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Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience:  Solicitor with 5+ years experience
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I would like to ask a question based on the fact we

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Hello. I would like to ask a question based on the fact we may need some help here.
We recently sold one of our small businesses. A previous supplier (SEO), that we had previously put on hold has now come out of the woodwork and said that the new owner needs to either retain their services or pay them three months notice to terminate the contract. As far as I was aware we had verbal confirmation prior to the sale that the contract was on hold indefinitely and that I would speak to the new owners about retaining their services. The new owner is (understandably) very angry about this as he is now getting invoices and threatening emails that he wasnt expecting. He is saying too that this is our responsibility as it should have been treated as a liability on the completion accounts.
I need to know whether from the supplier's perspective this is enforceable and if so who would be liable given the fact we are no longer directors and have sold the company.
Thank you very much
Hello my name is ***** ***** I will help you with this.
What does the contract say about termination please?
Customer: replied 2 years ago.

9 Termination

9.1 Termination Events

After Commencement of this Agreement, if the Client wishes to terminate this

Agreement before its commencement or before completion of the Services to be

provided as part of the Initial Project Fee, then the full Initial Project fee shall

become payable forthwith to Koozai by the Client as specified in Schedule 1.

9.2 Subject to Clause 9.1,

This Agreement may be terminated:

(a) By either party giving at least 90 days’ prior written notice to the other party;

(b) forthwith by the other party, if a party commits a material breach of any term

of this Agreement or any other agreement between the parties and (in the case of

a breach capable of being remedied) shall have failed, within 30 days after receipt

of a request in writing from the other party to remedy the breach;

(c) forthwith, if either party has a receiver or administrative receiver appointed

over it or over any part of its undertaking or assets or shall pass a resolution for

winding up (otherwise than for the purpose of a bona fide scheme of solvent

amalgamation or reconstruction) or a court of competent jurisdiction shall make

an order to that effect over it, or if it shall enter into an voluntary arrangement

with its creditors or become subject to an administration order or shall cease to

carry on business;

(d) if either party ceases to do business as a going concern, forthwith by the other


(e) forthwith by the innocent party, if any representation made by the other is

discovered to be misleading or substantially inaccurate;

(f) forthwith by the innocent party, if the other fails to comply with the

confidentiality provisions of this Agreement;

(g) forthwith by the innocent party, if the other attempts to assign, terminate or

cancel this Agreement contrary to the terms of this Agreement;

(h) forthwith by Koozai, if the Client fails to make payment in accordance with

clause 7 and in accordance with any other agreements the parties may have

entered into.

(i) forthwith if in Koozai’s sole reasonable opinion it suspects that the target web

site (i.e. the web address optimised during the campaign) or web pages linked to

it are involved in any search engine promotion technique deemed to be unethical

or unlawful; and

(j) forthwith if in Koozai’s sole reasonable opinion the Client is making

unreasonable demands for the Services and / or is behaving in an abusive,

obstructive or offensive manner towards Koozai, its directors, employers and


9.3 Effect of Termination

Upon termination of this Agreement:

(a) Koozai may cease providing the Services and may invoice the Client for the

Services pursuant to this Agreement;

(b) neither party shall be relieved from obligations under clauses 9.3(d), 9.4, 9.5

and 11;

(c) no fees or other payments previously made by the Client shall be refunded;


(d) where notice to terminate is served in accordance with clause 9.2(a) or the

termination of this agreement is triggered automatically pursuant to clause 9.2,

the Client shall remain liable for the Initial Project Fee and / or the other Project

Fees specified in Schedule 1 and due for the next three calendar months.

9.4 Within 14 days of the termination of this Agreement (howsoever and by

whomsoever occasioned) the Client shall at Koozai’s sole option return all copies of

any software and any copies in its possession or control to Koozai and a duly

authorised officer of the Client shall certify in writing to Koozai that the Client has

complied with its obligation as aforesaid.

9.4 Any termination of this Agreement pursuant to this clause shall be without

prejudice to any other rights or remedies a party may be entitled to hereunder or

at law and shall not affect any accrued rights or liabilities of either party nor the

coming into or continuance in force of any provision hereof which is expressly or

by implication intended to come into or continue in force on or after such


Were the services complete?
Did the buyer take on everything?
Customer: replied 2 years ago.

Yes. Well we retained a 5% share but that is all. We resigned as directors and didn't retain any rights.

Are they saying you are personally liable?
Customer: replied 2 years ago.

I am unsure. I just really need to know if the contract was transferrable to the new owners of the business even though it has changed hands and whether we (as the previous owners/Directors) would be liable or if the new owner would be?

Was it a Limited Company?
Customer: replied 2 years ago.


Customer: replied 2 years ago.

Yes it was / is. Thanks.

They purchased your shares in the company except for 5%
Customer: replied 2 years ago.

that is correct

Was the contract between the supplier and your Ltd co?
Customer: replied 2 years ago.

Yes it was with the Ltd Company

Customer: replied 2 years ago.

Do you need much longer on this?

Ok. In that case the agreement continues. The agreement is made between the supplier and the limited company. The agreement does not come to an end when you sell.
The limited company is the contracting party so the agreement continues or until terminated by one side. It does not end by you selling. The contract is not with you personally it is with the limited company.
As the limited company is its own legal entity it continues on.
Can I clarify anything for you about this today please?
Ash and other Law Specialists are ready to help you

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