I run a B&B. Back in June 2015 I did a deal with a company to take all of our rooms (5 rooms) on an ongoing basis but for a minimum of 6 months. This commenced on 22 June 2015. I received a call today from one of their company directors informing me that as of today they no longer require the accommodation.
The agreement is evidenced by the following email exchange:Hi TonyThanks for your email and payment. I believe Mariola has now sent you the invoice as requested.It was good to meet you the other day and to hear a little of your plans. I'm glad to say that the guys seem to be settling in well. Please do keep us informed about arrivals any changes.As regards ***** ***** guests we can currently accommodate up to 12 guests and I'm happy to consider providing caravan space should that be required.Finally, yes we can do a deal at 2 weeks notice after the initial 6 month minimum stay.Thank you for choosing Colthrop Manor and if we can be of any further assistance please give us a call.Yours sincerelyCraig ************Craig - ************Mariola - ************Sent from my iPadOn 19 Jun 2015, at 11:50, Tony Pope wrote:CraigThanks for this I will transfer the £1500 now to the accountCould we do a deal on the notice period for 2 weeks, Our contract will run for the next 5 years but should we have to change anything I am only going to get little notice from the client. I am hoping that through this period together, we will keep you well informed of how the contract is working and what if any changes are going to happen - such as change of workers etcPlease can we have an invoice on a weekly basis for the transfer so our accountant is kept up to dateWill this be okCheersAnthony ************Company DirectorTraffic Safety Officer Services Ltd,12a, Westpoint Enterprise Park,Clarence AvenueTrafford Park,Manchester,M17 1QS.Mobile: ************Office: 0161(###) ###-####br/>Fax: 0161(###) ###-####br/>mailto***@******.***www.tsoservices.uk.comTRAFFIC OPERATIVE AND SHIFT TRACKING System.-----Original Message-----From: Craig [mailto:************ Sent: 17 June 2015 17:13To: ************Subject: Colthrop Manor Booking ConfirmationDear *****Further to our telephone conversation I hereby confirm our agreement as follows:We, Colthrop Manor B&B, shall provide you with B&B accommodation for 10 persons at the negotiated rate of £1500 per week (£25 per person) on an on going basis (minimum 6 months).This arrangement may be cancelled by either party on giving one months notice.N.B. The above calculation takes into account the work shift patterns of 12 days on, 2 days off.Payment is requested by bank transfer to:Bank: NatwestAccount name: ************Sort Code: ************Account Number: ************Thank you for your booking and we look forward to welcoming your guys on Monday 22nd June.Yours sincerelyCraig ************Colthrop ************************
MINIMUM TERM 6 MONTHS - ONLY PAID FOR 3 MONTHS THUS £19,500 DUESent from my iPad
ADVICE RECEIVED - ADVISED THAT I MUST SEEK TO MITIGATE MY LOSES. ALSO ADVISED I HAD TO WAIT TILL THE END OF THE CONTRACT PERIOD (ENDED 22/12/15) BEFORE MAKING A CLAIM.
Thank you for last week’s payment, received with thanks. My apologies for not sending your invoice for last week, I was away and it was missed in my absence so please find last week invoice and this weeks attached.
On reviewing our correspondence I note in your email of 14th September, where you accept my proposal to off-set our earnings to reduce your liability, you also claim to be serving 4 weeks’ notice. I must point out that notice can only be effective after the minimum 6 months term has expired. This was made clear in my email of 17/06/15 where I confirmed the details of the agreement and again in my email of 25/06/15 when I responded to your request to reduce the notice period to 2 weeks.
I’m really trying to be fair. We went out of our way to accommodate your needs, incurring expense and cancelling forward bookings, which we were prepared to do only because you offered a long term contract, hoped to be for 5 years and contracted on an ongoing basis with a 6 months minimum period. I made it clear throughout that we needed a minimum 6 months contract for this deal to be viable. This was clearly communicated from the outset and it was even common knowledge among your employees that the contract was for a minimum of 6 months.
