Bad debt

[neweb]

I'm sure quite a lot of the members have run in to this problem over the past couple of months.

I have a client that had an outstanding invoice to the sum of e120.00 from January 11th
There was a lot of effort on my part to get this invoice settled but it was like flogging a dead horse.
Due to the lack of response from the customer every time contact was made and the endless "That will be pad Friday" response, I decided to add interest and account administration charges to the account in the attempt of getting this bill settled.

This went on for quite some time. Then 2 weeks ago the client paid the bill. When I checked the transfer they had only paid the original e120.00 and completely ignored the interest and charges. This company is a semi state body so the whole bill should have been paid in full.

So here is my question:
How would you deal with this situation??????

Because of there shear arrogance I am considering suspending all services until the bill has been paid in full. This would include domain and hosting. I know it seems a bit harsh but I feel if you let this behaviour continue it just gets out of control.

 

[mneylon]

Hand it over to your solicitor tbh

 

[neweb]

I would but the value outstanding is only e43.00

 

[mneylon]

I would but the value outstanding is only e43.00

Then drop it.

 

[louie]

if you got the big part of it than as blacknight said, forget about it and drop it...

 

[neweb]

Agreed I did get the main invoice paid but the arrogance of these people to just assume they can pay what and when they like.

The good thing is, there domain name is due up in two months. If I don't get paid within 30 days for this one then I will drop them like a hot potato.

I know it sounds petty but I show no mercy to arrogont assholes like this.
They want you to bend over backwards to get them sorted asap. It all changes when the invoice is issued.

 

[louie]

make sure you mention it in the invoice and send it out 30 days in advance...

 

[neweb]

make sure you mention it in the invoice and send it out 30 days in advance...

All my domain and hosting invoices state that the domain will be automatically suspended in 30 days if payment has not been made as it is assumed you no longer require the domain.

They also get the same reminder 20 days in telling them they have 10 days to renew there domain. After that its no longer my problem.

Over the past 6 months its like pulling teeth trying to get paid.
I've heard this from quite a few people.

 

[nevf]

I would but the value outstanding is only e43.00

Then drop it.

It's principle over effect if you ask me.

The fact that you have now collected all of the original debt though, probably means a solicitor is OTT to be honest.

What you should do however is write a letter/email (not a long one) expressing how you feel, because one hand that will help you vent your frustrations, and on another hand, will make sure that they know who the guilty party is in the future and they'll make sure they play their part from now on.

Unless, of course, they are cold-hearted, and if so, drop them.

 

[php.allstar]

I see this kind of thing time and time again.

I feel there is more of a need nowadays to have a rock solid contract and spec drawn up, agreed upon and signed by both parties.

This should include clauses for late payments that state what penalties will apply payments are late.

At least that way you have a leg to stand on if you need to set the dogs (solicitors!) on them.

Granted if the work is only for around €150 it may not seem worthwhile, but when you get a letter threatening legal action which may result in them having to pay the original fee plus legal costs, the client should change their tune fairly lively!

If I owed my phone company or broadband company money, and I didn't pay, they wouldn't be long cutting me off and then also not restore service until payment has been made.

I'm sick of developers/designers/seo'ers being walked on like this.

On the flip-side, I'm kind of half afraid to mention contracts to prospective clients during the initial handshake for fear of scaring them away!

 

[neweb]

I see this kind of thing time and time again.

I'm sick of developers/designers/seo'ers being walked on like this.

On the flip-side, I'm kind of half afraid to mention contracts to prospective clients during the initial handshake for fear of scaring them away!

Mention the word contract and they run a mile. Most people will say "Any half respecting company would be glad to sign a contract" well in fairy land that might be true but in Ireland its not.


We still have the philosophy of ducking and diving in this country. I had the pleasure of dealing with UK companies and German companies. Both always paid within the 30 days, the Germans topping the pole by always paying within 15 days.

It's principle over effect if you ask me.

