Legal Question in Business Law in United Kingdom

consultancy agreement for cost saving activity

I contracted with a client company to undertake cost analysis, my fee basis being a percentage of savings. Under the terms of our contract they agreed that the categories I had agreed to analyse were not subject to other cost-saving activity & I was entitled to fees on any refunds negotiated with suppliers within the categories under analysis. After detailed & confidential market information was provided, they went behing my back & independently formed a new supplier contract.

Also, my work was carried out on the basis that if it was successful I would be then be able to work with that company's large base of associate companies. My initial recommendations saved the client over �70K and I had negotiated furthur large savings before being cut out of the loop. Their actions mean I have lost out on anticipated future earnings.

What exactly is my cause of action? Are there any authoritative cases?


Asked on 3/29/02, 7:05 am

1 Answer from Attorneys
Richard Grams Oldham, Li & Nie

Re: consultancy agreement for cost saving activity

You clearly would have a cause of action against the client. At first blink, the appropriate cause of action to file suit with would be simple breach of contract but without more detailed information (ie: regarding possible exemption or exclusion clauses) it is difficult to say more. Even if you were unable to show a clear breach of any of the terms of your contract, you would be eligible to bring an action based on quantum meruit on the rationale that they derived an unjust benefit of GBP70,000 from your efforts. Any competent litigator would be able to assist you in taking this forward toward either settlement or, failing that, court action.

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Answered on 4/08/02, 12:22 am


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