the transferee shall only be able to
assign, novate or otherwise dispose of its rights and
obligations under the AUTHORITIES’ Agreement or any
part thereof with the previous consent in writing of
the CONTRACTOR;
604.4.2 the rights acquired by the transferee
relating to the Use of the Software shall not extend
beyond the activities previously performed by DSS
and, in particular, the transferee shall not be
entitled to perform any service bureau or facilities
management services utilising the Software for any
third party.
604.4.3 the rights of the transferee under Clause
610 shall cease; and
604.4.4 the following Clauses shall be varied from
the date of the novation or the date of the change of
status (as appropriate) as set out below as if the
AUTHORITIES’ Agreement had been amended by the
parties in accordance with Clause 101.3:
(a) in Clause 804, the words "or (in the case of
sums due to DSS) with any department, office or
agency of the Crown" shall be deleted;
(b) in Clause 606.1, the words "to the Crown or
POCL, or their respective servants or agents is
the property of the Crown or POCL, as
appropriate" shall be replaced with "to each
AUTHORITY or their servants or agents is the
property of the relevant AUTHORITY";
(c) in Clause 1001.1.1, the words "on Her Majesty's
Service (which term shall in this Clause 1001
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include all persons employed or engaged by the
Crown and all persons providing services to the
Crown) or employed by or providing services to
the Post Office Group" in the second line shall
be replaced with "employed by or providing
services to DSS or the Post Office Group or
acting on their behalf" and the reference to
"Her Majesty's Service or the Post Office Group
(as appropriate)" in the eighth line shall be
replaced with "DSS or the Post Office Group (as
appropriate) ";
(d) in Clause 1001.1.2, the words "on Her Majesty's
Service or employed by the Post Office Group"
shall be replaced with "employed by the
AUTHORITIES or acting on their behalf"; and
(e) in Clause 1001.2, the words "with the Post
Office Group or for Her Majesty's Service" shall
be replaced with "with the Post Office Group or
pss".
604.5 POCL shall be entitled to assign, novate or otherwise
dispose of its rights and obligations under the
AUTHORITIES’ Agreement or any part thereof (including,
where appropriate, requiring the grant by the CONTRACTOR or
its licensors of a direct licence of any Software other
than Third Party Software, and requiring the CONTRACTOR to
use all reasonable endeavours to procure the grant of a
direct licence of any Third Party Software) to any other
body which performs any of the functions that previously
had been performed by POCL, provided that any such
assignment, novation or other disposal shall not increase
the burden of the CONTRACTOR’s obligations pursuant to the
AUTHORITIES’ Agreement.
604.6 The AUTHORITIES shall be entitled to disclose, to the
extent necessary for the purposes of the Related
Agreements, to any transferee any Confidential Information
of the CONTRACTOR which relates to the performance of the
Services hereunder by the CONTRACTOR. In such circumstances
the AUTHORITIES shall authorise the transferee to use such
Confidential Information only for purposes relating to the
performance of the Services hereunder and for no other
purposes and, for the avoidance of doubt, the transferee
shall be bound by the confidentiality undertaking contained
herein in relation to such Confidential Information.
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Clause 605: Time
605.1 Timetable
The CONTRACTOR shall perform the Services hereunder in
accordance with any timescales specified in Schedule B7 and
elsewhere herein as “contractual milestones” and shall use
all reasonable endeavours to perform the Services hereunder
in accordance with any other timescales specified in
Schedule B7 and elsewhere herein, which shall be treated as
“target dates”. In the event of any failure to meet any
target date, the CONTRACTOR shall provide the AUTHORITIES
with a method statement showing how it intends to recover
any lost time. For the avoidance of doubt, time shall not
be of the essence in relation to any contractual milestone
unless notice is served in accordance with Clause 605.4.
605.2 Extension of Time
605.2.1 If the performance of the Related Agreements by
the CONTRACTOR be delayed by reason of Default by either
AUTHORITY or by its employees or authorised agents, the
CONTRACTOR shall be entitled to a reasonable extension of
time and to any reasonable additional costs which it can
show were directly incurred by the CONTRACTOR as a result
of the delay. The CONTRACTOR shall notify the AUTHORITIES
in writing within three (3) working days of becoming aware
of such Default.
605.2.2 If the performance of the AUTHORITIES’ Agreement
by any party be delayed by reason of any force majeure
event (as defined in Clause 605.3), all parties shall be
entitled to a reasonable extension of time subject to there
being no entitlement to any additional costs or expenses
incurred as a result of the delay. The party so delayed
shall notify the other parties in writing within one (1)
working day of becoming aware of such force majeure event.
605.3 Force Majeure
605.3.1 For the purposes of the AUTHORITIES’ Agreement
the expression "Force Majeure" shall mean any cause
affecting the performance by a party hereto of its
obligations arising from acts, events, omissions,
happenings or non-happenings beyond its reasonable control
including (but without limiting the generality thereof) (i)
Governmental Regulations (subject to Clause 605.5), (ii)
fire, (iii) flood, (iv) any disaster or an industrial
dispute affecting a third party. Any act, event, omission,
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happening or non-happening will only be considered Force
Majeure if it is not attributable to the wilful act,
neglect or failure to take reasonable precautions of the
affected party, its agents or employees, and only if a
substitute third party is not reasonably available (having
regard, without limitation, to the cost and quality of such
substitute) to perform the affected obligation. In no
event shall any fraudulent act or omission by any party or
third party relating to the Services hereunder for which
the CONTRACTOR is liable under Clause 808 constitute Force
Majeure.
605.3.2 No party hereto shall in any circumstances be
liable to any other party hereto for any loss of any kind
whatsoever including but not limited to any damages or
abatement of Charges whether directly or indirectly caused
to or incurred by the other party by reason of any failure
or delay in the performance of its obligations under the
AUTHORITIES’ Agreement which is due to Force Majeure.
Notwithstanding the foregoing, each party shall use all
reasonable endeavours to continue to perform, or resume
performance of, such obligations under the AUTHORITIES’
Agreement for the duration of such Force Majeure event. In
the case of the CONTRACTOR, the parties shall agree an
orderly process for such continuation or resumption of
performance (such agreement not to be unreasonably withheld
or delayed), and the CONTRACTOR shall comply with such
process.
605.3.3 If the CONTRACTOR shall become aware of
circumstances of Force Majeure which give rise to or which
are likely to give rise to any such failure or delay on its
part it shall forthwith notify the other parties within one
(1) working day and shall inform the other parties of the
period which it is estimated that such failure or delay
shall continue. If either AUTHORITY shall become aware of
circumstances of Force Majeure which give rise to any such
failure or delay on its part, it shall forthwith notify the
other parties within one (1) working day and shall inform
the other parties of the period which it is estimated that
such failure or delay shall continue.
605.3.4 It is expressly agreed that any failure by the
CONTRACTOR to perform, or any delay by the CONTRACTOR in
performing, its obligations under the AUTHORITIES’
Agreement which results from any failure or delay in the
performance of its obligations by any person, firm or
company with which the CONTRACTOR shall have entered into
any contract, supply arrangement or sub-contract or
otherwise shall be regarded as a failure or delay due to
Force Majeure only in the event that such person firm or
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company shall itself be prevented from or delayed in
complying with its obligations under such contract, supply
arrangement or sub-contract or otherwise as a result of
circumstances of Force Majeure and there is no substitute
person, firm or company reasonably available (having
regard, without limitation, to the cost and quality of such
substitute) to perform the affected obligation.
605.3.5 [Not used]
605.3.6 If any Force Majeure event prevents any party
from performing its obligations hereunder for a period in
excess of ninety (90) consecutive days, the AUTHORITIES may
after consultation with the CONTRACTOR and taking into
account the CONTRACTOR’s views jointly terminate the
AUTHORITIES’ Agreement in accordance with Clause 902.1.4.
605.4 Time of the Essence
Where the AUTHORITIES after undue delay by the CONTRACTOR
notify the CONTRACTOR that time is of the essence of the
AUTHORITIES’ Agreement and any of its obligations stated in
such notice shall not have been performed by the CONTRACTOR
by any reasonable date stated in the notice, the
AUTHORITIES may terminate the AUTHORITIES’ Agreement in
accordance with Clause 902.2.3. In relation to the
timescales specified herein. The AUTHORITIES may only give
notice making time of the essence in relation to timescales
specified herein as “contractual milestones”.