What you should do however is write a letter/email (not a long one) expressing how you feel, because one hand that will help you vent your frustrations, and on another hand, will make sure that they know who the guilty party is in the future and they'll make sure they play their part from now on.

A good idea but I have spent far to much of my time and effort chasing this company for money to take that route.
This is an ongoing problem with a lot of companies over the past 6 months. The problem has always been there its just got a lot worse over the last 6 months.

 

[php.allstar]

As mention previously by another user on this forum ...

"You could always get Viper Debt Recovery and Repossession Service Ltd" on their case!

 

[Byron]

"You could always get Viper Debt Recovery and Repossession Service Ltd" on their case!

A sly comment we make to all our clients at initial conversation when they mention payment terms... hisss

 

[StephenM]

This company is a semi state body so the whole bill should have been paid in full.

Since its a semi-state company, have a look at the Prompt Payments of Account Act 1997: No. 31/1997: PROMPT PAYMENT OF ACCOUNTS ACT, 1997

4 (2) A purchaser who does not pay for goods or services by the prescribed payment date shall, subject to sections 5, 7 and 14, pay an interest penalty to the supplier in accordance with this section on the amount from time to time outstanding under the contract for the supply of the goods or services.

 

[Byron]

To be honest the gov bodies and semi states are messing around with a few of my clients in their industries, they deal with by saying payup, pay interest or we'll go public - which scares them a lot. But if you do so, only use it as a last resort because you could be held liable and the govt are experts at screwing the little guy!

I have heard of a few having success with the Accounts Act

 

[neweb]

If that is case then they are not worth the effort.
I have just added another 7.50 account admin charge so there bill is just going to keep going up until they pay.

I don't agree with just dropping it because I got most of the bill. If people started doing that then we would have much bigger problems then we have now.

 

[link8r]

I see this kind of thing time and time again.

I feel there is more of a need nowadays to have a rock solid contract and spec drawn up, agreed upon and signed by both parties.

This should include clauses for late payments that state what penalties will apply payments are late.

At least that way you have a leg to stand on if you need to set the dogs (solicitors!) on them.

Granted if the work is only for around €150 it may not seem worthwhile, but when you get a letter threatening legal action which may result in them having to pay the original fee plus legal costs, the client should change their tune fairly lively!

If I owed my phone company or broadband company money, and I didn't pay, they wouldn't be long cutting me off and then also not restore service until payment has been made.

I'm sick of developers/designers/seo'ers being walked on like this.

On the flip-side, I'm kind of half afraid to mention contracts to prospective clients during the initial handshake for fear of scaring them away!

Unfortunately Rock solid contracts don't prevent bad debts - e.g. if the company goes out of business.

Another issue I've seen arise is the company, particularly ones with a larger management team, can claim the person who signed the contract didn't have the authority. So you need to have a clause that makes the person make sure they have the authority so that you have them on grounds of fraud (for signing a contract that they don't have the authority to do so. If it ends up in litigation, they would have to help you argue that they did have the authority). You should also ensure that they do.

If its a really big project and you will be committing to a large outlay, don't
be afraid to ask for a Personal Guarantee Form. If you engage someone to do your cotnracts and terms and conditions (e.g. EC Credit Control, Ireland - EC Credit Control, etc) then they can draw this up for you. It prevents directors from making willy-nilly contractual decisions and holds them personally responsible regardless of the protection offered by the LTD company.

Secondly be very aware that the courts can still decide that your action of holding back the website/works are going to cause a business loss to the other business, and if they claim you are simply holding them to ransom (by claiming that they have paid you) - a Judge can and will (if they see fit to) have an order sent to you to release the code. They will also award costs. You will then have to go and defend it and if you dont have the proper documentation, expect to kiss goodbye to another €7k. This does happen.

Becareful too how you describe your work - cover it from a Goods, Services and Intellectual Property point of view - Copyrights, Patents, Designs, Symbols, Instruments etc - cover with a solid, broad retention of title.