Legal Question in Credit and Debt Law in Philippines

Ending a Contract - is this justifiable?
We entered into a 1-yr partner satellite office agreement to start a Med Transcription Business. The written contract states that we will be provided with equipment, software, training, biz consultation, marketing, recruitment and it support. Our terms of payment were scheduled for 30% down, 50% upon delivery and installation of equipment & 20% payable after completion. We have paid for 60% of the contract price but stopped payment when we realized that all their company provided was furniture and computers which accounts for 25% of the contract. Also, a delay on their part caused marketing problems for us. Their consultant was frequently unavailable. They manipulated minutes of our mtgs. And when we asked for a payment term extension to complete the second payment (since their delay caused us mktg problems), they flatly said NO---citing that they have cashflow problems in their company. They needed our money to fund their monthly expenses (not the project itself!) This made us lose confidence in their stability as a company, aside from their inefficiency in providing previous services. There is no termination clause in the contract but are our reasons valid and justifiable to discontinue the contract?

Asked on 5/30/07, 1:27 pm

Reynaldo Destura Destura & Associates Law Offices

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Re: Ending a Contract - is this justifiable?

you have no option but to go to court. a contract with provision for extrajudicial rescission must be brought to court for cancellation

Answered on 5/30/07, 9:15 pm

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