Advise please

[trying_to_survive]

Hi

I would like some advise please

I am meeting a client who is a leading education institution. I know the project manager who works there and he has appointed an agent, who I think is a friend of his although he hasn't said that to me.

I don't know this agent in the past but this is the deal that is proposed - In the next 2 months I am required to deliver 20K worth of work and its IT based consultancy.

The arrangement is the payment is only paid when the work is delivered through the agent i.e, its not a daily rate.

My main worry is that the agent won't pay me even if the education establishments pay him. There will be a contract that will define the payment date and amount etc but for some reason I still find it hard to trust. I looked the agent up on company house and he has had a few companies in the past that are dissolved and liquidated. I am getting a bad vibe even before I had a proper meeting with the client next week.

What do you think? How do I know that I will definitely get paid for the work by the agent even though I don't doubt the university will pay. Can I propose to the client that he pays the amount directly to me when the work is delivered and pay the agent commission to him separate?

Thank you.

 

[Socio South West]

The word that runs throughout business is CONFIDENCE You clearly have no confidence that this agent will pay you, even with a contract in place.

If your concerns are this great, forget this job and move on... either way, don't let the situation fester and hinder you in trying to find agents that you have confidence in.

 

[Bob Morgan]

Perhaps when meeting someone from the field of 'Education' it might be better to use the Noun 'Advice' rather than the Verb 'Advise?'

 

[Annoying Donkey]

What's the Agent's role in this? From what you've said, you found the work... so why an Agent? (Ok, probably the Uni distancing itself from tax possible liabilities).
You need to set your own terms, so you at least get enough to cover expenses before you start. If they won't accept, then walk...

 

[Mark T Jones]

You are very right to be concerned. All to often, sub contractors fool themselves that their ‘risk’ lies with the ultimate client.

Potential remedies will include

• Insisting on being paid directly by the university for work completed by you
• Requesting payment up front, potentially using Escrow.
• Taking a PG from the agent - having established that they have some worth.

Good on you for recognising the risk, don’t be tempted into cutting corners!

 

[The Byre]

I looked the agent up on company house and he has had a few companies in the past that are dissolved and liquidated.

That here at Byre Towers is a reason to not wish to deal with any company or person.

In view of that, you say the following -

"Obviously we would like to get this work, but unfortunately the credit rating of your agent is such that we would need the university to countersign any agreement as a fully committed guarantor for the full amount."

Simples!

 

[Forgot password]

Sounds like there setting you up to shaft you so get the payment up front or from the main client. Do not accept their terms.

 

[BusterBloodvessel]

That here at Byre Towers is a reason to not wish to deal with any company or person.

In view of that, you say the following -

"Obviously we would like to get this work, but unfortunately the credit rating of your agent is such that we would need the university to countersign any agreement as a fully committed guarantor for the full amount."

Simples!

In this case (if I read the OP's post correctly), the university would pay the agent, and then the agent would pay the OP.

Would signing as a guarantor therefore hold any clout? i.e., if the agent failed to pay the OP so OP approached the university directly, would they not say "we have guaranteed it and paid it, it's not our fault it hasn't been passed on". Otherwise the University could be liable to pay twice?

Surely having a guarantor would only work if either (A) The agent was actually paying for the services and the university was just a "backup" to pay much like taking a loan with a homeowner guarantor (not applicable in this case) or (B) the agent was due to pay the OP before receiving payment from the Uni. So agent is due to pay the OP on 30 days EOM, University pays the agent 60 days EOM. If after 30 days the agent hasn't paid OP then they approach the university directly and take direct payment.

This isn't an arsey question btw I understand using a guarantor in the likes of a loan or mortgage but I'm not sure how it would be applied and enforced here...?

 

[The Byre]

I understand using a guarantor in the likes of a loan or mortgage but I'm not sure how it would be applied and enforced here...?

The agent and the university are asking the OP to grant the agent a £20k loan - that is the effect of the contract. They are not paying in advance, therefore they are asking for a loan.

And in this case, it is an unsecured loan - worse still, it is an unsecured loan to a person with a record of a string of failed companies and delinquent debts. His credit rating and that of his company are both zilch! He and his company are not credit-worthy.

His credit rating has a great deal in common with Monty Python's dead parrot.

All this loose talk of being an agent is a red herring. He is seeking to commission £20k work from our OP. As he expects to only pay on completion, he is asking for credit where none can be reasonably expected. He, therefore, must provide a guarantor. That guarantor could be his mother, his long-lost brother living in Pennsylvania or it could be Mrs. Millie Toolie of 17, Oil Drum Lane, Sidcup.

