Renewal of Merchant Contract - Addendum missing wording

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Latest post Tue, Sep 15 2015 5:29 PM by Len Testa. 13 replies.
  • Mon, Sep 14 2015 12:37 PM

    • Len Testa
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    Renewal of Merchant Contract - Addendum missing wording

    My question  is one that involves contract law concerning the wording of term of contract and automatic renewal of contract. I am having a dispute with my credit card processing company over the expiration date of my current agreement. Does the Terminal Placement Program Form state or supersede the original contract form renewal term, or just the original term. It is not clear to me that the Terminal Placement Program Form is worded that way. It clearly does not state the renewal months of the term. When I signed both pages I believed that the renewal of the initial term would be for 18 months. This company is telling me that the renewal is for 36 months.

     This is the Section of the original contract.

    9. Term. The term of this Agreement shall be twenty four (24) months commencing on the acceptance of the Application and the Agreement by Bank and EMS and the issuance of a merchant account identification number to Merchant identifying Merchant for accounting, billing, customer service and related purposes in connection with the Services. Thereafter, the Term shall automatically renew for additional consecutive eighteen (18) month terms, unless written notice of termination (to be effective upon the expiration of the then current term) is provided by Merchant to Bank and EMS or by Bank and EMS to Merchant at least ninety (90) days prior to the then existing term, unless earlier terminated in accordance with the provisions of this agreement.

    This is the section on the Terminal Placement Program Form

    In consideration of EMS' offering the Merchant participation in the Terminal Placement Program, Merchant hereby agreees that (i)the Term of the Merchant Agreement designated in setgion 9 thereof shall be increased to thirty six (36) months, and (ii) the termination fee provided in section 10 of the Merchant Agreement shall be increased by $795.00.

    Who is correct? If I am what can I do about it?

  • Mon, Sep 14 2015 1:05 PM In reply to

    Re: Renewal of Merchant Contract - Addendum missing wording

    I think the company is right.

    Each consecutive term becomes "The Term" according to Section 9.

    The Terminal Placement Program Form says "The Term" is 36 months if you participate in the Terminal Placement Program.

    If you want out early you pay $795 for the termination fee.

    I know that's not what you wanted to see, but I spent my life analyzing the most complicated contracts in the world (insurance policies) and your contract is pretty easy to understand.

    You are welcome to take it to an attorney for review.

     

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • Mon, Sep 14 2015 1:18 PM In reply to

    • Len Testa
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    Re: Renewal of Merchant Contract - Addendum missing wording

    Thanks for replying so quick. How come section 9 refers to the renewal of the 4 month term but the Terminal Placement program form does not?  Shouldnt every clause be spelled out word for word?  I thought contracts were not supposed to be left up to the signers assumptions.

  • Mon, Sep 14 2015 3:28 PM In reply to

    Re: Renewal of Merchant Contract - Addendum missing wording

    What was the effective date of original contract and the effective date of "Terminal Placement Program Form"?

    Was the 90 day notice given by anyone at any time?  If so, who gave it and when?

  • Mon, Sep 14 2015 3:32 PM In reply to

    Re: Renewal of Merchant Contract - Addendum missing wording

    Len Testa:
    How come section 9 refers to the renewal of the 4 month term but the Terminal Placement program form does not?

    What "4 month term"?

    In any event, this is an excellent question for whomever negotiated and wrote the contract but a terrible question for persons who have never seen the contract and have no information at all regarding the circumstances of its negotiation and formation.

     

    Len Testa:
    Shouldnt every clause be spelled out word for word?

    I don't even know what this means.

     

    Len Testa:
    I thought contracts were not supposed to be left up to the signers assumptions.

    They're not.  But what's "supposed to" happen is not always what actually happens.  For example, you appear to have entered into a contract that you interepreted one way without being sure that the other party shared your interpretation.  That's not "supposed to" happen but apparently did.

  • Mon, Sep 14 2015 4:54 PM In reply to

    • Len Testa
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    Re: Renewal of Merchant Contract - Addendum missing wording

    The date of the original contract and the Terminal Placement Program form are the same. August 11, 2011. I gave my 90 day notice to end my contract as of Febraury 11, 2016...the date that is 18 months after the initial term ended. The company says the contract is ineffect until August 11 2017 which is 36 months after the initial term ended.

  • Mon, Sep 14 2015 4:58 PM In reply to

    Re: Renewal of Merchant Contract - Addendum missing wording

    Len Testa:
    The date of the original contract and the Terminal Placement Program form are the same. August 11, 2011. I gave my 90 day notice to end my contract as of Febraury 11, 2016...the date that is 18 months after the initial term ended. The company says the contract is ineffect until August 11 2017 which is 36 months after the initial term ended.

    That's why we have courts.

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • Mon, Sep 14 2015 5:00 PM In reply to

    • Len Testa
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    Re: Renewal of Merchant Contract - Addendum missing wording

    Sorry about the typo...not 4 months...initial term in section 9 was 24 months.

