Was my contract terminated illegally?

This is a discussion on Was my contract terminated illegally? within the Business and Financial Law Questions forums, part of the Legal Questions & Answers Forum category; State: Florida My company was contracted as consultants for admin/finan services for 1 year, contracting company terminates contract without notice, what are my options? My partner and I have 1 ...

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  1. #1
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    Was my contract terminated illegally?

    State: Florida

    My company was contracted as consultants for admin/finan services for 1 year, contracting company terminates contract without notice, what are my options?

    My partner and I have 1 contract for the both of us to provide admin/finan. CONSULTING services to another company for a fixed amount per month. The term of the contract is for 1 year. I focus on the finances, partner on the admin/oper. We are 3 months into the contract and without notice, an email is received stating the termination of the contract. Reason cited "...the obligations of the Consultant will terminate upon the earlier of the Consultant ceasing to be engaged by the Customer...", which to my understanding is the CLIENT admitting to breach of contract.

    What options do we have?

  2. #2
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    Created Blog entryOverdriveTagger First Class50000 Experience PointsVeteran

    Without reading the full contract to see whether there are any escape clauses, it is a difficult question to answer. You should take the contract to an attorney to review. If there is no way to break the contract, then you may have a cause of action for breach of contract.
    Legal Disclaimer: Answers to questions on this forum are for informational and educational purposes only and do not constitute Legal Advice. No attorney-client relationship is established through this forum.

  3. #3
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    Thank you for your reply. Here are more details if it helps any.

    In January of this year, the company in which I am part owner of entered into a contract with another company LLC'd in FL. Term 1 year, where my company would serve as independent contractors providing admin/finan services to the client. My partner would handle the administrative services and I the financial services.

    I do have my own office and most of the contracted work I do is either carried out here at my office or at home. Not once have a received a complaint regarding the quality or performance of my work, just the fact that she has recently become obsessed with the notion of me being at her office at all times. No where in our agreement is it stated my physical presence. I did suggest that if she wanted to communicate anything with me, it could be done via e-mail, phone, text message, etc... or if she wanted to set an appointment to do so in a timely fashion, so that I could ensure my presence. Well she wasn't having it, and proceeded to change passwords that I used to manage and track various financial accounts belonging to the company. I was not given any notice, nor notified after the changes had been made, even though I had noticed, what I would assume to be, the same day they were changed as I checked would be consistently monitoring them.

    After a week of no communication awaiting to see if she was going to notify me in any way of what was going on, as it is a prime example of her unprofessional and child-like behavior, it never arrived. Therefor I proceeded to communicate with her via email expressing to her that due to her actions in denying access to me to accounts that are essential for me to carryout the services for which I was contracted, I will not be held responsible for my duties as she has made it impossible for me to access data needed in order to fulfill those duties. She stated in one of her replies "once you start coming to the office, i MAY give you access again to those accounts". I then proceeded to state my case as an independent contractor and that my contract is based upon providing a service, not being physically present at her office. Apparently she did not like this.

    Yesterday, I received a message from my partner saying we need to talk. We get together, he forwards me an e-mail from her titled "Contract termination". There is a notice clause in our agreement, stating she must give a months notice and is only enforceable if both parties agree to terminate the contract, which I am not agreeing to. In the e-mail she says that her company will no longer require finance consultancy because the consultant assigned to has seized to be physically present at all times. She then says "Therefor we would to terminate our contract for this service under clause 4." She doesn't indicate clause 4 of what, but I assume it is referring to our agreement. Article 4, includes the following citation “…the obligations of the Consultant will terminate upon the earlier of the Consultant ceasing to be engaged by the Customer…" Which I am still baffled by why she cited this, as it does not apply to her, as she is the Customer.

    I have yet to reply or communicate with her personally, although my partner has been in communication with her as he continues to fulfill the services of administration.

    I do have the following doubts:
    1) She is undoubtedly in breach of contract, correct?
    2) She has no grounds to legally terminate the contract as she has done.
    3) If the contract were to be "terminated", it would have to be in full correct? Unless a MUTUAL agreement between both parties were to be reached, which they have not. But if legal actions were to be taken, it would be against the FULL scope of the contract and not just my part?
    4) In the event of not being able to settle this civilly, which is my goal, I do not put it past her to claim bankruptcy. In the event of, would I be able to sue known associates of her company, investors, other sister companies with whom she is partnered.
    5) How long does it typically take for such a lawsuit to enter into judgement if mediation nor settling is a possibility?
    6) Due to her breach of contract, am I entitled to compensatory damages?

