Are your terms and conditions unfair?

Do You Have Terms and Conditions ? Are They Fair ? Are They Current?

Yes I know we constantly say make sure you have a good set of terms and conditions, protect yourselves, but we all know that far too many new start ups and young businesses find out too late just how valuable an investment they are. We are not talking about the generic standards that can be downloaded, one size does not fit all, and your friend who has never had a problem with theirs may not be the best ones to adopt, who says they will not have a problem?

When was the last time you had your terms and conditions updated?

Terms and Conditions or Contracts are tested regularly in courts daily, invariably they are relied on to prove the breach to grant a judgment or award.

If you deal with Sole Traders and None Limited Businesses, consumers and commercial Business to Business there is a good chance you need at least two possibly three sets, now that Sole Traders effectively have the right to the same 30 days notice before action and then an additional 30 days if they seek financial advise, then it stands to reason you cannot state they will be issued with seven day demands. There are also differences in what can be applied in respect of late payment interest and fees.

We have seen cases in the last year of judges halving the statutory interest of 8% per annum accruable daily as the creditor has made no real attempts prior to issuing proceedings to prompt and remind and collect the debt without legal recourse.

In respect of interest and fees we have seen terms stating interest as little as 2% why? The statute is 8%: On the other hand we have seen terms with interest as high as 12% or daily charges of £15 , whilst the customer may have agreed such terms a court may dependant upon circumstances deem then unreasonable or unfair and cap them or throw them out completely.

The disputes and remedy clause is also key, is it reasonable to say you can put prices up with 24 hours notice or give notice on the contract of a week whilst demanding 6 months from the customer? Where warranties are offered is the process fair, the compensation reasonable etc..

Without terms and conditions then we must try to prove the implied contract and what would be expected as fair and reasonable from it, however with them a judge can clearly define whether either party has or has not complied with the agreed terms.

Terms and Conditions must be shown and agreed before the provision of goods and services, they are not valid on the back of your invoice or a statement these at best serve as reminders but are not binding.

It is dangerous to trade without them or to trade with ones that cannot be seen to fit your business type, the things to be considered are numerous and seldom fully covered without proper advise, additionally by having them drafted correctly it is not as expensive as most might think and often payment arrangement can be achieved, you gain the security of Professional Indemnity Insurance if something is wrong.

The ICM Group can help with reviews and the drafting of terms and conditions to help you protect your business in the future.