If you have paid up front for a full year of professional services in advance (in this instance it is bookkeeping, management reports etc) and the company has failed to provide what they said they would and what they have charged for, what should/could I do to try and get some recompense?
The first thing to do is dig out the contract. What did the service provider say in the contract about what they would provide? Is it there in black-and-white as to how they have failed to provide the service that they said they would? Or was it a case of emails back-and-forth and phone conversations? The latter is going to be so much harder to prove a breach and to obtain your refund.
This is why it is so important to have a clear scope of services upfront – both for the supplier and for the client – so that there is no misunderstanding as to what was contracted to be provided.
If it is clear that the supplier was contracted to provide you with certain services and they have failed to do so, then you should look at the termination clauses of the agreement.
Most supplier contracts will have termination clauses that say that if the contract is breached, you must notify them of the breach and give them a period of time to remedy that breach, such as 14 or 21 days as specified in the contract.
If the contract does say this, you will need to follow the contract terms and serve notice on the supplier to let them know that they have breached the contract and how they have breached the contract and give them the requisite time to remedy. If the supplier doesn’t remedy the breach within the requisite period of time, you can terminate the contract and bring a claim for breach of contract.
Some contracts may also say that the client can terminate for persistent breach, although this is unlikely where you have not negotiated the supplier contract. In this case, you would not need to provide a period of remedy for the supplier and could terminate in accordance with that clause for the ongoing breaches.
Remember to look at the notice provision very carefully and follow it to the letter. For example if the contract states that the notice has to be served by registered post to the registered office, then you must do so, in order for the service of notice to be effective.
Unfortunately the supplier has the upper hand, with the 12 months payment in advance already in their pocket, so it may be that they will tough it out and you would need to bring a court claim against them to get any refund.
Whether the court would rule in your favour or not would depend on how clear it is as to what services were contracted to be provided and whether the supplier failed to provide them.
But in the first instance, it would certainly be worth a letter (after they have failed to remedy the breach or after you have terminated for persistent breach) stating the exact breaches, the exact amount of the refund that you require and the exact date by which the requested refund must be paid or you will take legal action. If they fail to reply to this letter and provide a refund, a solicitors letter restating the same may bear more weight. But ultimately, the supplier can refuse to pay up unless you take them to court, persuade the court of the breach and obtain an order for the supplier to pay you back.
You would need to consider whether it is worth the cost and effort to obtain a solicitors letter and take the matter to court, in light of the amount of the refund that you feel you are due.
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The information contained above is provided for information purposes only. The contents of this article are not intended to amount to advice and you should not rely on any of the contents of this article. Professional advice should be obtained before taking or refraining from taking any action as a result of the contents of this article. We disclaim all liability and responsibility arising from any reliance placed on any of the contents of this article.