Contract laws

UPDATED: Oct 1, 2022

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Contract laws

I was pressured to sign a contract with a marketing company to represent my online store. I told them at the time of signing it I wasn’t ready to start services but they said to keep them in the loop when I was. The owner of the company has been threatening me ever since that I signed the contract and need to pay for the services even though they’ve never done any business for me. Now he’s saying that he’s going to add a late fee clause in the contract because he’s not being paid. Let me reiterate they have never done any work for me because the first payment was to start services, which I haven’t been ready to do. Can they really take me to small claims over a contract where they’ve never done any work for me? And can they add fees to a contract even though they weren’t included when I signed it?

Asked on November 20, 2017 under Business Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

If "the first payment was to start services" and you have not made that payment, then you, not they, are in breach of contract: what you describe appears to be that you had an obligation to make an initial payment, *after* which they would provide service. (If this is not the case, please repost your question, clarifying this point.) Therefore, their failure to provide services is at present irrelevant, since they would not have to do so until you paid; and furthermore, if you signed a contract requiring an initial or first payment, you contractually--that is legally--obligated yourself to make that payment. If you fail to make a payment called for a contract when the other side did not first breach or violate its obligations, you are in breach of contract and they can sue you for the money due under the contract, including any late fees or penalties or other amounts the contract says they can get in this case. It doesn't matter if they have not yet started, if you had to pay first.
If you signed a contract, you can't change your mind: you have to honor the contract. And similarly, you can't just say you are not ready.
In the future, even if a salesman pressures you, do NOT sign any contract unless you are in fact willing to go through with it as it is written.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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