The Three-Year Contract Jasleen Almost Didn't Escape

The situation

Jasleen worked full-time as a call-centre representative, and for two years she had been building a small business on the side selling handmade goods online. What started as a hobby with a spreadsheet had grown into something closer to a real operation: her own storage and shipping process had become too much to manage after hours, so early on she had signed a fulfillment agreement with a small logistics outfit that packed and shipped her orders out of a warehouse outside the city. The arrangement worked well enough that she barely thought about the paperwork again. By the time revenue crossed roughly $100,000 for the year, the business was no longer a side project she could run casually — it was something that needed proper structure, and she came to Treadstone Law to talk about incorporating and getting her contracts in order before she scaled further.

The fulfillment contract had been signed with a company run by an owner-operator named Marco, who also drove long-haul routes and handled the warehouse and shipping side of his business between trips. It was a reasonable one-page agreement when Jasleen signed it: a modest monthly fee, a per-order handling charge, and a term that ran for one year. She had never had a reason to look at it again. Her bookkeeper, Giulia, was the one who flagged that something about the file seemed off when she was pulling together documents for the incorporation meeting — the contract listed a term date that had technically already passed twice.

What the review found

A routine legal check-up, done as part of getting a growing business's paperwork in order, usually starts with pulling every signed agreement and reading it in full — not skimming for the obvious terms, but checking renewal language, termination rights, liability clauses and notice periods line by line. This is where the fulfillment contract turned out to matter more than anyone expected.

Buried in a clause near the end of the agreement was standard-looking language: the contract would automatically renew for a further term unless either party gave written notice of cancellation within a specific window before the renewal date. That kind of clause, often called an evergreen or auto-renewal clause, is common in service contracts because it saves both sides from having to actively re-sign every year. The problem was in the details. The renewal window in Jasleen's contract was short, it required notice in a specific written form, and — critically — each successive renewal term was not another single year. It was three years.

Jasleen had never noticed this because nothing about the relationship had changed. Marco's company kept shipping her orders, the invoices kept arriving, and the business kept growing. There had been no obvious moment that would have prompted her to reread a contract she'd signed two years earlier. But the math was unforgiving: the current term was due to end in a matter of weeks, and the notice window to avoid another automatic renewal had already opened. If nobody acted, the contract would silently roll forward for three more years on terms that had been fair for a business doing a fraction of the volume Jasleen now shipped.

That mattered for two reasons. First, the per-order handling fee had made sense when Jasleen was shipping a small number of packages a month; at her current volume it was costing meaningfully more than comparable fulfillment arrangements available elsewhere, and being locked in for three years would have meant absorbing that gap without any ability to renegotiate or switch providers. Second, the contract had no clause allowing early termination for convenience — once renewed, it could only be ended early for a serious breach by the other side, which is a hard thing to prove and a harder thing to build a business plan around. Being locked into a single fulfillment partner for three years, on pricing set when the business was a fraction of its current size, would have limited Jasleen's options right at the point where she most needed flexibility to grow.

What we did

1. Calculated the actual deadline. The clause referred to notice being given a set number of days before the renewal date, not before the end of the contract's stated term — a distinction that mattered because the two dates were close but not identical. We worked out the true last day notice could be given and found there were eleven days left.
2. Reviewed the notice requirements exactly as written. The clause specified that cancellation notice had to be in writing and delivered to a particular address or method described in the contract. Many auto-renewal disputes come down to whether notice was valid, not just whether it was sent, so we made sure the notice met every formal requirement in the clause rather than relying on an email or a phone call.
3. Drafted and sent the cancellation notice. We prepared a formal notice declining the automatic renewal and confirmed it was delivered in a way that created a clear record — proof that mattered in case the other side later disputed whether notice had arrived in time.
4. Opened a separate conversation about renegotiating. Cancelling the auto-renewal did not mean ending the relationship with Marco's company, which had been reliable and knew Jasleen's business well. Once the automatic three-year term was off the table, we helped Jasleen approach the renegotiation from a position of choice rather than obligation — she could propose new pricing and a shorter term, or shop the work elsewhere, without a standing three-year contract narrowing her options.
5. Reviewed the rest of Jasleen's contracts for the same pattern. Once one auto-renewal clause with an unfavourable term length turned up, we checked her other agreements — a payment processing agreement and a software subscription — for similar structures. Neither carried the same risk, but both were flagged with their renewal dates noted for future reference.
6. Set up a simple contract calendar. As part of the incorporation work, we built Jasleen a short list of every ongoing agreement with its renewal date and notice deadline, so the same gap in oversight would not repeat itself once the business had more contracts to track.

The outcome

The cancellation notice was delivered with four days to spare before the window closed. The fulfillment contract ran out at the end of its existing term instead of rolling forward for another three years, and Jasleen kept the ability to negotiate new terms as an active choice rather than something forced on her by a clause she had never really registered agreeing to.

In the end, Jasleen did not switch providers. She and Marco agreed to a new one-year contract with updated per-order pricing that reflected her current shipping volume, along with a shorter, six-month auto-renewal window instead of three years — a change Marco was willing to make once the conversation was framed around keeping a good client happy rather than defending a clause neither of them had thought hard about the first time. The relationship continued, but on terms that matched the business Jasleen actually had rather than the one she'd had when she signed the original agreement.

Nothing dramatic happened here, and that was the point. No dispute, no lawsuit, no scramble to find a new fulfillment provider on short notice. The entire cost of the problem was the roughly two hours it took to review the contract and the modest fee for drafting and sending a compliant notice — a fraction of what it would have cost to unwind a three-year commitment or negotiate an early exit once locked in. The incorporation work that had brought Jasleen to Treadstone Law in the first place proceeded as planned, but the contract review turned out to be the more urgent piece of the visit.

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