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We have a retail business which moved to a new location. One…

We have a retail...

We have a retail business which moved to a new location. One vendor wants to stop selling to us, because there are others in the area that he is selling to. Can he legally do that?

Lawyer's Assistant: What state are you in? It matters because laws vary by location.

NY

Lawyer's Assistant: What steps have you taken so far?

I have only spoken to the salesperson.

Lawyer's Assistant: Anything else you want the lawyer to know before I connect you?

Not really

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Answered in 1 minute by:
7/11/2018
Legal Eagle
Legal Eagle, Lawyer
Category: Legal
Satisfied Customers: 14,184
Experience: Licensed to practice before state and federal court
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Hello! I am a licensed attorney, admitted to practice in state and federal court. I have a nearly 100% satisfaction rating (click here for more info) so all that means is that you can count on me to help today.

Are you aware whether your agreement gives them the right to cancel on these grounds?

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Customer reply replied 1 month ago
The salesperson says that he gave me my account based on the location, but they don't want to sell to me in the current location. I don't believe I have anything in writing, though.

Interesting. Has this caused your business some financial damages as a result? For example, have you had to find a new vendor at a higher cost?

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Customer reply replied 1 month ago
Well, actually they just cancelled my first order in the new location (which was placed while we were still in the old location). I told them that I was counting on it, and would have ordered other things had I known, but they still refused.
Customer reply replied 1 month ago
Since this is a well known branded item, there is no one else that can sell it to us.

I see.

This appears to be a classic breach of contract if the vendor cancelled this agreement for this reason. Normally, cancellation is proper only if you, as the other party, don't perform or some act of God would otherwise prohibit the vendor's performance. Your damages are likely going to be that you have to pay more for a vendor or try to replace the vendor's services unnecessarily.

For your information, a breach of contract just simply means that one party was obligated to perform and they have either have not performed or have said that they will not perform. This applies even when there was no written agreement, but just an oral agreement between the parties. Typically, the aggrieved party is entitled to be returned to the same position they were in before the breach.

This means that you have a couple of options.

  1. The quicker, informal option is to send a demand for performance. There’s a site that I’ve used in the past where you can find a good template for advising of a breach of contract. It's a bit easier (and cheaper) than going through litigation and I have seen it be effective in the past. This website is also pretty cool because you can download the forms right after purchasing. Click here to get started.

  2. If this doesn’t work, sadly, the only other option is to either go through an informal mediation or file a lawsuit in your local court. If you’ve already sent a bunch of letters, then the truth is this is the only way to compel them to do anything.

What other questions did you have for me today that I can help you out with:-)?

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Customer reply replied 1 month ago
Does this apply even when there was no contract between us?

Did they ever deliver anything to you at any time? And did you ever exchange payment with them?

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Customer reply replied 1 month ago
Sure.

Ok, then there was an agreement. Agreements do not have to be in writing to be enforceable.

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Customer reply replied 1 month ago
you recommend that I should first send them a formal letter stating the law, and telling them that it is illegal to stop selling based on that? The salesperson said that they have the right to stop selling to me based on demographics. Does that sentence change anything? Meaning, he only wants to sell to a certain amount of stores in this area?

You got it. So, the law doesn't just allow someone to stop selling based on "demographics." If they had an agreement with you they must honor it unless you breach the contract yourself by not paying. Regardless, it sounds like they're trying to get out of this contract, but are doing so without any legal basis.

You should also consider getting something in writing ASAP so you can have the terms of the agreement sorted out conclusively.

Did you have any other questions for me today? If not, were you satisfied with my service today:-)?

Legal Eagle
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