Capita Business Services Ltd v IBM United Kingdom Ltd [2023] EWHC 2623 (Comm) (20 October 2023)

Capita Business Services Ltd v IBM United Kingdom Ltd [2023] EWHC 2623 (Comm) (20 October 2023)

Condition 2 of Table B in Annex 2 to Schedule 2 of the Agreement provides that IBM's obligations for the Managed Services relating to the Relevant Service ceased on 30 August 2023, regardless of whether a replacement service was operational. The language, contractual context, and the absence of any provision for continued support or price adjustment after that date support IBM's construction. Any continued support after 30 August 2023 requires a Change Control Procedure at Capita's expense.

Citation
[2023] EWHC 2623 (Comm)
Parties
Claimant: Capita Business Services Limited; Defendant/part 20 Claimant: IBM United Kingdom Limited; Part 20 Defendant: Kyndryl UK Limited
Jurisdiction
England and Wales
Judgment Date
20 October 2023
Procedural Posture
Part 8 Claim (commercial Court) / Judgment After Expedited Trial on Construction of Contract
Outcome
Claim dismissed. Declaration granted in favour of IBM's construction.
Legal Topics
Interpretation of Contracts, Managed Services Agreements, Change Control Procedures, Termination of Services, Declaratory Relief
Contract Law Commercial Law IT Law Interpretation of Contracts Managed Services Agreements Change Control Procedures Termination of Services Declaratory Relief

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Parties

Capita Business Services Limited

Claimant

IBM United Kingdom Limited

Defendant/part 20 Claimant

Kyndryl UK Limited

Part 20 Defendant

Procedural Posture

Part 8 Claim (commercial Court) / Judgment After Expedited Trial on Construction of Contract

Legal Issues

  1. 1 Proper construction of Condition 2 to Table B in Annex 2 to Schedule 2 of the Restated and Amended IBM Agreement
  2. 2 Whether IBM's obligations for Managed Services relating to the Relevant Service ceased on 30 August 2023 or only upon operational replacement

Ratio Decidendi

Condition 2 of Table B in Annex 2 to Schedule 2 of the Agreement provides that IBM's obligations for the Managed Services relating to the Relevant Service ceased on 30 August 2023, regardless of whether a replacement service was operational. The language, contractual context, and the absence of any provision for continued support or price adjustment after that date support IBM's construction. Any continued support after 30 August 2023 requires a Change Control Procedure at Capita's expense.

Court Disposition

Claim dismissed. Declaration granted in favour of IBM's construction.

Orders

  • It is declared that IBM's obligations for the Managed Services relating to the Relevant Service ceased on 30 August 2023, unless otherwise agreed through the Change Control Procedure.