Supplier Disputing Invoice

[SIMONESANDERS]

Hi,

I wondered if someone could help me. My husband and his partner have been working for theirselves as a partnership since March. They did some work (locker and bench fitting) for a new Contractor. However despite me sending the invoice, sending numerous emails asking who I needed to speak to re: payment and telephone calls where I was forever being promised a call off the manager who needed to speak to me. I have today called his mobile, so forced him in a corner to speak to me. He is now saying he is going to send me an email re: the invoice as they are not happy. The work was carried out at the end of August. Surely its a bit late in the day to be disputing the invoice now. I assume if there was problems they should have done this immediately. I just dunno if they are trying to get out fo paying or looking for a reduced rate. I am awaiting an email confirming the details, which I probably won't receive, I then intend to send a formal letter chasing payment and then look at going to a small claims court. What do you think, can anyone give me any pointers or advice, shall i tell em to get lost because of timescale. Help!!

 

[Kernowman]

A good way to test their sincerity is to send them a "Notice of Intended Action" to ring their bells. Give them 7 days to pay your invoice in full and if they have a dispute, then they should raise it sooner rather than later, but don't of course say that in the letter.

If you get no response to that letter, then proceed with the recovery process.

 

[SIMONESANDERS]

Thanks for that, can I do that even though I haven't send any other formal letters? I don't suppose you would also know where I could get an example of one from? Sorry to be a pain this business stuff is all new to me.

 

[Kernowman]

It doesn't have to be overly complex or "legalised" at all.

Just write it as you would a normal letter, with name, address, date and reference, then in girt big letters across the top of your text put the words,

NOTICE BEFORE ACTION

State that despite repeated requests by email, telephone calls for payment, invoice number(s) are still outstanding beyond your strict 30 days credit period and they now have seven days to remit in full otherwise recovery action WILL commence. No further correspondence will be entered into.

Sign it, away it goes.

 

[Devon Julie]

I'm not sure where you're located. I'm in the UK and there is a ompany here called Thomas Higgins that you pay a very nominal fee £2 and they'll send a formal collection letter, threatening legal action if not paid immediately. If you're elsewhere in the world, there must be similar companies. Good luck. Pretty bad practice from them...
Julie
​

 

[SIMONESANDERS]

Thanks for your help, this is really appreciated.

 

[SIMONESANDERS]

Thanks, I will bear that in mind as we are uk based. I'm glad you think it's bad practice, you start to question whether its us, because we are new to all this. Im more annoyed the fact that there not happy with some work, they hadn't got the balls to say, I only found out because I asked the question. That's why I think they don't want to pay and if they weren't happy I know myself I would be straight on the blower, anyone would!

 

[Kernowman]

At least it will get sprung into action BECAUSE THIS LETTER SAYS YOU MEAN BUSINESS, or they will (if they have a legitimate claim, which I doubt) provide full details about this "problem" they appear to be having with the work carrie out.

I seem to recall another recent post about a sub-contractor who was also being led the same merry dance for the same reason. If it is a trend growing in the industry, then make jolly certain if there are problems to be sorted out it is YOU that does the remedial work and not some phantom tradesman rectifying a phantom fault then deducted from your invoices.

 

[bovine]

Hang on a moment. Work was done end of august, so only just over 30 days ago. And you're being encouraged to send a notice before action? Thats jumping the gun a bit.

Now to you and me, 30 days is a long time. To big companies, its not. Some companies move slowly, especially when it comes to accounts. Admittedly, any problems should have been notified soon after the work was done, but it is possible the faults/problems werent picked up until snagging was done, which is quite possibly some time after.

You have now been in touch with the manager who has said he will send over what they are not happy about. Give him a few days to do this before doing anything - it is possible there is a genuine issue that you can all resolve. If you dont wait for this and try to go legal, its all going to blow up in your face - the customer has said there is a problem and thats why they arent paying. Try putting that to a county court and you will be ruled against.

Once you know what the problem is, you will know if they are taking the mick or not (they may well be). Until then, just chase the manager for the queries. If they dont come back by the end of next week, impose a deadline for you to be told the problem, which if not met will result in a notice before action. Remember, this could all be small misunderstanding which is easily resolved and could lead to more work. Hack them off for now without good reason and you lose that work.

 

[SIMONESANDERS]

If we were made aware of the problem/s earlier on we would have obviously done the work out of our own pocket. The fact the manager has been ignoring my calls etc suggests its a load of crap. If there is a genuine problem then would it be reasonable to request part payment until any appropriate remedial works were completed. It gets better though we have 2 invoices to be paid, one which has nothing to do with this as the 1st job wasn't quite complete but the company were aware of this and at the time nothing was said and we couldn't complete because all the materials werent supplied. the second invoice is for a job which when they arrived was then cancelled, so in my view theres is no reason to hold the second invoice up at the very least. Put it this way a new contractor or not we won't be doing any more work for them, we will stick to who we know and in typical fashion we are working for another new contractor today. I hope they don't start playing silly buggers. I'm one of the partners wives and I seem to get lumbered with all this lol. When they start making enough money that audi is a must and well deserved lol. Thanks

 

[SIMONESANDERS]

Thanks for that, we don't work on a 30 day period. Our contractors usually pay us on 14 days and this is confirmed at the bottom of all invoices, so this is way overdue. I take note of chasing the response and giving the idiot a deadline to respond to.

 

[bovine]

What were the original terms of payment? Because if its 30 days, then it has only just gone past 30 days.

And I wouldnt recommend kernowmans suggestion of pay or we take you to court, no further correspondence will be entered into, unless you know 100% without a doubt that there is no valid issue with the invoice.

edit : - well, not yet anyway!

