A dispute may start with a missed deadline. Then a disagreement over the quality of delivery. Then costs pile up. Then the contract is terminated. After that, both parties may find themselves facing a question that didn't seem important at signing:

What does this clause actually mean?

In technology contracts and long-term projects, risk doesn't always show up as one clear problem. Sometimes it builds gradually from a set of small details: a milestone that wasn't met, a change that wasn't documented, an obligation nobody followed up on, or a clause that each party reads differently.

When these details accumulate, a contractual relationship can turn into a dispute involving significant financial liabilities. And this isn't a hypothetical scenario.

In recent years, the courts have seen a number of high-profile disputes over technology contracts and large projects. What they had in common is that the problem wasn't always whether a contract existed, but what happened to the contract during its performance, and how its clauses were interpreted once things started to get complicated. From Drax and Wipro to Triple Point and PTT, and from Atos to BSkyB and EDS, these cases offer different examples of how contractual details can turn into major financial and operational risks.

Drax v Wipro: when the liability clause becomes the heart of the dispute

In 2017, Drax Energy Solutions entered into a master services agreement with Wipro to deliver a major technology project, including an Oracle-based IT system with functions for customer relationship management, billing and smart metering, alongside other services spread across several statements of work.

The project was long-term, with defined phases and delivery dates. But implementation didn't go as planned. Problems with delivery and deadlines emerged, and the relationship then escalated into a dispute over a range of claims relating to quality, delay, termination and more.

In 2019, Drax terminated the agreement, and in 2021 it brought proceedings against Wipro. According to the preliminary issue judgment, the claims amounted to around £31.7m, while Wipro maintained that its maximum liability, on its reading of the contract, was limited to around £11.5m. This is where the question arose that made the case an important example in contract management:

Was there a single liability cap for all claims, or could a separate cap apply to each claim?

The wording of the limitation of liability clause included phrases such as "total liability", while at the same time using a mechanism for calculating the cap tied to when the "claim" arose. The court examined this wording in detail before reaching its interpretation of the clause.

In June 2023, the court concluded that the clause set a single aggregate cap in this dispute, and put the cap in question at around £11.5m. Importantly, this figure wasn't a final order to pay; it was the maximum liability under the preliminary issue the court was deciding.

The lessonThe wording of a single clause, and how it is understood, can become a multimillion-pound financial question when a project fails.

Triple Point v PTT: what happens when a project ends before it's finished?

Another case that reached the UK Supreme Court reveals a different side of the problem. In 2013, PTT Public Company contracted with Triple Point Technology to design, implement, maintain and license a bespoke software system for its commodity trading business, for a total value of $6.92m, with payment tied to the achievement of nine phases, or milestones.

But the project ran into problems early on. Only the first two milestones were completed, and they were 149 days late. PTT then terminated the contract in 2015. A dispute followed over the sums owed to Triple Point and PTT's claims, including liquidated damages for delay, the cost of procuring a replacement system, and wasted expenditure that hadn't delivered the expected result.

What makes the case interesting is that the contract didn't just contain a limitation of liability clause. There was also a liquidated damages clause for delay, and the limitation of liability clause contained exceptions, including cases involving negligence, fraud and wilful misconduct. Several questions therefore arose:

• Is the company entitled to liquidated damages for delay if the contract is terminated before the project is complete?
• Are those damages subject to the liability cap?
• And what does the "negligence" exception in the limitation of liability clause mean?

These questions went all the way to the UK Supreme Court, which handed down its judgment in July 2021.

The lessonIt's not just about having a liability clause or a delay clause, but about how the clauses interact when the project's circumstances change. A contract isn't a set of separate clauses; each clause can affect the others.

Royal Devon v Atos: when the clause is there... but its meaning isn't clear enough

In Royal Devon & Exeter NHS Foundation Trust v Atos IT Services UK Ltd, the contract covered the supply of an IT system and related services over five years. The contract was worth around £4.94m. The system was due to be delivered in the first year, with maintenance, training and other services continuing over the following years.

But problems arose, and Royal Devon brought claims for several breaches of contract. A dispute then emerged over the limitation of liability clause. The clause itself set financial limits on liability, but its wording raised an important question:

Is there a single liability cap? Or more than one, depending on the timing or type of breach?

The court at first instance found that the wording could be interpreted as setting a single cap, and the matter then went to the Court of Appeal. In its judgment, the court noted that the words used in the clause, including "total liability", were important in understanding that the purpose was to limit aggregate liability, even though the wording itself was far from perfect.

