Phoenix business agents again

[Ragingball]

Hello to everyone,

My first post concerns Phoenix business agents about which, much seems to have been written already, both here and on other forums.

I personally signed a contract with them as a director of my company in October 2010.

My company was invoiced and paid £1700 in marketing fees.

 

In February 2011, I decided to leave the company and agreed with the remaining director to leave the contract in place.

The contract was for 1 year and gave them sole selling rights.

 

In July 2011, I received a letter from them informing me that, despite the fact I knew they had interested parties I had failed to contact them and I was therefore in breach of contract.

It was true that I had changed my mobile phone number but they had not contacted me on my home phone, email, or by post.

 

I phoned them immediately and I was told that they had found out I had resigned my position.

Because I had signed the contract they stated it was to me only that they could introduce buyers and because I had left the business that was now impossible.

 

They ignored the fact that the company still wanted to sell and refused to deal with them.

They advised that I pay the cancellation fee of £3000 to terminate the contract.

I refused to pay the cancellation charge and tried to get them to enter selling negotiations with my old business as they were contracted to do

but they ignored that and issued me with an invoice for breach of contract for £6000 +vat.

 

Since July 2011 they have had credit agencies threatening to take me to court within 48hrs of the debt not being paid etc which I have ignored.

My own solicitor has told me that court proceedings are now likely though because they have engaged a solicitor

 

.He states that because I have been unwilling to compromise they are going to issue proceedings.

 

This agency seems to jump on to any excuse to issue a charge: valid or not.

I believe much of their revenue comes from this very practise.

 

I would be very grateful for anyone’s thoughts or experiences on the above with regard to this agencies practices

 

and the likely outcome of a court case.

Thank you -

[dx100uk]

so you are getting letters from which dca?

 

dx

[Ragingball]

Im sorry, its all new terminology to me -dca?

[dx100uk]

sorry you indicated you had read a bit onthese people

 

who is sending these letters wanting the money

 

debt collection agencies?

 

dx

[Ragingball]

Thanks dx,

 

yes, originally the letters were from debt collection agencies,

i have been told that they have been 'called off 'and now been informed the matter is with their solicitor.

 

Because their solicitor has asked mine if he is authorised to accept service on my behalf it looks as though they are prepared to go to court ?

 

This could just be a bluff of course as they are always pushing me to negotiate a compromise.

 

They have been to court with another business and lost that case (that case appears in another thread on this forum -search 'Phoenix agents').

 

 

tb.

[dx100uk]

i think you've hit the nail on the head here

 

offering a discount..typically means they know they have no chance!

 

wind 'em up

send them the text of that thread!!

 

hehe

 

two can play at phsyco stuff

 

dx

[testament1uk]

Hi Ragingbull -

- This company have a contract with solicitors and will sometimes venture to go to court but in your case it seems unlikely.

 

The defence used in the case mentioned on the other thread was a defence of Unenforceable Penalty Charge for contract breach.

The judge will ask Pheonix to quantify their loss and as they had already stated in the contract that they took payment for administration / marketing

they will have to prove that your breach caused them to ACTUALLY suffer a loss.

What is that loss,

you've already paid upfront for marketing and therefore they must present the judge with a GENUINE PRE ESTIMATE of loss.

 

The solicitor at the prior hearing could not produce anything other than the marketing costs

- the judge dismissed their case as these had already been paid and the £3000 was defined as a penalty!

 

Remember in small claims hearings neither party can claim for the cost of a solicitor so its a huge gamble for anyone taking a solicitor.

Write to their solicitor and tell them you will defend on the basis of "unenforcable penalty" as not a "genuine pre estimate of their loss".

 

As you've been told

- when debt collection companies offer you a discount is usually means that desperation is setting in!

If its just debt collection letters from a debt collector then ignore them.

 

If it does go to court you can post again and get help but I doubt it will go that far.

[Ragingball]

Hi Testament,

 

Thank you for the advice.

My case might be a little different from the one mentioned although, perhaps the same applies ie. an unenforcable penalty.

The debt collectors have been called off and we are now receiving letters from their solicitor.

[Ragingball]

I seem to have hit the 'post reply' button by mistake -Apologies.

 

- further to the last post and to continue where i left off...

 

Their solicitor is now saying that they intend to go to court.

 

They have asked my solicitor if he is to accept service on my behalf.

A sign my solicitor takes that they are serious.

I resigned my position while the phoenix contract for sale was still in place.

My ex partner (who authorised me to sign the agreement) was willing to continue and it was intended that i would profit from the sale.

 

As soon as phoenix found out that i had resigned

they tried to get me to pay the cancellation charge.

 

When i refused this they issued a Breach of contract charge.

 

The invoice is for £7200 so is now out of the small claims court.

 

I have told them that the sale can continue in the hands of the existing director

but they say they cannot deal with him as it was I who signed the contract.

 

From what you have said (testament) the judge in your case ruled there is no personal contract where a business to business is concerned.

