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Jamie-Law
Jamie-Law, Solicitor
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Experience:  Solicitor
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My son has signed on contract to have some building work

Resolved Question:

Hi
My son has signed on contract to have some building work done, starting November 2016, the survey is complete and he has paid the deposit, but the company went into creditors liquidation this week. My son would like to cancel the contract, but has been told the contract is legal until the company ceases trading. What is his position? The contract is ttps://na1.documents.adobe.com/public/viewAgreement?tsid=CBFCIBAA3AAABLblqZhCDRTf0xPw3d3ZeyuPspHGNJpGujRfEOqzYhxpWsaL97MZHYhhLNOt46BwLQLBGS4KRMrSMFyyaxw2Nc6sSsWN-&
The owner is opening another company with a similar name (national rather than nationwide)
Pauline Joslin
Submitted: 10 months ago.
Category: Law
Expert:  Jamie-Law replied 10 months ago.

Hello Pauline my name is ***** ***** I will help you.

Can you post the contract link again please?

Customer: replied 10 months ago.
https://na1.documents.adobe.com/public/viewAgreement?tsid=CBFCIBAA3AAABLblqZhCDRTf0xPw3d3ZeyuPspHGNJpGujRfEOqzYhxpWsaL97MZHYhhLNOt46BwLQLBGS4KRMrSMFyyaxw2Nc6sSsWN-&I have tried to put the London Gazette notice in but can't it is id is(###) ###-#### the liquidators were appointed on 24th August -Marshall Peters Limited
Expert:  Jamie-Law replied 10 months ago.

Are these the only documents? Are they no terms of business?

Customer: replied 10 months ago.
i Think so I have sent you a text version of the email that says 'it' is signed and filed. I will ask Tom when i can get hold of him
Expert:  Jamie-Law replied 10 months ago.

But any terms and conditions?

Customer: replied 10 months ago.
that's it. He can't remember any other bits of paper or emails
Expert:  Jamie-Law replied 10 months ago.

Ok. Generally a contract comes to an end when a company goes bankrupt. But it must close, not just be liquidated.

If for example, like BHS it is up for sale and then is later purchased the contract is valid.

But if on the other hand as there is no buyer (like BHS) and the whole thing closes the contract ends.

You cant have a contract with a company that does not exist.

In any event it can only continue with another company if the agreement itself is allowed to be assigned or sold on.

The terms here do not say that this can be done, therefore it can not.

If the company is in liquidation then its valid until the company stops trading.

Can I clarify anything for you about this today please?

Customer: replied 10 months ago.
the company says this to my son does this mean that Innerspace National have his contract now?
Hope this finds you well.Apologies for just responding to you now, i have been on appointment and onsite visits for the past few days and only just returned to the office.May i first apologise for the stress this may have caused you and assure you this is sorted and innerspace is still trading at the same address and the under the same name with only one variation and that being the company is called NATIONAL instead of NATIONWIDE.In a nutshell and without boring you both, about 3 years ago i had a meeting with 2 potential partners that would come into my business, one as a project manager and one as another salesperson, this did not work out as after about 18 months i realised that they where unsuitable for the positions and could not provide the service that i provide in general, this increased my work load 3 fold and i had a meeting where i said that i was ending there involvement.Even though this was agreed with all parties contracts had been signed and therefore have to follow a certain procedure, this has been a lot harder that thought at first due to the fact the 2 partners had incurred me a lot of additional costs due to there incompetence, i was advised to pursue these through a solicitor but because copmtracts had been signed this would prove to be timely and costly, and due to innerspace and the work load we have always had this would definitely affect the efficient running on the company, i was then advised to shut the company down and just re open with a slight name change.This has still caused me about 2 weeks worth of additional office work to change everything over to the new name but i can assure you that all the insurance and guarantees and everything in the Loft Conversion Proposal are still in place with no deviations at all.I hope this has assured you of the good intent of innerspace that we will still will provide you with a very good service..
Expert:  Jamie-Law replied 10 months ago.

They can NOT just change the name. It is with the company who he initially contracted with.

It can NOT be assigned or sold on - the contract does not allow that

Does that clarify?

Customer: replied 10 months ago.
What is the best way to go about getting out of the contract?
Expert:  Jamie-Law replied 10 months ago.

Have they said its been assigned?

Customer: replied 10 months ago.
Sorry, what been assigned?
Expert:  Jamie-Law replied 10 months ago.

If so, then it can be cancelled. That is because it can NOT be assigned.

They can't just change the name or assign it.

Does that clarify?

Customer: replied 10 months ago.
What do you mean assigned? Sorry i don't understand waht you are asking
Expert:  Jamie-Law replied 10 months ago.

Assigned - given or sold to another company

Its being varied from Nationwide to National.

Looks like an assignment for me
Does that clarify?

Customer: replied 10 months ago.
All tom has been told is what was in that email
nnerspace is still trading at the same address and the under the same name with only one variation and that being the company is called NATIONAL instead of NATIONWIDE.........
...............i was then advised to shut the company down and just re open with a slight name change.So no one has said Tom's work is being assigned to the other company. How would we know?
Expert:  Jamie-Law replied 10 months ago.

They should tell you.

But based on the fact there is a change of name, the contract can be cancelled

Does that clarify?

Customer: replied 10 months ago.
Who should tell him? is the email enough of a telling him? Can they tell him in the furture?
Expert:  Jamie-Law replied 10 months ago.

I would do it sooner rather than later. Yes, email is fine

Does that help?

Customer: replied 10 months ago.
I meant who should tell Tom if his work has been assigned to the new company. Can they do it in hte future?
The thing is from what you said the contract with the original company is still valid until the liquidattors have closed the company. So he needs to cancel a valid contract.
If they assign it to the new company in the future then TOm will be deemed to have a contract with the new company I assume. Thus he still needs to cancel a valid contract
Expert:  Jamie-Law replied 10 months ago.

He must have a valid contract yes.

So he can cancel it with the old one and get a new contract with the newer company if he wants

Does that clarify?

Customer: replied 10 months ago.
Nope. What I meant is
You said that the contract was valid with the old company until the liquidators finish. But if they don't finish and close the company before the start date of the job (November) he will still have valid contract that they could hold him to.But I am now worrying they might assign Toms work to the new company during liquidation thus he would have a valid contract with the second company.Either way it looks like he neeeds to get out of a contract that is still valid
Customer: replied 10 months ago.
Ie he currently has a valid contract which he wants out of
Expert:  Jamie-Law replied 10 months ago.

No - because it looks like they have assigned the contract (which they cant do).

He can give notice NOW because of this.

The old company is in liquidation and it looks like they have assigned because they want to change NATIONAL to NATIONWIDE

Does that clarify?

Customer: replied 10 months ago.
How should he word this?
Expert:  Jamie-Law replied 10 months ago.

Just that you want to cancel for the following reasons:

1) The company has gone into liquidation

2) You are not confident the company can perform the contracted works

3) In any event it appears there has been a name change, which is an assignment which is not permitted

Does that help?

Customer: replied 10 months ago.
Seems clear to me. I only hope the builder agrees. Can the builder claim compensation ie loss of earnings?
Customer: replied 10 months ago.
The builder is not going to accept this easily
Expert:  Jamie-Law replied 10 months ago.

No. The contract has changed. The Company went into Liquidation and is now going to try and assign.

Its a real mess. They (not your son) should have thought this through

Does that clarify?

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Customer: replied 10 months ago.
I think so. It looks like we are ok. Just got to convince the builder who can't see the problem. Thank you for your patience.
Expert:  Jamie-Law replied 10 months ago.

Indeed. All the best and a pleasure to help

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