Reply to: Agency have put wrong daily rate on contract and have only just noticed...2 months in

[AnthonyQuinn]

Forget what you had verbally agreed. Pretend it never happened.

Dont even pick up the phone from the agency. Let them fix it how they can.

[northernladuk]

And a good lesson you won't forget?

[contractmonkey]

UPDATE: OK, finally all resolved. I eventually got to the bottom of the rate % and I was given duff info. Strange that from an agency :-)

By the time they got it all sorted they had overpaid me £4800. I negotiated a reduced amount to pay back of £3300 for my inconvenience. Paid back over 3 months.

Contract just extended for another 3 months so a win win.

[measterbrook]

History:

I started a 6 month contract 2 months ago and had agreed a rate (x) with the agency. When my contract came through it was rate (y) (an additional £100 per day.) The agency have effectively put the client rate down that they are charging me out at rather than what I agreed with them. The agency and I signed the contract and they have been paying my rate (y) for the last 2 months. However, they've just realised what has happened and are now panicking.

I'm looking for people's onions here. I figure my options are listed below. I don't want to hear the usual "you agreed a rate with them blah blah blah," I'm interested in what you think of my options / questions below and if you can think of any others :-)

Option 1
The honest part of me says let them re-issue the contract, we come to some agreement about me paying back the extra money and leave it at that.

Option 2
They re-issue the contract, write off the difference between rates as a gesture of good will and I carry on with a new contract.

Option 3
Screw them. They made the mistake and I reap the rewards. Not sure if they could make my life difficult with the client though. Can the agency give me notice or does that have to come from the client?

Option 4
Get the agency to cancel the contract and go direct with the client at a new improved rate for both client and me. As it would be the agency cancelling the contract would that mean this is a workable option?

Thoughts, comments, suggestions welcome.

Point out the mistake. Ask them to send you a corrected contract for signing. Issue the agency with a credit note for the overpayment so far. At renewal you know their margin so you can bargain hard.

[Bee]

Reissue the contract with the agreed rate and pay the money back.

History:

I started a 6 month contract 2 months ago and had agreed a rate (x) with the agency. When my contract came through it was rate (y) (an additional £100 per day.) The agency have effectively put the client rate down that they are charging me out at rather than what I agreed with them. The agency and I signed the contract and they have been paying my rate (y) for the last 2 months. However, they've just realised what has happened and are now panicking.

I'm looking for people's onions here. I figure my options are listed below. I don't want to hear the usual "you agreed a rate with them blah blah blah," I'm interested in what you think of my options / questions below and if you can think of any others :-)

Option 1
The honest part of me says let them re-issue the contract, we come to some agreement about me paying back the extra money and leave it at that.

Option 2
They re-issue the contract, write off the difference between rates as a gesture of good will and I carry on with a new contract.

Option 3
Screw them. They made the mistake and I reap the rewards. Not sure if they could make my life difficult with the client though. Can the agency give me notice or does that have to come from the client?

Option 4
Get the agency to cancel the contract and go direct with the client at a new improved rate for both client and me. As it would be the agency cancelling the contract would that mean this is a workable option?

Thoughts, comments, suggestions welcome.

[ImaginativeTruth]

Contract

So, lots of opinions and advices - here is mine.

1. In law, the terms of your agreement are contained in the four corners of the contract. Therefore the rate is not 'wrong' - it may be different to what was contained in correspondence, but that is not relevant (see below).
2. If the the tenants of a contract are not met - capacity, intention, offer, acceptance, consideration then the contract may not be fully valid, or invalid in parts. I don't see how this would arise as it has been 'performed' on.
3. It could be argued that the other party had no intention to enter into a contract at a rate different to that contained in correspondence, however on this point I refer you to (1). You could argue they are simply seeking to exit a contract they regret signing. Regret does not carry in law. Also, see (4) below.
4. Custom and Practice - you have a written valid contract, and both of you have completed 'specific performance' of it for a period of time, if it were argued that the contract is 'wrong' on the basis of intention - you could counter argue that they and you varied the contract by custom and practice - carrying out a change / variation of terms for a period, without either side issuing notice of breach.

PS Purchasing items offered for sale is not legally in the same contract position as the above. In the case of a TV on sale for £100. This is not an 'offer' that you can 'accept' and therefore complete the contract. It is an 'invitation to treat' - that is, you are invited to offer £100 for the TV in which case the seller 'accepts' your offer.

[northernladyuk]

And if I do see TV advertised online for £1, exactly how do I verify the advertiser's intentions?

They will clarify their intentions themselves when they cancel the order and refund your £1.

[SussexSeagull]

So if it has been two months you have presumably been paid one invoice and put in another? If so as others have said I would be questioning their margin (unless you are on £1,000 a day or something) and trying to get a new rate.

As in no small part the mistake was on their part I would tell them you will make an adjustment on the next invoice and not just hand them the money back on the spot.

Give them a bit of an incentive to keep you working at the client as well.

[billybiro]

Wrong.

If it's abundantly clear the price was a mistake and not intended to be marketed at that price ( ie website showing HD TV for £1 ) then the price is not legally binding.

And if I do see TV advertised online for £1, exactly how do I verify the advertiser's intentions?

[billybiro]

but it would appear the OP knowing there has been a mistake in the contract

And if OP never admits to "knowing" about the mistake?

[MrMarkyMark]

IMO you are missing the best option.

100 quid sounds like a very high markup to me. Why don't you negotiated a better rate, let's start at 50 on your rate, maybe accept 25 quid. You offer to give them back the difference from the last 2 months ad a gesture of good wi and then continue on the new rate. They get more than enough and you actually make more over the whole engagement than you would squabbling over two overpayments you weren't really due anyway. You win, they win(ish), client need never know and your contract isn't at risk.

This, given the mark up was so high.

I certainly wouldn't be suggesting to them I keep any of the extra they have paid so far.

[northernladyuk]

Thinking this over it is Option 1. Are you trying to run an honest business that gives fair value to your client?

[psychocandy]

Hmmm. If you knew it was wrong (or do now) I can't see how you can tell them tough? Best to get would be option 2?

But as someone said, now you know their cut......

Completely different to the old scam where you agree rate, get paid it for three months, then they try and claim it was a mistake all along. Yeh right - heard that one once.

[WordIsBond]

What a stupid move.

They handed you, on a silver platter, the information of what their percentage was. You could have used it to your advantage. You could have said, "You've made a mistake but now I know what your cut is, seems a little high to me, don't you think you should be giving me another £25 / day?" You could have just sat on it until renewal and said, "You've been doing very well by me, £100 / day, that's too high, I want a £50 / day increase."

Instead, you raised a false invoice, or two, well knowing it wasn't the rate you'd agreed verbally.

They may not be able to prove in court that you verbally agreed that rate, but they know it. They know exactly what you've done. And they probably suspect you've done it intentionally, and if you try to play games here, you're a dead man walking, they'll terminate this contract and tell the end client you raised false invoices and are trying to avoid paying the money back.

Pay the money back. Ask them today to issue a corrected contract and tell them you can either pay them a refund today or just put a credit on your next invoice, whichever is easiest for them. Get it done. Somebody's finger is almost certainly hovering over the nuclear button to nuke your contract, depending on how you respond.

[northernladuk]

But as you say, may not be relevant as this is b2c

So no its not but thanks.