Client not paying

[HTPHP]

Hi Everyone,

I have recently run into my first ever issue with clients as a sole trader and am looking for some advice/support as I will probably have to goto court.

I started working for this client 9 months ago and everything went well, they were always late on paying but nothing I couldn't handle. We agreed a fee of x amount per 8 hour day.

Eventually I decided to leave and gave them my final invoice, however they didn't pay within the 30 days we agreed. I decided to give them a few more weeks as I knew they were in a bit of a financial hole and so I let another month pass.

As I'm sure you can see where this is going, I had to send them an email asking where the money is and that's when they said they were unhappy with the standard of the work and would only be willing to pay 50% of the invoice.

Since then I have rejected their offer and in return offered to arrange a payment plan so they didn't have to make their financial situation any worse. Unfortunately they've not responded and I fear I will have to goto court to see the money.

I will be seeing a member of the citizens advice bureau later this week however I was wondering what my legal options are as I now need this money desperately. Can I also charge him interest and charges on the amount as I've developed some bank charges due to his lack of payment?

Yours Sincerely

THPHP

[Geoff T]

Hi,

You can charge interest at 8.5% from the date the invoice fell due, and you can charge a fee on top in accordance with the Late Payment of Commercial Debts Regulations 2002 - check out this thread (http://www.ukbusinessforums.co.uk/forums/showthread.php?t=129199) for more info. That is assuming we're talking about a B2B deal here.

As far as your legal options go, basically you need to make sure you're info is in order, but it sounds - on the surface - like they're using a smoke and mirrors approach to save their cashflow. Saying that - the actual approach will depend on the amount of money we're talking about.

Before looking at the courts, I'd suggest getting in touch with GRDCredit (http://www.ukbusinessforums.co.uk/forums/member.php?u=46507) (there are others who do the same thing!;)) who is known on the forum to be successful in this area...

Best of luck

[HTPHP]

Thanks for the swift reply, the amount is around £2k enough to see me to the end of my current free-lance contract and it's a B2B invoice. I can just tell this is going to take forever to resolve, and is definatly making me reconsider being self-employed.

[GRDCredit]

Are they a limited company? As a starting point drop me a PM with the company name if they are and lets get an idea if they have the ability to pay.

How old is the debt?

(PS Thanks Geoff T!)

[HTPHP]

Hi, nope he's a sole trader just like me and the debt is about 3 months old now.

[Geoff T]

(PS Thanks Geoff T!)

You're welcome Namesake:)

[Geoff T]

OP - bearing this in mind - try Small Claims Online (https://www.moneyclaim.gov.uk/csmco2/index.jsp)- probably you're best bet IMO

[HTPHP]

Thanks for all the advice, have just started the paperwork for small claims, (So much evidence to gather together at the start).

[iridessa]

Just be sure that Court is the way you want to go. It is all to easy to throw good money after bad in this process.....as we have found out to our cost and even if you get a judgement there is no guarantee you will get your money. You need to weigh up all the costs and benefits to this route at the outset.

[HTPHP]

Thanks iridessa, but I get the court fees waivered because his actions have put me in "financial hardship".

[iridessa]

Well if you don't have to pay then nothing to lose! Only other thing I can recommend is to perhaps embarrass them in to paying. Maybe turn up on their home address doorstep one evening.....this has also worked for us in the past....it can become very embarassing and tiresome for people when they get a phone call every day and several visits to their home address.
I don't mean being bullying or trying to intimidate! We have used registered baliffs to do this kind of work for us (on residential lets) before going down the cost of court...and it's proved very effective, a lot cheaper, and you don't have to wait long for your money.

[GRDCredit]

when they get a phone call every day and several visits to their home address.

I don't mean being bullying or trying to intimidate!

At the risk of being a miserable old git I would say that by doing Quote 1 you are intimidating/bullying and this is of course - for individuals - illegal.

[iridessa]

I can see it may be interpreted as that by the person on the receiving end.....but many companies do this anyway. At a company I once worked for the suppliers who called every single day chasing their money and who turned up on the doorstep were the ones who got paid....those who didn't cause a commotion had to wait for their money. This co. even had the Revenue turning up on their doorstep to collect a PAYE cheque. You have to get tough when it's a matter of your own survival and someone is owing you money.

[Geoff T]

At the risk of being a miserable old git I would say that by doing Quote 1 you are intimidating/bullying and this is of course - for individuals - illegal.

Have to disagree here Geoff - the right words do not seem to be intimidating or bullying...

Think "harrassment" instead - right word, equally illegal.



(Had you going there for a sec hey Namesake!:D;))