Re: FN-FORUM: Contract termination - any legal experts?

date posted 2nd August 2007 16:02

From: "Cuation contact" [EMAIL REMOVED]
>
> Hi all,
>
> I mailed the list a week or so asking for some advice about a potential
> situation with a customer that I suspected was about to happen. Well, it
> has happened, and it is actually worse than I had thought. So I'd really
> appreciate any advice anyone can offer on this.
>
> My company has been working as a consultancy to a public sector body for
> a couple of years. The contracts have always been fixed price, but they
> have always conducted the projects on the basis of us working a certain
> number of days and them paying monthly invoices reporting on the number
> of days worked. In the contract there is a requirement for one month's
> written notice on either side, but no mention of payments.
>
> A month or so they suddenly sent out a curt email telling us to suspend
> work while they carried out an internal review (it turns out they have
> had a major reshuffle and declared this project to be "legacy" work).
> They gave no further information despite me prompting them until
> yesterday, when they emailed me a scanned pdf of a letter terminating the
> contract with one month's notice. They stated that they expected me to
> cease work at once (so actually not a month's notice at all).
>
> Here is where the problem is. At the time they suspended the work I had
> nearly a month's work about to be invoiced, so at the end of June I
> invoiced them as usual. They have not paid that invoice, which is now
> more than 30 days overdue. Instead, in the letter they have offered to
> pay this invoice as a gesture if I will accept that as full and final
> settlement.
>
> So in summary, they have kept me dangling for a month, then terminated
> the contract with immediate effect, and graciously offering to pay an
> outstanding bill instead of a termination payment. The terms of the
> letter are quite hostile (I should mention that this itself is a
> surprise - we have had extremely good relations with them up to now, and
> the project was on track) and they are clearly holding out the unpaid
> bill as a bargaining tactic to get me to agree to go away quietly.
>
> My question is, can I expect a payment for the one month's notice? And
> can I expect them to pay me for the month they kept me hanging around
> (they implicitly reserved the right to restart the project at any time
> during this period, and in fact they have done similar things in the
> past, so it would not have surprised me if they had). Or should I just
> settle for them paying their outstanding bill?
>
> Where would be a good place for me to get some legal advice on this (it
> doesn't seem like my family solicitor's territory somehow)?
>
> Any help much appreciated. Sorry about the anonymity - hopefully the
> reason for this is clear.

This is a tort issue for local handling by a local law firm. It concerns me
on many levels.

As folk here know I will sometimes help with these things. On this one,
though, I have suspicions - like the anonymity and the reference to a legal
term in the email address.

Contact off list if feedback wanted - with a genuine identity please!

Mike A.