605.5 Political Risk
605.521 Notwithstanding the provisions of Clause 605.3,
a change of, or new, Governmental Regulation:
(a) shall not excuse the AUTHORITIES from performing
their obligations to meet any minimum revenue
guarantees applicable under Schedule A6 and, without
limitation to the foregoing, if the due date for the
application of such minimum revenue guarantees (or
any agreed extension thereof) is delayed directly as
a result of any change in, or new, Governmental
Regulation, the AUTHORITIES agree to meet such
minimum revenue guarantees from the date when they
would have become payable but for such change in, or
new, Governmental Regulation;
(b) shall not entitle the AUTHORITIES to terminate the
AUTHORITIES’ Agreement under Clause 605.3.6, and any
such purported termination shall be treated as a
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termination for convenience in accordance with Clause
902.6; and
(c) shall not require the CONTRACTOR to perform any
additional obligations, or any reduced or modified
obligations resulting in increased cost to the
CONTRACTOR, without its agreement in accordance with
Clause 101.3.
605.5.2 Where a change of, or new, Governmental
Regulation causes a material alteration in the frequency of
benefit payments (as defined in Schedule A6), the Common
Charging Mechanism in Schedule A6 shall be adjusted in
accordance with the formula specified in that Schedule.
Clause 606. Confidentiality
606.1 Without prejudice to the application of the Official
Secrets Acts 1911 to 1989 (where relevant) to any
Confidential Information the CONTRACTOR acknowledges that
any Confidential Information (other than its own
Confidential Information) obtained from or relating to the
Crown or POCL, or their respective servants or agents, is
the property of the Crown or POCL, as appropriate.
606.2 The CONTRACTOR hereby agrees that (other than as
required by law):
606.2.1 the CONTRACTOR (and any person employed or
engaged by the CONTRACTOR in connection with the
AUTHORITIES’ Agreement in the course of such
employment or engagement) shall only use Confidential
Information of either AUTHORITY for the purposes of
the Related Agreements;
606.2.2 the CONTRACTOR (and any person employed or
engaged by the CONTRACTOR in connection with the
AUTHORITIES’ Agreement in the course of such
employment or engagement) shall not disclose any
Confidential Information of either AUTHORITY to any
third party (except its approved sub-contractors as
listed in Schedule A10) or to the other AUTHORITY
without the prior written consent of the relevant
AUTHORITY, and each AUTHORITY shall from time to time
notify the CONTRACTOR of the categories of that
AUTHORITY’s information which are not to be treated
as Confidential Information in relation to the other
AUTHORITY;
606.2.3 the CONTRACTOR shall take all necessary
precautions to ensure that all Confidential
Information of either AUTHORITY is treated as
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confidential and not disclosed (save as aforesaid) or
used other than for the purposes of the Related
Agreements by the CONTRACTOR's employees, servants,
agents or sub-contractors including, without
limitation, obtaining from any such agent or sub-
contractor a signed confidentiality undertaking on
substantially the same terms as are contained in this
Clause; and
606.2.4 without prejudice to the generality of the
foregoing neither the CONTRACTOR nor any person
engaged by the CONTRACTOR whether as a servant or a
consultant or otherwise shall use the Confidential
Information of either AUTHORITY for the solicitation
of business from the other AUTHORITY or from any
third party by the CONTRACTOR or by such servant or
consultant or by any third party.
606.3 The AUTHORITIES (other than as required by law):
606.3.1 shall treat as confidential all
Confidential Information obtained from the
CONTRACTOR, including but not limited to the Source
Code of any Specially Written Software (as defined
in the DSS Agreement or the POCL Agreement, as
appropriate) ; and
606.3.2 shall not, subject to Clause 606.5,
disclose to any third party without the prior written
consent of the CONTRACTOR any Confidential
Information obtained from the CONTRACTOR.
606.4 The provisions of Clauses 606.1, 606.2 and 606.3
shall not apply to any information which:
606.4.1 is or becomes public knowledge other than
by breach of this Clause 606; or
606.4.2 is in the possession of the receiving party
without restriction in relation to disclosure before
the date of receipt from the disclosing party.
606.4.3 is received from a third party who lawfully
acquired it and who is under no obligation
restricting its disclosure.
606.4.4 is independently developed without access
to the Confidential Information.
606.5 DSS and POCL may disclose any Confidential
Information obtained from the CONTRACTOR to the extent
necessary for purposes connected with the Related
Agreements:
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606.5.1 to any servant or agent of DSS (in DSS’s
case) or of the Post Office Group (in POCL’s case)
provided that DSS and POCL respectively have required
that such information is treated as confidential by
such servants or agents, including requiring such
servants or agents to enter into a confidentiality
undertaking where appropriate; and
606.5.2 subject to the prior written agreement of
POCL and DSS, to any other third party (in which case
the disclosing AUTHORITY shall notify the CONTRACTOR
of such disclosure), provided that the relevant
AUTHORITY shall have taken reasonable steps to ensure
that the third party shall observe substantially the
same terms as are contained in this Clause,
including, without limitation, obtaining a signed
confidentiality undertaking between the third party
and the disclosing AUTHORITY or the CONTRACTOR.
606.6 Nothing in this Clause 606 shall prevent the
CONTRACTOR or the AUTHORITIES from using data-processing
techniques, ideas and know-how gained during the
performance of the Related Agreements in the furtherance of
its normal business, to the extent that this does not
relate to a disclosure of Confidential Information or an
infringement by the AUTHORITIES or the CONTRACTOR of any
Intellectual Property Right.
Clause 607. Health and Safety Hazards
607.1 The CONTRACTOR shall notify the relevant AUTHORITY of
any health and safety hazards in relation to Premises owned
by or leased to that AUTHORITY which may arise in
connection with the performance of the AUTHORITIES’
Agreement.
607.2 The relevant AUTHORITY shall notify the CONTRACTOR of
any known health and safety hazards which may exist or
arise at the Premises owned by or leased to that AUTHORITY
and which may affect the CONTRACTOR. The CONTRACTOR shall
draw these hazards to the attention of its employees and
sub-contractors or any persons engaged by the CONTRACTOR in
the performance of the AUTHORITIES’ Agreement at such
Premises.
607.3 The CONTRACTOR shall inform all persons engaged in
the performance of the AUTHORITIES’ Agreement at the
Premises owned by or leased to the relevant AUTHORITY of
all such hazards and shall instruct such persons in
connection with any necessary associated safety measures.
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Clause 608. Protection of Personal Data and Social Security
Administration Act
608.1 The CONTRACTOR's attention is hereby drawn to the
Data Protection Act 1984.
608.2 All parties warrant that they will duly observe all
their obligations under the Data Protection Act which arise
in connection with the AUTHORITIES’ Agreement.
608.3 Section 123 of the Social Security Administration Act
1992 shall apply to this AUTHORITIES’ Agreement. It is an
offence for any person to disclose any information obtained
while carrying out administrative work where that
information relates to a particular person. All parties
warrant that they will duly observe all their obligations
under the Social Security Administration Act 1992 which
arise in connection with the AUTHORITIES’ Agreement.
Clause 609. Publicity
609.1 Except with the written consent of both AUTHORITIES
(which shall not be unreasonably withheld or delayed), the
CONTRACTOR shall not make any press announcements about or
publicise the AUTHORITIES’ Agreement in any way. The
AUTHORITIES shall consult the CONTRACTOR before making any
press announcement about or publicising the AUTHORITIES’
Agreement, other than pursuant to any legal obligation or
in any internal publication of DSS or the Post Office
Group.
609.2 The CONTRACTOR shall take all reasonable steps to
ensure the observance of the provisions of Clause 609.1 by
all its servants, employees, agents, consultants and sub-
contractors.
609.3 The CONTRACTOR shall have no right to use the brand
or logo of any Post Office Group member without POCL’s
prior written consent, nor to use the brand or logo of any
part of DSS without DSS’s prior written consent nor to use
the AUTHORITIES’ joint brands and logos (if any) without
the AUTHORITIES’ prior written consent. The CONTRACTOR
shall do nothing to injure such logos and brands or the
reputation of the AUTHORITIES and, if it uses such brands
and logos, shall take all reasonable steps to enable the
AUTHORITIES to protect such logos and brands and the
reputation of the AUTHORITIES but in no event less than the
steps it would take in relation to its own logos, brands
and reputation.
609.4 The AUTHORITIES shall have no right to use the brand
or logo of the CONTRACTOR or its sub-contractors without
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the CONTRACTOR’s prior written consent. The AUTHORITIES
shall do nothing to injure such logo and brands or the
reputation of the CONTRACTOR or its sub-contractors and, if
either AUTHORITY uses such brands or logos, it shall take
all reasonable steps to enable the CONTRACTOR and its sub-
contractors to protect such logo and brands and the
reputation of the CONTRACTOR and its sub-contractors, but
in no event less than the steps they would take in
relation to their own logos, brands and reputations.
