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Stuart J
Stuart J, Solicitor
Category: UK Law
Satisfied Customers: 22400
Experience:  PGD Law. 20 years legal profession, 6 as partner in High Street practice
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JA: Hi. How can we be of help?
Customer: Sorry, I wasn't expecting to have my question answered and just stumbled on your site. However, if you're able to offer some free guidance...
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Customer: i am just swatting up on the "effective clause"
JA: Have you talked to a lawyer yet?
Customer: not as of yet
JA: Anything else you think the lawyer should know?
Customer: dispute between my business and another agent - both had consent (them 3 months before us) but they failed to keep in touch and the client never responded to them, whereas we made an intro, ran the process which led to the hire - i think we're therefore covered regardless if they had consent from before especially when the candidate and client want us to get paid
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Submitted: 5 months ago.
Category: UK Law
Expert:  Stuart J replied 5 months ago.

Hello. Thank you for your question. It’s my pleasure to assist you with this.

I’m afraid that we don’t offer free help but we do offer assistance at a fee chosen by you.

If you want assistance on that basis, I’m happy to help you in which case, could you explain your situation in detail please?

Thank you.

Customer: replied 5 months ago.
Hi, just picking back up on this... what additional info do you need?
Expert:  Stuart J replied 5 months ago.

I need the full background detail please because all I’ve got are very sketchy details saying that there is a dispute between your business and an agent.

Customer: replied 5 months ago.
HiIn October 2015 the other agent sent an email to the candidate stating 'here is the CV re-formatted for your comments' to which the candidate replied 'this is now good to go. I can confirm that I happy for you to contact X company'. The candidate then heard nothing for three months from the agent and assumed it went no where. He then instructs use to approach the business which we then did successfully, agreed client terms, ran the process and made the placement. The other agent is now disputing that they made the introduction first and so they should be paid regardless of the client and candidate's preference to work via us. The candidate is somewhat disgusted with the lack of response and poor service (plus they apparently ripped off the CV we created for the candidate.The reason the introduction wasn't flagged was apparently because it went to the HR inbox and wasn't then send on to the company directors as the HR manager was in the process of leaving.There are three notable clauses in the client terms -
1. Fee Exclusion - No fee shall be payable to the Agency with respect to any Candidate who is recruited by the company if that Candidate was previously introduced to the company another agency within six (6) months of the date the Agency introduced the Candidate. Where an office receives a CV from the Agency after already having received a CV for the same Candidate from another source, we may return the CV to the Agency with a note of explanation. However, the failure by us to return a CV shall in no way mean that the Candidate’s CV had not been received previously from another source.2. In the event that more than one search firm claims the right to a Fee for placement of a particular Candidate, the company will pay no more than the aggregate of a single Fee. It is the responsibility of the respective Agencies to resolve any dispute over the Fee. By introducing a candidate for consideration you represent you have express permission to do so. If required by the company, the Agency will be required to show evidence of permission by the candidate to introduce them to the company on their behalf.3. Introductions
The introduction of a Candidate for one role shall be effective for that role only and no other.Since this has all happened the company has put the other agent in touch to resolve the dispute despite both they and the candidate being in our corner. Whilst I understand they sent a CV first (although I note the candidate only implied this was ok in that email exchange) their failure to follow up or keep in touch is what has let them down. We then came across the 'effective clause' and saw that regardless of an agreement the courts generally side with the agent who was effective in making the successful introduction which we clearly were and the other agent wasn't.Hope this is enough background - please let me know your thoughts.Many thanks
Expert:  Stuart J replied 5 months ago.

Is the other agent also trying to bill the employer?

It appears that the situation you are in is covered under clause 2.

How much is the fee?

Would you be happy to take 50% of it?

You say that the candidate instructed you to approach the business which you did successfully. How did you or the candidate no but the business was in the market for an employee

Customer: replied 5 months ago.
The other agent hasn't raised an invoice to the employer but we have - although it's not due to another month yet. We wouldn't be happy to settle as the fee is large (£85k before VAT) and it'll indicate that we're in the wrong. I think clause just enables us to settle it with the agent but the employer will probably sit on paying out our invoice until we resolve it. How about this effective clause?
Expert:  Stuart J replied 5 months ago.