Gross Contract Value
Minimum contract period 6 months (26 weeks), contract rate £1500 per week
Contract value: £1500 x 26 = £39,000,
Payments received: £1500 x 13 = £19,500
Outstanding payments: £19,500
I am still prepared to off-set our actual earnings against your contract rate as I offered previously, as I think that that is the fair thing to do. I had proposed to do this weekly however that has not proved possible but can now be done by the end of the month.
I hope that we can resolve things amicably and look forward to hearing from you.
Unfortunately I do not see this the same way
My 4 weeks’ notice period was effective from the start as we cannot predict what would have happened in the industry I would not leave myself open to such a massive loss with not even a man on the contract
The 4 week period was questioned down to 2 weeks so my losses would have been manageable should the works come to an end
I have paid the 4 weeks with no opps in your establishment I have no intension of paying a further 3 months
Very sorry that this has come about this way
12a, Westpoint Enterprise Park,
Office: 0161(###) ###-####/p>
Fax: 0161(###) ###-####/p>
Thank you for your email and my apologies for the delay in responding. Obviously i was disappointed by the content of the email and thus thought it prudent to seek legal advice on the matter.
Our normal rate: £79 per night / £533 per week per double room. Thus £2765 per week for 5 rooms / 10 people.
Your discounted rate negotiated of £1500 per week on an ongoing basis BUT for a minimum term of 6 months.
I then confirmed the terms in writing / email, see attached.
I have now taken legal advice on the matter and will be pursuing a legal claim through the small Claims Court if we cannot reach an amicable agreement.
I don’t like having to take such action however we are a very small business and invested heavily in providing you with the accommodation that you required and it was made clear from the outset that we needed a minimum term of 6 months for it to be viable for us to do so.
Since being informed of your change of circumstances resulting in you no longer needing the accommodation contracted for we have done all that we can to seek to mitigate the loss however having cancelled all our forward bookings and made alternative arrangements for our regular clients in reliance on your contract we are still projecting a significant shortfall over the contact period of in excess of £6000. This is not something that we can simply accept. We have been advised that we have a very strong case and should simply wait until the end of the contract and then pursue a money claim through the Small Claims Court to get a Country Court Judgement.
I would rather it didn’t come to this, I do appreciate that you didn’t deliberately set out to damage our business however that is the outcome at present. I would urge you to seek legal advice yourself and hope that we can come to some agreement.
I look forward to hearing from you.
I also am very sorry that the situation has arisen but clearly stated on the next line down which has not been highlighted (but has now by me)
“This arrangement may be cancelled by either party on giving one months’ notice”
We have complied with this term and paid the one month notice even with having no operatives in your establishment?
I feel we have honoured our agreement and again very sorry you feel this way.
Mobile: 0771(###) ###-####/p>
Office: 08456 801 802
I am sorry that you have chosen to take this stance. You know full well that we agreed to a minimum term of 6 months, though we were both hoping that our contracts would run the full 5 years! There is no way that we would have agreed to such terms for a one month deal or a two week deal as per your request to reduce the notice period and when you read the terms in their entirety it is plainly clear that the agreement was to be for 'an on-going basis' with a term of minimum of 6 months. The option to cancel the agreement applies to the 'on-going basis' and not the 'minimum 6 months'. Also in response to your request to reduce the notice period to two weeks, on agreeing to your request I clearly reiterated the 'minimum 6 months' term in my response. Ask yourself would you have cancelled 6 months of forward orders and invested in changes to the property in return for a one month contract or two week contract? I don't think so. Do you seriously claim that that's what you genuinely believed the deal to be with us? I’m sorry that your contract was cancelled and we are doing all that we can to mitigate our losses under the circumstances.
As a result of your early termination / breach of contract we find ourselves significantly out of pocket. Our gross income against the contracted income is heavily down and our costs are significantly higher including online marketing commissions, giving us projected losses over the contract period totalling £9800 (September £3300, October £2500, November £2500, December £1500). Taking into account your notice payments totally £6000 we are left with a projected short fall of £3800.
