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  1. #1
    Join Date
    Mar 2012
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    2

    Default Clients Fail to Pay

    My question involves business law in the state of: CA

    I'm a small business owner in CA. We sell electronic devices. A client in Scottdale, AZ purchased equipment from us and has not paid their invoices over 3 months. We stopped all transactions since January of 2012. Amount owed is around $27000. There was no contract, but we have proof of invoices, tracking numbers/ proof of delivery to their office. He did pay for previous invoices. The guy at first was still responding to our calls and emails, promising to pay. He stopped responding in March, couldn't get a hold of him.

    Please advise on what I should do at this point. Should I involve an attorney and take guy to court?

    Thanks for your help.

  2. #2
    Join Date
    Sep 2005
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    Behind a Desk
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    98,846

    Default Re: Clients Fail to Pay

    Read this book.

    If you do consult a lawyer, you'll want to have a pretty good sense of whether there's a realistic chance of recovery and negotiate a fee accordingly. For example, you typically don't want to pay by the hour to try to collect a debt from a company that has no assets and is about to shut its doors.

  3. #3
    Join Date
    Mar 2012
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    2

    Default Re: Clients Fail to Pay

    Thanks for the reply. I will look into it.

  4. #4
    Join Date
    Mar 2008
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    1,995

    Default Re: Clients Fail to Pay

    Quote Quoting chuotlua72
    View Post
    My question involves business law in the state of: CA

    I'm a small business owner in CA. We sell electronic devices. A client in Scottdale, AZ purchased equipment from us and has not paid their invoices over 3 months. We stopped all transactions since January of 2012. Amount owed is around $27000. There was no contract, but we have proof of invoices, tracking numbers/ proof of delivery to their office. He did pay for previous invoices. The guy at first was still responding to our calls and emails, promising to pay. He stopped responding in March, couldn't get a hold of him.

    Please advise on what I should do at this point. Should I involve an attorney and take guy to court?

    Thanks for your help.
    I've been in commercial finance for a number of years. It looks like a candidate for getting an attorney, but before I do this, I would order a Dun and Bradstreet report. Sometimes, you'll find that there are numerous other lawsuits and collection agency actions already, who those creditors are, so you know where you stand.

    On a few occasions, I find out who the attorney is handling a current case against the debtor, and find out if he would also take my case, if there is no conflict. Once I had an attorney who successfully sued the debtor once before agree to take my case, I called the debtor one last time to tell him if he doesn't call me back, the next call would be from attorney so and so, and he's looking forward to rip you to pieces again. My message said "remember last time"?? The guy called me right back the same day agreeing to pay me $100,000 after ignoring my calls if I won't sike this attorney on him.

    Also, we've belonged to trade associations, and that's where a fellow creditor told me about the above customer, and this attorney "who sound like Matlock" in court, and that's also how we find out these things about problem customers. Bottomline is, the more more you know, the more effective you are.

    As to these associations, I had another guy who closed up and disappeared on us and within a year, reopened at another location in the county, stocked with our merchandise. I showed up, at first he had no idea who I was, then I announced myself, told him "that's all our stuff". At first he denied it, but then told me there's nothing I can do about it. So I told him it's fraud which didn't impress him, but better yet, I rattled off the names of creditors in the trade association that I know was looking for him, which scared him more. He fell silent, and asked me if he paid me what he owes me for the last company, which technically I can't touch him on, would I shut up and not mention anything to my trade association buddies. I kept my word, and got my money.

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