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Advice on rolling contracts?

Discussion in 'General Business Forum' started by Nicola Meekin, Sep 13, 2020.

  1. Nicola Meekin

    Nicola Meekin UKBF Newcomer Free Member

    6 0
    I feel I have been ripped off by a company providing HR services. I signed a 3 year contract which ended in March 2020. Because I didn't cancel with 90 days notice, they have rolled me on for another 12 months. Are they obliged to send a reminder that this cancellation period is coming up? Would appreciate any advice. My hospitality business has been extremely hard hit and I am not willing to pay another year for services I will not be using (I have had to make all my employees redundant)
     
    Posted: Sep 13, 2020 By: Nicola Meekin Member since: Sep 13, 2020
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  2. Newchodge

    Newchodge UKBF Big Shot Free Member

    14,388 3,834
    Their contracts with clients are usually the best of their drafted contracts - notoriously hard to get out of. You need to read the fine print. Have they fulfilled their part of the contract? Telling them that you will be screaming about failure to provide proper services amy persuade them to allow you to go early.
     
    Posted: Sep 13, 2020 By: Newchodge Member since: Nov 8, 2012
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  3. Mr D

    Mr D UKBF Legend Free Member

    24,305 2,948
    Send a reminder? No, they aren't obliged to. After all if you wanted to cancel you'd have done so as per the contract.

    They cannot even force you to read what you signed.
     
    Posted: Sep 13, 2020 By: Mr D Member since: Feb 12, 2017
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  4. KAC

    KAC UKBF Ace Free Member

    1,251 282
    Sound like Peni****a as they have a reputation for enforcing rolling contracts. Unfortunately you do need to read the small print on this type of contract
     
    Posted: Sep 13, 2020 By: KAC Member since: May 7, 2017
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  5. Newchodge

    Newchodge UKBF Big Shot Free Member

    14,388 3,834
    Sounds like them, I agree, but it was only a 3 year initial contract and one year extension. Peni* usually wants 5 years and 5 year extension, unless they have 'mellowed'
     
    Posted: Sep 13, 2020 By: Newchodge Member since: Nov 8, 2012
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  6. Nicola Meekin

    Nicola Meekin UKBF Newcomer Free Member

    6 0
    Thank you Cyndy,
    I did send an email last November asking for advice and they didn’t respond (no acknowledgement/reply/out of office). This could be a failure on their part to provide advice ‘24 hours per day,365 days per year’ as quoted in their terms. I didn’t send a second email as i needed to proceed with my contracts. Could this be a breach on their part? Also, aren’t they obliged to send a reminder or is this a grey area? Surely this could be deemed as unfair contract terms? Much appreciated, Nicola
     
    Posted: Sep 13, 2020 By: Nicola Meekin Member since: Sep 13, 2020
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  7. Nicola Meekin

    Nicola Meekin UKBF Newcomer Free Member

    6 0
    Av***ure. Very similar company. This kind of practice is questionable at the very least.
     
    Posted: Sep 13, 2020 By: Nicola Meekin Member since: Sep 13, 2020
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  8. obscure

    obscure UKBF Ace Free Member

    3,306 844
    No they aren't required to send a reminder and there is nothing grey about it.

    You signed a contract that included details of how/when to cancel. All you had to do was write a reminder in your diary for a week before. As a business owner/manager you are deemed to be responsible for your own actions and it is your responsibility to read/understand the legally binding contracts you sign on behalf of your business (or if you don't understand, to hire a professional to advise you).
     
    Posted: Sep 13, 2020 By: obscure Member since: Jan 18, 2008
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  9. Newchodge

    Newchodge UKBF Big Shot Free Member

    14,388 3,834
    A failure 10 months ago about which you did nothing - no complaint no request to do better, nothing, is unlikely to be seen as a fundamental breach of contract.

    They do not have to send a reminder. The reminder is in the contract that you agreed to.
     
    Posted: Sep 13, 2020 By: Newchodge Member since: Nov 8, 2012
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  10. Mr D

    Mr D UKBF Legend Free Member

    24,305 2,948
    Time to complain about unfair contract terms is before you sign to agree to those terms.

    From what you have posted there is nothing to suggest they have broken the contract or that the terms were unfair.

    Heck, there are companies out there that would sign you up for multiple years renewal automatically. You have at best 6 months to go.
     