    Also, pasted below is a notice of breach of contract I wrote up to give to her in hopes of settling this, so I can move on. (See below)

    **Heading remove due to space limitations**

    The purpose of this letter is to inform you and provide you with a written notice that you are hereby put on notice that as of April 10, 2012 you are in breach of our contract entitled “Consulting Agreement” dated January 16, 2012.

    More specifically, you have breached the following obligations under the “Consulting Agreement”:

    1. **. ** provided a written notice in form of a PDF document entitled “Contract termination”. The document was emailed to my business partner, **, on April 10, 2012 and then forwarded to me several hours later.

    In the second paragraph of the document ** claims, "** has seized to be Physically present at all times and has been absent from assigned meetings.” To my defense, and as defined in Article 18 of the “Consulting Agreement”, “It is expressly agreed that the Consultant is acting as an independent contractor and not as an employee”. As an independent contractor, it is to my understanding that it is well within my rights to work from my home or my office, so long as I fulfill the services for which I was contracted. Which in my opinion and as per the emails attached, I have. With regards to her claim of my absence “from assigned meetings”, it is impossible for me to participate in an “assigned meeting” without proper and timely notification, which she refuses to provide me with.

    Further down in the document ** explicitly states the termination of the “Consulting Agreement”, and I quote, “we would like to terminate our contract for this service under clause 4.” Consequently resulting in the breach of the contracts term. Furthermore, her reasoning for which she believes serves as basis for her termination of the “Consulting Agreement” is cited a few lines below her previous citation that reads as follows, “…the obligations of the Consultant will terminate upon the earlier of the Consultant ceasing to be engaged by the Customer…” which also located in Article 4 of the “Consulting Agreement”. It is to my understanding the underlying meaning of the cited text relieves ** of its obligations set forth in the “Consulting Agreement” when either a) the Consultant (**) ceases to be engaged BY the Customer (**) or b) both the Consultant and the Customer mutually agree to terminate the “Consulting Agreement” with a 1 month notice period; whichever comes first and as far as I am concerned, I have not agreed to anything. With that said, I believe that the claims brought forth by ** in an attempt to justify the wrongful and premature termination of the “Consulting Agreement” are to be considered invalid.

    2. **. It is also noteworthy, and evident in the attached emails, that as recent as the past two (2) weeks, as well as on several other occasions, ** has made it nearly impossible for me to fulfill contractual obligations by engaging in child like, erratic, and very unprofessional behaviors and many times neglecting to communicate information with me, as well as changing passwords, with notice neither before nor after such changes are made. Resulting in the inability to be able to obtain data from such accounts that are essential in order to fulfill contracted services.

    Pursuant to Article 7 of the “Consulting Agreement”, ** has also, on several occasions, failed to fulfill her contractual obligations of compensating GSCG for services rendered, as stated in Article 7, “on a bi-weekly basis.” at times payments for our consulting services has not been received until 10 days after it is due.

    **, given the nature of wrongful conduct here, it is in my opinion that you are responsible for all damages arising from this breach. It is my desire to inform you of the forgoing and afford you the opportunity to cure said breach. I have no desire to pursue this matter in Court, if and only if, a fair settlement for compensatory damages can be achieved. I prefer to settle this matter without any time-consuming litigation and hope that you too will be open to settlement discussions, taking into account potential liability that you and your company may face considering the facts, laws, evidence and testimonies that will be brought forth in the event that you fail to cure such breach in the manner set forth below.

    Solely for settlement purposes, I will accept the following in full satisfaction of all claims:
    1. You and your company will pay in full, compensatory damages for the sum of **. *See Table I below for quantum calculations.


    This settlement offer will expire (unless sooner withdrawn) on Monday, April 16, 2012 at 5:00 p.m. If the offer is not accepted by you and your company prior to that date, you will leave me no choice but to vigorously pursue any and all available legal and equitable claims against you and your company, including, but not limited to, those claims set forth above; I will seek all available remedies against you and your company, including, but not limited to, appropriate writs of attachment, and, of course, compensatory damages as well as attorney’s fees and costs.

    This letter is the only notice you will receive prior to legal action being taken against you and your company.

    This letter does not purport to exhaustively set forth my entire position in this matter nor to comprehensively recite the pertinent facts or law. Nothing herein should be construed to be a waiver of or limitation of any of my rights in law, in equity, or otherwise. All rights, claims and remedies are specifically reserved.


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