Raj agrees to act as a sales agent for Service Company on a commission basis. Their contract stipulates six-months' notice of termination. The firm ends the deal without notice. If Raj seeks payment of commissions on sales for the six months following the termination, a court is most likely to hold that

A) the amounts accrue to Service, which had the power to end the agency.
B) any compensation on sales during the period should be split equally.
C) Raj can recoup expenses but no profit.
D) Raj is entitled to the commissions.

Question

James Abbott · Accepted Answer

Final Answer : D, Explanation :  The contract stipulated a six-months' notice period for termination, which Service Company did not adhere to. Therefore, Raj is entitled to the commissions for the six months following the termination as if the notice period had been respected. This is because the company breached the contract by not providing the agreed notice, and Raj would likely be entitled to damages or compensation for the breach, which would include the commissions he would have earned during the notice period.

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