    Spelled out word for word IE...   Thereafter, the Term shall automatically renew for additional consecutive thirty six (36) month terms.  Shouldnt the TPF be worded this way?

     Amen.   Is it legal to leave out the automatic renewal terms?

  • Tue, Sep 15 2015 10:11 AM In reply to

    • Len Testa
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    Re: Renewal of Merchant Contract - Addendum missing wording

    ca19lawyer2:
      What "4 month term"?

    Sorry about the typo...not 4 months...initial term in section 9 was 24 months.

    ca19lawyer2:
    I don't even know what this means.

    Spelled out word for word IE... Thereafter, the Term shall automatically renew for additional consecutive thirty six (36) month terms. Shouldnt the TPF be worded this way?

    ca19lawyer2:
    They're not.  But what's "supposed to" happen is not always what actually happens.  For example, you appear to have entered into a contract that you interepreted one way without being sure that the other party shared your interpretation.  That's not "supposed to" happen but apparently did.

    Amen. Is it legal to leave out the automatic renewal terms?

  • Tue, Sep 15 2015 10:16 AM In reply to

    Re: Renewal of Merchant Contract - Addendum missing wording

    Len Testa:
    The date of the original contract and the Terminal Placement Program form are the same. August 11, 2011.

    That's poor drafting (to have two parts of the same contract contain conflicting terms), but I think it's pretty clear that the original term was 36 months and that it renewed for an additional 18 months when no one gave notice in advance of 8/11/14 expiration of the original term.

     

    Len Testa:
    The company says the contract is ineffect until August 11 2017 which is 36 months after the initial term ended.

    Nothing in the bits you quoted supports this interpretation.

  • Tue, Sep 15 2015 10:19 AM In reply to

    Re: Renewal of Merchant Contract - Addendum missing wording

    Len Testa:
    Spelled out word for word IE... Thereafter, the Term shall automatically renew for additional consecutive thirty six (36) month terms. Shouldnt the TPF be worded this way?

    A contract should be written so that it clearly reflects the mutual agreement of the parties.

     

    Len Testa:
    Is it legal to leave out the automatic renewal terms?

    I saw nothing in the blurbs you quoted that isn't "legal."

  • Tue, Sep 15 2015 10:29 AM In reply to

    • Len Testa
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    Re: Renewal of Merchant Contract - Addendum missing wording

    ca19lawyer2:

    Len Testa:
    The date of the original contract and the Terminal Placement Program form are the same. August 11, 2011.

    That's poor drafting (to have two parts of the same contract contain conflicting terms), but I think it's pretty clear that the original term was 36 months and that it renewed for an additional 18 months when no one gave notice in advance of 8/11/14 expiration of the original term.

     

    Len Testa:
    The company says the contract is ineffect until August 11 2017 which is 36 months after the initial term ended.

    Nothing in the bits you quoted supports this interpretation.

     

    Do I have a good case against this company? If I do...the company is in Ohio and I am in Mass. What do I do. Who do I hire a Mass layer or an Ohio Lawyer

  • Tue, Sep 15 2015 2:06 PM In reply to

    Re: Renewal of Merchant Contract - Addendum missing wording

    Len Testa:
    Do I have a good case against this company?

    A good case of what?  At the moment, you appear to have a disagreement over the interpretation of the contract and have 4-5 months to work something out.

     

    Len Testa:
    If I do...the company is in Ohio and I am in Mass. What do I do. Who do I hire a Mass layer or an Ohio Lawyer

    Does the contract provide that any disputes must be adjudicated in Ohio?  If so, and if one of you ends up suing the other, then that provision likely will be enforced and you'll need a lawyer in Ohio.  However, if you want to hire a lawyer now to advocate on your behalf, it really won't matter where the lawyer is located.  As far as what you "do," I have no idea.  You didn't say, but I'm guessing that you gave a termination notice and that the other party responded by rejecting your notice and setting forth its interpretation of the contract.  If that's the case, then the ball is in your court to explain your interpretation (since I assume you didn't do so in your termination notice).

  • Tue, Sep 15 2015 5:29 PM In reply to

    • Len Testa
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    Re: Renewal of Merchant Contract - Addendum missing wording

    I did state my intrepreation of the contarct when I formally issued my notice to cancell. The retention representative refused to acknowledge my assumption. Contract does state that any and all disputes will be handled by arbirtartion in Cleveland Ohio.

    I have sent the contract to a lawyer in Mass to see if I was right this was his reply:

    I agree with your interpretation of the 36 month term ended on 8/11/14.  Unless you notified them in writing of your desire to terminate the contract by 5/11/14 (90 days prior) then the contract automatically extends an additional 18 months, ending on 2/11/16. 

    Unfortunately it will cost me more than $300 to have this drwan up and set to the company. If they decide to take this to arbitration it will cost me more to hire a laywer in Ohio or go there myself.

    Since I have to pay $795 to cancel I might as well make them wait for it and pay the $30 per month minimum fee until August 2017. It will also cost them money to send me statements each month.

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