CASE STUDY:
McKenzie Legal & HR – Case Study on Contracts

Summary

The Situation:
A caterer relied on basic Terms of Business copied from an old template found online. When a large corporate event went wrong, they discovered their terms didn’t protect them, and actually left them exposed.

The Risk:
Unclear liability limits, no cancellation provisions, no protection for late payments or supply issues, and vulnerability under consumer law.

The Result:
Comprehensive new Terms of Business drafted to balance legal compliance with commercial protection. The business now operates confidently with watertight contracts and reduced financial risk.

Value:
Greater legal certainty, reduced disputes, improved professionalism, and stronger cash flow management.

“We thought our terms were fine…until a client refused to pay for food they’d already eaten.”

In spring 2025, a catering business contacted us after a corporate client refused to settle their final invoice, claiming “poor service”. The business had standard terms copied years earlier- a single page with no mention of payment deadlines, liability, or dispute resolution.

The client threatened to withhold payment and post negative reviews. When challenged, it became clear that the caterer’s terms lacked any real protection. They needed urgent advice on enforcing payment and safeguarding future bookings.

❌ The Problem

  • No clear payment terms or late payment rights
  • No limitation of liability clause to cap exposure to alleged loss
  • No force majeure clause to protect against supply chain issues
  • No proper cancellation or refund terms
  • Unclear definition of services, leading to “expectation gaps”
  • No express right to recover costs or interest under the Late Payment of Commercial Debts (Interest) Act 1998
  • Exposure to Consumer Rights Act 2015 challenges where clients were individuals rather than businesses

✓ How We Helped

Step 1: Initial Triage

We reviewed the existing Terms and the correspondence trail to assess whether any implied contractual rights could be relied on under the Supply of Goods and Services Act 1982. The lack of written clarity made recovery difficult – but not impossible.

Step 2: Expert Review

McKenzie Legal examined the contractual weaknesses, identified key compliance gaps, and provided immediate advice on recovering the unpaid invoice while maintaining a professional relationship.

Step 3: Action Plan

We then created robust new Terms of Business tailored to the catering sector, including:

  • Defined service scope, pricing, and payment triggers
  • Tiered cancellation and refund policy reflecting actual costs incurred
  • Liability cap aligned with professional indemnity cover
  • Force majeure and supply delay protection
  • Consumer law–compliant clauses for mixed B2B and B2C clients
  • Late payment interest and debt recovery costs under the 1998 Act
  • Dispute resolution clause to prevent escalation and reputational harm

Step 4: Implementation:

The caterer was trained to issue written terms before accepting deposits. Every quote now includes a clear link to the Terms, with digital acceptance required before bookings are confirmed.

The Outcome

  • Dispute settled after the client realised the weak contract couldn’t be used again
  • Full recovery achieved through negotiated settlement
  • New Terms in use across all bookings, eliminating ambiguity
  • Clear payment and cancellation policies to improve cash flow
  • Reduced stress, better professionalism, and insurer confidence

Why This Matters

  • Weak or outdated Terms of Business cost small businesses thousands every year
  • Without clear clauses, disputes often favour the client – even when you’re in the right
  • Good terms protect your time, income, and reputation

Your Expert Team

McKenzie Legal & HR: 

Specialists in commercial contracts, business protection, and dispute resolution for catering and hospitality businesses

Top Tips:

  • Never rely on copied or generic online templates as they rarely meet legal standards
  • Ideally, review your Terms annually – or definitely after any major business change
  • Include clear payment terms, cancellation rights, and liability limits
  • Distinguish between consumer and business clients – the law treats them differently
  • Keep evidence of acceptance – your terms are only enforceable if properly agreed

The team behind your team, from day one…

Don’t risk opening with an unsafe or non-compliant unit. Get expert guidance from day one.

Get Expert Support
Read More Success Stories