Cancelling a business contract before work starts

[Louise Hill]

Unfortunately, I was talked into an advertising contract by a cunning salesman and asked to sign the contract immediately, which I did. They wanted payment there an then, but I said I did not have my card with me.

On returning to the office and working money out, I decided that it would not be a good idea for me to go ahead with this due to the cost and possibility of not getting a return on my investment.

I emailed them saying that I could not afford to do the advertising and they offered me a reduction of £5, which does not help me.

I told them that I can not go ahead with the contract whereby the salesman told me that I can't cancel as there is no cooling-off period for B2B contract. I have since emailed them today and asked to cancel the contract.

As no costs have been incurred by the company at this time, they have not done any work on this as yet. Is there any way out of this? Please help.

 

[Nico Albrecht]

Cunning salesman? How did he trick your and can you proof it? B2B, pretty much no cool off here and without seeing the actual contract you blindly singed you might have to honor this contract or do a better negotiation on a early termination fee.

 

[Louise Hill]

Well he handed me his tablet and asked me to sign, I never read the terms and conditions (like a fool) I assumed that there is always a cooling off period with contracts... they have not started any work on anything yet though so I was hoping that this may help? they have not spent any money on my advert yet. its for an advertising stand with a small banner on it and my cards underneath in 2 hospitals, along with 10 other companies who they are trying to sign up too. This will be new in these 2 hospitals...

 

[Chris Ashdown]

You were in charge and let the salesman pressure you into the sale easily. no doubt you will have to pay the full amount as the law assumes you are wise and need no protection in making a contract

Just take it as a cheap lesson you will never forget and in future will take due consideration before signing any contract regardless of pressure selling and will also fully read the small print on the contract and FULLY understand what it means

 

[Louise Hill]

at £1600 for the year I am not feeling that its a cheap lesson at all, and I am upset with myself for being talked into this.. I think that they should make you aware that there is NO way of cancelling the contract once signed.... I must have MUG written all over my face . Thank you for your advice

 

[Mark T Jones]

It's a relatively inexpensive lesson in business. There is no such thing as a 'today only' deal.

Anyone who wants you to sign on the spot isn't to be trusted.

Learn the lesson & move on.

You can bluff it and say 'so sue me'. They may, or may not. If you lose you will add court costs to your loss.

 

[Louise Hill]

I guess it is a learning lesson as unfortunate as that may be.... I will see what they say to my email.. and thanks again for your prompt reply it was fantastic to have someone to advise me.

 

[estwig]

Don't be too hard on yourself, it's a very old con executed by experienced conmen. I think it's a con as it almost certainly won't generate any business, your stand will run out of cards and no one will top it up. It'll be in a daft location where no one will even notice it.

Be as difficult as possible, argue with them about everything, refuse to pay, refuse to sign off on artwork, keep asking for changes, ask for proof of the location of the banner, don't answer emails until the last minute, ask to see the T&C's, look for every angle to make their lives so difficult they give up and go looking for a softer mark.

 

[The Byre]

Many of these 'advertising' deals are without substance. That is to say, the medium is often fiction and is not really published.

Be as difficult as possible, argue with them about everything, refuse to pay, refuse to sign off on artwork, keep asking for changes, ask for proof of the location of the banner, don't answer emails until the last minute, ask to see the T&C's, look for every angle to make their lives so difficult they give up and go looking for a softer mark.

THIS!

I might help to state on this forum who these people are and what it is that they were offering. If there is anything bogus about the deal, we'll soon punch holes in it!

 

[Paul Norman]

1. Technically, you are under contract.

2. Learn the lesson. Never sign on the spot. Ever. Not once.

3. Nonetheless, kick off. Bullying people to do this is sharp practice. If you make enough fuss you might find they can't be bothered to pursue for the money.

 

[Mr D]

at £1600 for the year I am not feeling that its a cheap lesson at all, and I am upset with myself for being talked into this.. I think that they should make you aware that there is NO way of cancelling the contract once signed.... I must have MUG written all over my face . Thank you for your advice

Some people, signing without reading costs them tens of thousands. So yes could be considered cheap if it causes you to never have to pay anything like that again.

The sales people aren't there to educate you in business nor are they likely to point out problems in contracts.
Consumers get protection and are treated like children that need protections from big bad companies.
As a business owner you are presumed to be an adult. Read the contract before signing, don't read the contract before signing, the choice becomes yours.
You are usually however going to be kept to the contract by the other party regardless.

There may be a clause about termination - read it and use it. Notice periods often apply, some can be requiring cancellation 6 months before contract end.

 

[The Byre]

Some people, signing without reading costs them tens of thousands. So yes could be considered cheap if it causes you to never have to pay anything like that again.