 

My solicitor has also told me what they have said about not being able to deal with the company now has no basis in law.

I believed I signed the contract on behalf of the company and the company duly paid the marketing invoice.

 

All these points are well and good but as many have found before it is the costs and risk associated with county court action

that appears to be the problem for most people.

 

Kind regards,

 

tb

[testament1uk]

Hi tb

 

Yes the whole thing gets a little more scary when you get out of the small claims arena

and paying their solicitors costs would not be good if you don't win.

 

But the fact still remains they will have to prove that the £7200 is an actual loss and not a penalty for cancellation.

 

Which solicitors are they using?

 

The case I referred too was due to the cancellation of the contract after the initial first six months.

The circumstances of the cancellation are not really relevant...

.the judge will stick to a point of law and that will be

...is the £7200 a genuine pre estimate of loss.

 

I would ask their solicitor to send you a breakdown of the what the £7200 consists of

and state that you will consider the matter on receipt of such a breakdown.

 

Don't mention the pre estimate of loss.

If they aren't able to give you a valid loss breakdown for the amount then continue to challenge

- and oops you have a nice little bit of evidence to put before the judge!!!

[testament1uk]

In the case I mentioned they were trying to sue for £3000 and presented a loss estimate which came to about £1765. The judge wouldn't even award that amount as this did not match the £3000 which then makes the £3000 a penalty. So the other side have to provide a calculated loss breakdown equal to £7200 - I'd like to see that!!

[Ragingball]

Thanks for the replies.

It just happens that their final selling fees are also £7200 so they might try and say that they lost the sale due to my failure to complete negotiations?

Incidentally, their solicitors are a company called Widdows Pilling of Manchester.Ring any bells ??

 

tb

[testament1uk]

Widdows Pilling are one of the two they normally use - the £7200 needs to reflect an actual loss, had negotiations already begun for a sale?

[Ragingball]

no negotiations had begun,

I think what happened was that they got wind of my resignation

and then conveniently 'found' some potential buyers which they said were then unable to introduce because I had left the business.

 

They said that they had to go through me because I signed the contract,

a point which I think is completely wrong anyway as I believed I had signed for the business.

 

I have never seen or heard from anyone regarding possible buyers before they told me I was in Breach of contract.

My mobile phone number had changed but they had all my other contact details:

email, home address and home phone and yet they said that 'despite the fact I was aware they had interested parties i had failed to contact them'.

 

When you say that the solicitor is 'one of two they use'

do these cases always end up in court?

 

I would have thought that the way they conduct business

and the amibiguity of their contracts would mean they lose quite a lot ??

[testament1uk]

The main franchise owners provide the franchise with two solicitors - probably covering UK North and South,

 

are you in the north?

as part of the franchise package the solicitors will take on cases

but are given the green light by the actual owners.

 

So in your case I presume that the head office will have to give the go ahead for such an action.

[Ragingball]

Strangely I am in the South so i'm not sure why their solicitors are from Manchester?

I havent replied earlier because I have been issued with court proceedings -so now the fun begins.

I am putting together what I believe to be a very strong defence but would appreciate any more information from anyone out there -including advice on 'Litigant in person.

Thanks.

[legalhelp74]

Strangely I am in the South so i'm not sure why their solicitors are from Manchester?

I havent replied earlier because I have been issued with court proceedings -so now the fun begins.

I am putting together what I believe to be a very strong defence but would appreciate any more information from anyone out there -including advice on 'Litigant in person.

Thanks.

 

Hi Ragingbull,

 

I am assiting two peope in the South who are being pressured by Phoenix to pay 'cancellation fees' even though no sale was concluded

and indeed there is no evidence of efforts to sell.

 

The terms discussed by the sales person (cold calling) were completely different to the terms put down in the contract.

 

We are going to argue on the penalty clause basis but if you have any other info,

or want to exchange details do let me know,

as the two people I am assisting would be more than happy to assist others

and provide witness evidence to verify their conduct

and way they going about their business and inducing people to sign the agreement.

[disgruntled23]

Hello all...

Have been reading this thread thoroughly,

no disrespect but I'm kinda glad I'm not the only one out there that's being threatened..

. I'm a bright chap but I'm seething that I can have the wool pulled over my eyes so easily,

I guess this is why these peeps are still in business and we're all struggling

 

I actually approached Phoenix business agents about three years ago

- I had a little cottage industry that I had fun out of and thought that someone else with bigger ideas may be able to take it somewhere further.

 

The main man came to see me and offered to waive the marketing fee for three months as I was skeptical,

I didn't have time to read all the small print and signed my life away not realising the £3000 cancellation fee etc etc,

 

after 3 months I got a letter stating that if I didn't pay the £750 markeing fee within two days, I would have to pay the full £3000

- I had to borrow money off a friend for this and I though that was the end of it

 

- About a year ago they called to ask if I would consider lowering the asking price for the business

which, when I initially suggested taking it off the market they told me about the £3000 termination fee

- I agreed to keep it running and lower the price...

