Termination of Contract

[ach_patil]

Hello,

I am an IT contractor and been with the agency for 18 months. All along they have been bad with payments and communication. Tired of constant followups, I have decided to terminate my contract with them and go with other agency on the grounds of breach of payment terms and frustration. My clien is fine with the change. I do have a 6 month restriction in my contract not to go direct or through another agency.

I would like to know
1) Am I in a position to terminate the contract.
2) If so do I need to give a proper notice of 30 days or I can terminate with immediate effect.
3) Wordings I need to use in the termination letter.
4) Will the court see it as Breach of contract terms from my end(I have sufficient evidence that of the agency's faults)

Appreciate your help.

Regards

[Olly]

good luck with all that...no idea of the legals but your points seem a bit weak especially if you're trying to get away without paying them off.

If client is really behind you can't they terminate rather than you?

P.S. Who's the agency? If you are actually getting paid reasonably regularly then it would be probably be wise just to suck it up and keep going.

You gotta change jobs in 6 months anyway haven't u or loose expenses?

[northernladuk]

1) Am I in a position to terminate the contract.

Not really, they havn't actually breached have they? I thought I saw something awhile ago that constant poor performance can be used as breach if a certain process is used. You can terminate the contract with the agency but that will terminate the agreement with the client as well. For a short period of time even if this goes through smoothly you could be effectively out of work until the new contract is signed and therefor at some considerable risk.

2) If so do I need to give a proper notice of 30 days or I can terminate with immediate effect.

What does your contract say? Remember again this is termination of the role not just with the agency. Seems to be the only way out of this. I also guess you can do either, it is just how much sh*t you think you can deal with and will the agency not totally screw you over with the client!

3) Wordings I need to use in the termination letter.

What does it matter, he is gonna be well p*ssed. I think this is least of your problems.

4) Will the court see it as Breach of contract terms from my end(I have sufficient evidence that of the agency's faults)

Faults are not breaches. Thing is at the end of the day someone has to start the legal process for it to get to a court. The gamble is do you think the agency will see it worthwhile progressing this. Up until that point it is just a bun fight over words on a piece of paper.

I do think first agency will attempt to spoil your gig with the client and although the client may be ok with the move he may reconsider when he has a pile of cr*p on his desk that is nothing to do with him.

Also is the person at the client in a position to use another agency? Do they not have a PSL?

If you start this process you are going to have a number of ugly phone calls and sleepless nights IMO. How about sending a couple of pretty stern letters to the agency pointing out the latest problem or keep a history on the bottom of the letter. This letter will also indicate your intention to walk should the situation not be resolved to a reasonable level. Send this letter three times with a detailed and extended history might make them sit up and think that your serious.

[BolshieBastard]

1) Am I in a position to terminate the contract.
2) If so do I need to give a proper notice of 30 days or I can terminate with immediate effect.
3) Wordings I need to use in the termination letter.
4) Will the court see it as Breach of contract terms from my end(I have sufficient evidence that of the agency's faults)

Appreciate your help.

Regards

1, Depends what your contract says. Does it contain a reciprical termination clause?
2, You'd need to give the relevant notice specified in the contract.
3, Anything that says '(Your co) hereby serves notice under section, para of the contract between us, to terminate this contract. The (date) will be the last day services will be provided by (your co). This notification is deemed to have been delivered to your registered office 3 working days after posting and is deemed effective from (date).
4, Late payment is not usually considered a material breach of contract so I very much doubt a court would find in your favour.

In short, you're going to hang yourself out to dry!

[NotAllThere]

Or possibly not. Though your case does seem weak.

[pzz76077]

Hello,

I am an IT contractor and been with the agency for 18 months. All along they have been bad with payments and communication. Tired of constant followups, I have decided to terminate my contract with them and go with other agency on the grounds of breach of payment terms and frustration. My clien is fine with the change. I do have a 6 month restriction in my contract not to go direct or through another agency.

I would like to know
1) Am I in a position to terminate the contract.
2) If so do I need to give a proper notice of 30 days or I can terminate with immediate effect.
3) Wordings I need to use in the termination letter.
4) Will the court see it as Breach of contract terms from my end(I have sufficient evidence that of the agency's faults)

Appreciate your help.

Regards

When was the last time you paid a bill on time unless you had to??

Did they take you to court??

Did the other party stop dealing with you??

Does your contract explicitly state that paying a few days late is a breach of contract?? No?? Not a breach of contract then.


PZZ

[NotAllThere]

Of course you have a statutory right to charge them interest for all late paid invoices in the future, together with an admin charge.

What you do, is write to them telling them that as from now, you'll be adding statutory interest and admin charges to any invoices paid late. When the invoice is paid, you issue a customer statement, deducting the amount of the invoice from the invoice+admin charge+interest. You keep doing this, with plenty of requests for payment, and when you finally terminate to go elsewhere, it could be a tidy amount that you can claim through the small-claims court.

[Hex]

Of course you have a statutory right to charge them interest for all late paid invoices in the future, together with an admin charge.

What you do, is write to them telling them that as from now, you'll be adding statutory interest and admin charges to any invoices paid late. When the invoice is paid, you issue a customer statement, deducting the amount of the invoice from the invoice+admin charge+interest. You keep doing this, with plenty of requests for payment, and when you finally terminate to go elsewhere, it could be a tidy amount that you can claim through the small-claims court.

WHS.

On this renewal make sure the payment terms are explicit and see if you can negotiate them further down (i.e. if they're monthly try to get weekly). Invoice them on time and if they haven't paid in time follow the procedure for unpaid debts (see here: www.payontime.co.uk). Keep hitting them with the admin fees and interest. As written above, they will probably ignore paying the admin fees and interest so just keep adding them on and re-invoicing and finally take them to the small claims court.

[PAH]

Down tools!

As someone who has recently experienced a scumbag agency ripping me off by not paying invoices on time then eventually not paying them at all, I strongly recommend the first course of action is to down tools immediately at the first sign of overdue payments.

Obviously inform the client of the reason why you are no longer turning up so they know it's the agency that's at fault.

This will result in the client putting pressure on the agency to pay up and could possibly result in the client ditching the agency for breaking their contract.

The risk with sitting around waiting for the agency to pay is that they may not be in a position to pay at all. By turning up at the client site while they have a contract with the agency means they will be legally obliged to pay the agency for any work you do. I doubt many clients will have the balls to stand up to the agency if threatened with legal action, much easier for them to ditch you and get someone else in, unless you have a very specialist skills set or knowledge of their business that they can't easily replace.

[BolshieBastard]

When was the last time you paid a bill on time unless you had to??

Did they take you to court??

Did the other party stop dealing with you??

Does your contract explicitly state that paying a few days late is a breach of contract?? No?? Not a breach of contract then.


PZZ

Exactly.

Oh and regarding advice to go to the small claims court, the court will expect all possible avenues have been considered and exhausted before the matter is referred to be dealt by them.

Sending letters and keeping records of these will not satisfy the court that all avenues have been exhausted. They'll expect you have contacted the MD of the agency, gone to and used any agency body to resolve the issue etc, etc.

Small Claims Court do not appreciate being used as a first or second attempt to resolve a dispute.