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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Business Law
Satisfied Customers: 88858
Experience:  All corporate law, including non-profits and charitable fraternal organizations.
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Hi, hope you can advise me.I have a contract which ...

Customer Question

Hi, hope you can advise me.

I have a contract which commenced on 1st April 2007 and ends today 31st May 2008.

There is an Additional agreement in the contract copied below (I am a consultant employed on a Food factory contract in Iran by a company referred to as MMP)



Additional agreement.



A 0.5% of total JV gross value success fee will be paid to JWC Services in the event of MMP entering into a JV agreement / arrangement with any other

party.



My contract ends today and an agreement re a Joint venture has been reached with a global company although this is not yet signed it should be signed next Friday and then may not complete for some months are there are some conditions precedent.

It is clear that the understanding re a Joint Venture is reached as the new joint venture party has offered me a new contract in writing today commencing tomorrow 1st June 2008.

The party that holds my contract which expires today has interpreted the contract clause of 0.5% of JV value as being outside of the contract period due to non signing and non completion of the JV within the contract period ending 31st May 2008.

Please could you give me an opinion as to whether or not their interpretation is correct.

Regards

John
Submitted: 6 years ago.
Category: Business Law
Expert:  Law Educator, Esq. replied 6 years ago.
Sorry to say that i their JV did not begin until your contract expired, then it is outside of the contract period. Just because this deal was negotiated during your period and maybe even signed during that period, it did not go into effect until your contract expired. Logically, if they would be responsible to you for merely negotiating a contract during your contract period, then it would become fairly expensive to ever negotiate and sign new contracts. If they had to wait until your contract expired to negotiate and sign the new one, what would happen during the gap period? I believe that their interpretation is correct.

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Customer: replied 6 years ago.
Thank you.
I perhaps have not been clear enough and my new contract is being confused with the question. The only reason I mentioned a new contract beig offered to me with the NEW JV partner was to highlght that the deal was essentially done and only delay was due to legalities of preparing contracts and due diligence.
The word agreement I thought was established that an agreement was reached within the term of the contract although not signed and the offering to me of a new contract evidences that.
Regards
John
Thank you again, I will be obtaining several legal opinions on this and it will be interesting to see if all responses are in line with yours
Expert:  Law Educator, Esq. replied 6 years ago.
Ok, sorry, I got you now. I see your issue, you can argue that the agreement was "entered into" during your contract period, but their counter argument will be what I stated above, they will argue that they negotiated a new contract, but it was not entered into and effective until after your contract expired. There is certainly an issue there for litigation, depending on the interpretation of the contract by a court. Contracts are generally interpreted pursuant to their plain meaning and if there is any ambiguity, as I believe may exist here, then that ambiguity is construed against the drafter of that agreement. You should enlist an attorney to file suit since there is ambiguity here. I could not even guess which side the court will come down on, which is why I said there certainly is ambiguity here and I could see both interpretations.

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Customer: replied 6 years ago.
Hi
Thanks again
I know there is an ambiguity which is why I am seeking advice the actuall wording is: JV agreement / arrangement and this term arrangement I believe is the crux of this as an arrangement I believe is a fairly loose understanding that an agreement will be / has been reached during the term of the contract to enter into a JV agreement / arrangement
Hope you can further clarify.
Regards
John
Expert:  Law Educator, Esq. replied 6 years ago.
I would say that it is understood that an agreement would have to be reached while your contract was still in effect because if not, for the reasons I stated above, there would be a gap between the end of your contract and the reaching of a new JV agreement. This is why I said that at the very least there is ambiguity. From your side, your argument is there is no ambiguity, it was understood that they would be reaching a JV agreement during your contract term and that was why the clause was put in there, to reward you for your work in making the JV happen during the term of your contract. If the court does not see the agreement as clear, then you argue the ambiguity. This is simply how these contract cases are fought. I believe you have a case here, but prepare for a long haul battle, these companies do not roll over easily. I had one that lasted for over 3 years before we ever even got to motions.
Customer: replied 6 years ago.
Thank you again.
You refer throughout your responses to litigation and unfortunately your focus on this is not a part of the answer and simply distracts from a clear and focussed response th the question.
As with anything there can be litigation and this is you will agree is to be avouided at all costs by establishing with a fair degree of confidence how the courts would view a certain phrase etc from a case history / legal standpoint and this is where your expertise is requested in basically giving legal definitions to phrases based upon your knowledge and experience.
Your answers are appreciated but do not give any further clarity than I had at the beginning but raise doubts which may not in fact be there.
I hope that you can read the initial question again and attempt to answer it rather than focus on phrases like litigation which does not address the question.
Thank you again
Regards
John
Expert:  Law Educator, Esq. replied 6 years ago.
No attorney can give you an answer regarding whether or not their interpretation is correct, all the attorney can do is discuss what courts have done in similar situations and what would likely happen if the matter were to end up in litigation. Any attorney who would give you an answer that you are seeking would be opening himself up to some serious liability. My discussion of litigation was merely to point out how courts are likely to handle this situation. Unfortunately, there is no clear cut answer to your question about whose interpretation of this clause is correct. I am sorry I could not give you the definitive answer you were seeking, but as with many things in the law, there is no real definitive answer to your question.
Customer: replied 6 years ago.
Paul
I have now received other responses which answer my question quite concisely.
Thank you for your input.
Regards
John
Expert:  Law Educator, Esq. replied 6 years ago.
Sorry I couldn't help you more.
Law Educator, Esq., Attorney
Category: Business Law
Satisfied Customers: 88858
Experience: All corporate law, including non-profits and charitable fraternal organizations.
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