If you still don`t receive the money owed for your bill after sending a final payment request, it`s time to check if it`s worth suing your customer for non-payment. The costs associated with a lawsuit can be high and it can also take a long time to plead. You need to make a business decision to determine if it`s worth it. First, assess what you are owed: the total amount of all your invoices, as well as any related expenses that have not been reimbursed to you. Next, assess the financial health of the business you want to sue to make sure it has the money to pay you back. Consider factors such as: Make sure you have a solid foundation in place before you start your work. Ideally, you have negotiated a contract that defines the terms of the contract, delivery and payment dates, deadlines, and proof of delivery of the products. You can also add termination clauses for non-payment and retention of title clauses, which means that you retain ownership of your products until they are paid. It is advisable to put these conditions in writing – LawBite can draft tailor-made contracts for your business at relatively low prices. Once you have decided to proceed with the collection of payment, first write a complaint letter to your customer.
When writing to a company, you can also include the name of the person you have had contact with or who has given a personal guarantee for the goods/services provided. In your letter, you must state the following: If a customer who doesn`t pay ignores your emails and calls, demand payment more firmly. Service companies that are constantly working with the customer are best positioned to issue an ultimatum, Hoffmann said. If payment is still not made after reminders, perform a simple cost-benefit analysis where you determine whether the cost of the lawsuit is higher or lower than the amount of money you are asking your client to pay. When entering into contracts, you must ensure that the other party is aware of the payment terms underlying the transaction. The other party needs to know when to pay, how much owes and how to make the payment. Otherwise, you run the risk of not paying. However, if the other party does not pay, you can take legal action. However, when you make this claim, you must indicate the amount of damage and the likelihood of compensation. Most payment disputes can be avoided with a clear billing process or resolved with a gentle reminder – but what can you do if your customer simply isn`t paying? If the customer ignored your late invoice emails or bought time with an apology, the fear of legal action can sometimes be enough for the customer to eventually pay the unpaid amount.
A lawyer can send a formal letter to the client on your behalf. If you decide to take legal action for non-payment of bills, start the process with a formal letter of claim to the defendant, whether it is an individual or a business, or both. If the defendant is a business, but someone has signed a personal guarantee, you can make the claim to both. Before you file a non-payment lawsuit, you need to determine whether or not it is worth the cost of legal fees associated with filing the lawsuit. How much do you plan to hire a lawyer and plead the trial? Will these expenses be higher than what the other party owes you? When you make this decision, you also need to understand what your damage is. Are you just suing for repayment? Or are you also suing for additional financial damages? Does the other party have financial problems? These are all important considerations when deciding whether or not to bring an action for non-payment. Attorney Seth Kretzer, who has worked with many companies that require unpaid invoices, can help you prepare a sample claim letter for payment for services provided and file your complaint in case you need to file a lawsuit for non-payment. Contact Kretzer and Volberding P.C.
law firms today for assistance. When you`re ready, you can work with your client to enter a payment plan for the unpaid invoice, where payments are made over several weeks or months. “Take the opportunity to review a customer`s satisfaction with your services, and then discuss any upcoming or overdue bills,” Waldorf said. If you find that you want to take legal action, you can begin the process by writing a formal complaint letter and sending it to the other party, whether it is an individual or a company.