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Hello my name is ***** ***** I will help you with this. Please note that I am a working Solicitor and may be on and offline as I have to attend Court and meet with clients, even at weekends. As such you may not get an instant response when you reply as this is not an ‘on demand’ live service, but rest assured I will be giving your question my immediate attention upon return. There is no need to wait here, you will get an email when I reply.
Did they seek legal advice before signing the contract? Was it just a mistake please?
I believe the person who negotiated the contract is a US lawyer - she would have given the ok for it to be signed to her CEO. Essentially, we changed our position during negotiations but they still signed the contract without reviewing properly. In context, this is the media industry and we deal with several contracts daily. From my perspective, I have to check and review every contract that is redlined, so nothing slips through the net - they signed this contract.
Did you inform them of the changes?
Not me. The material change is a delivery assets so it was decided by a different department - ie. they make the final call what they need. My last email to them with be along the lines of this:
Please advise if you have any final comments. I will then liaise internally and we can insert the final Schedule of Assets into a signature copy of the Agreement.
I am concurrently circulating this internally and therefore must reserve the right to comment/amend further.
Ok - but the contract was changed and no one advised them of the change?
Correct. How we can advise every client, on amendments that go and involve an entire company that we make, is near impossible. We are transparent and we present contracts for signature. They signed and there was nothing underhand or sneaky about it. OK, so we didn't flag it. But, I surely they need to read contracts before signing? As I said before in earlier email, the following clauses are in the contract they signed.
In no event will Licensor be entitled by reason of breach or default to revoke, terminate, or rescind or alter this Agreement or to enjoin or restrain sales and distribution or advertising of the Film or Kaleidoscope’s exploitation of the Rights, or to seek, accept, apply for or obtain any equitable remedies whatsoever against Kaleidoscope.
20 Entire agreement
20.1 This Agreement contains the entire agreement between the parties with respect to its subject matter and supersedes and extinguishes any prior drafts, agreements, undertakings, representations, warranties and arrangements of any nature whatever, whether or not in writing, between the parties in relation to the subject matter of this Agreement.
Can we really be responsible for their signature?
Are these assets ancillary to the contract or a major part of it please?
In their opinion, small. In our opinion, material and completely necessary as we are the distributor and know our clients, area of expertise and will make no money without them.
I see. In that case they and you are bound.
The only thing they can argue is mistake
But mistake is unilateral where one person makes a mistake
However saying that in the case of Smith v Hughes (1871) it was held that it would have to be a fundamental term
If it was not then it is mistake as to quality and can't be rectified
They should have had a lawyer check the contract before signing
If their lawyer did not pick it up then it is quite possible they have a negligence claim against the lawyer.
Can I clarify anything for you about this today please?
OK thanks, ***** ***** I thought. Is "mistake" a good defence in commercial contracts where the contract is clear and they have signed on their own free will ie. given the opportunity to provide further comments as well ?
ie is this generally successful? ( FYI, this is not a huge contract, less that 100k)
Mistake can be used in commercial but generally it has to be so fundamental, ie subject matter etc
Does that help?
OK, thanks - so would you be confident that we can just be happy with the contract that is signed and let them argue whatever they want - let them sue if they want?
That's my last question, promise!
Yes I would be confident of that. It is not a mistake as to subject matter, but the fact they didnt pick up on a term
Negligence from the lawyer rather I think
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