I've done work for friends and relatives in the past and I always tell them that they have to buy the material before I can do anything. I will tell them what they need based on their desires and even shop around for whatever it is. I present a list. They either give me the cost of the material and I go get it or I tell them to go get it.
Sometimes they have backed out and I lost nothing but a little time. If they buy the material, then they are usually serious about the project and there is a better bet they will give me a token for my labor.
If the US, then there's the Small Claims Court which is low effort, low cost and set up for exactly scenarios like this. Each State has a maximum amount allowed for the claim; AFAIK they all dis-allow lawyers (illegal in many States). If you sue,find out ALL of your legal remedies if award is unpaid.
Isn't this just a civil matter of unpaid debt in the USA?
In the UK you would normally have T&C that say that title to goods is retained by the vendor until the customer's payment has cleared for outcome *BUT* if the invoice remains unpaid after 90 days or in the event that the cheque bounces then you have to take civil action.
I worked for a major corporate once who only ever paid big vendors when bailiffs arrived to take away their photocopier and fax machine. Having
60 day terms and spinning it out on the stop list they could extract nearly 150 days free credit by not paying suppliers on time. They were typically on the stop list of two out of three alternative suppliers in rotation. The first time the bailiffs turned up I was shocked.
Scruffy tramp from debt collectors in skunk oil sat in their plush reception furniture seemed to focus minds better than civil proceedings.
The story seems to have changed... how sure are you that you are not just being strung along here?
Fine. Take back the most expensive key components now and make it clear that you will only reinstall them when full payment is received. They have the benefit of using both your kit and your money at present.
Don't forget to add interest at 5% (or whatever US law allows) to your invoice to them once your payment terms of 30 days are exceeded.
Perfect - then I would issue a final demand with a reasonable deadline (month or two), then take it to the small claims. Judges in the UK system usually require that you have tried all remedies before coming to court - so document everything and try to collect the money amicably. But if that fails, do not be afraid to use the court service.
For the services, yes. For the equipment, since no contract was signed, it belongs to the person with the bill of sale. Refusing to return it is a criminal matter everywhere AFAIK.
If you're doing it as a business, giving away receipts is not a good idea. At least if you have a bad account you can write not only all disbursements but all other expenses related to the job such as mileage. That stuff can add up.
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Best regards,
Spehro Pefhany
Amazon link for AoE 3rd Edition: http://tinyurl.com/ntrpwu8
Microchip link for 2015 Masters in Phoenix: http://tinyurl.com/l7g2k48
There's usually a dollar limit for employee priority claims - something like $12K now in the U.S. - so best not to let things get
*too* far behind.
--
Best regards,
Spehro Pefhany
Amazon link for AoE 3rd Edition: http://tinyurl.com/ntrpwu8
Microchip link for 2015 Masters in Phoenix: http://tinyurl.com/l7g2k48
Canada's the same, assuming you're using accrual accounting (usually required for businesses). Bill a domestic client and you owe the HST or GST (up to 13%) on the next return (quarterly for me). You get it back on the next period if turns out to be a bad debt but you've been out the money for some months.
Not a huge deal (you do get to hold onto the collected money before remitting it under normal conditions- could even be a win if you pay suppliers slower than your cutomers pay) but it kind of adds insult to injury to have to send more cash out the door.
For smaller amounts, getting some up-front cash from Paypal or Interac/bank transfer is fast and avoids wasting mental bandwidth on accounts receivable stuff (unfortunately it makes bookeeping a bit more complex). I've got one customer in California (a household name European company) that demands net 60 terms and actually pays more like 100+ days, and even then only after being bugged.
--sp
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Best regards,
Spehro Pefhany
Amazon link for AoE 3rd Edition: http://tinyurl.com/ntrpwu8
Microchip link for 2015 Masters in Phoenix: http://tinyurl.com/l7g2k48
Here, small outfits like mine can do cash accounting, which avoids that problem, and can expense equipment purchases up to $500k per year or something like that. Beyond that they have to be depreciated over 5 or
7 years.
The expert witness business can be like that too, if you let the lawyers talk you into agreeing to pay-when-paid terms. My standard language includes "In the event that (client) does not remit payment in a timely manner, (law firm) will ensure that (my) invoices are paid in full no more than 90 days from the invoice date."
I've never had anybody refuse that. Sixty days you could argue about, because it's possible to just miss the billing cycle, but by 90 there's a definite problem. In order to refuse that provision, the lawyer is implicitly admitting that they're worried that the client is a deadbeat, which is politically somewhat difficult.
For engineering work, some large companies (such as GE) insist very strongly on Net 90 terms. I had to walk _twice_ to get them down to 45 days, but they paid on time. It's amazing how some companies think it's smart to piss off their suppliers--including people who are helping them ward off million-dollar lawsuits--by paying them late, when the prime rate is 3.25% per annum.
Cheers
Phil Hobbs
--
Dr Philip C D Hobbs
Principal Consultant
ElectroOptical Innovations LLC
Optics, Electro-optics, Photonics, Analog Electronics
160 North State Road #203
Briarcliff Manor NY 10510
hobbs at electrooptical dot net
http://electrooptical.net
Lots of companies have a policy of refusing to pay interest on late invoices. Wonder why?
Cheers
Phil Hobbs
--
Dr Philip C D Hobbs
Principal Consultant
ElectroOptical Innovations LLC
Optics, Electro-optics, Photonics, Analog Electronics
160 North State Road #203
Briarcliff Manor NY 10510
hobbs at electrooptical dot net
http://electrooptical.net
Most of the furniture was rented anyway. I worked for a company that shared a floor with Ross Perot's company, EDS. They moved to a new space and some of us searched their spaces for better chairs. A week later I came into the office and all our booty was gone! The rental company wasn't stupid and looked through our space too. But they missed one that was behind a door so I thought I was good. A couple of weeks later that one was gone as well. I guess even one chair is worth a trip back to the scene of the crime.
If you really want to make sure you are paid, find out how much a company/individual must owe you before you can apply to have them placed in receivership (as in bankruptcy). Make sure your invoice is for that amount plus whatever is fair for your work etc. Give them a big discount if they pay early (i.e the total amount you padded the invoice by). If they don't pay early or don't pay the full amount write to their account department and point out that they are in arrears by X dollars and if you don't have payment in 7 days you will have to submit court document to wind up their company (a photo copy of the documents already prepared but not yet submitted helps) and if they have any brains they will pay immediately because :
The larger companies and banks etc will be informed that a bankruptcy hearing for this company is underway and then they will also have to file or else miss out all together. The sod who tried to shaft you will now have to renegotiate all his debt agreements at less favorable rates and have all his financial details exposed. If he is successful it will cost him a lot more than your invoice plus a lot of time and you get your money. If he is unsuccessful you are at the head of the que of people the company owes and in no worse shape than before.
On the downside if it comes to threatening to wind his company up then you probably won't do business with them again - but then since he wouldn't pay you thats no great loss.
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