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6 comments

To sue or not to sue

2010
06.14

So I’m going to court today to try to collect against a client who hasn’t paid me in six months…  I’m trying to walk a fine line between not coming off as an a-hole and being able to make my mortgage payments.

So I tried to negotiate a payment plan of some ridiculously low amount each month over what seems like forever, and they didn’t even pay me that!  Court is today and I got a call last night from the client’s husband saying he wants to meet me this morning to pay me half the money and will pay the other half at the end of the week. I debated what to do and this is my solution…

I told him to meet me at the courthouse an hour before the hearing, pay me half, sign a contract taking on the debt personally, and agreeing that a default in paying the balance will allow me to sue for the rest plus costs.  This way, if he doesn’t show, or doesn’t sign, I grab lunch and go to court and let the proceedings continue.

I’ll let you know how it turns out.  In the mean time – how would you suggest I get people to pay what they owe?  Especially ones who had paid all their previous debts up to a point, then disappeared?   And as a follow up, if this project comes back, should I have anything to do with these people (have them pre-pay for services) or should I run for the hills?

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This entry was posted on Monday, June 14th, 2010 at 11:00 AM and is filed under architecture, DOTS, the profession. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

  • Donna

    I was watching a commercial on tv about this online bill service that will help small businesses with thier billing. I will try to get the name of the website. Or you could hire a real some one local who caouls act as bill collector for you.

  • Monique

    I think this is a problem that plagues small businesses and can be crippling. But I am not sure if there is anything that you can do that you’re not already doing. You have a contract that deals with breach, collections, etc., you give people leeway and then you file court cases as necessary. That is good business practice and I think the best you can do.

    But to your other question, personally I would not do business with these folks again. However, if you opt to anyway I would suggest making sure you collect a significant retainer fee (perhaps 25 – 50%) upfront to cover your costs and cease with immediately upon any late payment and/or the retainer runs our.

  • architectblog

    I'll get my brother-in-law to go bust some knee caps to get my money for me! I think that all architect's should review their AIA contracts carefully and see that the standard contract states that legal issues be handled in the jurisdiction of the project – make sure you change that to be your local jurisdiction. There's nothing worse than having to sue someone to get paid than having to drive 45 minutes into Philly, try to park, wait in line, and find out you have to come back a different time. This process would have been easier for me if I could have handled it in Trenton courts and not Philly.

    But for a summary, I did get paid more than half the amount owed and withdrew the court filing (didn't settle it, just withdrew it). If I get the rest of my money in a month, as the new agreement states, I'll be in pretty good shape!

  • http://intensedebate.com/people/architectblog Brian V

    I could always send my brother-in-law to break some knee caps (or at least intimidate) people who owe me money, but people who don't pay their debts tend to find ways around collections.
    As a hint to all those architects using the AIA standard contracts, make sure you notice that disputes are handled in the jurisdiction of the project. If there's something worse than going to court, it's going to court in downtown Philly! The drive, the parking, the multiple trips to file. If I had been paying closer attention, and on all future contracts, this will say that disputes will be handled in *MY* jurisdiction. Why should I go out of my way to go to court where my non-paying client lives?

  • architectblog

    I do have a signed contract with them! I would have definitely won the case, but they are an LLC with one asset – a gutted building worth nothing. I think I'll start taking a retainer at the beginning of a project and then not doing more work in one billing cycle than the retainer would cover. That way I can be assured I am not doing work for free anymore.

  • http://32candles.com Ernessa from 32 CANDLES

    My first thought was why would you even think about working with this person again, but then I remembered that I gave my last hairdresser not one, not two, but four chances before I dumped her after she fried my blowout. I think you handled this well and should have people sign contracts going forward. In fact it would probably be a good idea to post the contract you use going forward to help out other architects.