I have a DBA. I have been paying commission to someone for a few years for the use of her Facebook group to scout clients/have her send me clients from that group. I have never signed a contract with her in writing. There were strictly verbal and informal agreements. I want to leave her immediately. If she demands that I continue to pay her commission based on leaving WITH my clients who came from HER Facebook group, does she have a legal leg to stand on? Since there were no written contracts, can she demand anything from me at all? I am in NY, she is out of state.
2 Answers from Attorneys
It's not always necessary that a contract be in writing. It's unclear what you guys agreed to in your verbal and 'informal' agreements, so there's no way to say if or what would happen in this situation. As a practical matter it's probably going to be difficult for her to sue you, but if there's a lot of money on the table maybe she will. Best approach is to have a straight conversation and come to an agreement ending the relationship which is fair and reasonable to both of you. Did you continue to pay ongoing commissions for the clients she forwarded to you in the past?
A court would look to your course of dealing. Without any written agreement either of you is free to terminate at anytime and she would not have any cause of action to be paid beyond the norm you already established. That is, she can't now say "because you no longer want to work with me I get on going commissions, etc.." That is something that would have to be agreed to. But of course we don't have all the facts here.
If you feel you need more clarification, I suggest that you consult with a lawyer in private and discuss your objectives in more detail. You can start by calling around to several for a free phone consultation, get some insights then pick the best fit to work with.
If you would like to discuss further over a free phone consult, feel free to contact me anytime that is convenient.
Our firm is now referred by the American Bar Association (see under the New York section): http://www.americanbar.org/groups/delivery_legal_services/resources/programs_to_help_those_with_moderate_income.html
DISCLAIMER: this is not intended to be specific legal advice and should not be relied upon as such. No attorney-client relationship is formed on the basis of this posting.
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