Struggling to get payment from a client.

[waynelang2001]

Hi all, I hope you all had a great christmas. Mine has not been that great because of my latest client. For more then a month now i have not been able to get payment from them on a finished job. If it was a small amount it wouldnt be so urgent but they owe what comes to more then a months salary. I started phoning them after the job was done and they where always in a metting and they would phone me the next day. That has never happened, and as of the last week the refuse to take my calls all together. first it was just my cell number they would ignore but now that i have been using my home number the first time i called them they answered, but not anymore.

I am at my wits end with them now and desperetly need this money for my bills at the end of this month. It has been a tough enough year for me with my illness and lack of work, but this feels like the nail in the coffin for me.

Does anyone have any advise on what i should do next ????

 

[ajones]

I would probably go and see him at an  inconvenient hour of the morning, and ask for payment then play it by ear, it would  harder for the client to say no if you can get in the house, and don't leave until you have payment

 

[andyman]

Stick on the case if it is a company issue them with a written demand for payment, unsure what your legals are like in SA, if no reply in 7 days send recorded delivery.

If it a private person do the same, if your laws are as stupid as ours you cannot reclaim anything, even though the people might not have bought anything.

i lost over £15000.00 on my 1st day back in work Jan 2012 as Millets / Blacks a big company went into administration, they then had all the debts wiped out & the b******s then carry on trading all the same people shops etc, no chance of anything back, I think they owed about £100 million, if anybody reads this & shops at any of their stores do me a favour & shop elsewhere.

Back to yours you could always do the other way but check who the people are 1st as you don't want to cause more problems for yourself

 

[woodwrights_corner]

Somebody needs to ask the tough questions.  Did you have a written agreement?  Are you both in agreement that the job has been completed to the customer's satisfaction?  Is it in writing?  Are you the only contractor on this job?  Any other work being done by others at this site?  Is it a residence or a business location?  Also, how much money are we talking about in materials and labor - separately?  How much damage can this fellow do to you in the future?

 

[Oldwood]

Hi,

Do you have a signed contract detailing payment schedules? Around here we have 45 days to file a builders lien on the property but that only has an effect if they want to sell or borrow money against the property.

Some collection agencies will take this on but take a percentage of the funds. I would first ensure you have no chance of collecting before handing it over to them though.

Good luck,

Gerry

 

[waynelang2001]

Somebody needs to ask the tough questions.  Did you have a written agreement?  Are you both in agreement that the job has been completed to the customer's satisfaction?  Is it in writing?  Are you the only contractor on this job?  Any other work being done by others at this site?  Is it a residence or a business location?  Also, how much money are we talking about in materials and labor - separately?  How much damage can this fellow do to you in the future?

These are tough question your right, I am the only one who worked at the house, it was cabinet makers work like fixing cupboards, replacing hinges and adding some other cabinets to various rooms. When I was at there house to collect the deposit we both signed the quotation saying what had been payed and what was owing when the job was complete. I didnt put any deadline on when the final payment should be made and maybe that was a mistake on my part. But that is not the issure here, whenever i have to tried to phone they cancel the call and send me a message saying they will call me the next day. That happened at least 6 times and as of the last week or so they just cancel the call and do not reply at all.

Also when I had finished the job i went through everything with them and they had no complaints about anything and where happy. This is the first time I have ever had to fight for what is in fact my money now, its not theres its mine, I have put the time in and finished the job.

I think i need to put in the quotation next time that on the day of completing the job i want payment, and i wont leave the house until i get it.

 

[mouppe]

Perhaps a letter from a solicitor will show them you are taking serious action? Often people will back down with the threat of legal action.

 

[Tinker]

Upon occasion, i have slapped a mechanics lein on a property.  This has to be done (in my state) within 30 days of last delivery (action) or completion.  we then have a year to start further action, such a legal action thru courts.  We don't even need to inform the client about the lein.  If they pay the bill before legal court action, the lein gets cancelled and the client needs never to know such action had been necessary.  Of course, even tho i get paid, if i had to lein and follow thru on a property, i am generally not too excited about going back to that property.