Clause 610. CONTRACTOR's Personnel
610.1 The AUTHORITIES reserve the right under the
AUTHORITIES’ Agreement to refuse to admit (a) (in DSS’s
case) to any premises occupied by or on behalf of the Crown
(which term shall in this Clause include all persons
employed or engaged by the Crown and all persons other than
the CONTRACTOR and its sub-contractors providing services
to the Crown) or (b) to any premises occupied by or on
behalf of any member of the Post Office Group or to any
post office (in POCL’s case) any person employed or engaged
by the CONTRACTOR, or by a sub-contractor, whose admission
would be, in the reasonable opinion of the relevant
AUTHORITY, undesirable.
610.2 If and when directed by the relevant AUTHORITY, the
CONTRACTOR shall provide a list of the names and addresses
of all persons who it is expected may require admission in
connection with the performance of the AUTHORITIES’
Agreement to any premises occupied by or on behalf of the
Crown or by or on behalf of any member of the Post Office
Group or to any post office (as appropriate), specifying
the capacities in which they are concerned with the
AUTHORITIES’ Agreement and giving such other particulars as
the relevant AUTHORITY may reasonably require. The
CONTRACTOR shall comply with any reasonable directions
issued by the designated representative of the relevant
AUTHORITY as to which persons may be admitted to such
premises and at what times.
610.3 If and when directed by the relevant AUTHORITY, the
CONTRACTOR shall secure that any person employed or engaged
by the CONTRACTOR or by a sub-contractor, who is specified
in the direction or is one of a class of persons who may be
so specified, shall sign a statement that he understands
that the Official Secrets Acts 1911 to 1989 apply to him
both during the term of and after the expiry or termination
of the AUTHORITIES’ Agreement.
610.4 The CONTRACTOR's representatives, engaged within the
boundaries of a Crown or Post Office Group establishment or
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post office, shall comply with such rules, regulations and
requirements (including those relating to security
arrangements) as may be in force from time to time for the
conduct of personnel when at that establishment or post
office and when outside that establishment or post office.
610.5 The decision of the relevant AUTHORITY as to whether
any person is to be refused admission to any premises
occupied by or on behalf of the Crown or the Post Office
Group or to a post office (as appropriate) shall be final
and conclusive.
Clause 611. Waiver
611.1 The failure of any party to insist upon strict
performance of any provision of the AUTHORITIES’ Agreement,
or the failure of any party to exercise any right or remedy
to which it is entitled hereunder, shall not constitute a
waiver thereof and shall not cause a diminution of the
obligations established by the AUTHORITIES’ Agreement.
611.2 A waiver of any Default in relation to the
AUTHORITIES’ Agreement shall not constitute a waiver of any
subsequent Default.
611.3 No waiver of any of the provisions of the
AUTHORITIES’ Agreement shall be effective unless it is
expressly stated to be a waiver and communicated to the
other parties in writing in accordance with the provisions
of Clause 603.
Clause 612. Access to Premises
612.1 Any land or premises (including temporary buildings)
made available to the CONTRACTOR by the AUTHORITIES in
connection with the AUTHORITIES’ Agreement shall be made
available to the CONTRACTOR on such terms and conditions as
may be agreed between the CONTRACTOR and the relevant
AUTHORITY. The CONTRACTOR shall have the use of such land
or premises as licensee and shall vacate the same upon the
termination or expiry of the AUTHORITIES’ Agreement or at
such earlier date as the relevant AUTHORITY may reasonably
determine.
612.2 The relevant AUTHORITY shall be responsible for
maintaining the security of such land or premises in
accordance with its standard security requirements. The
CONTRACTOR shall comply with all reasonable’ security
requirements of the relevant AUTHORITY while on _ the
premises, and shall procure that all of its employees,
agents and subcontractors shall likewise comply with such
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requirements. The relevant AUTHORITY shall provide the
CONTRACTOR upon request copies of its written security
procedures and shall afford the CONTRACTOR upon request
with an opportunity to inspect its physical security
arrangements.
Clause 613. Security Requirements
The CONTRACTOR shall comply with the security requirements
as set out in Schedule A2.
Clause 614. CONTRACTOR’s Key Personnel
The parties acknowledge that the CONTRACTOR’s key personnel
specified in Schedule Al2 are essential to the fulfilment
of its obligations hereunder. The CONTRACTOR undertakes to
use all reasonable endeavours to ensure that such key
personnel are not removed or replaced during the term
hereof. However, in the event that any of its key
personnel becomes unavailable for any reason (including
without limitation death, injury, sickness promotion or
resignation), the CONTRACTOR shall have the right upon
giving thirty (30) days’ notice in writing (or such shorter
period of notice as may be reasonably practicable) to the
AUTHORITIES to replace such an individual with another
individual whose abilities and qualifications are
appropriate for the services to be performed by such
individual.
PART 7 : WARRANTIES AND STANDARDS
Clause 701. Authority and Approval
The CONTRACTOR warrants and represents that it has full
capacity and authority and all necessary consents
(including but not limited to, where its procedures so
require, the consent of its Parent Company) to enter into
and to perform the AUTHORITIES’ Agreement and that the
AUTHORITIES’ Agreement is executed by a duly authorised
representative of the CONTRACTOR.
Clause 702. Performance of Services
The CONTRACTOR warrants and represents that:
702.1 the Services hereunder shall be supplied and rendered
by appropriately experienced, qualified and trained
personnel with all reasonable skill, care and diligence;
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702.2 the CONTRACTOR shall discharge its obligations under
the AUTHORITIES’ Agreement with all reasonable skill, care
and diligence including but not limited to good industry
practice and (without limiting the generality of this
Clause) in accordance with the best of its own established
internal procedures;
702.3 the Services hereunder shall be performed in
compliance with all applicable laws, enactments, orders,
regulations, and other similar instruments;
702.4 the Services hereunder shall be fully integrated
within the Service Architecture;
702.5 the Services hereunder shall be performed in
accordance with all applicable provisions of the Service
Architecture Design Document;
702.6 the Services hereunder shall be compatible with the
Service Environment as at the date hereof, as set out in
Schedule 1;
702.7 the Services hereunder shall be performed in such a
way as to cause a minimum of disruption to the business of
the AUTHORITIES and the End Users.
Clause 703. Performance of Products
The CONTRACTOR warrants and represents that:
703.1 at the Operational Trial Acceptance Date the
Operational Trial System shall meet the Operational Trial
Criteria and the regulations and standards specified in
Schedule A2;
703.2 at the Operational Trial Acceptance Date and
thereafter during the term of the AUTHORITIES’ Agreement
all components of the Service Infrastructure shall operate
in accordance with their respective technical
specifications, except that, for the avoidance of doubt, it
is agreed that the AUTHORITIES shall have no remedy for
breach of this warranty in relation to errors or
interruptions to Services covered by paragraph 4.1(a) of
Schedule A6 of the DSS Agreement or POCL Agreement (as
appropriate); and
703.3 the Service Infrastructure will be compatible with
the Service Environment as at the date hereof, as specified
in Schedule 1.
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Clause 704. Intellectual Property Rights
The CONTRACTOR warrants and represents that:
704.1 neither AUTHORITY's use and operation of the Service
Architecture and the provision of the Services hereunder
shall infringe any Intellectual Property Rights of any
third party;
704.2 the CONTRACTOR has the full capacity and authority to
grant the licences referred to in Clause 502;
704.3 it is able to comply with Clauses 903.1.2 and
903.1.3.
Clause 705. Industry Standards
The CONTRACTOR warrants and represents that the Services
hereunder and the Service Infrastructure shall comply with,
and be provided in accordance with, all relevant applicable
industry standards as specified in Schedule A2.
Clause 706. Statements and Representations
The CONTRACTOR warrants and represents that all statements
and representations made to the AUTHORITIES in connection
with tendering for and entering into the AUTHORITIES’
Agreement are, to the best of its knowledge, information
and belief, true and accurate at the time of making such
statements and representations and that, from the date of
execution hereof, it will advise the AUTHORITIES of any
fact, matter or circumstance of which it may become aware
which would render any such statement or representation to
be false or misleading.
Clause 707. Disclaimer of Implied Terms
Except as expressly stated in the AUTHORITIES’ Agreement,
all terms, warranties and conditions, whether express or
implied by statute, common law or otherwise (including but
not limited to satisfactory quality and fitness for
purpose) are hereby excluded to the extent permitted by
law.
PART 8 : REMEDIES
Clause 801. Audit
801.1 The CONTRACTOR shall keep or cause to be kept the
Records.
