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Jo C.
Jo C., Barrister
Category: Law
Satisfied Customers: 71153
Experience:  Over 5 years in practice
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I need to respond to a notice of contract breach, where a termination

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I need to respond to a notice of contract breach, where a termination agreement was reached verbally and now the other party is denying the termination settlement. They are in breach of the same contract, so I now need to determine what is the best response to the notice of breach
Thank you for your question. My name is ***** ***** I will try to help with this.
-Could you explain your situation a little more?
Customer: replied 3 years ago.

Sure Jo,

Thanks for your help. We were operating an affiliate program on behalf of a client, under a 12 month contract. Part of the service we outsourced to a family member (Scott) of one of the directors here. The client was subsequently unhappy with the performance of the program in terms of affiliate acquisition. I contacted Scott to inform him that the client wanted to cancel the contract and I felt they had grounds and that I would like to agree a settlement for the remaining 3 months of the contract. I agreed with Scott over the phone a sum of £2750 to terminate the agreement. It was a bit naive, but given he is a family member I thought a telephone call enough of an agreement. However, he has now sent of notice of contract breach, which I can send you along with the original contract.

Scott was directly responsible for acquiring affiliates, and it was the lack of affiliates that eventually lead to the client moving this program in-house. There is also a clause in the contract that required Scott to deliver affiliate payment information no later than the 10th of each month. This was repeatedly missed.

What I need to work out is the best way to respond to the notice of breach, which doesn't expose me to any further risk, but also protects me from paying his over inflated expectation. I have left the offer of £2750 on the table at this moment.

Many thanks

Customer: replied 3 years ago.

Hi Jo,

Is there a way I can send these files over to you?

If this got to court it would be a case of your word against his and it would be decided depending on whose version of events the judge believes.
My suggestion would be to send him a cheque to confirm the offer of £2750 and tell him in the covering letter that by accepting the cheque and cashing it he accepted in full and final settlement of this issue.
I would go further and tell him that if he does not accept it he should send it back to you by return.
Actually having a cheque in a person's hand it is very tempting to cash it rather than risk going to court.
If he returns the cheque to you then at least you know where you stand because at the moment you are in limbo.
Always mark a letter containing any kind of admission or offer Without Prejudice Save as to Costs.
The reason for that is so that it cannot be produced in court as evidence of any breach or wrongdoing or previous offer, except with regard to court costs if he subsequently gets a settlement which is less than you were offered.
If that happens, you can ask the court to award costs against him on the basis that he pursued this unreasonably.
For legal reasons it is better (not essential but better) if the cheque comes not from the company but from a 3rd party. It can be a solicitor or an accountant or if the alleged breaches by a limited company, it can come from you personally.
Can I clarify anything for you?
Customer: replied 3 years ago.

Thanks Jo,

Is there a reason behind persuing the verbal contract approach, as opposed to countering with his own breach of contract?


The breach of contract argument is going to be based (presumably) on some kind of evidential issue where is the termination issue is completely verbal and there is no evidence at all. It is simply your version against his.
For that reason, regardless of whether it's a termination payment that your pursuing or suggesting money in respect of an alleged breach of contract, what he wants out of it will ultimately generally be money.
What I'm suggesting is giving him enough money that he cashes it rather than waste a lot of time going to
A cheque in someone's hand is much more powerful and a bigger incentive than a simple offer in a letter.
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