I figure anybody can run into problems paying bills and as long as no further action than the lein was necessary, i generally go back for more work >>> after doing a bit of research about pay habits.  For my landscaping work, the bills never get too big and people want me there again next week/next month/next year.  if they don't like to pay, i just don't care about going back.
Tinker

 

[rmwarren]

Depending on your legal system you may need to obtain a judgement against them before proceeding with collection. In the US we have "small claims" courts where you can file against someone and then you both show up without counsel and stand before a judge. If they fail to show up you received a default judgement against them from the court, but the trick is collecting on the judgement. I have had a reverse situation where a contractor took a deposit & then disappeared. We obtained a default judgement then started dropping by his house at 8:00 PM on weeknights, and he paid not wanting his wife/kids to learn he was a crook.

I agree with Richard that the best first step is doing something official that shows you are not going to roll over. I suspect in your case you need to pursue them via your legal process and then get hard-nosed about collecting. You still probably won't collect soon enough to pay this month's bills.

Good Luck.

RMW

 

[woodwrights_corner]

Are you dealing with both a husband and wife and their primary residence?   Is there any chance that one of them doesn't know what is going on with the late payment?  When you say you met with them or you left them a message or they left me a message are you certain it is a "them" and not a "he" or "she"?  I've had an occasion where one spouse didn't tell the other the truth about paying an invoice that was due.  This is why I ask these questions. 

 

[Bob Gerritsen]

Wayne, before anything else, you need to know what the order of legal actions in SA is. For instance, i believe over here I would have to send three reminders before taking it a step further. So that would probably be another six to eight weeks at least before any serious action could be taken. In any case, I would inform yourself about that and take the proper first step ASAP. 

Visiting them at an odd hour will only do you any good depending on what the problem is. If they are prepared to dodge your calls six times in a row I don't see how a personal visit would be much different. It can well be they have financial issues. Not saying you shouldn't visit them, I would but after you've starting the legal route so to speak. So lets say you've sent the first official reminder, then go over, tell them you're taking action but hope things will work out.

All the best Wayne, hope this works out for you!

 

[Wood_Junkie]

Call them up and this time state that you are "Calling, representing Mr. {your name or your company}, in the matter of an outstanding debt for work done on the residence of Mr and Mrs. so and so (they're name) for which payment is overdue."   Put a little lawyer-fear in them, but don't overtly lie/misrepresent yourself AS a lawyer.  The statement above is truthful, but just worded to sound official-like.  Your representing yourself.

Anyway, a few things to keep in mind:
Their financial trouble doesn't justify giving you financial trouble.  It was their decision to contract with you, and whatever happened to their financial resources is their problem, not yours.
You are *owed* the money.  It's not just a nicety to get paid for work done.

Document, document, document.  Write down all the contacts you've already made and/or attempted.  Responses / refusal / broken "promises" to call back etc.  Get it all down and documented ASAP.
When you call them, as per above, reference the list of contacts and lack of responses, etc.  If you wind up writing a letter, include this information so they can see their trend of BS'ing you.

Do you have the ability to put a lien on the home? Here it's a ridiculously simple process and a $30 fee with the city.  Too easy, IMO, but an effective threat, since they then have to fight the battle to clear it.

I would advise *against* showing up at their home.  This could create a bit of defensive hostility.  I know this from personal experience, as I had a contractor who screwed us (the homeowners) by botching a roof repair, which then resulting in some serious water damage to our condo, and he was weaseling out of taking responsibility for it and getting repairs lined up and done.  Weeks and weeks of going around and around and calls ignored, excuses, etc.  So we knocked on his door one evening... and he went ballistic... blah blah, this was his home, not his work, blah blah, he was with a guest and how dare I blah blah.  I yelled back about how his actions had ruined our home blah blah.   Didn't end well.

Anyway, next day I put in a call to start the claim process with my homeowners insurance, and when they asked if it was the result of anyone/anything I specifically named the contractor and his company.  He got a call from the insurance lawyers that week ('cuz they want to go after whomever caused a claimable repair), and apparently messed his shorts, 'cuz he was then calling me to try to get things sorted out.
Again, legal action is the only thing that prompted any response.

Oh yeah, once you've actually started down the legal path, do NOT go to their home or make further contact.  It might appear to be harassment at that point.  If a non-legal/court solution is to be found, make them scramble for it.  In fact, the less responsive you are, the more they'll stress (basically the same as you are doing now).

 

[Rick Christopherson]

I would probably go and see him at an  inconvenient hour of the morning, and ask for payment then play it by ear, it would  harder for the client to say no if you can get in the house, and don't leave until you have payment

This is the worst thing you can do. You do not harass a debtor in an effort to collect a debt. Not only can you lose your bad debt, but you can end up paying them fines. South Africa does have debt collection laws just like the U.S., although those laws possibly only apply to secondary debt collectors and not the original creditor.