Most of these contracts are roll-overs, so if our OP insists on not reading the contract, she will be paying this sum or an even higher sum EVERY year!

 

[Louise Hill]

thanks so much everyone very helpful, I have also spoken with citizens advice who say I could argue misrepresentation as it was all verbal and then he pushed his iPad under my nose and pointed to the boxes where I was to sign, I will see how they come back with the email and take it from there... I will try to Get out of it and yes I have indeed learned a big lesson

 

[Financial-Modeller]

You have three options @Louise Hill :

1. try to negotiate a release from your contractual obligation. It sounds like you have attempted this without success
2. refuse to pay the invoice and await legal action.
3. pay for the advertising.

Assuming that you pay the invoice, there are three potential outcomes of the advertising that you have agreed to purchase:

1. the advertising/banners etc that you have paid for never actually materialise. You can now claim the cost back from the other side as they have not performed their side of the contract.
2. the advertising/banners etc are installed/broadcast and you get no business from the activity
3. the advertising/banners etc are installed/broadcast and you get lots of business from the activity - do everything you can to ensure that this happens.

Take heed of @The Byre suggestion to check that you haven't agreed to a recurring contract.

As an aside, you mention the word "unfortunate" in most of your posts, which can sound like you consider this to be bad luck. It wasn't bad luck and you need to take responsibility for your actions to avoid repetition in future.

 

[obscure]

+1 to the part about carefully reading your copy of the contract to check for an automatic roll over. Many such contracts require that you give a specific amount of notice otherwise they roll over for another year and you have to pay again!!

 

[gpietersz]

Its refreshing that @Louise Hill is willing to learn the lesson and not shoot the messenger, so lets not be hard on her @Financial-Modeller - how many people ask similar questions here but will not accept:

I have indeed learned a big lesson

It is very difficult to switch from the consumer protections that we are all used to as consumers to thinking in a different mode for business.

If Citizen's Advice think there might be misrepresentation, it may be worth asking a lawyer. On the other hand that might just mean spending more money.

 

[gpietersz]

Have you tried negotiating a compromise? i.e. paying them part of the amount to compensate for lost profit from agreeing to cancel?

 

[BristolBiz]

Commiserations, hand's up - I was conned like this early doors in my business life.

FWIW here's my negotiating to-do list:

CONTRACT NEGOTIATIONS

NEVER, NEVER, NEVER………..

1. AGREE A VERBAL/TELEPHONE CONTRACT

2. SIGN AN IPAD CONTRACT

3. SIGN A CONTRACT ON THE DAY

4. SIGN A CONTRACT WITHOUT READING AND UNDERSTANDING IT – SEEK (legal) ADVICE IF NECESSARY

WHY

A business to business contracting is legally binding. Instantly, unless a cooling off period is written in to the contract.

What a salesman promises is worth absolutely nothing unless it’s in writing.

There is no such thing as trust in a business contract.

A CONTRACT MAY EXIST EVEN WITHOUT A WRITTEN CONTRACT

THINGS TO AVOID

Direct debits

Autorenewal

Payments to third party billing agents

Termination “issues”

Charges escalating above RPI


WARNING SIGNS


Pressure to sign there & then.

Small print at length – contracts CAN be written in plain English – if they’re not there will be something(s) unpleasant buried somewhere. It’s a bit like marriage – sign in haste, regret at leisure ☹.


Much of this has been gleaned off here, so thanks to all.

 

[Louise Hill]

thanks everyone, I have since received this email from them
Dear Louise,


Thank you for your email.
Unfortunately, the Contract you have signed is not subject to cancellation .
As this is a Business to Business Contract, there is no ‘cooling off period’ or ‘cancellation policy’.
I have re-attached your Contract stating all of the Terms and Conditions which outlines this. (Term 18.)
Unique Advertising Limited is contractually binded to fulfil the Advertisement on behalf of your business, this is our terms which we have agreed to, please provide any information for your advertisement to our production team so that an artwork proof can be issued as soon as possible.
Please note, should artwork not be received, an advertisement will be created and published without your approval.
We must also advise that, if for any reason payments are not received on the date they become due; charges will be applied, and legal action may be taken to recover any overdue debt balance.
As previously mentioned, this contract is not subject to cancellation & your Deposit Payment of £260.00 is still due and payable immediately to Unique Advertising Ltd.

Feel free to contact me if you have any questions,
Kind Regards,
Hannah Sudell
Accounts Administrator

 

[Mark T Jones]

Personally I'd go for the bluff - BUT - there are risks relating to fees and charges.

