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:
Thanks 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.
Craig - ************
Mariola - ************
Sent from my iPad
On 19 Jun 2015, at 11:50, Tony Pope wrote:
Thanks for this I will transfer the £1500 now to the account
Could 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 etc
Please can we have an invoice on a weekly basis for the transfer so our accountant is kept up to date
Will this be ok
Traffic Safety Officer Services Ltd,
12a, Westpoint Enterprise Park,
Office: 0161(###) ###-####br/>Fax: 0161(###) ###-####br/>mailto***@******.***
TRAFFIC OPERATIVE AND SHIFT TRACKING System.
From: Craig [mailto:************
Sent: 17 June 2015 17:13
Subject: Colthrop Manor Booking Confirmation
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:
Account name: ************
Sort Code: ************
Account Number: ************
Thank you for your booking and we look forward to welcoming your guys on Monday 22nd June.
MINIMUM TERM 6 MONTHS - ONLY PAID FOR 3 MONTHS THUS £19,500 DUE
Sent 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.
- You approached us, Colthrop Manor B&B, seeking to secure accommodation for your workers. You stated that you had a 5 year contract to supply labour to a local company and required accommodation on a long term basis for a minimum of 10 persons.
- Terms and rates were negotiated over the telephone:
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.
- You then sent us an email asking to reduce the notice period from one month to 2 weeks. I responded to this email agreeing to your request ‘after the expiry of the minimum 6 month period’.
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.
12a, Westpoint Enterprise Park,
Mobile: 0771(###) ###-####/p>
Office: 08456 801 802
Fax: 0161(###) ###-####/p>
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.
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.