 

Today I have received a letter saying that if I don't send them my accounts for the business within 7 days I will be in breach of contract..

. While I do still have stock, I don't have any accounts as I've not had any sales and just a few expenses here and there

- It looks to me like they are looking for any excuse for me to be in breach and not them

 

If any of you could lend me some advice I would be most grateful as I don't have a solicitor and can barely afford one

- I don't really want to go to court but would like to know my likelihood of winning if I did,

the other option would be bankruptcy as I am a sole trader and don't have much in the way of savings,

just all seems like a lot of ball-ache for what felt like a good idea at the time

 

Thanks all

[Ragingball]

Hello to everyone getting involved with this thread,

 

I cannot pm anyone just yet as i have not posted enough

but can anyone suggest a way that we can communicate without 'hanging out our washing' for all to see?

 

I am quite happy to exchange info with interested parties and the idea of strength in numbers seems a good one.

Of course, by the time we need to group together like this its a little late and as Testament says,

we need to read and understand the contracts fully in the first place.

 

The more trusting folk (naive?) amongst us assume that we are dealing with straight people though.

We expect them to make honest efforts to sell and i believe most of us 'read over' the cancellation fee etc

because at point of signature we would see no reason to cancel within a year.

 

I hope threads like this will enable potential clients for this business to see the light before this happens to them.

 

I seem to be heading for court,

unfortunate as this is,

my experience will provide valuable info to anyone finding themselves in this position.

 

This company seems to thrive on their clients reluctance to enter the legal arena and the associated costs.

I confess i was petrified when i started but I am so up for the fight now!

I have what I believe to be good council around me from business people and others who have been to court.

I will be litigating in person to keep my costs to a minimum.

 

Others should look up previous threads from Testament who has been through court with this company and offers good advice.

I am about to present my defence to the court for allocation so, the likely date of an actual court hearing is June /July?

 

There must be others who have been to court with this company.

 

Testament belives they use a couple of solicitors which indicates that they go to court quite a bit

or, perhaps that the threat of a solicitor is enough for most to cough up a 'settlement fee'.

Its my opinion that their solicitors are on a retainer;

they go through the motions and in the majority of instances this is enough to get some revenue.

 

Disgruntled23-

You dont seem to have been in breach of anything yet.

Can't you just send them anything in the way of books?

You are a sole trader and it doesnt matter that you havent done much.

 

They are trying anything on and the fact that you paid up £750 at a later date probably makes them think you will pay up again.

You have paid a marketing fee, see out the contract date whichever way you can.

 

The defence of the cancellation being a penalty fee seems to be very strong though so dont fret too much.

[dx100uk]

can i suggest one of you start a yahoo group

 

but MAKE IT PRIVATE!!

 

invited members only.

 

dx

[legalhelp74]

Has anyone been able to set up a yahoo group?

 

Any updates on peoples cases would be useful.

 

For the two I am assisting with we have not heard anything for several weeks

 

so guess we will just ride it out at this stage and respond if they (or their 'solicitors' get back in touch).

[Insider11]

Hi Ragingball,

If you need any witness against that evil company terrifying lots of people around I'm ready to help.

I've got enough evidences about rip off manners this cowboys.

[Gothikdesigns]

Hi there,

 

I did not pay any marketing fees and it states this on the contract. Do you know where I stand with regards to classing the 3000 as a penalty fee?

 

Thanks

 

Hi. Did you get sorted out? They LOST in court. See other page of thread.

[NCH]

Hi this company is pestering me and I need some help tackling them as they don't stop harassing me. How do I get them to stop asking for a fee of £7550 which they are not entitled to or agreed to. Please give me some advice on what to do. Many thanks

[dx100uk]

Originally Posted by testament1uk

I have previously posted on the subject of Pheonix and have been to court and successfully defended a claim.

 

 

PheonixBusiness Agents v S Wynn (2012) CASE No. 1SE02571 - Walsall county court

 

 

I must point out that it is not a good idea to try and defend this on the basis of any consumer laws as these do not apply in the case of Pheonix contracts.

 

As was made clear in the case I defended, all contracts are not between a business and a consumer, as in every case both parties to the contract are in fact a business. Therefore the contract is made between two parties on an equal footing. The judge in my case stated very clealry that when two equals enter a contract they may give away their rights within the terms of the contract and therefore tests of fairness do not apply.

 

The only good defence is the same defence used in "Private parking ticket" cases.

 

I used the same defence supplied by some great members of consumer action group to win this case.

 

That a charge for breach of contract must be a "GENUINE PRE-ESTIMATE OF LOSS"

If IT IS NOT it becomes a penalty and is uneforceable in law.

 

I am not a solicitor - Pheonix came with a solicitor who in private chambers told me I didn't have a chance. BUT using the following case, the judge threw out the Pheonix claim:

 

"OB Services V ThurlowWorcester Combined Court 10 February 2011".