You pour your heart and soul into your local business, working long, stressful hours to ensure that you meet or exceed all your customers’ expectations. In exchange, you expect your customers to promptly pay your invoices. Most do, but occasionally one tries to avoid paying you what they owe. Do you have any recourse if a customer won’t pay their bills? The answer is yes.
First, though, you need to know that there are different types of debt. Consumer debt, such as a car loan or credit card debt, is different from a merchant’s invoice. Consumer debt is subject to a great deal of oversight and law that is not applicable to a local merchant.
Also, before you even make the sale, protect yourself. Is there a way to have automatic withdrawals from the customer’s bank account or other ways to ensure payment? Do your invoices give the prevailing party the right to collect attorney’s fees if you are successful in a litigation?
To attempt to collect the debt, start by emailing, mailing and calling the customer so you can prove that you have tried in good faith to reach them. If they don’t respond, the next step is to send a formal demand letter that includes the amount of the debt, the date by which payment must be received, and a statement noting that you are planning to take legal action if they don’t pay. You may want to consider having a South Florida business dispute attorney, such as Rader Law Group, craft the letter on your behalf. Sending a demand letter from an attorney communicates that you are serious about collecting the debt and oftentimes can compel the customer to pay their bill.
If your customer still doesn’t respond, you will need to determine if it financially makes sense to continue to pursue this debt collection. The first step is to work with an attorney to investigate their finances to see if they are financially solvent. If they are in or close to bankruptcy, it will be very difficult to collect the debt. In this situation, you may be better off selling the debt to a collections agency than trying to collect it yourself.
If they are financially strong and the value of the debt is $8,000 or less, you can sue them in a Florida small claims court. Some companies prefer to have attorneys represent them in small claims court and some prefer to represent themselves. Your attorney can advise what makes the most sense for your particular situation. If the customer refuses to respond to the court summons, you will automatically prevail in the case. If the customer does respond, you will both present your sides of the situation and the judge will rule if they must pay the money they owe you. If you prevail, you will need to work with the court to obtain a judgement enforcement mechanism, such as a judgement lien or writ of execution, to seize the customer’s assets or garnish their wages to secure payment if they won’t willingly pay you.
If the value of the debt is $8,000-$50,000, you could sue the customer in county court. If it is above $50,000, you would take the matter to circuit court. This can become a long and expensive process, so it’s essential to meet with a knowledgeable business dispute attorney to understand how it works and what the best course of action for your situation is. Rader Law Group is headquartered in Coral Springs and Deerfield Beach, but we handle cases state-wide. Rader Law Group attorneys are experts in navigating the complexities of business disputes. We are skilled negotiators and fierce litigators. Call us to learn how we can help you pursue justice.
Rader Law Group, LLC
With decades and decades combined experience, the attorneys at Rader Law Group understand the meaning of Justice. Our one and only mission is to get each client the justice he or she deserves; our team of attorneys never back down when we know our client is right.
We offer our clients the compassion and guidance they need as they work through trying times in their lives. The balance of working relentlessly for our clients combined with our caring approach has helped us achieve a fantastic record of success with our clients. We get our clients the justice they deserve.
At Rader Law Group, You matter. Your justice matters. Your Justice Starts Here. 954-913-2273.