Whoever is stupid enough to act as guarantor for this totally impecunious person must themselves be creditworthy - it is reasonable to expect that a university will be able to de-trouser £20k in the event of the debt becoming delinquent.

The university would in all probability balk at the idea of acting as guarantor for this agent and also seek to distance themselves from him.

Here at Byre Towers, if we find that a company owner or director has just one failed enterprise in their past, we avoid them and any enterprise they might be involved with totally.

 

[Ian J]

I am meeting a client who is a leading education institution. I know the project manager who works there and he has appointed an agent, who I think is a friend of his although he hasn't said that to me.

Is it the project manager that has appointed the agent or the education institution itself?

It is becoming increasingly common for councils, healthcare and universities to use agents such as De Poel for all their purchasing, especially recruitment and one of the big problems is that they often have a "pay when paid" clause in their contract.

This means that if the end customer refuses to pay your customer for whatever reason then your customer is under no legal obligation to pay you

 

[DragonLady]

I buy these type of services for organizations. I'd be looking at contracting under staged payments against deliverables, so split out the work into stages / phases and agree payment against delivery of each, with x% to be paid on final delivery.

 

[Onthebrightside]

We are roofers and have had a few jobs with staged payments etc. through third parties and we find that they always find some reason to delay some of the stages of the payments... it's like a signal to tell us that they about to go into liquidation. At that point we just withdraw services, so fortunately we haven't lost out too much, but we have seen some of the smaller firms supplying goods and services get hit really badly, particularly where there is a local authority employing an agent to do building work. They always go for the lowest bid and don't seem to check or care about the agents previous businesses going into liquidation. We simply don't deal with them anymore.

 

[Chris Ashdown]

I would be upfront with the Project manager, in that I would write to him outlining your concerns that your investigation of the agent, shows you can not give him a good credit rating due to past failures and can they offer a different agent

 

[trying_to_survive]

Thanks all - I emailed the PM telling him that I can't commit to working as having looked at the "design" and following my site visit that it is now not possible and it is beyond my skill set to be providing this service. There is a obviously some sort of dodgy deal going on with the PM and the agent itself. However, the agent has sent a contract to me to sign while this is going on using DocSign. Do I have any obligation to tell the agent as well or should I leave that to the PM? I am thinking just ignoring agent's email and definitely not going to sign the contract.

 

[billybob99]

There are some backhanders going on, that's why they're using an agent. Provided software dev to quite a few uni's - they all paid directly, albeit net 30 days.

 

[Mr D]

Thanks all - I emailed the PM telling him that I can't commit to working as having looked at the "design" and following my site visit that it is now not possible and it is beyond my skill set to be providing this service. There is a obviously some sort of dodgy deal going on with the PM and the agent itself. However, the agent has sent a contract to me to sign while this is going on using DocSign. Do I have any obligation to tell the agent as well or should I leave that to the PM? I am thinking just ignoring agent's email and definitely not going to sign the contract.

Courtesy would suggest letting them know 'no'.
Be nice to them - you may come across them again.

 

[trying_to_survive]

I messaged the agent saying that he should consider choosing someone else. Wrote a long text message why I am not 100%committed and some rubbish about the clients system setup wouldn't work out for me. He messaged saying he will discuss with PM a d come back to me...I dont understand why...obviously they are onto something and I am their way to achieve it.

 

[trying_to_survive]

Hi - the agent messaged me again and asking to meet to go for drinks with PM. He says the client are impressed with me and want me onboard. My biggest worry is now that it isn't that i might not get paid or not. However, is there a chance they can hold my company liable if anything were to go wrong? What i dont want to do is to work with people that i dont trust and lose hard earned money on top. Is there a way to ask them to remove the liability clause? I am thinking the worst case scenario is I won't get paid but at best if I am lucky I might get paid

 

[Mr D]

Hi - the agent messaged me again and asking to meet to go for drinks with PM. He says the client are impressed with me and want me onboard. My biggest worry is now that it isn't that i might not get paid or not. However, is there a chance they can hold my company liable if anything were to go wrong? What i dont want to do is to work with people that i dont trust and lose hard earned money on top. Is there a way to ask them to remove the liability clause? I am thinking the worst case scenario is I won't get paid but at best if I am lucky I might get paid

Translation he is desperate to get you onboard. If client needed you the client can deal direct?