I think i need to put in the quotation next time that on the day of completing the job i want payment, and i wont leave the house until i get it.

A due date is not your problem here. These people have no intention of paying regardless of a date. That is why they are avoiding contact. This doesn't mean that they had never intended to pay, but could have come upon sudden financial hardship. You need to be firm, but always treat them with respect and do not do anything that could constitute harassment.

Because your laws will be different than anyone else on this forum, you will need to do your own research as to what action you can or should take, as well as what actions you cannot take.

Begin your research by looking up information pertaining to a "Builder's Lien" (which we call a "Mechanic's Lien" in the U.S.). This amounts to a "claim" against the property. I haven't researched the process in your country, but in the U.S., anyone performing work on real property has the right to file a lien on that property. Different lien types have different powers of authority. Some lien types can actually foreclose on the property, but it is unlikely that a Builder's Lien would have this power.

After doing some research of your own, then you should contact a lawyer to find out specific details about your situation. In the U.S., most lawyers will provide an initial consultation for free. That means you can ask some basic questions without a fee, unless they begin working for you.

Another thing to make sure of, is that the home owner has a written statement of invoice for the charges (preferably itemized with respect to what the charges are for). If possible, send it to them in a form that can be tracked, such as registered mail. The main purpose of this is to document the debt owed. Also begin gathering all of the documentation that you can. Record the dates and times that you have attempted to contact them, and what the results were from that attempt. Be meticulous in your record keeping. If you ever need to take them to court, you will need all of the records you can produce.

 

[Wooden Lungs]

I would find out what your legal rights are first.

On all my quotes and invoices to clients I clearly write in red letters that all materials belong to me until paid for in full.
This has helped me greatly in the past with the odd nutty client.

I know what you are going through as last christmas we did a lot of price work for a local timber frame company and we got screwed over christmas as they paid all their regular guys but the subcontractotrs got left for weeks without money.We did eventually get paid.  Learnt just the other day they went bust.

I would put something in writing and send it to them registered post so if it does see legal proceedings you have proof you sent something, also I would email them the same letter so you have a digital copie too.

After laying out for materials and labour its a real kick in the spuds not to get your money.

Best of luck and hope it gets sorted soon.

 

[tiralie]

After doing some research of your own, then you should contact a lawyer to find out specific details about your situation.

I think Rick and others here offer sound rational advice. While writing demand letters and going to their house will make you feel better it may make matters worse.

You have two problems: Bills to pay and a customer who owes you money. Unfortunately the second problem is aggravating the first and is going to take some time to resolve and problem one will get worse.

The quicker you come to this conclusion the sooner you can take care of problem one - paying bills.

Being pissed off and particularly in your situation, is completely normal, just try not to make decisions in that state.

Once you have figured out how to solve problem one (paying bills), you can now work on problem two.

Because this is the first time you have had this problem, ask others you have worked with or in the trade if they know of or work with any lawyers who have experience with this kind of situation. I am sure it's not unique.
When you get some names of lawyers, contact them and discuss your problem, when you find one you like and connect with tell them you would like to meet to discuss your problem and what they can do for you.
When you meet with them take a copy of your agreement or letter and ask them what you need to do in the future to reduce the risk of this happening again. I would also ask the lawyer to consult on what the best practices for insuring payment in your area.
Good luck

 

[Tinker]

Putting a lein on property does work, but in some cases, your still must work very fast.
I had frgotten about the only time i actually went to court over a bill i had sent.

I had become friendly with a next door neighbor from the time he moved in.  He had a lot of problems with his house and i volunteered lots of advice and offered some assistance for several small projects.  He eventually was ready to excavate under his house to make a crawl space into a full cellar.  This particular project was something i had expertise AND equipment to do.  I went in and dug under his huse along with necessary shoring and bracing. We made an agreement about my charges.

Once i had the excavation completed and the house and earth were well supported, i showed the man how to do the form work for concrete.  When he had completed the forms, i went over and took one horrified look and told him the first shot of concrete would have everything collapsing in a heap with his house probably settling down on top of everything else.  We went round and round on this and i finally told him I wuld not help him with the concrete unless he allowed me to redo the formwork r to get somebody else to do it.  I ended up doing the form work for nothing as a neighbor but he would still have to pay for the concrete and the excavation work i had done.  I had originally told him i would help him to pour the concrete for nothing. 