Reality - they almost certainly will deliver on creating the promotion. It's unlikely the promotion will yield results, hence the need for unethical selling.

 

[Ian J]

Unique Advertising Limited is contractually binded to fulfil the Advertisement on behalf of your business,

The published accounts together with those of the associated companies look very interesting

 

[Louise Hill]

Thanks Ian, any chance you could ellaborate? I am putting an email reply to them at the moment any comments would be appreciated....
this is what I have written so far... I am scared to say the wrong thing and would like to say enough for them to stop and just cancel it and get rid of me...

Hi Hannah

I was not given any terms and conditions to read before signing when I met with Phil, I was not made aware that there was no cooling off period or no way of cancelling this contract once I had signed the agreement. I did tell Phil that it was too much for me and that I could not afford this advertising but as an experienced salesman he then pressured me into signing by saying he would do me a favor and split the payments over 6 months. This was neglectful on his part as he could clearly see that I could not afford this amount of money for such a small business, however he was happy to go ahead and push me into this anyhow. In addition I was not given any terms and conditions to read, just an iPad put infront of me and was told to sign here and here and here! I feel that I was taken advantage of in this circumstance and there was definitely misrepresentation In this case.

As you have not started any works on my behalf nor spent or outlaid any money on my behalf I would appreciate you cancelling this contract. I do not have the funds to pay this money so I am not sure what good any legal action would be. I am a beautician with a small work from home business, I am the sole employee and I simply can not afford this.

I would hope that under the circumstances you would have some understanding as to where this agreement all went wrong and appreciate that a more open and upfront approach to your clients should be taken in the future. As for myself, I was not aware or made aware that there was no cooling off period for this contract.

 

[The Byre]

The published accounts together with those of the associated companies look very interesting

The couple that have actually filed returns of any sort! Recent C.rating downgrade and negative assets!

I doubt that this company is in a position to actually place and real advertising anywhere - but that is just an opinion! I would definitely want to see that advertising before paying anything!

 

[Louise Hill]

thank you so much, I really appreciate your help with this. I have sent the above mail now. they basically say that if I don't provide them with any artwork they will just produce what ever they see fit and I am still liable to pay.. I won't do anything or give them anything.

 

[Ian J]

I would definitely want to see that advertising before paying anything!

And proof of distribution too

 

[estwig]

Thanks Ian, any chance you could ellaborate? I am putting an email reply to them at the moment any comments would be appreciated....
this is what I have written so far... I am scared to say the wrong thing and would like to say enough for them to stop and just cancel it and get rid of me...

Hi Hannah

I was not given any terms and conditions to read before signing when I met with Phil, I was not made aware that there was no cooling off period or no way of cancelling this contract once I had signed the agreement. I did tell Phil that it was too much for me and that I could not afford this advertising but as an experienced salesman he then pressured me into signing by saying he would do me a favor and split the payments over 6 months. This was neglectful on his part as he could clearly see that I could not afford this amount of money for such a small business, however he was happy to go ahead and push me into this anyhow. In addition I was not given any terms and conditions to read, just an iPad put infront of me and was told to sign here and here and here! I feel that I was taken advantage of in this circumstance and there was definitely misrepresentation In this case.

As you have not started any works on my behalf nor spent or outlaid any money on my behalf I would appreciate you cancelling this contract. I do not have the funds to pay this money so I am not sure what good any legal action would be. I am a beautician with a small work from home business, I am the sole employee and I simply can not afford this.

I would hope that under the circumstances you would have some understanding as to where this agreement all went wrong and appreciate that a more open and upfront approach to your clients should be taken in the future. As for myself, I was not aware or made aware that there was no cooling off period for this contract.

Don't send this, sounds like you are trying to appeal to their better nature and asking for leniency, they don't care about you, they are out to rob you, they are liars and thieves.


Tell them you made a mistake, your business partner has pointed out you are not authorized to make decisions like this on behalf of the company. Introduce a third party to blame and create a reason why the contract is not valid. Leave it there, don't get sucked into a conversation, they will outwit you. Just keep saying you are not authorized to make decisions on your own on behalf of the company, therefore the contract is invalid.

 

[gpietersz]

Tell them you made a mistake, your business partner has pointed out you are not authorized to make decisions like this on behalf of the company.

So, lie?

Don't send this, sounds like you are trying to appeal to their better nature and asking for leniency, they don't care about you, they are out to rob you, they are liars and thieves.

I agree, but its a bit late the email has gone.

 

[Financial-Modeller]

...they basically say that if I don't provide them with any artwork they will just produce what ever they see fit and I am still liable to pay.. I won't do anything or give them anything.

Why not try to get the best out of a bad situation?