You say that the candidate instructed you to approach the business which you did successfully. How did you or the candidate no but the business was in the market for an employee

Customer: replied 5 months ago.
Arguably the candidate instructed us both originally which is what they'll say whilst referencing that email exchange they had - we worked proactively with the candidate for a year to explore many options and the company was on our list so we didn't know they were looking for someone until we spoke with them with the candidate's consent.What do you think about this effective clause?
Expert:  Stuart J replied 5 months ago.

On a strict interpretation, under clause 1 no fees payable to you because the candidate was previously introduced by another agency. I accept all your arguments about the other agency not doing any of the work but ultimately, the candidate was introduced by the other agent.

Clause number 2, is not enforceable. Someone cannot say that they not paying the bill because there is a dispute between two third parties. It makes sense to withhold the money I might add because the last thing the employer wants to do is pay the bill from one agent only to be sued by the other agent.

I can’t see the relevance of clause 3 because presumably the role for which the candidate was introduced by agent 1 is the same as the role for which you introduced. If it’s a different role, then clause 3 means that only you get paid.

These are obviously the employers terms and whether they are effective in total are not comes down to whether the use were presented as being conditional after the agencies presented theirs.

It’s a case of “last shot wins” and if their terms were put in with their acceptance, then they are applicable. If however their terms were put in when they first asked the agencies to look for the candidate and then the agencies got their own terms signed by the employer, then they are not enforceable.

I know what you are saying that you did the work on this and the previous agent did little work but it does appear that the initial agent made the introduction. You didn’t answer the question as to why approached this particular employer what you did say that you did it at the candidate’s request albeit that the employer was on your list in any event. I don’t think that employer being on your list helps you because agencies very often have huge databases of potential employers and it would not be sufficient for that name to be on the list view to say “we would have got round to approaching them at some stage in the future in any event”.

As you said, you didn’t know that they were looking for someone until you spoke to them with the candidate’s consent. That was presumably because the candidate knew from agent 1 that the company was looking for someone albeit that agent 1 did nothing about it other than provide the introduction.

There is an argument here over whether agent 1 actually did provide an introduction or not. This is what the employer is trying to say at the end of clause 1. Just because the introduction went into a big black hole does not mean that the employer didn’t get it.

If you were made aware that this employer was looking for someone and it was at the candidates suggestion that you approach the employer and if the terms of the employer were the final terms exchanged between you, then you need to sort this out with the other agent that did the initial introduction.

Ultimately, if the three of you cannot come to an agreement, then you can’t beat each other with a stick and the only recourse would be through the courts with three-way litigation which, because of the amount of money involved, is not going to be cheap.

Can I answer any specific points arising from this?

Customer: replied 5 months ago.
Thanks, that's good to know. I have a call with the client this afternoon so may ask one more question post that once I have their view - as they're apparently not happy with agent 1's "aggressive" approach and it's apparently not the first time they've done this. In the meantime, can I ask if this is still all covered under the initial fee I paid? Really appreciate your advice so far.
Expert:  Stuart J replied 5 months ago.

It is a sad fact that some agents simply use a scattergun approach and send a CV in and then say that they made the first contact!

All our exchanges are covered under the one initial fee. You don’t pay any extra (although you can pay a voluntary bonus which is always appreciated by experts) regardless of how many exchanges we have.

Please don’t forget to rate my answer service positively so that I get paid. You may get the impression the thread closes after rating, but it does not, it remains open and we can still exchange emails if anything needs clarification.

Kind regards

Expert:  Stuart J replied 4 months ago.

This has come back into my inbox as something requiring my attention. If you don’t need any further advice, please ignore this email otherwise, please ask away.

Customer: replied 4 months ago.
Hi, I was just trying to rate the answer as per your request but the link gets blocked by my servers. Also I wanted a receipt (with a VAT number if possible)... Thanks, Craig
Expert:  Stuart J replied 4 months ago.

Thank you.

If you can confirm the number of stars out of five (5 being the best) to me in reply, that you would give the service, I will get admin to do it manually and ask them to forward your receipt.

Regards

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