Non Paying Client 3

[bigmig]

I have a non paying client (5 months late) who is a contractor. In order to work with them, (they are a national disaster restoration contractor beginning with the letter B)they pretty much said they would not sign my typical contract, which specifies payment condtions etc.

In short, I have no way of getting my money other than constantly calling them by phone or physically going to their office... which isn't working. The invoice is small, thank goodness, but the principle makes me a little mad.

Has anyone ever gone to the building department and pulled their plans over non-payment? I've heard it stated before, but wanted to get some more specifics.

 

[fegenbush]

I wouldn't have a problem with going to the building department. Additionally, depending on your location, you may be able to file a small claims suit against them. The filing fee is often quite small. There is a maximum amount that you can sue for based on the laws in your jurisdiction. If you have unpaid invoices and other sufficient documentation, it should be an easy case for you. Even easier if they don't show up.

 

[JedClampett]

Can't you file a lien against the owner of the project? They can pressure the contractor easier than you to pay their bills.

 

[FSS]

Too late to do anything other than continue to harass the client with phone calls. Going to the building department in my opinion is an empty threat anyway. After 5 months the work has probably already been done and what little choices you might have had are long gone. Liens also have very strict time tables to follow.

You have to decide if the fee is worth the continued aggravation and when it becomes time to move on.

 

[JedClampett]

I'm no expert on liens, but I once stayed at a Holiday Inn Express. Even if the lien is somewhat bogus or late, and I'm not saying it is, it should get the owners attention. That might be enough leverage to get paid.
Don't forget if the design invoice is 5 months late, it doesn't mean that the the contractor has started or completed the work.
This kind of item bothers me. Big guys taking advantage of little guys, especially after you did a service for them. They probably could pay this out of the money in their petty cash.

 

[miningman]

I once had a similar situation where I was forced to file in small claims court , won the judgement, s

http://eng-tips.com/till

no cash so I had the sheriff seize the office furniture. The sheriff doesn't actually take possession of the furniture , simply attaches an official looking legal document onto the office door stating that said goods have been seized due to non payment, anyone removing said assets as is guilty of contempt of court , as is anyone removing or defacing this notice. Its amazing how difficult it must be to continue doing business with one of those on your office door....... suddenly my cash was readily available. Lots of fun

 

[berkshire]

I do not know which state you are in, but you should be able to file a lien against the building itself for services rendered, if your drawings are being used to construct it.
If the building has not started yet ,and your bill is under $5000 ( I would check this amount in your state.) then you should be able to file in small claims court.
Years ago I tried the theft of services route in court, and got it bounced because the judge ruled it a civil matter.
B.E.

You are judged not by what you know, but by what you can do.

 

[brandonbw]

Any tips on small claims court? We have 2 projects that did this. One is built and selling, the plans we adjusted were approved without a signature on the plan set. And the other project is just out of planning.

I spoke with a Landscape Architect and he said throughout his 30+ years he has found that pursuing these things wasn't worth the cost and time. Its more the principal, but money is money too. The only good to come out of this is we have changed things so this doesn't happen again.

B+W Engineering and Design
Los Angeles Civil Engineer and Structural Engineer

http://bwengr.com

 

[berkshire]

Brandon,
I think in California, you have to file in the county the business you are suing resides in. Also your landscape Architect is correct. Even if you prevail in court, you may not get the money.
An item concerning my wife, who did work for a customer in Los Angeles. The guy stiffed her for work done on a job. She had to travel from San Diego to L. A. to submit the case to small claims court. The judge heard the evidence, and said pay the lady. The guy in court wrote a check for $2700. It bounced, My wife then, had to go back to court, to get a contempt of court ruling, and an enforcement order. In the meantime the guy skipped the country, and has not returned. It turns out he owed a lot more people a lot more money than my wife's $2700, we are still out that money.
B.E.

You are judged not by what you know, but by what you can do.

 

[miningman]

Many of the practical cautions in this thread are true. Winning your case at small claims is NOT a guarantee of collecting your money. Each person has to weigh the positives against the potential negatives and make their own choices. But what I can tell you , is the personal satisfaction of beating the offending party in court is immense........ especially when they appeal the initial ruling and you beat them again in appeal, and again when they file for dismissal of the case and you then get to listen to the judge giving their lawyer a verbal lambasting for wasting the courts time , and then when the judge apologises to yourself both personally and on behalf of the court.

By definition, anyone who has never gone through this process does not fully understand what is involved, but believe me, what you learn the first time is invaluable in the event you ever have to do it again , potentially with much bigger $$ involvred. I would argue that the experience is much more relevant as proffessional development than many of the PDU credit courses that we all take.

And dont even raise the point about pissing off a potential client who wont supply any more business to you. Do you ever want to work for the scumbag again??? And if your market niche is so small that colleagues and aquaintenances become knowledgeable of your actions, this can only be a positive since similiar unscrupoulous indivividuals will be less inclined to take advantage of you in the future.

And once you sieze some assets, the siezure can be maintained untill , ALL , as in every single judgement is paid off by the debtor. In my case ( many years ago) I was only looking for $2000 but his total judgements were over $250,000 and everything had to be paid off before the siezure notice came off his office door. I would pay money for the opportunity to partake in a similiar exercise again.

 

[SLTA]

This is why God invented lawyers.

I had a builder put off paying, over and over, and then sent me a rubber check. One letter from my lawyer demanding a certified check and what do you know, the money appeared.

The builder actually had the gall to ask me to look at another project for him. Umm, no.