The lessonA clause with a clear heading doesn't necessarily have a clear effect in every scenario. You may have a limitation of liability clause in your contract, but the real question is:

BSkyB v EDS: when the problem doesn't start inside the contract at all

BSkyB v EDS adds an entirely different layer. In 2000, BSkyB contracted with EDS to develop a large customer relationship management system. The contract included a delivery clause, as well as a liability cap of £30m in certain circumstances.

But the project ran into major problems. By 2002, BSkyB had taken over part of the work itself, and the project wasn't completed until 2006, at a cost of around £265m to complete, according to reports on the case.

BSkyB brought claims of around £709m, including allegations that EDS had made false representations during the negotiation stage about its ability to deliver the project, the timetable, the technology and the methodology. This is where a very important point came up:

Does a contractual liability cap apply if the claim is based on fraud or fraudulent misrepresentation?

The court concluded that the £30m cap did not apply to the claims for deceit and fraudulent misrepresentation, while it did have an effect on other types of claims. The case later ended in a settlement of £318m, which included interim payments BSkyB had already been ordered to receive.

The lessonContractual risk can begin before the contract is even signed: what is said during negotiations, what is included in the contract, what is excluded, and what happens after signing. All of this can become important when the relationship turns into a dispute.

What these cases have in common

Despite the different projects, parties and facts, there is a clear pattern:

This means risk doesn't come from a single clause alone, but from an entire lifecycle.

The problem starts before it becomes a problem

When a new contract is signed, the focus is usually on closing the deal. But after signing, a different set of questions begins:

These questions don't come up at the end of the contract; they come up during its life.

When the number of contracts becomes part of the problem

In an organization with ten contracts, the team may well know the details of almost every agreement. But what happens when the number reaches 500? Or 5,000? Every contract can contain:

• Different dates and obligations
• Different payment terms
• Different limits of liability
• Different renewal and termination terms
• Different service levels
• Different exceptions
• Clauses that require specific approvals or procedures

At that point the problem is no longer: where is the contract? It becomes: what's inside these contracts? And what needs to be tracked?

A contract's importance doesn't end at signing. After it, another stage of follow-up begins: obligations, deadlines, renewals, exceptions, and changes that can affect the business.

This is what makes contract lifecycle management different from simply storing documents. Storage tells you where the contract is; contract lifecycle management helps you track what happens to the contract from the moment it is created until it expires and is renewed.

This is the part that often gets lost when a contract is seen as a document whose job is done the moment it is signed.

This is where AI comes in

When you're dealing with hundreds or thousands of contracts, you can't handle them all the same way. AI can help teams get to the important information inside contracts faster, such as:

• What obligations are there?
• What are the key dates?
• When does the contract expire?
• What are the renewal terms?
• Which clauses deviate from approved standards?
• Are there deviations or points that merit review?
• What are the most important things the team needs to know about this contract?

This is where the value of AI becomes tied to the context of the contract and its lifecycle, not just to summarizing a long document. The goal isn't to get a summary of the contract; the goal is to be able to work with it better.

How does Signit help?

At Signit, we see a contract as part of a business process, not just a file that gets signed and then stored.

With Signit's contract lifecycle management (CLM) system, organizations can manage the contract lifecycle in one place, from drafting and review, through approvals and signing, to tracking and renewal. The platform helps teams organize workflows, collaborate on contracts, manage approvals, track obligations and deadlines, and keep a clearer view of each stage of the contract.

And with Signit's AI assistant, teams can use AI to help at different stages of the contract lifecycle:

This matters especially when the problem isn't a single contract, but an organization's entire contract portfolio. Legal, commercial and operations teams need more than the ability to open a contract; they need to know what requires their attention, when, and why.

A contract doesn't end at signing

The cases above don't mean that every long-term contract will end in litigation, but they show something important: contractual risk doesn't always appear where we expect it.

It may start with a milestone, a change in scope, the quality of delivery, a promise made during negotiations, a termination clause, or a liability clause the parties later couldn't agree on how to interpret. In some cases, the difference between millions of pounds and a different liability cap comes down to the wording of a few words in the contract.

That's why contract management in organizations shouldn't stop at:

Because the value of a contract lies not only in the agreement that was signed, but in the organization's ability to know what it committed to, track what happens after signing, and spot the details that could later turn into operational or commercial risks.

This is where Signit connects the stages of the contract lifecycle in a single experience that brings together contract management, electronic signatures, AI, and obligation and risk management, so the contract is no longer just a stored document, but becomes a source of the information the organization needs to run its business with greater clarity.