Jul 5, 2014
I had a rather interesting case arrive on my desk a few months ago, one that is now, thankfully, resolved. A large company that I shall not name has two directors that, for the sake of this I will call John and George. Both have equal shares in the company.
The directors had decided that they needed to expand their premises and had settled a moving date based on the purchase finalisation of their new building. Unfortunately, John was away on his holidays over this period and the dates could not be changed.
While John was away, George began the task of getting ready for the move and looked into dumpster rentals, using this company to get them a great deal. The dumpster was delivered and the clearing out began. As you can imagine, with a large company, there was a lot of stuff to move and a lot of stuff to get rid of. Nevertheless, the move went smoothly and, by the time John returned from his holidays, everyone was settled at the new place.
When the bill for the dumpster rental arrived on John’s desk, he queried it. George explained why he had hired one and that this was the best company he found to do the job. John disagreed, saying that, a) there shouldn’t have been any need for a dumpster rental and, b) George should have got his permission before doing it.
Now, strictly speaking, that last part is true – as both directors hold equal shares in the company, everything, especially that which involves spending money should be cleared by both parties. However, this isn’t the fault of the dumpster rental company and they wanted their money, which, by law, they are entitled to.
However, John refused to authorise the payment and, after lengthy correspondence, the dumpster rental company contacted me for assistance. By rights, they have the law on their side and could, by their own terms and conditions, go straight to a court of law to recover the money. However, they opted to go down a different route first to see if they could resolve the dispute without things turning too nasty.
All’s well that Ends Well
After long discussions with both directors, I pointed out that both were at fault. George should have got authorisation from John, before he left for his holiday, to hire a dumpster for the removal. John should accept that he was not around for the hard part – the clearing out and actual move and, as the dumpster was hired in good faith, it should be paid for. I also pointed out that, should the bill remain unpaid, the rental company had good cause to refer the matter to a court of law – after all, they provided a service and it should be paid for.
Eventually, the matter was settled, with payment in full of the rental bill. Whether the two directors will ever see eye to eye again is another matter and not one for me to worry about – unless one of them ends up as my client for something!
On another note, the website they used to find their rental company also covers a range of other services – you can find out all you need to know here, at this website.