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Legal problems after starting new employment, formerly a contractor

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    Legal problems after starting new employment, formerly a contractor

    Hello All,

    Firstly, sorry to be asking for advice on my first post. I normally like to be part of a community before asking for advice. But i found you guys after searching for answers to my issue last night. So, i thank anyone for reading and offering up any thoughts or advice.

    Summary before reading

    Old company i contracted for stating work not completed, and currently not near completion, asking for full refund, even though they received items 100% complete, and now handed to the final user. No paperwork in place between the two of us. Items picked up as complete about 3 weeks ago, spoken to them several times since then and no mention of this problem.

    Original Work Setup

    Limited company
    Providing a service to one other company exclusively
    Building drone aircraft for the movie industry

    A customer would contact the other company, this is then forwarded to me, i would quote for the job to the customer, including parts, and build fee etc

    If the job is to go ahead, the other company then orders all parts and ships to me, i build the aircraft and then deliver it to the customer.

    The other company took the markup on parts and 50% of the build fee for each aircraft.

    I would then invoice at the end of each month for my part of the build fee, and be paid direct from the company.

    Particulars in place

    None!

    No contract, or agreements between me and the other company.
    Had never met in person
    Conducted entirely via email and occasional telephone call.

    The Problem:

    I got offered a job about 6 weeks ago, which was a dream job, so i snapped it up. I then gave the other company notice i was leaving. As good will i stated i would complate any builds in progress, rather than just working a weeks notice.

    Once the old company realised in my new employment i would still be doing a little work in connection with the old industry everything turned messy. And they requested all the builds back, stating they would complete any work required and i should enjoy my new job. With no mention of finances.

    At this stage i was owed money from them, but decided to leave it, and try and forget about the old company as they had been doing a number of tactics in order to muddy the waters in my new employment. which did not work.

    Current situation

    I now have a demand for them for nearly £3000 citing 3 builds that where not complete. In fact the words used on the 22nd of December "currently no where near completion". But i have been in contact with the potential owners of these new aircraft who have stated they have had them for over two weeks complete and working.

    In fact i have been helping a number of the old clients via email, as they have reported the old company is now not offering them any after sales support.

    I could understand the old company trying to claim 1 or 2 hours per build for testing and finalising of the hand over, but to ask for the whole build fee back, stating the aircraft was not built. Even though they have delivered it and taken full payment for it, seems a bit much to me.

    Another good point, is about two weeks ago, after they had received the aircraft back, they sent a demand for around £600, for various bogus reasons. The fact that they did not ask for the near £3000 then seems strange. In fact this current demand only comes after i point out they still owe me £1600.


    Advice needed:


    So i am looking for any pointers of where i might stand, several people have stated they would not have a leg to stand on in court if they went ahead with legal action, and they are trying to scare me into paying. I am also currently owed by them £1600, which i was willing to leave.

    I also know of a couple of occasions the other company director has performed VAT fraud, with written evidence via email from him. I was contemplating asking him to stop any action, or would report him for this, as i am sure there are other occasions. But i worry that this could make things a whole lot messier.

    There are other bits and pieces of info to this, but the above sums it up.

    In summary


    Old company i contracted for stating work not completed, and currently not near completion, asking for full refund, even though they received items 100% complete, and now handed to the final user. No paperwork in place between the two of us. Items picked up as complete about 3 weeks ago, spoken to them several times since then and no mention of this problem.

    I suspect i could state, please then return the work to me to complete, which they cannot do as it is now with the customers. Would that put an end to it?

    Again, thank you for reading, and look forward to any pointers.

    #2
    Sorry for the simplistic response to your long mail but until you see something from small claims, legal person or anything that indicates they are taking this further you just ignore all the bluff and bluster and see if it goes away. People don't really like to spend money to claim amounts such as this back and with no paperwork to back up their story they will realise pretty quickly if they do try small claims or something they have no evidence to put forward.

    Send them a mail saying you believe the issue is closed, thank you and goodbye. Ignore everything else until something with some substance comes though, which it probably won't.
    'CUK forum personality of 2011 - Winner - Yes really!!!!

    Comment


      #3
      Hi Northernladuk,

      Thanks for the reply and advice. it is appreciated. I know it is a small amount, compared to what a lot of people may deal with, but just wanted to check. So you would not even reccomend a long winded letter back to them countering there points and figures?

      Just an email stating i received it, but that i beleive the matter is closed, goodbye etc

      I had also received advice from a friend. Saying as they took away my ability to complete the work, they can also then not request a refund without giving me a chance to complete within the agreed time frame, which still has weeks to go.

      I pretty much new the letter was rubbish, but this puts me at ease a little.

      Thanks again.

      Comment


        #4
        Firstly do as NLUK says.

        Secondly is your limited company still open?

        If so you need to get it closed asap. They cannot pursue you personally as long as all payments they made were to the limited company not you as an individual.
        "You’re just a bad memory who doesn’t know when to go away" JR

        Comment


          #5
          I now have a demand for them for nearly £3000 citing 3 builds that where not complete. In fact the words used on the 22nd of December "currently no where near completion". But i have been in contact with the potential owners of these new aircraft who have stated they have had them for over two weeks complete and working.
          They´re trying it on. If you can get this in writing you can shut them up.

          You might point out that if they´re claiming the aircraft don´t work when they do, this is a fraudlulent claim.

          Don´t pay a penny.
          Last edited by BlasterBates; 23 December 2012, 18:28.
          I'm alright Jack

          Comment


            #6
            Thanks Northernladuk. I feel better about the situation now. A simple reply is fine, as it means the matter is more clear cut. Would an email suffice saying i beleive the matter to be closed. Also, that i would like for no further personal communication from him. But that i would of course reply to any matters brought to my attention by his legal representitive or by a court. Then forget about it?

            Originally posted by SueEllen View Post
            Firstly do as NLUK says.

            Secondly is your limited company still open?

            If so you need to get it closed asap. They cannot pursue you personally as long as all payments they made were to the limited company not you as an individual.
            The limited company is indeed still open, it was only opened for this purpose. All invoices to them are in the company name, but all payments were made to my personal name. So i am not sure if it will help to close it.

            Blasterbates:

            Thanks for the advice and info. Yes this is one of the main points i am annoyed with. They have done similar actions over other matters. Including telling the clients i was let go, rather than i had handed my notice in to move on. But this was quickly cleared up as i mass emailed all past clients giving them my new contact details at my new employer.

            I do indeed have there comments about the aircraft in writing, so they have not thought through this whole plan as it is easy to counter.

            Again, thanks everyone. I will get one with letting the other party know i see this matter as now closed.
            Last edited by neutrino; 23 December 2012, 20:10.

            Comment


              #7
              In future if you ever work as a contractor again make sure every single payment is in your company name and to your company bank account. More so when you don't have a clear written contract.

              Limited companies have limited liability however if you put yourself in the mix like now you are opening up yourself to getting CCJs or worse.

              Oh and good luck.
              "You’re just a bad memory who doesn’t know when to go away" JR

              Comment


                #8
                And don't open yourself up to blackmail claims by putting in writing threats to report to the VAT man. Either report him, or hint towards it to the company owner without any written proof if you think you need it.

                Comment


                  #9
                  Thanks to both of you. Yes i learnt a lot on this one. Didnt look to cover myself explicity as all was peachy. But have learnt that even the best relationships can turn sour if one side feels put out.

                  Agree on the VAT side of things, i will either quietly report it if the company still tries to be hostile. Or just forget about doing that as i know now i shouldnt be to concerned with there initial letter. So most likely i will forget about it.

                  Comment

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