Q&A - Business consultant hoodwinked me into signing fee agreement. What can I do?

Q: I own a small florist business and am thinking of retiring, so when I received a call from a business consultant offering to market my business for sale I agreed to a meeting.  At the meeting the consultant was very positive and said he could achieve a high sale price as demand for my type of business was on the rise. He said they would only charge commission if they sold my business and promised there would be no up-front fees or withdrawal charges payable. 

However, as he was leaving he produced a piece of paper and asked me to “just sign here”.  He said it was confirmation for his boss that he’d met with me so I signed and he gave me the carbon copy before leaving.  When I read the paperwork later, I realised I had signed an agency contract which stipulated that a £2,000 plus VAT registration fee was payable within 7 days, that there was no cooling off period, and that if I wanted to get out of the contract, I would have to pay a £3,000 withdrawal fee. What can I do?

A: This is typical sharp practice from a sales team. You should consult a solicitor immediately for advice.

The law governing business-to-business agreements is different to business-to-consumer agreements.  As the contract does not have a “cooling-off period”, you are not entitled to cancel if you change your mind after signing.  Additionally, the law governing unfair terms in contracts is much more limited in a business-to-business contract than a business-to-consumer contract. You would therefore not be able to dispute payment of the fees because they are “unfair”. 

However, as the agent made promises that you could withdraw without a fee then you can challenge these charges as the contract was misrepresented to induce you to sign the contract. Seek legal advice without delay.