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801.2 The CONTRACTOR shall grant or procure the grant to
the AUTHORITIES, any statutory or regulatory auditors of
the AUTHORITIES and their respective authorised agents the
right of reasonable access to the Records and shall provide
all reasonable assistance at all times for six (6) years
after the creation of the relevant Records for the purposes
of carrying out an audit of the CONTRACTOR's compliance
with the AUTHORITIES’ Agreement including all activities,
Charges, performance, security and integrity in connection
therewith. Each party shall bear its own expenses incurred
pursuant to this Clause. On termination, the CONTRACTOR
shall within a reasonable time to be agreed by the parties
transfer the Records to the AUTHORITIES or a replacement
contractor, as instructed by the AUTHORITIES. The
CONTRACTOR shall thereafter be relieved from any further
liabilities under this Clause in relation to such Records.
801.3 Without prejudice to the foregoing, in the event of
an investigation into suspected fraudulent activity or
other impropriety by the CONTRACTOR or any third party the
AUTHORITIES reserve for themselves, any statutory or
regulatory auditors of the AUTHORITIES and their respective
authorised agents or (in the case of DSS) any Crown body
the right of immediate access to the Records described in
Clause 801.1 and Clause 801.2 above and the CONTRACTOR
agrees to render all necessary assistance to the conduct of
such investigation at all times during the currency of the
AUTHORITIES’ Agreement or at any time thereafter.
801.4 Whenever DSS requires it, and solely for the purposes
of enabling DSS’s accounting officer to meet his
obligations under the Exchequer and Audit Departments Act
1866, the CONTRACTOR:
801.4.1 shall disclose to DSS whatever information
DSS requires concerning the prices DSS has paid or
may have to pay under the AUTHORITIES’ Agreement; and
801.4.2 shall produce whatever evidence DSS
requires in support of the information provided under
Clause 801.4.1 above.
For the avoidance of doubt, such information shall not
include information concerning prices paid by the
CONTRACTOR to its sub-contractors or suppliers.
801.5 In connection with the AUTHORITIES’ Agreement, the
CONTRACTOR must not enter into any other contract or
agreement with any person unless that contract or agreement
contains a provision equivalent to Clause 801.4 allowing
DSS to obtain price information and evidence (as described
in Clause 801.4) from that person. This Clause 801.5 does
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not apply if the CONTRACTOR has entered into a contract or
agreement following a competitive tendering exercise in
which the CONTRACTOR accepted the tender with the lowest
price.
801.6 DSS must use information provided under Clauses 801.4
and 801.5 for the purposes of the Exchequer and Audit
Departments Act 1866 and for no other purpose.
801.7 The CONTRACTOR shall provide the AUTHORITIES at no
additional cost with copies of the annual and interim
audited accounts of the CONTRACTOR and its approved
subcontractors within fourteen (14) days of such accounts
having been lodged at Companies House or its local
equivalent to Companies House.
801.8 Without in any way limiting the application of the
other Clauses of this AUTHORITIES’ Agreement, the
CONTRACTOR acknowledges that for the purpose of examining
and certifying DSS’s accounts or for examining (pursuant to
Section 6(1) of the National Audit Act 1983) the economy,
efficiency and effectiveness with which DSS has used its
resources, the Comptroller and Auditor General may examine
such documents as he may reasonably require which are
owned, held or are otherwise within the control of the
CONTRACTOR and may require the CONTRACTOR to produce such
oral and written explanations as he considers necessary.
801.9 The CONTRACTOR shall ensure that the terms of its
contracts with its sub-contractors require the sub-
contractors to permit examination by, and provide
explanation to, the Comptroller and Auditor General in the
manner described in Clause 801.8.
801.10All information obtained by DSS or POCL pursuant to
this Clause or Schedule A3 shall be treated as Confidential
Information.
801.11The parties shall comply with the provisions of
Schedule A3.
Clause 802. Liquidated Damages and Delay
802.1 In the event that:
802.1.1 the CONTRACTOR fails to make available the
Operational Trial System or any part thereof for the
Operational Trial pursuant to Clause 402.1; or
802.1.2 the Operational Trial is not recorded as
successful pursuant to the relevant provisions of the
AUTHORITIES’ Agreement, and the AUTHORITIES elect to
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extend the relevant testing period in accordance with
the relevant provisions hereof,
the CONTRACTOR shall, at the option of the relevant
AUTHORITY either credit against the Charges or pay to the
relevant AUTHORITY liquidated damages calculated in
accordance with Schedule C5. Unless the relevant AUTHORITY
exercises its option to recover such liquidated damages as
a payment to it, the relevant AUTHORITY shall be deemed to
have exercised its option to recover such liquidated
damages as a credit against the Charges.
802.2 The CONTRACTOR shall credit the relevant AUTHORITY
with, or pay to the relevant AUTHORITY, the liquidated
damages within thirty (30) days of receipt of a valid claim
by the AUTHORITY.
802.3 The parties acknowledge that the liquidated damages
specified in Schedule C5 are a genuine pre-estimate of the
loss likely to be suffered by the relevant AUTHORITY and
that the figures therein are reasonable.
802.4 The liquidated damages specified in this Clause are
without prejudice to any other rights and remedies of the
AUTHORITIES, except where they are specified in Schedules
A8 and C5 to be the AUTHORITIES’ exclusive remedy in
damages, in which case such credit or payment of the
relevant liquidated damages shall be in full and final
settlement of the CONTRACTOR’s liability in respect of the
Default to which they relate. Except in accordance with
Schedules A8 and C5, the AUTHORITIES shall have no right of
termination in relation to any such Default.
802.5 The provisions of Schedule A8 shall apply in relation
to liquidated damages and service credits under all the
Related Agreements.
Clause 803. Additional Resources
In the event that the Services hereunder are not provided
in accordance with all applicable provisions hereof as a
result of the Default of the CONTRACTOR, the CONTRACTOR
shall, at the request of the AUTHORITIES and without
prejudice to the AUTHORITIES' other rights and remedies,
arrange all such additional resources as are reasonably
necessary to correct the said failure as early as
practicable thereafter and at no additional charge to the
AUTHORITIES.
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Clause 804. Recovery of Sums Due
If any sum of money shall be due from the CONTRACTOR, the
same may be deducted from any sum then due or which at any
time thereafter may become due to the CONTRACTOR under the
Related Agreements or under any other agreement between the
CONTRACTOR and the relevant AUTHORITY or (in the case of
sums due to DSS) with any department, office or agency of
the Crown or (in the case of sums due to POCL) with any
member of the Post Office Group.
Clause 805. Intellectual Property Rights Indemnity
805.1 Subject always to the AUTHORITIES' proper observance
of their obligations under this Clause 805, the CONTRACTOR
shall indemnify the AUTHORITIES against all claims,
demands, actions, costs, expenses (including but not
limited to legal costs and disbursements on a solicitor and
client basis), losses and damages arising from or incurred
by reason of any infringement or alleged infringement
(including but not limited to the defence of such alleged
infringement) in the United Kingdom of any Intellectual
Property Right by the use or possession of the Products,
Services hereunder or Service Architecture by or on behalf
of the AUTHORITIES or in connection with the Services
hereunder.
805.2 The CONTRACTOR shall promptly notify the AUTHORITIES
if any claim or demand is made or action brought against
the CONTRACTOR to which this Clause applies.
805.3 The AUTHORITIES shall promptly notify the CONTRACTOR
if any claim or demand is made or action brought against
the AUTHORITIES to which Clause 805.1 may apply. The
CONTRACTOR shall at its own expense conduct any litigation
arising therefrom and all negotiations in connection
therewith and the AUTHORITIES hereby agree to grant to the
CONTRACTOR exclusive control of any such litigation and
such negotiations. The CONTRACTOR shall consult with and
pay due regard to the interests (including the commercial
interests of the Post Office Group and the public interest)
and views of the AUTHORITIES in the conduct of any defence
to any claim or demand hereunder, and shall, where it is
reasonable to do so, comply with such interests and views.
805.4 The AUTHORITIES shall at the request of the
CONTRACTOR afford to the CONTRACTOR all reasonable
assistance for the purpose of contesting any claim or
demand made or action brought against the AUTHORITIES to
which Clause 805.1 may apply or any claim or demand made or
action brought against the CONTRACTOR to which Clause 805.2
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may apply. The CONTRACTOR shall reimburse the AUTHORITIES
for all costs and expenses (including but not limited to
legal costs and disbursements on a solicitor and client
basis) incurred in so doing.
805.5 The AUTHORITIES shall not make any admissions which
may be prejudicial to the defence or settlement of any
claim, demand or action for infringement or alleged
infringement of any Intellectual Property Right to which
Clause 805.1 may apply or any claim or demand made or
action brought against the CONTRACTOR to which Clause 805.2
may apply.
