Capita Business Services Limited v IBM United Kingdom Limited

Capita Business Services Limited v IBM United Kingdom Limited

The language of Condition 2, its immediate contractual context (including Conditions 1 and 3), and the structure of the Agreement make clear that IBM's obligations to support the Relevant Service ceased on 30 August 2023, regardless of whether a replacement service was operational. Any further support would require a Change Control Procedure at Capita's expense. Capita's application for declarations was refused.

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
11 October 2024
Procedural Posture
Commercial Contract Dispute (part 8 Claim) / Judgment After Expedited Trial on Construction of Contract
Outcome
Claim dismissed
Legal Topics
Interpretation of Commercial Contracts, Change Control Procedures, IT Services Agreements, Declaratory Relief
Contract Law Commercial Law Interpretation of Commercial Contracts Change Control Procedures IT Services Agreements 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

Commercial Contract Dispute (part 8 Claim) / 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

The language of Condition 2, its immediate contractual context (including Conditions 1 and 3), and the structure of the Agreement make clear that IBM's obligations to support the Relevant Service ceased on 30 August 2023, regardless of whether a replacement service was operational. Any further support would require a Change Control Procedure at Capita's expense. Capita's application for declarations was refused.

Court Disposition

Claim dismissed

Orders

  • Capita's application for declarations refused
  • IBM's contingent application against Kyndryl does not arise