Do you get enough work from this company to make it worth your while? And how much is the hassle worth to you? Get your lawyer to write a letter, demanding the fee, late fees, and lawyer's fees. If they don't pay that, then try the courts.

Good luck!

 

[bigmig]

The problem with this particular client is that they make all their 'vendors' sign a release form that eliminates you from taking them to court unless you pay all court fees etc. I believe the word is indemnifiable. If you don't sign it, they won't work with you. I signed on with these guys because I had just started out on my own, and had 2 choices. Starve, or sign.

Now that I've got the year under the belt, I have enough clients to tell these guys to take a hike.

Regarding my invoice, I drove to the owner's office (insurance agent) and announced who I was. They sort of fumbled around and looked really nervous, and said they weren't aware I was even on the project, because their client (my non paying contractor) had not indicated I was. Based on their squirming, I'm thinking that was not in fact true. The insurance rep asked for a copy of my report so they could pay me. I promptly mailed and emailed it. My non paying contractor sent me a message asking for a copy. I did not oblige.

Will call the project owner (insurance rep) and keep pressing until the check is in hand.

To add to some other conversation on this thread, I generally ask for a project retainer that is the bare minimum I could do the job for and not feel completely fooled. This does several things. 1) It means the client is serious in order for them to pay money for their project to start 2) It gives you something that is better than nothing in the event things go south.

The other thing I do is stop working on their project at the slightest sign of non payment. My contract specifies how long I will wait for payment, how the job will stop, and what the startup fee will be to re-initiate something that has gone unpaid. As mentioned earlier, this particular client (B..E...L..F..O..R) would not sign my contract 'because of corporate'.

 

[TenPenny]

"The problem with this particular client is that they make all their 'vendors' sign a release form that eliminates you from taking them to court unless you pay all court fees etc. I believe the word is indemnifiable. If you don't sign it, they won't work with you."

It might be worth investigating if that clause is even enforceable. Many times, companies will get you to sign releases that don't have any actual validity, except to scare you off doing anything.

I dealt with a YMCA where they wanted all the kids using their facilities to sign a waiver saying you couldn't sue them even in the case of negligence...my lawyer confirmed that that clause could never be defended in court (around here, anyway), so that it was fine to sign it, because it was meaningless, the only reason it was there was to discourage people from suing them.

 

[berkshire]

bigmig (Structural)
If you have not lawyered up over this yet , I strongly advise you to do so.
You need a trained person to go over the agreements you have signed, and advise you on a proper course of action.
As many others have said here, the advice you get here, including mine, is worth what you pay for it.
B.E.

You are judged not by what you know, but by what you can do.

 

[drawoh]

...

I dealt with a YMCA where they wanted all the kids using their facilities to sign a waiver saying you couldn't sue them even in the case of negligence...my lawyer confirmed that that clause could never be defended in court (around here, anyway), so that it was fine to sign it, because it was meaningless, the only reason it was there was to discourage people from suing them.

I have been told that all sorts of waivers are "court tested". Was your lawyer perhaps advising you that waivers signed by kids under 18 were not valid?

--
JHG

 

[PicoStruc]

The truth about Health Liability Waivers (in sport for example) : A Waiver is invalid if there is negligence.

 

[bigmig]

Finally, success. Received payment today. In summary, the communication regarding invoices is like this:
emails = meaningless. Phone calls = better. In person face to face visit = best. I guess lawyer and seizure might be best on some people's list.

I did find an email tracking system that allows you to obtain very useful information regarding your emails, such
as when it was opened, how long it was read, and the general geographic location of the person when they read it.
The program does not depend on annoying read response click boxes, but works in the background.

I used it with the owner and found out that my emails were going to his spam folder, hence is lack of response to anyone on the project.
I figured this out right away, and was able to make the phone call instead. This ended up being the difference between me getting paid and
me waiting another week to figure out his spam folder caught my email.

The program is called getnotify.

 

[curiocity]

For future reference, if the customer has previous payment records reported with DNB, you could look up their past payment history (how late, and if they've paid others) and risk of delinquency for free via the "When will I get paid" app.

 

[MacGyverS2000]

I did find an email tracking system that allows you to obtain very useful information regarding your emails, such as when it was opened, how long it was read, and the general geographic location of the person when they read it. The program does not depend on annoying read response click boxes, but works in the background.

I used it with the owner and found out that my emails were going to his spam folder, hence is lack of response to anyone on the project.

Just a heads up... these tracking programs work by placing an image (often 1 pixel in size) into the email. If the receiver uses an email client that blocks image downloads unless they specify it's okay (up to a person-by-person basis), you won't get notified of squat. I use Thunderbird, one such client, and most others out there include the functionality (though you have to enable it for many of them, such as Outlook).

The trackers also can not tell you what folder the email is placed in as that information is completely localized and never touches the email datastream. It can tell you if the email was blocked by a spam blocking service, such as SpamHause, but this is completely different than it being blocked by the email client's spam blocker/redirector.

Dan - Owner

http://www.Hi-TecDesigns.com

 

[kylesito]

Regarding the email tracking, I can see some advantage to having this kind of information but it's a risk. Are you really going to call them and say "I saw you opened the email at X:XX". If someone did that to me I would instantly go on the defensive and communication would further shut down.

PE, SE
Eastern United States

"If a builder builds a house for someone, and does not construct it properly, and the house which he built falls in and kills its owner, then that builder shall be put to death!"
~Code of Hammurabi