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Jo C.
Jo C., Barrister
Category: Law
Satisfied Customers: 71153
Experience:  Over 5 years in practice
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Can I sue of contract? I signed a contract of sale

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Can I sue for breach of contract? I signed a contract of sale in regards ***** ***** business. This was to include stock, an ebay account to sell the goods on, training and supplier information. The price it was up for was £8000, we agreed with the buyer that we would sell this for £6500. We had met the buyer and gone over everything and had spent a lot of time securing this sale. This buyer then decides that he only wants to pay a part payment of £3000 and the remainder when it had reached its annual profit. To be honest we should never of agreed to this as it was a very poor value deal as the stock had cost us £1500 alone however we had a new business that we was working on within the same industry but slightly different and we wanted to build it up like we had this one. We agreed to this and signed a contract. Buyer promised that he would sell a certain amount of items per week so he could get the money to us within the year. There is no withdrawal clause in this contract. Buyer personally inspected stock and was happy and we provided training both in person and in terms of a business pack. We have trained him completely about the trade and given him ideas on how to expand in ways we did not have time to devote ourselves to. He has now had the stock in his possession for 6 weeks and the contract was signed 8 weeks ago. We decided that instead of putting the sales through our supplier we would take orders through our jewellery business and contact the supplier directly ourselves. We would not be making any profit on this but this way we had a record of the sales and what the annual profit stood at so when our money was due if he did not make payment the contract would be void and we could stop selling to him until he paid us the money he owed us. We did not disclose to him that this was our business which was probably wrong however we had suspisions that when the time came he would not actually give us our money and just run away with the supplier details. He has never placed an order in all this time. Now he is claiming the stock is defective which it is not and once again he has had this in his possession for 6 weeks now. He then writes up a email demanding £3000 back and once he has this he will return our stock and ebay account. This is obviously completely unreasonable as he has the items in his possession and there is nothing stopping him keeping the items and his money. My business partner and I wrote him up an email saying that we are unhappy with him not sticking to his side of the contract and would like to mutually end the contract. He has the option of selling the stock and the account on himself and we will transfer him the remainder of the price or he can return these to us and we will refund him. He is refusing both options and is saying he wants the money in person by lunch time and only then will he return our stock and ebay account. He is also saying that if he does not have it by then he will go to the police for fraud and deceivement. This does not worry me at all as I have stuck by my side of the contract but now I am wondering where I stand legally regarding the situation. Am I able to sue for the remaining £3500 as he is being unreasonable and is breaching his agreement?
Thank you for your question. My name is ***** ***** I will try to help with this.
Sorry if I'm missing the point but where does the £3500 come from?
In short, he is demanding money back on the basis that the stock is defective?
Customer: replied 2 years ago.

Hi Jo,

Thanks for your response. The total contract was for £6500. He paid part payment of £3000 for stock, ebay account and to have information on where to purchase products so he could takeover the business. He was to pay the remaining payment of £3500 when his profit margin hit a certain level. He personally inspected the stock in person and has had it in his being for six weeks. He is now saying it is defective and he wants his £3000 back. There is nothing wrong with this stock and as mentioned he walked away happy with it.

My business partner and I would like to end this contract with him as he does not seem like a honest person so agreed that on return of the stock and the ebay account to our business address we will refund him the £3000 payment however he is saying that payment must be made to him and only then will he return any stock which is obviously ludicrous. He is now saying he is getting in contact with his solicitor so my question was if it comes to it am I able to sue for breach of contract? There is no withdrawal clause and the contract was for £6500.


I wouldn't worry about his solicitor. This is a small claims court sum so he won't be able to claims costs. He will not use a solicitor.
This will really come down to whether or not the stock was defective and how confident you are that it was not.
You do have a claim for £3500. The contract price was £6500 and he just plain hasn't paid in full. Therefore you have a claim for the remainder.
He will probably defend on the basis that the stock was defective and possibly bring a counter claim for £3000. Then you would have to defend his claim.
In principle though, this is a proper sum for the small claims court so it would be cheap and quick to issue.
I would send a letter before action first though making clear that if he does not pay within 28 days you will sue and seek costs and interests. He will not pay of course but it will protect you from costs.
Can I clarify anything for you?
Jo C. and other Law Specialists are ready to help you
Customer: replied 2 years ago.

Thank you so much for your help. It is good to get clarification from someone so experienced.

Thanks again