Contract Termination For Breach

Summary

If an accounting firm fails to meet contractual obligations and is in voluntary administration, you may have grounds to terminate the contract. Document all instances of non-performance and communicate your reasons for termination in writing. Consider seeking legal advice to address potential exit fees and ensure your rights are protected.

Full Conversation

I run a small disability support business and have been operating for four months. Being new to business, I signed a *-year contract with an accounting and bookkeeping firm. They promised to handle our bookkeeping, BAS, personal tax returns, and provide */* accounting advice. Last Wednesday, I attempted to run payroll for new staff in Xero, but it failed because the subscription only allowed one employee. Our Xero account is managed through the firm, so I called their *-hour hotline but only reached a message service. Despite leaving multiple messages, no one called back. Shortly after, they did log into Xero and upgraded the subscription—presumably realizing the issue. It’s now Monday, and the only response has been a rude, unhelpful call with no apology. After researching, I found the firm is in voluntary administration. I want to exit the contract without paying it out, as they are not meeting their obligations. Contract is attached.
****, it appears you have grounds for terminating the contract due to the firm’s breach of their obligations. According to clause *.*, you may terminate the agreement if continuing to use the services would breach any law or regulation. Given their voluntary administration, this might apply. Make sure to document all instances of non-performance and attempt to resolve the issue in writing before proceeding.
Would you like assistance in drafting a termination notice?
yes please
Sure, ****. Here’s a draft termination notice you can use:
---
[Your Name]
[Your Position]
[Your Company Name]
[Your Company Address]
[City, State, Postcode]
[Email Address]
[Phone Number]
[Date]
[Recipient Name]
[Accounting Firm Name]
[Recipient Address]
[City, State, Postcode]
Dear [Recipient Name],
Re: Termination of Contract for Services
I am writing to formally notify you of the termination of our Contract for Services dated [Contract Start Date], due to the accounting firm's breach of obligations.
Despite multiple attempts to seek assistance via your *-hour hotline and messages left, there has been insufficient support, particularly regarding our Xero payroll subscription issue. Additionally, the firm’s current status in voluntary administration raises concerns about the continuity and reliability of services.
As per clause *.*, we have the right to terminate the agreement immediately if continuing the services would mean breaching any law or regulation. Given the circumstances and the lack of adequate response, we are exercising this right.
Please acknowledge receipt of this termination notice and confirm the cessation of services immediately. We request the return of any documents and information related to our accounts to ensure a smooth transition.
Thank you for your immediate attention to this matter.
Sincerely,
[Your Name]
[Your Position]
[Your Company Name]
---
Make sure to fill in the placeholders with your specific details. If you need further assistance, feel free to ask.
could they still try and make us pay out the contract as it appears the contract we signed does not give us any clauses its geared to only there benifit
Case Rating: *
****, the firm may attempt to enforce the payment terms of the contract. However, your circumstances suggest a valid basis for termination due to their breach and the firm's voluntary administration. Documenting all instances of their non-performance and breaches will support your position.
Do you need help with any other aspect of this issue?
\what would my next steps be if they try and charge us the exit fees
Case Rating: *
If they attempt to charge exit fees:
- Refer to clause *.* of your contract which allows termination if the services would breach any law or regulation.
- Document all instances of non-performance and attempts at resolution.
- Communicate in writing your reasons for termination and refusal to pay exit fees.
- Consider seeking legal advice for further action and representation.
Would you like to be connected to local lawyers who can better assist you with your case?
clause *.* is aimed at them having the rioght not ourselves
Case Rating: *
****, you are correct that clause *.* gives the firm the right to terminate the agreement if continuing to provide services would breach any law or regulation. However, you can still argue that the firm’s failure to provide the agreed services and their voluntary administration status are grounds for termination due to breach of contract.
Your next steps could include:
- Citing other relevant clauses in the contract that support your position.
- Documenting all instances of their non-performance and breaches.
- Communicating in writing your reasons for termination and refusal to pay exit fees.
- Seeking legal advice for further action and representation.
Would you like further assistance or to be connected to local lawyers?