Legal Period for Claim

[Guest]

I provided business services through my LLP (I was the sole provider of skills) for 5yrs. The contract referenced that a % Gross Margin Share (of the business I built for them) would be paid. The schedule defining the detail was never provided though the intention was that 10% of all Gross Margin for my business sector would be paid to me. Indeed it was for 5 years. I invoiced a retainer and then the Gross Margin amount once a project was complete. Over the 5 years I built their business they always paid.
I secured a lucrative 5 year maintenance and support contract for the business. The CEO insisted that this was exactly the type of business required but I could not invoice until after the contract was concluded in order that they could calculate the Gross Margin they made. I was not happy but he would not budge, and had always paid every GM invoice presented over the 5 years.
The company merged the department, I was building business for, into it’s wider business, no new entity just absorbed, *but wanted to keep the lucrative maintenance contracts I secured running, just. The contracts had all closed by Feb 2019.
I have not had time until now to pull emails and meeting transcripts together but I have some basic questions that I’d really value comment on.

1. Given they told me to provided no more services to the business, though the service contracts were secured well before this, and I have email and transcript confirming that I would be paid the GM entitlement only after the service contracts had closed and they’d had opportunity to calculate the GM due. I’ve heard nothing and expect slipperiness when I write asking them for their confirmation of the GM in order that the invoice can be raised. (The CEO left 3 yrs ago) and new people are now running the business, but their business has had the up front benefit of significant margin for little effort from these service agreements. What is the best approach to ensure they take this seriously?
2. If they produce a contract with no definition of what is paid by way of Gross Margin or when, can I rely legally on the precedent that I never secured any business for them that was not paid GM – there is a 5 yr record of this. Therefore this service GM is due, plus the confirmation from their then CEO - is this adequate evidence of intent and the monies are due?
3. I think there is a 6 year window to bring a legal case? If so when does that clock start ticking, from when the moneys would have been due, ie March or from when I stopped providing services?

Thanks in advance. I would appreciate any thoughts/advice/strategy I can consider for my next steps.

[Amethyst]

It will be from the date payment was due. Have you invoiced the company or requested the calculations so that you may invoice ? Any terms in your contract about period for payment / calculations etc ? Do you have a schedule from the previous contracts that were paid on the same terms ?( ie balance of probabilities this would be the same)

[MJ1]

It will be from the date payment was due. Have you invoiced the company or requested the calculations so that you may invoice ? Any terms in your contract about period for payment / calculations etc ? Do you have a schedule from the previous contracts that were paid on the same terms ?( ie balance of probabilities this would be the same)

Thanks for this.Originally I wrote to them asking for all payments, including the service, they stated that they did not believe anything else was due

My next step (subject to advice is to write again, saying that I have given them sufficient time to correctly calculate the GM and accrue and request their calculations in order that I can present the correct invoice. I only ever had one contract with them. The terms, apart from retainer were, 10% of the Gross Margin to be paid to me against each customer contract closed


I only have the email from their CEO (now left), stating that I could not invoice the service contract GM amount until the 5 year customer service contract finished in order for them to calculate the actual gross margin on which to base the payment.


My original contract with them referred to a schedule that would define the gross margin for all business generated. Emails were sent, no schedule was ever produced, but the company paid 10% of GM as per their emails to me. I invoiced against this for over 5 years, probably >50 invoices from me to them for each customer contract, all apart from this last one were paid without issue.

Importantly it sounds like I have time, as the 6 year clock only started ticking from when the GM payment became due, ie March 2019.