Contract liability.

[S0UTHUKF]

Hi all , I'm new here so go easy lol.
I have a customer of which I made a contract trading as.
He paid 2 initial payments from that same contract.
Then verbally I told him we were going ltd.
More payments where taken and invoiced with ltd details and paid into the ltd account.
A further two separate contract where drawn up and signed as additional work.
This customer has not paid a couple of stage payments under the first contract .
My question is that under the first contract of which most payments where made to the ltd
Is it who he paid liable or the contract if that makes sense

 

[Paul Kelly ICHYB]

Did you amend the contract to the ltd co or agree in writing that it can change?

 

[Newchodge]

1. You have a contract as a sole trader with a client.
2. Part way through the contract you notified the client that you would be trading as a ltd company.
3. What, exactly, did that notification say?

 

[S0UTHUKF]

I was two weeks into the contract sole trader , then the customer asked me to do more work.
I spoke to my accountant who advised me that I should go limited.
I told the customer verbally that all future payments must be in the new company name and sent him the two new ltd contracts,
My problem is the first contract did nt switch even though he was very aware he was dealing with the limited ie invoices for the rest of the first contract in ltd name , and to ltd bank account as well as communication on the ltd what's app group

 

[Paul Kelly ICHYB]

What happened when you asked them for payment?

Did you raise new (outstanding) invoices in the ltd co name, referencing the old invoice?

Why can't the client pay you as sole trader?

 

[S0UTHUKF]

What happened when you asked them for payment?

Did you raise new (outstanding) invoices in the ltd co name, referencing the old invoice?

Why can't the client pay you as sole trader?

The payments owed where for the later work of the first contract at which point I was ltd. Even though that contract did switch to new name because of technical fault.
Yes there was two payments in the first contract as sole trader , and twelve further payments of that same contract to the ltd , invoice from ltd , paid to ltd bank account and discussed on what's app to pay ltd.
I could accept more payments as sole trader because I was on vat limit and advised by accountants which was also explained to the customer as he did nt want me to add vat

 

[Newchodge]

I told the customer verbally that all future payments must be in the new company name and sent him the two new ltd contracts,

But did nothing to change the original contract or to notify the client of the change in writing?

 

[Newchodge]

The payments owed where for the later work of the first contract at which point I was ltd. Even though that contract did switch to new name because of technical fault.
Yes there was two payments in the first contract as sole trader , and twelve further payments of that same contract to the ltd , invoice from ltd , paid to ltd bank account and discussed on what's app to pay ltd.
I could accept more payments as sole trader because I was on vat limit and advised by accountants which was also explained to the customer as he did nt want me to add vat

What is the problem now? Is the client claiming faulty work, or what?

I think there is a 'not' missing at the beginning of your last sentence.

 

[S0UTHUKF]

But did nothing to change the original contract or to notify the client of the change in writing?

 

[S0UTHUKF]

It was a bit more complicated than that I used contract software which on my end was set up in ltd so when sent it didn't show ltd as it took a couple of days to register, so it did say the company name but missed the ltd I did nt notice until much later

 

[Newchodge]

It was a bit more complicated than that I used contract software which on my end was set up in ltd so when sent it didn't show ltd as it took a couple of days to register, so it did say the company name but missed the ltd I did nt notice until much later

I'll try again.
But did nothing to change the original contract or to notify the client of the change in writing?

 

[S0UTHUKF]

What is the problem now? Is the client claiming faulty work, or what?

I think there is a 'not' missing at the beginning of your last sentence.

We have done extra work on the first contract which he is arguing about, so for clarity before doing costly legal I was trying to clarify who he is dealing with , all my legal and liability is now with the ltd.
Yes sorry not

 

[Bobbo]

Without a formal novation of the first contract from you as a sole trader to your limited company everything I imagine still sits with you as a sole trader. You may be able to argue that the customer's subsequent accepting and paying of invoices from the limited company could be deemed accepting a contract novation, though it would be better if there was written communication setting out change of business entity.

 

[Newchodge]

We have done extra work on the first contract which he is arguing about, so for clarity before doing costly legal I was trying to clarify who he is dealing with , all my legal and liability is now with the ltd.
Yes sorry not

How did the extra work on the first contract come about. What is there in writing about it?