805.6 If a claim or demand is made or action brought to
which Clause 805.1 may apply or in the reasonable opinion
of the CONTRACTOR is likely to be made or brought, the
CONTRACTOR may at its own expense either:
805.6.1 modify any or all of the Products, the
Service Architecture or the Services hereunder
without reducing the performance and functionality of
the same, or substitute alternative products, service
architecture or services of equivalent performance
and functionality for any or all of the Products, the
Service Architecture or the Services hereunder, so as
to avoid the infringement or the alleged infringement
but without disrupting the performance of the
Services hereunder, provided that the terms herein
shall apply mutatis mutandis to such modified or
substituted items or services and such modified or
substituted items shall be acceptable to the
AUTHORITIES (whether by passing any form of
acceptance testing or otherwise), such acceptance not
to be unreasonably withheld or delayed, and shall
reimburse the AUTHORITIES’ all reasonable costs
directly incurred by them; or
805.6.2 procure a licence to use the Products,
Service Architecture and Services hereunder on terms
which afford to the AUTHORITIES no more extensive
rights than those originally applicable hereunder and
which are acceptable to the AUTHORITIES, and shall
reimburse the AUTHORITIES’ all reasonable costs
directly incurred by them.
805.7 The foregoing provisions of this Clause 805 shall not
apply insofar as any such claim or demand or action is in
respect of:
805.7.1 any use by or on behalf of the AUTHORITIES
of the Products, the Service Architecture or Services
hereunder in combination with any item not supplied
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or approved (such approval not to be unreasonably
withheld or delayed) by the CONTRACTOR where such use
of the Products, Service Architecture or Services
hereunder directly gives rise to the claim, demand or
action; or
805.7.2 any modification carried out by or on behalf
of the AUTHORITIES to any item supplied by the
CONTRACTOR under the AUTHORITIES’ Agreement if such
modification is not authorised by the CONTRACTOR in
writing; or
805.7.3 any use by the AUTHORITIES of the Products,
Service Architecture or Services hereunder in a
manner not reasonably to be inferred from the
specification or requirements of the AUTHORITIES.
805.8 If the CONTRACTOR has availed itself of its rights to
modify the Products, Service Architecture or the Services
hereunder or to supply substitute products, service
architecture or services pursuant to Clause 805.6.1 (or the
AUTHORITIES have unreasonably withheld their acceptance of
such substitute products, service architecture or Services)
or to procure a licence under Clause 805.6.2 and such
exercise of the said rights has avoided any claim, demand
or action for infringement or alleged infringement, or if
the AUTHORITIES have unreasonably withheld their acceptance
of any items modified or substituted by the CONTRACTOR in
accordance with Clause 805.6, then the CONTRACTOR shall
have no further liability thereafter under this Clause 805
in respect of the said claim, demand or action.
805.9 If a modification or substitution in accordance with
Clause 805.6.1 above is not possible so as to avoid the
infringement and the CONTRACTOR has been unable to procure
a licence in accordance with Clause 805.6.2 Clause 805.1
shall apply.
805.10The AUTHORITIES hereby warrant and represent that any
instructions given in relation to the CONTRACTOR's use of
any third party item supplied directly or indirectly by the
AUTHORITIES shall not cause the CONTRACTOR to infringe any
third party's Intellectual Property Rights in such item.
The AUTHORITIES shall, to the extent reasonably possible,
assign to the CONTRACTOR any indemnity in their favour in
relation to the Intellectual Property Rights in such third
party items.
805.11The foregoing states the entire liability of the
CONTRACTOR with regard to the infringement of any
Intellectual Property Right by the use or possession of the
Products and Service Architecture by or on behalf of the
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AUTHORITIES or in connection with the receipt of the
Services hereunder.
Clause 806. Remedies Cumulative
Except as otherwise expressly provided in the AUTHORITIES’
Agreement, all remedies available to the CONTRACTOR or to
the AUTHORITIES for breach of the AUTHORITIES’ Agreement
are cumulative and may be exercised concurrently or
separately and the exercise of any one remedy shall not be
deemed an election of such remedy to the exclusion of other
remedies.
Clause 807. Alternative Dispute Resolution Procedure
807.1 All disputes between either or both of the
AUTHORITIES and the CONTRACTOR arising out of or relating
to the AUTHORITIES’ Agreement shall be referred, by any
party involved in the dispute, to the Contracts Steering
Group (as specified in Schedule A4) for resolution.
807.2 If any dispute cannot be resolved pursuant to Clause
807.1 within a maximum of fourteen (14) days after it has
been referred under Clause 807.1, that dispute shall be
referred to the PDA Board (currently comprising the chief
Executive of the SSA(NI), the POCL Development Director,
the BA Project Director and the BA/POCL Programme Director)
of the AUTHORITIES and the Manging Director of the
CONTRACTOR for resolution.
807.3 If the dispute cannot be resolved by the relevant
parties' representatives nominated under Clause 807.2
within a maximum of fourteen (14) days after it has been
referred under Clause 807.2 the dispute may be referred:
807.3.1 if the dispute is of a technical nature or
is expressed by the AUTHORITIES’ Agreement to be
subject to expert determination, by agreement between
the relevant parties it may be referred for final
determination to an expert (the "Expert") who shall
be deemed to act as expert and not as arbitrator; and
807.3.2 in all other aspects it shall be determined
pursuant to Clause 104.1.
807.4 The Expert shall be selected by mutual agreement or,
failing agreement, within fourteen (14) days after a
request by one relevant party to the other(s), shall be
chosen at the request of any party by the President for the
time being of the Institution of Electrical Engineers who
shall be requested to choose a suitably qualified and
experienced Expert for the dispute in question.
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807.5 Fourteen (14) days after the Expert has accepted the
appointment the relevant parties shall submit a written
report on the dispute to the Expert and to each other and
seven (7) days thereafter shall submit any written replies
they wish to make to the Expert and to each other.
807.6 The relevant parties will then afford the Expert all
necessary assistance which the Expert requires to consider
the dispute including but not limited to full access to the
Service Environment and any documentation or correspondence
relating to the Service Environment.
807.7 The Expert shall be instructed to deliver his
determination to the relevant parties within fourteen (14)
days or such other period as may be agreed between the
relevant parties after the submission of the written
reports pursuant to Clause 807.5.
807.8 Decisions of the Expert shall be final and binding
and not subject to appeal.
807.9 The Expert shall have the same powers to require any
relevant party to produce any documents or information to
him and the other relevant parties as an arbitrator and
each relevant party shall in any event supply to him such
information which it has and is material to the matter to
be resolved and which it could be required to produce on
discovery.
807.10The fees of the Expert shall be borne by the relevant
parties in the proportions determined by the Expert having
regard (amongst other things) to the conduct of the
relevant parties in relation to the dispute in question.
807.11Work and activity to be carried out under the
AUTHORITIES’ Agreement shall not cease or be delayed by
this alternative dispute resolution procedure. However,
during the currency of any alternative dispute resolution
procedure, the AUTHORITIES shall not be entitled to
exercise any right of termination which would otherwise
arise in respect of the dispute which forms the subject
matter of such procedure.
Clause 808. Liability
808.1 Except as otherwise specified in Schedule B8 in
relation to benefit payment, the CONTRACTOR shall be liable
for all losses and shall indemnify the AUTHORITIES against
all costs, expenses, losses and damages incurred (including
any legal costs) as a result of:
(a) use of copied, altered or forged Cards;
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(b) any unauthorised third party access to the Service
Architecture;
(c) any impersonation of Card holders which successfully
defeats extended validation procedures;
(d) any “hacking” into systems used by the CONTRACTOR to
provide the Services (whether or not constituting an
offence under the Computer Misuse Act 1990)
(e) drawing of any benefit payments by Card holders or
their proxies where at the time of payment
notification had been given by DSS to the CONTRACTOR
to withhold payment or cancel a proxy authorisation;
(£) any other form of fraud (in relation to any of the
Services).
808.2 Except as otherwise specified in Schedule B8 in
relation to benefit payment, Clause 808.1 shall not apply
if and to the extent that any of the matters referred to
therein have been caused by the AUTHORITIES' non-
performance of any obligation under the AUTHORITIES’
Agreement upon the performance of which the CONTRACTOR's
obligations under the AUTHORITIES’ Agreement in respect of
risk for fraud are expressed to depend. The foregoing is
in place of the general rule stated in Clause 101.5.6.
808.3 In any case where either or both of the AUTHORITIES
incur any costs, expenses, losses or damages as referred to
in Clause 808.1, Clause 808.1 shall be presumed to apply
unless the CONTRACTOR proves that Clause 808.2 applies.
808.4 In relation to benefit payment only, the
responsibilities of the parties for the investigation of
fraudulent losses and the agreed apportionment of costs
under this AUTHORITIES’ Agreement are defined in Schedule
B8.
Clause 809. Injury to Persons; Loss of Property
809.1 Subject always to the AUTHORITIES’ proper observance
of their obligations under this Clause, the CONTRACTOR
shall fully indemnify the AUTHORITIES in respect of any
personal injury or loss of or damage to Property incurred
by the AUTHORITIES or their respective employees and
authorised agents to the extent that such personal injury
or loss of Property is directly caused by any Default of
the CONTRACTOR, its employees or agents, in connection with
the performance or purported performance of the
AUTHORITIES’ Agreement.
