Proof of business

[Ian fraser]

I'm a self employed driver, providing airport transfers - until covid struck - and as such I had signed up to a credit card terminal provider back in 2012 to take card payments. I had to give the name of my business even although I didn't consider my self employment a business so gave them a name for that purpose which was entered on the agreement.

Up until the point my work was wiped out I was happy with the agreement, it auto-renewed every year, requiring 3 months notice in advance of renewal date to cancel otherwise it renewed for another year.

Once it became apparent I had no work and no likelihood of work any time soon I wrote to them asking them to cancel my agreement forthwith, offering to pay them one months notice. The contract had auto-renewed only a couple of months earlier. In which case they're insisting on full payment until the end of the agreement which I appreciate they are entitled to do. I put myself at their mercy advising I currently had no income, I'd been a good customer of long standing i.e. they'd had 9 years worth of rentals out of me and I was therefore looking for a little understanding/help. They still insisted on full payment.

Having done a little research I'd have some protection if this agreement had been entered into by me as an individual as opposed to as a business. What's even more frustrating is there has been new government legislation up for discussion which would change the circumstances I find myself in my favour but it has been sidelined for years with no sign of movement. So bottom line I believe legally I have no room for manoeuvre and they are entitled to pursue me for payment up until the new date.

My question is the only place my 'business' name is quoted anywhere is on they're agreement. I don't possess a business account, all payments to them come from my normal personal bank account. If they chose to pursue this would they have to prove I was a business an as such not entitled to the protection I'd enjoy as an individual entering into this agreement when it comes to auto renewals being considered unfair?

Thanks, Ian

 

[Newchodge]

There are, broadly, 2 types of business - a sole trader and a limited company. Clearly you were not operating as a limited company so you were operating as a sole trader. All agreements and debts are, therefore, your personal repsonsibility. The name you gave as the business name wouuld be considered a trading name, so Fred Bloggs is a sole trader window cleaner.: he calls his business Fred's windows but Fred Bloggs is responsibel for all debts. The trading name ios merely an identifier, not a legal entity.

You were running a business so the transsaction between you and your supplier was a business transaction. The protectiojn you talk about is, I believe, a protection for consumers, not businesses.

 

[Mr D]

Sounds like a business to business contract. You as a business agreeing the terms - and responsible to pay.

Unless they so something stupid like breach the contract usually you would be liable.
If you stop payment they chase you.

 

[Ian fraser]

There are, broadly, 2 types of business - a sole trader and a limited company. Clearly you were not operating as a limited company so you were operating as a sole trader. All agreements and debts are, therefore, your personal repsonsibility. The name you gave as the business name wouuld be considered a trading name, so Fred Bloggs is a sole trader window cleaner.: he calls his business Fred's windows but Fred Bloggs is responsibel for all debts. The trading name ios merely an identifier, not a legal entity.

You were running a business so the transsaction between you and your supplier was a business transaction. The protectiojn you talk about is, I believe, a protection for consumers, not businesses.

Thanks, yes your correct the protection I'm talking about is not afforded re BTB contracts. Consumer legislation stipulates auto renewal of contracts to be unfair but not for those entered into by businesses. That's why I was asking from the angle of what constitutes a business?

Recommendations by both the Law Commission and Scottish Law Commission were made as far back as 2005 re extending similar protection to businesses which were accepted in principle but as yet haven't been implemented. I've been banging my head off a brick wall since with various government agencies re a timetable for implementation. Might be of no help to me now but might help others in future. Seems to be something they've allowed to slip through the cracks after going to the trouble of having both commissions make recommendations!

 

[Newchodge]

That's why I was asking from the angle of what constitutes a business?

Providing goods or services to someone else for consideration (money). I cannot think of any situation whatsoever when a consumer (as opposed to a business) would want a card payment system. What would a consumer (as opposed to a business) take card payments for?

 

[Ian fraser]

Providing goods or services to someone else for consideration (money). I cannot think of any situation whatsoever when a consumer (as opposed to a business) would want a card payment system. What would a consumer (as opposed to a business) take card payments for?

Good point, thanks.

 

[eteb3]

On this 'consumer protections for small businesses' thing, worth noting that the Consumer Credit Act extends its protections to sole traders and unincorporated entities in some circumstances - so while it's unthinkably illogical in some senses, it has been legislated for in the past.