    Posted: Sep 13, 2020 By: Mr D Member since: Feb 12, 2017
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  11. LanceUk

    LanceUk UKBF Regular Free Member

    110 36
    In these situations, one should break down the law of contract.. There has to be an offer, acceptance, intention to create legal relations... and consideration. And of course, the old chestnut- silence is not consent. Based on these, how courts have not held rolling contracts clauses unenforceable, I'll never know (remember, penalty clauses are unenforceable)...

    Be that as it may, it seems if the clauses realting to rolling contracts are enforceable, especially if they are clear in how to a) assert a new contract or b) prevent a new contract from forming, so, generally, you're going to be stuck with it unless you did what was required to stop the new contract forming.

    However... the courts have long time ago dispensed with form over function... and the general rule may (I stress, may) be that if you have communicated your desire not to form a new contract before it was "executed", then, you may well be able to escape the rolling contract obligation. This will depend on the exact wording (for example, if they include wording such as, " the other party recognises that the method of notification of cessation of the renewal of this contract is imperative to releasing their obligations... ", then it will be more difficult to avoid the contract.

    However, if there is no similar wording, then any evidential manifestation of your intent not to renew that has been communicated to them may be good enough.. Your email re advice they didn't respond to would not normally be enough to avoid the contract (although, if it were a sufficiently urgent matter where you would incur substantial losses, that may be different, but since you didn't follow up, the inference is it wasn't). You could probably be able to have that monthly fee reduced or voided... the question of whether it is a breach of contract will be based on the nature of the advice requested, however, since you kept paying them after that, that would be evidence of your intention to continue the original contract.

    You have probably learned a lesson.. Many protections available to consumers (such as a 14 day cooling off period for rolling financial services contracts) are not available to businesses as business people are considered to be professional and shoudl know what they are signing up to.. If there is anything in a contract you think will work against you, negotiate to have it struck out.

    Note, though, there are limited circumstances where you can have an onerous clause of a contract struck out if it was not sufficiently highlighted in the agreement (and sometimes, explcitlty drawn to your attention). These have to be very onerous obligations.. and the consequences unforseen or so disproprtionate that it would be totally unfair to enforece. I am not sure the rolling of a contract is one of them...
     
    Posted: Sep 13, 2020 By: LanceUk Member since: Jan 8, 2018
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  12. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    11,861 2,465
    Afraid its just a lesson in reading a contract fully before you sign, to most people it only happens once in a lifetime including myself

    A good sign is if the sales person is in a hurry or the offer ends the next day there is a need to read the contract fully at least twice. as they must be trying to hide something in the small print
     
    Posted: Sep 14, 2020 at 10:47 AM By: Chris Ashdown Member since: Dec 7, 2003
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  13. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    4,802 1,815
    You say ripped off, the law says vountarily entered into a contract whilst chosing not to read T & Cs. Unless you have compelling evidence of mis-selling?

    Moving forward, you have 3 options:

    Continue with the contract and give proper notice at the end.

    Try to negotiate a settlement

    (A variant of the above) Play hardball. Stop paying and let them take you to court. Not without risk, but in many cases they will agree to a negotaited settlement out of court.
     
    Posted: Sep 14, 2020 at 12:17 PM By: Mark T Jones Member since: Nov 4, 2015
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  14. Nicola Meekin

    Nicola Meekin UKBF Newcomer Free Member

    6 0
    Very informative reply thank you
     
    Posted: Sep 16, 2020 at 7:19 AM By: Nicola Meekin Member since: Sep 13, 2020
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  15. Nicola Meekin

    Nicola Meekin UKBF Newcomer Free Member

    6 0
    Thanks, yes the salesperson was in a hurry now looking back. She also emphasised how employers are frequently accused of racism and how invaluable their services/insurance are in today’s age. How naive of me not to read the small print.
     
    Posted: Sep 16, 2020 at 7:25 AM By: Nicola Meekin Member since: Sep 13, 2020
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  16. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    4,802 1,815
    If it's any consolation, I, and many otrhers on here have learned the hard way. (And I definitely fall into the 'shuld know better' category)

    My serious point however, is that whilst blaming the sales person is cathertic, it avoids the key lessons - one of which is 'never buy from a salesman in a hurry'.
     
    Posted: Sep 16, 2020 at 8:38 AM By: Mark T Jones Member since: Nov 4, 2015
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  17. Nicola Meekin

    Nicola Meekin UKBF Newcomer Free Member

    6 0
    Indeed. Thank you for the sensible responses to my thread
     
    Posted: Sep 16, 2020 at 1:23 PM By: Nicola Meekin Member since: Sep 13, 2020
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