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809.2 In the event of any claim or demand being made or
action brought to which Clause 809.1 applies, the
CONTRACTOR shall be promptly notified thereof and the
CONTRACTOR shall at its own expense conduct all
negotiations for settlement of the same and any legal
proceedings that may arise therefrom. The CONTRACTOR shall
consult with and pay due regard to the interests (including
the commercial interests of the Post Office Group and the
public interest) and views of the AUTHORITIES in the
conduct of any defence to any claim or demand hereunder,
and shall, where it is reasonable to do so, comply with
such interests and views. The AUTHORITIES, their employees
and agents, shall at the request of the CONTRACTOR afford
all reasonable assistance for the purpose of contesting any
such claim or demand or action and shall be repaid any
reasonable expense incurred in so doing and shall not make
any admissions which may be prejudicial to the defence of
such claim or demand or action.
Clause 810. Limitation of Liability
810.1 No party hereto excludes or limits its liability to
any other party for death or personal injury or any breach
of any obligations implied by Section 12 of the Sale of
Goods Act 1979 or Section 2 of the Supply of Goods and
Services Act 1982.
810.2 Subject always to Clause 810.1, the liability of each
party for Defaults shall be subject to the financial limits
set out in this Clause 810.2.
810.2.1 The aggregate liability for all Defaults
resulting in direct loss of or damage to the Property
of any other party under all the Related Agreements
shall in no event exceed:
810.2.1.1 ten million pounds (£10,000,000), in
the case of POCL’s liability to the CONTRACTOR;
810.2.1.2 one million pounds (£1,000,000) in the
case of DSS’s liability to the CONTRACTOR;
810.2.1.3 fifty million pounds (£50,000,000), in
the case of the CONTRACTOR’s liability to DSS;
and
810.2.1.4 ten million pounds (£10,000,000) per
Year in relation to such Defaults arising during
that Year, in the case of the CONTRACTOR’s
liability to POCL.
810.2.2 The aggregate liability of each party for
all Defaults resulting in direct loss of or damage to
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the Property of any other party under the
AUTHORITIES’ Agreement shall in no event exceed:
810.2.2.1 one million pounds (£1,000,000), in the
case of POCL’s liability to the CONTRACTOR;
810.2.2.2 one hundred thousand pounds (£100,000)
in the case of DSS’s liability to the CONTRACTOR;
810.2.2.3 five million pounds (£5,000,000), in
the case of the CONTRACTOR’s liability to DSS;
and
810.2.2.4 one million pounds (£1,000,000) per
Year in relation to such Defaults arising during
that Year, in the case of the CONTRACTOR’s
liability to POCL.
810.2.3 The aggregate liability per Year under all
the Related Agreements of the AUTHORITIES for all
Defaults (other than a Default governed by Clauses
810.2.1 and 810.2.2) arising during that Year shall
in no event exceed:
810.2.3.1 five million pounds (£5,000,000) in the
case of DSS’s liability to the CONTRACTOR;
810.2.3.2 five million pounds (£5,000,000) in the
case of POCL’s liability to the CONTRACTOR.
810.2.4 The aggregate liability per Year of the
AUTHORITIES for all Defaults (other than a Default
governed by Clauses 810.2.1 and 810.2.2) arising
during that Year under the AUTHORITIES’ Agreement
shall in no event exceed:
810.2.4.1 five hundred thousand pounds (£500,000)
in the case of DSS’s liability to the CONTRACTOR;
810.2.4.2 five hundred thousand pounds (£500,000)
in the case of POCL’s liability to the
CONTRACTOR.
810.2.5 The aggregate liability under all the
Related Agreements of the CONTRACTOR for all Defaults
(other than a Default governed by Clauses 810.2.1 and
810.2.2) shall in no event exceed:
810.2.5.1 two hundred million pounds
(£200,000,000) in the case of the CONTRACTOR’s
liability to the AUTHORITIES.
810.2.6 (Not used]
810.2.7 (Not used]
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810.2.8 Subject to Clause 810.2.9, the financial
limits specified in Clause 810.2 apply to all claims
for monetary relief which any party may have against
the other parties either under the Related Agreements
or otherwise in relation to the subject matter of the
Related Agreements, including all claims for
liquidated damages pursuant to Clause 802, all claims
to be indemnified pursuant to Clauses 805 and 809 and
all other claims or costs which are compensable in
money or money’s worth.
810.2.9 The financial limits applicable to the
AUTHORITIES under Clause 810.2 shall be exclusive of
and additional to any liability of the AUTHORITIES to
pay any Charge, any Termination Charge, any Transfer
Payment or any amount payable under Clause 201.9
which may become properly due and payable to the
CONTRACTOR in accordance with the provisions hereof
or any sum by way of interest thereon that a court
may award.
810.3 Subject always to Clause 810.1, in no event shall any
party be liable to any other party for indirect or
consequential loss or damage. For the avoidance of doubt,
this Clause 810.3 shall not be deemed or construed to
affect the CONTRACTOR’s liability under Clause 808.
810.4 The provisions of Clause 810.3 shall not be taken as
limiting the right of either AUTHORITY to claim from the
CONTRACTOR for:
810.4.1 additional operational and administrative
costs and expenses; and/or
810.4.2 expenditure or charges rendered unnecessary
as a result of any Default by the CONTRACTOR.
810.5 The parties expressly agree that should any
limitation or provision contained in this Clause be held to
be invalid under any applicable statute or rule of law it
shall to that extent be deemed omitted but if any party
thereby becomes liable for loss or damage which would
otherwise have been excluded such liability shall be
subject to the other limitations and provisions set out
herein.
810.6 For the avoidance of doubt, it is acknowledged that
nothing in the Related Agreements shall be deemed or
construed to relieve any party of its common-law duty to
any other party against which a claim may be made to
mitigate any loss which is the subject of such claim.
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PART 9 : TERM AND TERMINATION
Clause 901. Term
The term of the AUTHORITIES’ Agreement shall, unless
terminated earlier in accordance with the provisions of
Clause 902, be for a period commencing on the date hereof
and ending five (5) years from the Roll-Out Completion
Date.
Clause 902. Termination of AUTHORITIES' Agreement
902.1 The AUTHORITIES may jointly at any time by notice in
writing terminate the AUTHORITIES’ Agreement with effect
from the date of service of such notice or such later date
as may be specified therein if:
902.1.1 there is a change of control, as defined by
Section 416 of the Income and Corporation Taxes Act
1988, in the CONTRACTOR or its GUARANTOR; or
902.1.2 the CONTRACTOR or the GUARANTOR, being an
individual, or where the CONTRACTOR or the GUARANTOR
is a firm, any partner or partners in that firm who
together are able to exercise direct or indirect
control, as defined by Section 416 of the Income and
Corporation Taxes Act 1988, shall at any time become
bankrupt or shall have a receiving order or
administration order made against him or shall make
any composition or arrangement with or for the
benefit of his creditors, or shall make any
conveyance or assignment for the benefit of his
creditors, or shall purport to do so, or appears
unable to pay or to have no reasonable prospect of
being able to pay a debt within the meaning of
Section 268 of the Insolvency Act 1986 or he shall
become apparently insolvent within the meaning of the
Bankruptcy (Scotland) Act 1985 as amended by the
Bankruptcy (Scotland) Act 1993 or any application
shall be made under any bankruptcy or insolvency act
for the time being in force for sequestration of his
estate, or a trust deed shall be granted by him for
behoof of his creditors; or any similar event occurs
under the law of any other jurisdiction; or
902.1.3 the CONTRACTOR, being a company, passes a
resolution, or the Court makes an order that the
CONTRACTOR or the GUARANTOR be wound up otherwise
than for the purpose of a bona fide reconstruction or
amalgamation, or a receiver, manager or administrator
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on behalf of a creditor is appointed in respect of
the business or any part thereof (which for the
avoidance of doubt shall not include any subsidiary
company of the CONTRACTOR or of the GUARANTOR) of the
CONTRACTOR or the GUARANTOR, or circumstances arise
which entitle the Court or a creditor to appoint a
receiver, manager or administrator or which entitle
the Court otherwise than for the purpose of a bona
fide reconstruction or amalgamation to make a
winding-up order, or the CONTRACTOR or the GUARANTOR
is unable to pay its debts within the meaning of
Section 123 of the Insolvency Act 1986 or any similar
event occurs under the law of any other jurisdiction;
or
902.1.4 the circumstances in Clause 605.3.6 arise
and either the obligation in question is not capable
of being performed again, or, if it is so capable, is
not so performed again within thirty (30) days of
written notice to the CONTRACTOR specifying the
obligation in question and requiring it to be
performed or within such other period as may be
requested by the CONTRACTOR and agreed by the
AUTHORITIES, such agreement not to be unreasonably
withheld or delayed; or
902.1.5 any provision hereof other than Clause 902
expressly entitles the AUTHORITIES to terminate the
AUTHORITIES’ Agreement.
