Legal Question in Business Law in Illinois

Deposit obligations - daycare
My wife operates a daycare out of our home. Her contract requires a 2 week deposit and a 2 week notice of cancellation of services. A couple agreed to use her for daycare for their baby and gave her the required 2 week deposit. Then the wife decided to stay home with her child before starting to bring their child. In between the time that they agreed to bring their child and their cancellation, my wife had to turn away other children due to the lack of vacancies created by adding the new child. The new parents want their deposit back saying that they fulfilled the obligations of the contract by giving my wife 2 weeks notice. They are threatening taking my wife to court if she doesn't pay them back the deposit money and placing a lien on our house. Shouldn't the couple be obligated to pay my wife for the first 2 weeks of service, even though they never started? What are my wife's options here?

Asked on 2/12/02, 1:37 pm

Curt Handley, Esq. Law Office of Curt Handley

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Re: Deposit obligations - daycare

Your situation depends upon the wording of your wife's contract as to the following:

(1) Did it speak to cancellations prior to service ever being rendered?

(2) Did it state when your wife was to start providing service to this couple?

(3) Did it have any "lost opportunity" or "non-refundable deposit" clause?

I'd need these questions answered before I could say whether you have any recourse other than giving them their deposit back.

Answered on 2/12/02, 10:52 pm

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