QLD Extending Payment Terms After Contract - Help?

[Hayden Ledwige]

Hi,

I have clear payment terms of 15 days from invoice with my customer. He has a well drafted contract stating the terms of work and payment. I have in the past provided longer terms in an attempt to assist my customer with cash flow.

My customer is behaving erratically and I no longer wish to provide extended terms. They are telling me because I have in the past I am bound to in the future. The contract is 6 months into a 2 year contract. Do they have a legal case?

Thanks so much!

 

[Rob Legat - SBPL]

They're probably referring to the legal concept of 'laches', which is a form of defence against claim based on unreasonable delay in asserting your rights. It's unlikely to have any real applicability here, not least because most modern contracts contain clauses which negate the concept. The more pro-active you are and the more you require them to stick to the terms of the contract, the less likely they'd be able to make out a valid defence.

 

[Tim W]

Do they have a legal case?

1. Going by what you've said so far, missing facts missing, and with any unstated facts, ifs, buts, maybe, exceptions and unlesses not allowed for, I don't see one.
The whole point of contract is certainty.
The fact that you have been a bit flexible from time to time, as a matter of day to day business practice,
does not create a right to that flexibility.

2. Is this an employment related contract?
If so, then much depends on whether or not it is a genuine contract,
or what the law calls a "sham contract".
If the latter, then it's probably unlawful anyway,
and you might have a much harder time enforcing the literal terms.