We are not asking you to pay the full value of the remaining term of your contract (4 months / £26,000) but only for the shortfall in our earnings after we have sought to mitigate our loses, suffered as a result of your early termination.
Your people spoke highly of you and I believed you to be an honourable person so I am disappointed with your response. I still hope that we can resolve things amicably, as much as I’m confident that a court will award judgement in our favour, I’m sure neither of us really wants the hassle and expense of court proceedings and I feel sure that you would rather not have a CCJ recorded against your company particularly as, if I recall correctly, part of your business is the financing / leasing of heavy equipment.
I urge you to reconsider your position on the matter and look forward to hearing from you.
Craig ************ Colthrop ************
SO EVERYTHING COMES DOWN TO THE '6 MONTH MINIMUM TERM'!
we have done our best to mitigate our loses but are still left with a shortfall in income of £5435.87 and this figure doesn't fully reflect the extra cost, effort and hours of work to revive the business.
In the first would you please give your view on the strengths and weaknesses of my case based on the above info.
there really shouldn't be anything difficult about this - i have already been advised by Alex W on here previously so i'm happy that i have a good case i was just seeking a second opinion before launching legal action however what i need is for someone to 'hold my hand' through the process of 'small claims' procedure so as to be able to achieve the best outcome.
it seems that 'Alice H' somehow took offense at me renewing my subscription rather than paying in installments. if its a question of cash im happy to pay more for the right support.
Ah Alex - good to hear from you. Just the person I want.
Carrying on from where we got to last time...
As I feared the company / Tony Pope the Managing Director has continued to deny that he agree to a 6 month minimum term. He maintains that he paid one months notice, which he did, and that he owes nothing further.
The term of the contract (the 6 month period) expired on 22 December. Our accounts for the period have now been reconciled and shows that we suffered a reduction in income (income being gross takings minus direct marketing costs / laterooms.com costs) of £5435.
I wrote to Tony last week as follows:
Re: Colthrop Manor B&B Claim for early termination of contract
I last wrote to you on 26th October urging you to reconsider your position in regards ***** ***** early termination of your contract with us in the hope of achieving an amicable solution. I received no response.Now that the contract term has expired we have established the actual loss suffered by our business as a result of your early termination to be £5435, this is based on gross income minus direct marketing costs only, see breakdown of these figures below.
Contract minimum term 6 months / 26 weeks.
Contract price per week = £1500
Thus total Value of contract = £39,000
Payments received = £19,500
Payments outstanding = £19,500
Mitigation /Actual B&B income generated over period = 14,064
19,500 – 14,064 = £5,435I therefore request that you pay the two invoices already issued to you totaling £3000 (see copies attached) and i attach a further invoice for the balance of £2435.Please make payment within 7 days or we will be commencing legal proceedings forthwith.Yours sincerelyCraig Nottage Colthrop Manor
If I have not heard from him by Tuesday I intend to write to him once more giving - Notice Before Action -
So that's where I am at present and I expect to have to take them to court! So i'm a bit nervous about that and i'm seeking some guidance / assistance in presenting my case effectively.
It seems I have many questions...however the key one is:
what are my chances of success?
and what risks are involved?
ok thanks for that.
Now, just to wait until Tuesday and issue the 'Notice Before Action' giving 14 days notice, sufficient? I guess this will need to be sent by 'real post' / recorded delivery rather than just email?
Any guidance as to what format this should take / what should be included? Ideally i'd rather he just paid...
is something like this suitable?
'Notice Before Action'
Further to my previous email correspondence I am now writing to officially inform you that I intend to commence legal action in 14 days time if our outstanding invoices to the value of £5435 are not satisfied in full or a payment plan agreed.
Yep, I think so.
I guess that's all for now. Next i'll need to 'present my case' - which i'm thinking is basically an edited version of the advice you've give? Can you tell me where I can find examples of any similar cases so I can see how they are presented?
I'll be in touch when I reach the next hurdle then :-)