902.2 The AUTHORITIES may jointly at any time by notice in
writing terminate the AUTHORITIES’ Agreement with effect
from the date of service of such notice or such later date
as may be specified therein, if the CONTRACTOR is in
Default of any obligation under the AUTHORITIES’ Agreement
and:
902.2.1 the Default is capable of remedy and the
CONTRACTOR shall have failed to remedy the Default
within thirty (30) days of written notice to the
CONTRACTOR specifying the Default and requiring its
remedy or within such other period as may be
requested by the CONTRACTOR and agreed by the
AUTHORITIES, such agreement not to be unreasonably
withheld or delayed;
902.22 the Default is not capable of remedy (and
for the purposes of this Clause, failure to comply
with a timescale shall not of itself be considered a
Default not capable of remedy except pursuant to
Clause 605.4); or
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902.2.3 notice has been served pursuant to Clause
605.4 making time of the essence and all or any of
the obligations specified in the notice have not been
performed by the time limit stated in the notice.
902.3[Not used].
902.4 In the event of any termination of the AUTHORITIES’
Agreement pursuant to Clause 902.1 or Clause 902.2, the
AUTHORITIES shall return the Service Infrastructure or any
part thereof (other than any part in relation to which
either or both of the AUTHORITIES has exercised an option
to purchase under the Related Agreements), in which case
the CONTRACTOR shall, at no additional cost to the
AUTHORITIES, remove such parts of the Service
Infrastructure and shall make good any damage to the
Premises occasioned by such removal.
902.5 The AUTHORITIES shall only be permitted to exercise
their rights pursuant to Clause 902.1.1 for three (3)
months after each such change of control and shall not be
permitted to exercise such rights where the AUTHORITIES
have agreed in advance in writing to the particular change
of control and such change of control takes place as
proposed. The CONTRACTOR shall notify the AUTHORITIES in
advance of any change of control taking place, if legally
possible, or if not so possible as soon as reasonably
practicable, and in any event no later than one (1) month
after such change of control taking place.
902.6
902.6.1 The AUTHORITIES may jointly terminate the
AUTHORITIES’ Agreement by giving the CONTRACTOR not
less than twelve (12) months' notice.
902.6.2 (Not used]
902.6.3 In the event of such notice being given,
the AUTHORITIES shall on termination hereof pay to
the CONTRACTOR the Termination Charge (calculated in
accordance with Schedule A9).
902.6.4 [Not used]
902.6.5 [Not used]
902.7 Termination shall not prejudice or affect any right
of action or remedy which shall have accrued or shall
thereafter accrue to either party.
902.8 The provisions of Clauses 101, 102, 104, 502, 606,
608, 609, 801, 804, 805, 810, 902, 903 and 904 and the
provisions of Schedules Al and AQ _ shall survive the
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termination of this AUTHORITIES’ Agreement by the
AUTHORITIES.
902.9 In the event of notice of termination of the
AUTHORITIES’ Agreement being given hereunder, DSS shall
have the option exercisable at any time up to six (6)
months after such notice to terminate the AUTHORITIES’
Agreement to give notice to terminate the DSS Agreement
pursuant to Clause 902.1.4 thereof and POCL shall have the
option exercisable at any time up to six (6) months after
such notice to terminate the AUTHORITIES’ Agreement to give
notice to terminate the POCL Agreement pursuant to Clause
902.1.4 thereof.
902.10If either POCL terminates the POCL Agreement, or DSS
terminates the DSS Agreement or all the DSS Services:
902.10.1 the terminating AUTHORITY shall have no
further rights or obligations under the AUTHORITIES’
Agreement, and none of the provisions of the
AUTHORITIES’ Agreement other than the provisions of
Clauses 101, 102, 104, 301, 606, 608, 609, 801, 805,
810, 902, 903 and 904 and of Schedules Al, A3, A6 and
AQ shall survive in relation to the terminating
AUTHORITY; and
902.10.2 the non-terminating AUTHORITY shall have
the option of terminating the AUTHORITIES’ Agreement
pursuant to Clause 902.1.5, provided that, if the
terminating AUTHORITY terminated the POCL Agreement
or the DSS Agreement (as appropriate) pursuant to
Clause 902.6 of the POCL Agreement or the DSS
Agreement (as appropriate), or terminated all the DSS
Services (in the case of DSS) pursuant to Clause
903.5 of the DSS Agreement, then termination in
accordance with this Clause 902.10 shall be treated
as a termination for convenience in accordance with
Clause 902.6.
902.11In the event of the termination of any DSS Services
or POCL Application Services or of any Related Agreement,
the parties shall negotiate in good faith to make any
necessary consequential amendments to the surviving Related
Agreements in accordance with Clause 101.3. Until such
consequential amendments have been made, the CONTRACTOR
shall not be liable for any delay or failure in the
performance of its obligations under the surviving Related
Agreements which is directly caused by the termination of
any DSS Services, POCL Services or Related Agreement.
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Clause 903. Rights on Termination of AUTHORITIES’ Agreement
903.1 In the event of termination hereunder, in
circumstances where the AUTHORITIES do not intend inviting
the CONTRACTOR to continue to provide the Services
hereunder or to provide services equivalent to the Services
hereunder, DSS or POCL shall, without prejudice to the
AUTHORITIES' other rights and remedies, have the option,
exercisable at any time within four (4) months after
notice of termination:
903.1.1 to acquire from the CONTRACTOR a
non-exclusive licence to use (or authorise a
replacement contractor to use) for the continuation
of services equivalent to the Services hereunder in
respect of any necessary Intellectual Property Rights
which are owned by the CONTRACTOR and used in
connection with the performance of the AUTHORITIES’
Agreement. Such licence shall:
903.1.1.1 not be subject to payment other than
pursuant to Clause 903.1.5;
903.1.1.2 be perpetual and irrevocable (subject
to Clause 903.3); and
903.1.1.3 [Not used]
903.1.1.4 [Not used]
903.1.1.5 [Not used]
1
903.1.1.6 permit use by members of the Post
Office Group and End Users.
903.1.2 to require that the CONTRACTOR shall assign
or novate, or (if assignment or novation is not
possible) arrange for the benefit thereof to be
transferred, in favour of the AUTHORITIES or to any
person as may be designated for the purpose by the
AUTHORITIES any sub-contracts, equipment rental or
lease agreements and all other (non-employment)
agreements entered into by the CONTRACTOR which are
necessary to the performance of the Services
hereunder as the AUTHORITIES may designate;
903.1.3 to require that the CONTRACTOR shall at no
cost to the AUTHORITIES (or a replacement contractor)
forthwith release to the AUTHORITIES (or a
replacement contractor) a copy of all the Software
and all other software, data, tools, utilities,
documentation and any other item necessary to provide
the Services hereunder. Such software (other than
any in respect of which the AUTHORITIES have
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exercised their option under Clause 903.1.1) shall be
subject to any applicable licence terms, provided
that such terms shall not detract from the
AUTHORITIES’ or a replacement contractor’s ability to
perform services equivalent to the Services.
903.1.4 Notwithstanding the generality of
Clauses 903.1.1 to Clause 903.1.3 the AUTHORITIES
agree only to exercise their rights under such
Clauses when and only to the extent that it is
necessary for the AUTHORITIES either to fulfil the
purposes of the AUTHORITIES’ Agreement themselves or
to engage a third party so to do.
$03.1.5 In the event that the AUTHORITIES’ exercise
any of the options in Clause 903.1, the AUTHORITIES
shall pay to the CONTRACTOR the Transfer Payment
calculated in accordance with Schedule A9.
903.1.6 If the AUTHORITIES’ Agreement expires and
the AUTHORITIES do not recompete the Services
hereunder, they shall be obliged to exercise all of
the options in this Clause, unless the CONTRACTOR
elects to relieve the AUTHORITIES of this obligation
in whole or in part.
