Legal Question in Business Law in Connecticut

Storage of terminations

We are a small Massachusetts nmanufacturing plant. A large Connecticut company gave us an order and terminated it mid manufacture. They paid termianation fees but as part of the agreement we signed, wanted us to store it. They did not pay for storage. 10 years later they asked us if we still have the material. We could not find it. They do not want it but they want us to pay them back for the termination. The termination fees they paid did not include storage so am I obligated to repay them?


Asked on 11/04/08, 4:45 pm

3 Answers from Attorneys

Re: Storage of terminations

I would have to see the agreement you signed but I think the customer is being unreasonable. Your storage of the material needs to be for a reasonable period of time and 10 years strikes me as unreasonable.

While they may have a claim, unless the amount is for a fair amount of money, they should settle the matter reasonably. You should check your records and see if you asked them to take the material at some point and see if they told you they no longer wanted it, so you dumped it or got rid of it.

Stranger things have happened. Good Luck

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Answered on 11/04/08, 4:54 pm
Craig J. Tiedemann Kajko, Weisman & Colasanti, LLP

Re: Storage of terminations

The answer to your question depends on the language in the applicable contract and, perhaps, the previous course of dealing and/or industry custom for such things.

However, whether or not the company has legitimate claims may be irrelevant. From your description, it sounds as though you have a strong statute of limitations defense. The statute of limitations for contract claims is six years.

The clock begins to run when the claimant knew or should have known of the existence of the claim. Here, the company surely knew of the costs 10 years ago, when it terminated, so even any legitimate claims now should be barred by the 6-year limitations period.

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Answered on 11/04/08, 5:16 pm
Lawrence Graves Coolidge & Graves PLLC

Re: Storage of terminations

The answer would depend upon the actual written agreement and, possibly, communications ancillary to its formation and any subsequent modifications -- best to simply show the contract to a lawyer and go from there. The initial consultation would not cost you anything. Best wishes,

LDWG

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Answered on 11/04/08, 6:04 pm


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