Send them the artwork, force them to do what they promised to do, try to get extra business on the back of it, or some return on the cost. If you do nothing, you get zero return on the cost.

 

[estwig]

So, lie?

Yes

 

[estwig]

Why not try to get the best out of a bad situation?

Send them the artwork, force them to do what they promised to do, try to get extra business on the back of it, or some return on the cost. If you do nothing, you get zero return on the cost.

There is no business to be had, notice boards in hospitals is a very old con. It's been around as long as the Police calendar, and advertising on the 18th hole of your local golf club.

 

[gpietersz]

Leaving aside the ethics of lying, its not going to make her look good if it gets to court and may be an offence in itself (surely it must be?).

 

[estwig]

Leaving aside the ethics of lying, its not going to make her look good if it gets to court and may be an offence in itself (surely it must be?).

Telling lies isn't an offence, most of the population would be locked up!

 

[Mr D]

Telling lies isn't an offence, most of the population would be locked up!

Depends what lie you tell.

"Not guilty your honour"
not quite the same as
"I'm on the pill"
or
"This product is the best selling item in the world and will make you lots of money".

 

[alan1302]

Depends what lie you tell.

"Not guilty your honour"

You can't be prosecuted for saying that though.

 

[ImranR]

This would fall under small claims court so any court fees would be minimal. For them to have a chance, they would have to actually print and deliver their side of the contract. It doesn't sound like they will unless you pay a deposit.

One of the legal experts may be able to chime in but surely their is no 'consideration' and thus the contract is nullified? Unless signing the contract equates to a promise to pay.

There's a reason im not a solicitor

 

[billybob99]

If this gets to court, it'll be everyone suing them. They are a joke, they're not going to do anything, when its easier to find the next softy.

Should be dissolved before you know it.

 

[Mr D]

You can't be prosecuted for saying that though.

On that we can agree.

 

[gpietersz]

You can't be prosecuted for saying that though.

Yes, but you can be prosecuted for lying to the court under oath (perjury).

If you lie for financial advantage its fraud: https://www.cps.gov.uk/legal-guidance/fraud-act-2006#a07 and that seems relevant here.

 

[gpietersz]

@ImranR I am not a solicitor either, but I do know enough law to know that an agreement to pay is consideration.

 

[Louise Hill]

Just to update you all.... I had heard nothing so was hoping that the problem would just go away, unfortunately this is not the case, I had this email from them yesterday ..

Hi Louise,

As discussed, we do need to find a resolution to this situation. I am sorry you were unaware of the legality surrounding the Contract you have signed but we assume that every Contract is read in full before it is signed as once signed it is not subject to cancellation. This is common knowledge in England and I am afraid that stating you were not aware of this will not change the fact that the law is in place and will be enforced.

I am writing as I am trying to assist you through this process to ensure that no further action takes place. In England, we have Consumer and Business Contracts. The former is covered by the Consumer Protection Act, but the latter is not. Once a Contract has been signed and the Contract is for the purpose of the business not the individual, the Contract is immediately not subject to cancellation as long as the Contract clearly states this which it does. Even if you state you did not read the Contract, we cannot be held liable as it is down to the individual to know what they are signing.

A Judge will also not look at anything outside of the Contract in this instance. They will not entertain emails or verbal statements. This is what they call the Four Corner Rule. The Four Corners Rule Contract Law, also known as the Patrol Evidence Rule, stipulates that if two parties enter into a written agreement, they cannot use oral or implied agreements in court to contradict the terms of the written agreement. The term "four corners" refers to the four corners of a document. Basically, it implies that the only legal parts of the contract are within the four corners of a page or online document. If there is evidence that exists outside of these four corners, they cannot be used in Court.

At this point, your Account is going to start accruing late payment charges of £60 per week per the Contract in place. This will be added on automatically and your balance will continue to increase until your feature is live and the matter is taken before the Courts. This is not a threat, we have to be clear for the avoidance of doubt to show the Courts we have made you aware of your situation prior to them becoming involved.

I would rather we work together on this and find a suitable resolution to this matter so the above action is not necessary. I am able to remove these late payment charges as a gesture of goodwill and discuss payment options to provide financial relief. I would highly recommend seeking legal advice on the matter to confirm my statements regarding business contracts as this is not something that will not go away until it is either resolved or taken to Court. The Citizens Advice Bureau can provide you with free legal advice on the matter if you do not wish to pay for legal advice. I also need to ensure you are aware that if we do not resolve this and move forward with Legal Proceedings that this will have a negative effect on both your personal and business credit score.

I will be back in touch next week to allow you the chance to review the above and see if we can move forward in a civil manner.

Any more advice for me please....

thanks
Louise