903.2 In the event that the AUTHORITIES’ Agreement is
terminated as provided for herein:
903.2.1 the CONTRACTOR shall repay forthwith to the
relevant AUTHORITIES all monies paid in relation to
Services hereunder up to and including such date of
termination other than monies in respect of any
Services or part thereof properly performed in
accordance with the AUTHORITIES’ Agreement;
903.2.2 the CONTRACTOR shall return to POCL all
Post Office Group Property in its possession and
shall return to DSS all Property of DSS in its
possession;
903.2.3 the CONTRACTOR shall render all practicable
assistance to the AUTHORITIES, if requested, to the
extent necessary to effect an orderly assumption by
the AUTHORITIES or a replacement contractor of the
services theretofore performed by the CONTRACTOR
under the AUTHORITIES’ Agreement and the AUTHORITIES
shall reimburse the CONTRACTOR for such assistance at
the rates then prevailing for customers of the
CONTRACTOR for the same or similar services;
903.2.4 the AUTHORITIES shall be entitled on
termination to offer any employee or sub-contractor
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(being an individual) of the CONTRACTOR who has
during the six (6) months prior to such offer been
involved for at least seventy-five per cent (75%) of
his contracted working time in performing the
CONTRACTOR'S obligations under the AUTHORITIES’
Agreement employment or an agreement for services
with the AUTHORITIES and the CONTRACTOR agrees that
if such person accepts such offer the CONTRACTOR
shall release such person from any breach of contract
with it (other than in relation to such person’s
obligations of confidentiality and notice of
termination) which such acceptance may otherwise
involve; and
903.2.5 (a) as soon as possible following any
notice of termination being given (in the case of an
early termination of the AUTHORITIES’ Agreement) and
no later than three (3) months prior to the expiry of
the AUTHORITIES’ Agreement (in the case of the
termination of the AUTHORITIES’ Agreement through the
effluxion of time) the CONTRACTOR shall at _ the
request of the AUTHORITIES provide to the AUTHORITIES
or to a replacement contractor nominated by the
AUTHORITIES details of the terms of employment of all
CONTRACTOR personnel who are then employed in the
performance of the Services hereunder as reasonably
required by the AUTHORITIES in order to permit
compliance with the Transfer of Undertakings
(Protection of Employment) Regulations 1981 by the
AUTHORITIES or a replacement contractor;
(b) subject always to the AUTHORITIES’
proper observance of their obligations under Clause
903.2.5(c), the CONTRACTOR shall fully indemnify the
AUTHORITIES from and against any and all liabilities
which the AUTHORITIES may incur in connection with or
as a result of any claim or demand whatsoever by any
employee or former employee of the CONTRACTOR or of
any of the CONTRACTOR’s sub-contractors or agents in
respect of his employment with the CONTRACTOR or such
sub-contractor or agent (or, pursuant to the
application of the Transfer of Undertakings
(Protection of Employment ) Regulations 1981, with
either AUTHORITY or any replacement contractor)
and/or its termination save to the extent such claim
or demand both (i) is made by an employee identified
within the relevant employment details referred to in
Clause 903.2.5(a) as transferring pursuant to the
Regulations and (ii) relates to employer’s
obligations accruing after the said transfer of
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employment which are clearly identified within the
relevant employment details;
(c) in the event of any claim or demand
being made or action brought to which Clause
903.2.5(b) applies, the CONTRACTOR shall be promptly
notified thereof and the CONTRACTOR shall at its own
expense conduct all negotiations for settlement of
the same and any legal proceedings that may rise
therefrom. The AUTHORITIES, their sub-contractors,
agents and employees shall at the request of the
CONTRACTOR afford all reasonable assistance for the
purpose of contesting any such claim or demand or
action and shall be repaid any reasonable expense
incurred in so doing and shall not make any
admissions which may be prejudicial to the defence of
any such claim or demand or action.
903.3 The CONTRACTOR may at any time by notice in writing
terminate any licence granted under Clause 903.1.1 if the
relevant AUTHORITY is in Default of its obligations under
Clause 903.1.1 in relation to such licence and the relevant
AUTHORITY shall fail to remedy such Default within thirty
(30) days of written notice to the relevant AUTHORITY
specifying the Default and requiring its remedy, provided
that if the Default in question is caused by an Agent, such
licence shall only be terminated in relation to Use by such
Agent.
903.4 The AUTHORITIES shall only be entitled to exercise
the options in Clause 903.1 and 903.2.4 to the extent that
such exercise does not affect the CONTRACTOR’s ability to
perform any DSS Services or POCL Services.
Clause 904. Transfer Services
In the event of termination of the AUTHORITIES’ Agreement
pursuant to Clause 902, the CONTRACTOR shall perform the
Transfer Services as set out in Schedule A9.
PART 10 : MISCELLANEOUS
Clause 1001. Corrupt Gifts and Payments of Commission
1001.1The CONTRACTOR shall neither:
1001.1.1 offer or give or agree to give any person
on Her Majesty's Service (which term shall in this
Clause 1001 include all persons employed or engaged
by the Crown and all persons providing services to
the Crown) or employed by or providing services to
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the Post Office Group any gift or consideration of
any kind as an inducement or reward for doing or
forbearing to do or for having done or forborne to do
any act in relation to the obtaining or performance
of the AUTHORITIES’ Agreement or any other agreement
with Her Majesty's Service or the Post Office Group
(as appropriate) or for showing or forbearing to show
favour or disfavour to any person in relation to the
AUTHORITIES’ Agreement; nor
1001.1.2 enter into the AUTHORITIES’ Agreement if in
connection with it commission has been paid or agreed
to be paid to any person on Her Majesty's Service or
employed by the Post Office Group by the CONTRACTOR
or on the CONTRACTOR's behalf or to the CONTRACTOR's
knowledge, unless before the AUTHORITIES’ Agreement
are made particulars of any such commission and of
the terms and conditions of any agreement for the
payment thereof have been disclosed in writing to the
AUTHORITIES.
1001.2In the event of any breach of this Clause 1001 by the
CONTRACTOR or by anyone employed by the CONTRACTOR or
acting on the CONTRACTOR's behalf (whether with or without
the knowledge of the CONTRACTOR) or the commission of any
offence by the CONTRACTOR or by anyone employed by the
CONTRACTOR or acting on behalf of the CONTRACTOR under the
Prevention of Corruption Acts, 1889 to 1916 in relation to
this or any other contract with the Post Office Group or
for Her Majesty's Service, the AUTHORITIES may terminate
the AUTHORITIES’ Agreement by notice in writing to the
CONTRACTOR pursuant to Clause 902.1.5. Provided always
that such termination shall not prejudice or affect any
right of action or remedy which shall have accrued or shall
accrue thereafter to the AUTHORITIES and provided always
that the AUTHORITIES may recover from the CONTRACTOR the
amount or value of any such gift, consideration or
commission.
1001.3The decision of the AUTHORITIES shall be final and
conclusive in any dispute, difference or question arising
in respect of:
1001.3.1 the interpretation of this Clause (except
so far as the same may relate to the amount
recoverable from the CONTRACTOR under Clause 1001.2
in respect of any loss resulting from such
termination of the AUTHORITIES’ Agreement); or
1001.3.2 the right of the AUTHORITIES under this
Clause 1001 to terminate the AUTHORITIES’ Agreement;
or
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1001.3.3 the amount or value of any such gift,
consideration or commission.
Clause 1002. Discrimination
1002.1The CONTRACTOR shall not unlawfully discriminate
within the meaning and scope of any law, enactment, order,
regulation or other similar instrument relating to
discrimination (whether in relation to race, gender,
religion or otherwise) in employment.
1002.2The CONTRACTOR shall take all reasonable steps to
ensure the observance of the provisions of Clause 1002.1 by
all servants, employees, agents and consultants of the
CONTRACTOR and all sub-contractors.
Clause 1003. Guarantee
The CONTRACTOR shall procure that the GUARANTOR shall
within thirty (30) days after the date hereof enter into
and maintain a guarantee in the form set out in Schedule
All. Breach of this Clause shall constitute a Default not
capable of remedy.
Clause 1004. Insurance
The CONTRACTOR shall to the extent reasonably possible
insure or make provision for self-insurance against all
losses and damages which are the result of its fault or
negligence in performing the Services hereunder, including
workman’s compensation, public liability, product
liability, property damage and professional indemnity. The
CONTRACTOR will, if requested in writing by either
AUTHORITY, produce to the relevant AUTHORITY a certificate
of insurance showing the applicable coverage currently in
force, and will also give the AUTHORITIES’ prior written
notice of (where possible), or written notice no later than
thirty (30) days after, alteration or cancellation of such
insurance.
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IN WITNESS WHEREOF this Agreement has been executed on
behalf of the parties as follows:
Signed for and on behalf of the Secretary of State for
Social Security
BYY woe sme woe eRe ee See SOE HE Ew ee ee Nes He Ree ew ee SOS
Name: PETER MATHISON
Title: Chief Executive, Benefits Agency
Name: STUART SWEETMAN
Title: Managing Director, Post Office Counters Ltd
Signed for and on behalf of the CONTRACTOR
Name: JOHN H BENNETT
Title: Managing Director, Pathway Group Limited
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