Question

Question 3

The Unemployment Program of the Government of Guava Land has several offices throughout the country, ten (10) to be specific. At these offices, all the administrative matters of the Program are administered, inclusive of payments to suppliers, payroll and Information Technology services. There are several assets and confidential data on each compound such as computer equipment, filing cabinets, personal data and several pieces of furniture.

Within recent times, there were numerous burglaries’ at a number of locations, which resulted in the loss of two million dollars’ worth in items. The Police are currently undertaking an investigation to catch the culprits.

The Minister, who is responsible for the Program, has mandated the Program to procure security services for one year at each location. After a highly competitive procurement process, Big Trouble Security Services secured the contract to provide security services at all the locations.

The Unemployment Program and Big Trouble Security Services met on several occasions to finalize the written contractual obligations. Finally, on March 31st 2019, they agreed on all the terms of the contract and both parties duly signed. One of the agreed terms is that “Big Trouble Security Services under no circumstances will be held liable for any unforeseen acts committed by its officers during the provision of services to the Unemployment Program”

Raymond Tin Foot, a security officer from Big Trouble Security Services, was assigned to the Harlem Office for the last six months for the 6 pm to 6 am shift. Raymond, who is also a resident of the Harlem area, invited several of his friends during his shift, to lime and have a cookout at nights as a means of passing the time. This involves the lighting of a fire as well as occasional drinking of alcohol on the premises.

Big Trouble Security Services – Manager and Owner – Mr. Lazy, on one of his rear occasional visits to the Harlem Site, saw what was going on at this office. He quietly told Raymond “to please keep everything under control so that no one will know”. Mr. Lazy as per contractual obligations must visit the site every night to ensure that the guards are performing their functions efficiently and effectively. However, this has never been done, because Mr. Lazy treasure his sleep very much. Additionally, Mr. Lazy did not want to take any affirmative action, because he feared that Raymond might leave the job. Indeed, Big Trouble Security Services is having problems recruiting security guards in this area and as such, if Raymond left the job there will be no available guard for this location.

One night, while Raymond was cooking and consuming alcohol with his friends, forgot to extinguish the fire. They all fell asleep and subsequently the Harlem Compound of the Unemployment Program was destroyed.

The Unemployment Program intents to sue Big Trouble Security Services for breach of contract due to the negligence of their employee Mr. Raymond Tin Foot. However, Big Trouble Security Services is seeking to rely on the following agreed term of the contract, which excludes them from liability, that is – “Big Trouble Security Services under no circumstances will be held liable for any unforeseen acts committed by its officers during the provision of services to the Unemployment Program”

Advise the Unemployment Program, whether or not Big Trouble Security Services can rely on the above-mentioned exclusion clause in the face of a fundamental breach of contract due to the destruction of the compound.

Answer 1

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Answer:

From the given case study, we understand that:

1. BTSS and UP have executed a services contract that allows BTSS to provide security services to UP across all locations including location H.

2. Mr. RTF was deployed as a security guard at a particular location of UP for the past 6 months for shift hours between 6 pm to 6 am.

3. The contract language absolves BTSS from any liabilities for any unforeseen acts committed by BTSS officers while delivering their services to the UP.

The keyword here is 'unforeseen' as any potential liabilities for BTSS would be measured against this condition.

Next, we prepare the following table comparing the contractual obligations/expectations against reported issues to identify the contractual breaches:

#	Contractual Obligation/Expectations	Reported Issues	Remarks
1	The Owner of BTSS should undertake daily site visits every night to ensure the guards are working effectively and efficiently	It is mentioned that the Owner rarely visited the sites.	This is a Breach of contract.
2	BTSS Security guards should not engage in any onsite activity that puts the facility at risk.	During his stint at location H, RTF frequently engaged in non-work related activities during his shift hours which included lighting fire, cooking, and drinking.	This is a Breach of contract.
3	BTSS security guards across the UP locations must be engaged in providing security services during their shift hours.	RTF fell off to sleep during his shift hours which eventually resulted in an accident that destroyed the entire UP facility.	This is a Breach of contract.
4	Security guards should not allow any unauthorized access to the UP facility.	RTF frequently allowed his friends to the UP facility without any form of authorization.	This is a Breach of contract.
5	In case of any dereliction of duty, BTSS Owner should take immediate action and report the incident to the UP management.	BTSS Owner was aware of RTF's indiscipline and unsolicited activities during the shift hours. But, he deliberately chose to ignore that in light of his business benefit.	This is a Breach of contract. It is also unethical on the part of BTSS owner to put the client's facility at risk to serve his business interest.

Based on the above analysis, we can safely conclude that the fire accident at UP's facility located in H, was a result of continuous negligence of duty on the part of security guard RTF. It is also evident that the BTSS owner was completely aware of this continued negligence on the part of RTF. However, he deliberately chose to protect his business interest while putting the client at risk.

Therefore, in this case, BTSS cannot absolve itself from the contractual liability and the penalty thereof.