- Expiry of lock in period give you right to walk out to contract. There is not beach of court.
- Legal notice is not sustainable, you can give a proper and fitting reply to the notice .
- You can certainly file criminal complaint against him for racial abuse depending to what race you belong. The cases can be filed in pune Court.
Breach of Contract
I was in a partnership with a firm based out of Pune that has head office in Israel. In the contract, it was mentioned that both of us will share 50:50 in profits by doing IT trainings where I am the trainer and they would do marketing. The contract was made for 5 years with 3 years lock-in period and the lock-in period ended in June 2021 post which terms can be negotiated. The penalty for breaking the contract was kept 2 crores. During first 3 years, the CEO changed the terms to fixed cost per day and made me agree to that. Having no choice, I had to agree. My queries are below: 1. Does this constitute breach of contract from company's end? 2. I walked out of the contract post June 2021 giving proper notice and information saying it's impossible to work in those costs. They have now sent me a legal notice asking 2 crores. Is that valid? 3.The CEO used to have unethical and unfair practices and used to racially discriminate and abuse me. Are there any criminal cases that can be filed against the CEO who is an Israeli citizen?
Asked 2 years ago in Business Law
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12 Answers
1) once you have agreed to fresh terms it would supersede earlier contract
2) it does not amount to breach of contract
3) you ought to have sought negotiations on fixed costs rather than walking out
4) reply to legal notice denying your liability to pay Rs 2 cr
5) take the plea that you had no option but to walk out on account of abusive behaviour of CEO
Sir, the CEO was not willing to reconsider the fixed price option and it was impossible to work in that environment and that cost. What other option would have been possible?
Asked 2 years ago
It is necessary to peruse contract to advice
engage a lawyer and reply to legal notice
Reply to the legal notice through lawyer and later contest any case if filed any by the said party
Dear Client,
If they are forcing you to agree on any terms then it is not a valid contract. As the lock-in period was June 2021 and you walked out post June 2021 shows that there is no breach of contract from your side. Therefore, you not are required to pay 2 crores. If he is not willing to cooperate then the only option is to leave the contract. Lastly, you can not file a case against an Israeli citizen in Indian courts.
Thank you.
1. If the terms during the first 3 years were not agreeable to you then you should not have agreed for the modification of the terms. After having agreed and worked for the first 3 terms on those altered terms, you cannot challenge it now. The principle of estoppel will apply against you.
2. The lock in was for only 3 years. Post that there was an option to terminate. So the company has no locus to sue you.
3. As regards racial discrimination you can lodge a complaint with the Israeli High commission in India and also with your local police
Hi Mr Yusuf, thanks for your response. I think you got my viewpoint wrong.....I was agreeable to work of them on 50:50 profit sharing but THEY changed the terms & conditions to per day fixed rate saying that you are getting too much money for little work. Since I was not in a dominant position (they get trainings for me and all the money), what could I possibly would have done ?
Asked 2 years ago
You could have refused to agree to modification of terms of contract
once you agree to the changes it is binding upon you
1. The CEO cannot unilaterally change the terms, but if the same was reduced to writing and you both have agreed to this change then it can be a mutually agreed change, by which you may not be able to claim it as breach of conditions of the agreement.
2. You said that it was agreed to settle Rs. 2 Crores to break the agreement, which was again a mutually agreed condition, however if this agreement was not reduced to writing, and the original contractual agreement or conditions only shall prevail then on the basis of the completion of the initial lock in period, you can tender your resignation or offer to quit on the already agreed terms.
If the company is demanding this amount in excess to the agreed terms, you may refuse the same and challenge their claim ibn appropriate legal forum on merits.
3. If the CEO had committed the said offence in India then you can very well take up the case through an Indian court, or you can pursue the matter through the laws governing that country to which he belongs.
However you may have to exercise caution because you had failed to take any legal action when the incident took place but now your intention to take action on these issues may not be maintainable considering it as an after thought action since they did not give in to your demands.
The CEO appears to have breached the conditions of the agreement, hence you had an option to pursue the matter legally besides quitting the company.
Even now you can look for an option to drag him to court in India based on the violations of the conditions of the contract between you both.
If there was an agreement in writing between you both, then such issues can be termed as breach of conditions.
You can cite this as the chief reason for quitting the company
In fact you could have sought compensation from them for violating the terms and pursued the matter through court seeking compensation in terms of money for their illegal and unjustified acts.
Best of luck
Hey,
As such, I strongly believe that perusing both the contract and the modified terms along with the legal notice sent to you is necessary to give the appropriate answer. However, instead of answering the question of facts, I will try and make the standing of the law clear.
Since, the lock-in period as mentioned in the first contract is over, there is no claim. However, if the modified terms also modified the terms of the lock-in period, then that's another thing. Otherwise, you need not worry.
Further, if the modified terms didn't change the lock-in period you can send a reply to the notice from an advocate making your stand clear as to how you are not liable.
Further, if racially you have been abused, you can file a criminal complaint.
