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contract interpretation

Discussion in 'Business Fundamentals' started by OneBadDodge06, Dec 10, 2004.

  1. OneBadDodge06

    OneBadDodge06 Senior Member
    from Iowa
    Messages: 734

    Ok guys I need some help on this. I can't decide if I had some accounts of my own that they would become this guy's accounts under this contract provision. What do you think???

    It is understood that The Company has a large number of accounts in which it has done work over the past years and that it is continuously engaged in advertising and sales promotions in an effort to acquire new accounts. Therefore, all accounts for which work is done are accounts of The Company. Contractor may solicit new accounts for The Company. Such new accounts will be accounts of The Company even though there were procured by Contractor. Contractor will receive a commission for all new accounts secured by him, which commission will be equal to 5% of The company's gross bilings to that account for the first year. The commission wil........ :confused:
     
  2. glenspot

    glenspot Senior Member
    Messages: 255

    Sounds like all your accounts become those of "the company" if you do work on them.

    To me, it sounds like you are no longer a sub, or self employed.....but that you work for them ... on a commision basis.

    That paragraph would scare me away.

    Glen
     
  3. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    Therefore, all accounts for which work is done are accounts of The Company. Contractor may solicit new accounts for The Company. Such new accounts will be accounts of The Company even though there were procured by Contractor. I] :confused:[/QUOTE]

    Yes, they would become "The Company"'s accounts. And any future accounts you get.
     
  4. ciapek

    ciapek Member
    Messages: 43

    Company

    Is it ASPEN Landscaping???
     
  5. Kramer

    Kramer Senior Member
    Messages: 386

    As Monty Python would say.....:Run Away!, Run Away!". :redbounce
     
  6. OneBadDodge06

    OneBadDodge06 Senior Member
    from Iowa
    Messages: 734

    Naw its some guy that does parking lot maintenance during the summer here in DSM. My dad thought the same thing you guys did but I figured it wouldn't hurt to get a second opinion. I guess I could call him back and see if we could work something out. It also says that I can't compete as an employee, subcontractor, contractor, or in any other capacity by providing these services which are subject to the Company's customer's for a period of two years after termination.

    Does any contractor usually pull this kind of crap??? :angry:
     
  7. bobingardner

    bobingardner Senior Member
    Messages: 136

    I interpreted your original post differently. The use of the word "may" suggested to me that you could still take on accounts separate from "The Company" and he was only trying to protect his current client list. But that non-competitive clause is crap! He can protect himself without putting you out of work for 2 years.
     
  8. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    I'd say the use of word "may" means you can continue to solicit accounts if you want. But if you do, they become The Company's accounts and you would get a "finder's fee".
     
  9. bobingardner

    bobingardner Senior Member
    Messages: 136

    I can't argue with that. That's why things like this end up in court because the English language is imprecise. I was reviewing a will my mother had made up and I had to ask the lawyer to explain a few Latin words and phrases. I then asked why he didn't just say it in English and his explanation was that these words have specific meanings whereas the English counterparts are subject to interpretation. I don't see anything in the first part of the contract that explicitly prohibits the subcontractor from keeping his own accounts. It simply says he "may" get accounts for the "The Company". OK. He may also get accounts for another company. It wasn't until I got to the non-competition clause that I viewed the previous part of the contract in a different way.
     
  10. plowman350

    plowman350 Senior Member
    Messages: 125

    You're free and clear!

    Here's why:

    Part of being classified as a sub-contractor means that you are "for hire" and may hire yourself out to multiple companies. Someone who is an employee may only work for his 1 employer.

    Being that you're a sub, you have to be able to sell your services to another contractor (company). Therefore, your own company or any others may procure your services. How can you sell your services to (through) another company if you're bound to an agreement which releases all of your customers to the one employer? If that's true, you cannot be a sub-contractor under his "sub-contractors" agreement and he must treat you as an employee on payroll!

    Let him try explaining why his subcontractos agreement forces you to be treated as an employee, and yet he hires you and saves a few bucks by calling you a sub!

    Anyways, he can't take YOUR clients if you're advertising on behalf of yourself. He can't even take clients you obtain while working on his "clock" unless you are specifically representing HIS company when selling the service. Reason this is true: as a subcontractor, you are working independently. He has no right to control your actions or methods. He can only contract what is expected and when. He may not limit what else you do during your time. For example, you can sub for 2 contractors at once, and intermingle your route to make it more efficient, as long as you satisfy the production and time requirments of each contract, the order you complete the work makes no difference.

    Anyways, this guy is trying to put the chains on, which voids the fact that you're a subcontractor under his "subcontrator agreement!"

    Sorry this got so long....hope it is more clarifying than confusing.
     
  11. plowman350

    plowman350 Senior Member
    Messages: 125

    revised

    I re-read my ramblings and just wanted to clear up 1 thing.

    A contractor may still prevent you from taking HIS clients away that you encountered while doing HIS work. He cannot however prevent you from obtaining new customers, exclusive of his customer list.