 

[bovine]

ref 14 days - were your contractors aware and agreed to your 14 days? What is your industries usual payment terms?

 

[SIMONESANDERS]

The terms of our invoices are 14 days and that's what all of our contractors pay on. I know what your saying and really don't want to be in a position where out of pocket completeley. so gotta give them a bit of time. Thanks

 

[Kernowman]

When these people won't even respond to your queries in a straightforward and timely manner you have to do something to provoke them into positive action otherwise they bounce you along for as long as they possibly can. All very well being polite and patient, but when it is your livelihood at stake then you have to protect your own interests.

 

[bovine]

Part of the problem is the OP did not know who to chase for payment. In any organisation, this is the key to getting paid - working out what they need to do to pay you. In a lot of these organisations there is a process. If this process is not followed, you dont get paid. For example, you send an invoice into accounts. They key it into their system and match it to a PO. This is then sent to the site for authorisation. The manager at the site has to approve this and sign it off. This is then sent back to accounts. Accounts then re-enter this so it can go through for payment. The finance manager then has to approve the payment to go on the payment run. A date is set for the payment run. Then hey presto, you get paid.

The above is an example of what needs to be done by one of our customers to pay us. Their terms are month end + 45 days, but we dont wait for this time to nudge it along. We call at various times to different people to check the invoices are on the system. This means we get paid promptly. Before we worked out the process, it took ages to get paid.

So whenever you take on a new client, work out what you need to get paid and who you need to talk to. The OP has managed now to get a direct contact for someone to sign off on this, so has made good progress.

Develop a procedure for chasing up debt, what happens and when. But dont threaten legal action as the first real step. If you need help on this sort out thing, there are a few people on here who can help. Letters before action do have their uses, but not as an opening gambit.

Its a bit like when you have a different view to someone. Is it better to discuss it calmly first or just go in and shout at them? Talking calmly will resolve most problems, but sometimes you do need to shout.

 

[SIMONESANDERS]

It didn't help as every time I rang and asked to speak to accounts no-one would put me through and no-one responded to and returned my calls. this has been going on for way over a couple of weeks up until today when I rang a managers mobile.

Thanks, if I say don't get a response after my phonecall today by say Monday would you send a letter / email saying anything particular??

 

[Michael Gerard]

Simonesaunders - what industry are you in / what was the work for please?

 

[SIMONESANDERS]

Hi, Construction. My husband and his partner fit lockers in schools, gyms etc for various contractors.

 

[Michael Gerard]

Your husband's work will therefore be caught under the Housing Grants, Construction and Regeneration Act, which lays down strict rules concerning payment applications, when payments fall due and the final dates for receiving payments.

In addition, for any debtor who intends to withhold payment for any reason, must send a timeous withholding notice, and failing this, then it cannot withhold any monies against the invoice. It can abate the claim should the value be incorrect in the invoice for such things like defects.

You therefore have a choice (and notwithstanding any written terms which you may be governed by). Threaten to refer the dispute to adjudication (a decision will be made within 28 days), or issue proceedings through the court.

The method you decide to select will depend on the value of the dispute. For instance, if it is a few hundred, or even a couple of thousand, then adjudication is not the right course of action to take.

However, whatever method you decide, a weel set-out and very firm 'Letter Before Action' is crucial.

If you PM me and tell me where you are based and what sort of values your projects are, I may offer to be on hand in the future!

 

[SIMONESANDERS]

Thanks for that, the invoices total just under £900. But for a business which set up in March is a lot.

Realistically what do you think my next steps should be as the contractor has said nothing to us despite numerous emails and telephone calls and has only today confirmed there is a problem because I asked and yet he still hasn't sent an email confirming the problems as promised. I only asked because I'm being ignored and we have had the offer of no further work, which is normal as it slackens off a bit now. I really don't know what to do. Bearing in mind 1 of the invoices is for a day which was cancelled on arrival so has nothing to do with any problem on site which the other relates to. Surely this should have therefore been paid. if we had been advised of any problem we would go and put it right without additional cost. I know that the contractors client was a pain in the bum so i suppose the contractor being a pain should be no surprise.

I don't follow the pm bit, sorry.

The lads work for various contractors on sites which include: hospitals, schools, gyms, fire stations, commercial offices. So i don't really know the value of the contracts as we are the middle men and i am currently in the process of registering with constructionline so we can look at bidding on anything appropriate to move the company forward. This will be challenging though as the bid process is new to us and lucky me im doing a course lol. Thanks

 

[Kernowman]

The "PM" referred to is forum speak for "Private Messaging" which you can access by clicking on the poster's name in the top left hand corner of the post and a drop down menu will appear with the option "Send a private message to . . . . . "

 

[Michael Gerard]

I am sure that £900 is quite a bit to yourselves, but your only realistic option is a Letter of Claim (like a Letter Before Action), and if no joy, then issue proceedings on line.

Because of the low value involved, you will need to do this yourself, otherwise fees will start to erode away any benefit.

The PM is a 'private message' which you can send if you do not wish to show on the public forum - but don't worry now.

Good luck.

 

[SIMONESANDERS]

I don't suppose you could suggest anywhere to get a template from?

 

[Kernowman]

Here is one from Consumer Direct

http://www.consumerdirect.gov.uk/after_you_buy/making-complaint/template-letters/letter_before_action/

or another one from Microsoft


http://office.microsoft.com/en-gb/templates/letter-before-action-TC001196030.aspx

Or you can type "Letter before action template" into a Google search and it should find plenty