Anyhow, we finally got the job safely done with a whole lot of tearing out and rebuilding.  In the end, the job actually came out pretty good and the neighbor seemed very happy. When i presented him with the bill for the work we had agreed on that he would pay, including the concrete (the form lumber had been from my own stockpile and was retrieved and repiled to where it had originally come from) he hit the ceiling and refused to pay for anything.

To make a long, and somewhat funny, story short, we ended up in court and the judge determined i should gt all that I had billed him for along with my court expenses.  My lawyer had told me that as soon as I got the Judge's decision, i should go to town hall and place a lein on the neighbors property.  I got the letter from the court a couple of weeks later and immediately went to the town hall to lien the property.  For some reason i do not remember, i had to await the decision before i could apply the lien.  when i got to the town hall, the clerk told me she could not do it unless my lawyer was doing it for me.  I ran to my lawyers office around the corner, as it was almost closing time at the town hall.  My lawyer was in court 30 miles away but somehow was able to get to the phone.  He told me the statute number that covered our situation and told me not to take "no" for an answer.  I ran back to the TH as fast as I could and caught the clerk just as she was abut to lock up to go home.  I gave her the info as I had been directed by my lawyer and after a few impatient moments, she finally agreed to do as i had asked.  The deal was completed and i went home knowing I had at least secured the property for the time being.

The next morning at about five after nine, my wife got a phone call from the neighbor who wanted me to call him back immediately.  My wife called me at the job I was on for that day and told me of the call.  I called the very upset neighbor immediately, figuring he was ready to pay me right away.

As he got my call back, he exploded.  "What the H--- are you doing?"  he did not sound like a man who was ready to pay a bill.  "I just went to the town hall with my mother to put the property into her name.  You put a lien on it!" By now he was practically screaming into the phone.  He was so upset, I had a difficulty to keep from laughing.  "

He continued, "What the h---, don't you trust me?" 

I did get my money.  This guy was a real dead beat.  He later hired my demolition guy who had done the jack hammer work for us to do another job on the house he moved into after he left our neighborhood.  He pulled the same stunt on him.  Same results.  Some people just keep trying but i have never forgotten his perplexity when he asked if I didn't trust him.
Tinker

 

[andyman]

They have a program in UK called Cowboy Builders they should have a show for the customers of a similar vain  [mad]

 

[woodguy7]

That is quality  [thumbs up]

Wayne, I send a recorded letter saying they have 7 days to pay & then I am taking them to small claims court & that they will be liable for all court costs & my legal fees in retrieving my money.  That always works.  I have the court papers at home & if needed, I would fill them in & send a photocopy to the scum-dog in question.  They will then realise you are serious.

Good luck & let us know how you get on.  We have all been there !

 

[Rick Christopherson]

Wayne, I send a recorded letter saying they have 7 days to pay & then I am taking them to small claims court & that they will be liable for all court costs & my legal fees in retrieving my money.  That always works.  I have the court papers at home & if needed, I would fill them in & send a photocopy to the scum-dog in question.  They will then realise you are serious.

Good luck & let us know how you get on.  We have all been there !

Small claims court is not for collecting money. It is used for settling a disagreement whether money is owed or not owed. If they weren't willing to pay your invoice, having a judgement does not automatically mean they will pay you against a judgement either. Simply having a judgement in your favor does not add any more weight to your attempt to collect money, except that it does open new legal avenues that you can pursue. But those avenues have additional costs and additional paperwork.

With a judgement, you can levy their back account or garnish their wages, but you still have to go through the legal process of doing that. That also includes the difficult (or impossible) task of even finding their bank accounts or places of employment. Short of that, you are still stuck making phone calls...would you pay me?...would you pay me?...would you pay me?

 

[Alan m]

after the judge rules in favor of the trades person would there not be an order to pay the tradesperson.
surly failure to do that would be contempt of court  adn result in jail  etc .

wayne. some good advice above.
get everything writen down and all the t s crossed and i s dotted. etc. then go after tham for everything.
remember to add on all the associated costs of trying to get your money,. phone costs costs of leans etc,

most of these scum are only chancers and will back down when the law is brought in.
just remember that your in the right and they are steeling your money.