 

[trying_to_survive]

I have told the agent I will meet the PM when I feel better direct. The chances are he is going to persuade me to deal with agent. As I know him personally and fairly sure they are both in some sort of dodgy deal to extract money from the client. So my thinking is to let them do their own thing and I will go along to sign a contract with the agent - but the issue if something didn't go according to their expectation then I dont want to be liable out of my pocket. This is especially considering the agent has poor history plus albeit knowing the PM personally I dont really trust him either.

 

[Mr D]

I have told the agent I will meet the PM when I feel better direct. The chances are he is going to persuade me to deal with agent. As I know him personally and fairly sure they are both in some sort of dodgy deal to extract money from the client. So my thinking is to let them do their own thing and I will go along to sign a contract with the agent - but the issue if something didn't go according to their expectation then I dont want to be liable out of my pocket. This is especially considering the agent has poor history plus albeit knowing the PM personally I dont really trust him either.

You sign a contract with agent and have problems what are you going to do?

 

[trying_to_survive]

I have not signed it yet but want to know what my risks are if I do from liability terms. Can the agent take me to court if anything were to go wrong? What should I do now to prevent this happening in future?

 

[Ian J]

I have not signed it yet but want to know what my risks are if I do from liability terms. Can the agent take me to court if anything were to go wrong? What should I do now to prevent this happening in future?

The devil is in the detail and it all depends on the wording of the contract. Obviously you will be liable for any problems with the work that you have carried out but you need to ensure that there aren't any provisions for contingent liabilities in the contract making you liable if your input blows up and causes all sorts of damage to their business

 

[Noah]

My biggest worry is now that it isn't that i might not get paid or not. However, is there a chance they can hold my company liable if anything were to go wrong? What i dont want to do is to work with people that i dont trust and lose hard earned money on top.

The best advice has already been given :

If your concerns are this great, forget this job and move on... either way, don't let the situation fester and hinder you in trying to find agents that you have confidence in.

 

[trying_to_survive]

Hi, PM has asked to meet with me. I have told I will catch-up with him in a few days. One of the thoughts I had to safeguard my company (Say A), Can I register a new company (Say B). If I decide to do any contract I will ask them to make a new contract to Company B - that way I know incase of any liabilities its only Company B that is at stake not my Company A - Can this be a safe way to go? If they refuse to this then 100% I won't take the deal. Obviously, only thought stages now and not committing to anything.

 

[billybob99]

It sounds like you are chasing the client, if they wanted your services so bad, they'd be after you.

Don't talk yourself into a bad deal.

 

[trying_to_survive]

Thanks they are after me ,,,, but I am worried they have hidden agenda and this is obvious and I want to make sure I don't get caught up with liability in case it goes wrong. At the same time I am tempted that there might be still money to be made but want to do it safest way possible. You might think this sounds a little bit paranoid but given the bad company house credit history of the agent + PM who I do know personally and would do anything to make money makes me nervous a bit....but as I said there may be money to be made in this deal still and I want to do it the possible way and thinking of all combinations and hence my posts.

 

[billybob99]

Thanks they are after me ,,,, but I am worried they have hidden agenda and this is obvious and I want to make sure I don't get caught up with liability in case it goes wrong. At the same time I am tempted that there might be still money to be made but want to do it safest way possible. You might think this sounds a little bit paranoid but given the bad company house credit history of the agent + PM who I do know personally and would do anything to make money makes me nervous a bit....but as I said there may be money to be made in this deal still and I want to do it the possible way and thinking of all combinations and hence my posts.

The safest way to do it is on your own terms. Either take a deposit for 2 weeks at a time or 1 month upfront or don't talk yourself into a bad deal.

All seems very strange using an agent that handles the payments. If they want a PM to manage the project, that's ok - but they should be paying you directly.

 

[trying_to_survive]

ok thanks a lot. Really appreciate this. Let me catch up with the PM and see what he says, Thanks again.

 

[Mr D]

Thanks they are after me ,,,, but I am worried they have hidden agenda and this is obvious and I want to make sure I don't get caught up with liability in case it goes wrong. At the same time I am tempted that there might be still money to be made but want to do it safest way possible. You might think this sounds a little bit paranoid but given the bad company house credit history of the agent + PM who I do know personally and would do anything to make money makes me nervous a bit....but as I said there may be money to be made in this deal still and I want to do it the possible way and thinking of all combinations and hence my posts.

The risks are up to you to decide on.
Usually money to be made - but are the risks of no money at all also possible?

 

[billybob99]

Usually money to be made - but are the risks of no money at all also possible?

If waiting 2 months to get paid wasn't bad enough, having all these doubts before even starting the job is a no brainer.