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Ben Jones
Ben Jones, UK Lawyer
Category: Law
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Hi I signed up to a virtual office with Regus in January

Resolved Question:

Hi

I signed up to a virtual office with Regus in January 2013. Business has not been great so I decided to terminate my contract in February 2014. First I was advised that I needed to give them 3 months notice which I reluctantly agreed, and then I was told that since my contract was rolled over in January 2014 I cannot now terminate until January 2015. I asked why I was never notified in writing or by phone, their response was, as you never terminated in December we assume that everything is OK.

I have been in email contact with Regus staff at several levels and they all seem to think that the 2 clauses below justifies their action. For me the flaw in the clause is that they do not say they will NOT contact you prior to rolling the contract.

2.2 Duration: This Agreement lasts for the period stated in it and then will be
extended automatically for successive periods equal to the current term but no less than
3 months (unless legal renewal term limits apply) until brought to an end by the Client or
by Regus. All periods shall run to the last day of the month in which they would
otherwise expire.

I am meeting with the area manager on Friday and would be grateful for any advice you can give me to take to the meeting.

Many thanks
Submitted: 3 years ago.
Category: Law
Expert:  Ben Jones replied 3 years ago.

Ben Jones :

Hello, my name is XXXXX XXXXX it is my pleasure to assist you with your question today.

Customer:

Hi Ben



I signed up to a virtual office with Regus in January 2013. Business has ot been great so I decided to terminate my contract in February 2014. First I was advised that needed to give them 3 months notice which I reluctantly agreed, and then I was told that since my contract was rolled over in January 2014 I cannot now terminate until January 2015. I asked why I was never notified in writing or by phone, their response was, as you never terminated in December we assume that everything is OK.



I have been in email contact with Regus staff at several levels and they all seem to think that the 2 clauses below justifies their action. For me the flaw in the clause is that they do not say they will NOT contact you prior to rolling the contract


2.2 Duration: This Agreement lasts for the period stated in it and then will be
extended automatically for successive periods equal to the current term but no less than
3 months (unless legal renewal term limits apply) until brought to an end by the Client or
by Regus. All periods shall run to the last day of the month in which they would
otherwise expire.


I am meeting with the area manager on Friday and would be grateful for any advice you can give me to take to the meeting.

Ben Jones :

I am afraid your argument is weak – you would not expect a contract to state that the other party will not contact you to advise you of the upcoming renewal and seek your approval for a further term. The wording of the contract is clear – it will last for an initial term of 12 months and then it would automatically renew for a further term, unless it is cancelled. So they do not have to contact you at all – you know that there is a renewal coming up on the anniversary of the contract and if you do not wish for this to occur then you would be expected to cancel as per the terms of the contract.


 


So by cancelling now you may be acting in breach of contract and they could potentially sue you for losses incurred as a result of that. These could for example include fees for the remainder of the contract. However, they also have a duty to minimise these losses as best as they can so that would usually mean trying to get a replacement to occupy the officer instead. If they do then they will not have ongoing losses from your breach and what you owe them will be reduced as a result.

Customer:

So how can I best approach the meeting?

Ben Jones :

it really depends on how they wish to pursue this, that could vary considerably depending on who is taking the meeting. You may wish to agree to pay for an additional few months and tell them that in that time they should have no problems in getting a replacement and as such you would have no further liabilities as they would have no further losses from you and trying to get you to pay for the full term would be a penalty clause which is illegal

Customer:

They wont actually incur any loses as it's a virtual office. I'm not based there and I've also agreed to there notice of 3 months.

Ben Jones :

they can only pursue you for actual losses so ask them to justify what these are. Also point out the prior agreement to terminate with 3 months notice

Customer:

Ok many thanks

Ben Jones :

You are most welcome. Please take a second to leave a positive rating for the advice I have provided as that is an important part of our process. Thank you and feel free to bookmark my profile for future help:



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