British Gas's lawsuit over an SAP-based customer billing system had another boost after the utility won all but one of its key pre-trial arguments in its case against Accenture.
Centrica – British Gas' parent company - is claiming about £183 million from Accenture over the system which it says was fundamentally flawed. It also claims that the collapse of the system disrupted its customer service operations and led to a large spike in complaints. Accenture in turn argues that the problems were of British Gas’ own making, that the system was delivered on time, on budget, and was tested by British Gas which used it for two years before making any claim.
As a prelude to a full court case, there were five days of preliminary hearings in the High Court in June and July 2009 since which time Mr Justice Field has issued two judgments, both of which have gone against Accenture with nine out of ten contractual points under dispute bring ruled in favour of Centrica.
Among Field's rulings were that:
Centrica can aggregate individual breaches of warranty into a single fundamental breach of warranty for the purposes of its claim. "I can see nothing in the agreement that prevents Centrica from asserting that a breach is a Fundamental Defect when to begin with they thought that the effects of the breach did not justify such an assertion,” ruled Field.
Centrica does not have to prove that a fundamental breach of warranty had caused a severe adverse effect at the time it notified Accenture of the breach, only that the breach would have caused a severe adverse effect if left unaddressed.
Centrica can claim damages for the costs of fixing the problems, for direct losses caused by any fundamental defect, and for damages for the problems before Accenture was told of any defect. It can also laim other losses, such as compensation to customers and for extra hardware which Centrica claims it had to buy in order to address the slowness of the system.
Accenture plans to appeal on 14 December. A full trial hearing is not expected until early 2011.