Company must pay consultant despite no written agreement
A company has been ordered to pay a consultant his fee for helping to negotiate a business deal, despite there being no written record of any agreement being made.
The company was part of a Swedish industrial and transportation conglomerate. It had been working on a contract with the oil company Shell.
The consultant was recruited to help secure the deal. He had worked with the company before and had contributed towards several successful projects. He had always been paid a fee based on a percentage of the revenue generated.
In this case, the company refused to pay the consultant. It claimed there was no agreement in place, and pointed out that there was no written contract. It also said that the final details of the deal were completed without the consultant’s help.
The consultant argued that he was entitled to a fee equal to 0.25% of the revenue the deal had generated for the company. He claimed he had agreed the fee in a telephone conversation with the company manager shortly before the deal was completed.
The company manager denied such an agreement had been made.
The court ruled in favour of the consultant and ordered the company to pay him the 0.25%. It pointed out that he had contributed towards the successful deal. He should be paid in the same manner he had been in the past, regardless of whether or not the agreement was in writing.
Please contact Sing Li if you would like more information about the issues raised in this article or any aspect of contract law.