Non-Payment of Good and Services Debt Recovery Service
It is an unfortunate fact that sooner or later, most businesses will find themselves dealing with a customer who fails to pay for their goods and services. Reasons can vary from a dispute as the terms of the transaction to the paying party facing financial difficulty and struggling to pay In any event, a non-paying customer can cause cash flow problems and general inconvenience to you and your business.
If you are having issues with a client who is not paying for goods or services that you have provided, Lupton Fawcett can help.
Call us today for a free initial consultation; one of our experts will look at the terms agreed with your non-paying client and work with you to find the best strategy for your business under the circumstances.
We strongly recommend taking legal advice before deciding to commence a claim in court if:
- there are any reasons that your customer might argue for non-payment, such as an issue with the quality of the goods or services that you have provided.
- there is anything complicated or unclear in the terms of the contract – one of our solicitors will be examine the contract for anything that might cause an issue
- the value of the sum you are claiming in England or Wales exceeds £10,000 and is therefore not within the small claims jurisdiction of the courts.
Should I consider legal action?
Whilst legal action should achieve a resolution one way or another, there may be ways to address your client’s non-payment without having to go through the courts, saving time and expense.
Is your customer likely to pay?
If your client is facing financial difficulties, they may be unable to pay, which would render legal action expensive and ultimately fruitless. There are certain checks that you can make before making a decision; you can search the London Gazette for insolvency notices or use a credit agency to check for bad debts. Our solicitors can offer legal advice on the best course of action in the circumstances.
Send a solicitor’s letter
Sending a solicitor’s letter can often be enough to motivate your customer to settle their invoice, as it indicates that you have taken advice and are willing to act if they do not pay. It is important to follow any applicable pre-action protocol and make sure that the letter contains all the relevant information if you end up having to take action.
It is important to be able to show that you have taken every available step to resolve the dispute with your customer over their non-payment. If the case goes to court, it can reflect badly on you if you have not followed all of the relevant steps. At the first hint that you may have to take legal action , please take steps to preserve all documentation that you have in relation to the matter. Also keep emails, invoices and any other communications that document your attempts to resolve the issue.
Should I try mediation?
If your client is disputing the debt, then it may be worth going through mediation or some other form of alternative dispute resolution in an attempt to resolve the issue before a claim goes to court. A mediator is a neutral person with training in dispute resolution who will attempt to assist all parties in a dispute to reach an agreement without having to go to court. There is usually a fee for mediation, but it tends to be cost effective in the long term if a resolution can be reached.
Retention of title
You may have a retention of title clause included in your the terms of your contract, which broadly means that in the event of non-payment, the goods that you have provided do not legally belong to the buyer, and you may be able to take them back. This clause will play an important role if your client is having financial difficulties, leading to the appointment of an administrator or liquidator. If you think that there is a risk of this happening, it is imperative that you take legal advice immediately to protect yourself.
An appointed liquidator may challenge your retention of title clause. You need to provide the liquidator with a copy of your terms, invoices and a statement of the buyer’s account so that they are fully aware of your situation. If a liquidator is appointed, the terms of your contract or agreement with the client should state that in the event of insolvency, all debts due become payable immediately, even if this differs from your usual terms.
If your clause is valid, immediate action is crucial. Our solicitors can offer you advice responsively, ensuring that you are fully aware of your rights in order to avoid financial losses through your client’s insolvency. If you have any queries about your position in regard to the retention of title clause, speak to us as soon as possible.
How can Lupton Fawcett help?
Our contract law solicitors are experts in their field and have many years of experience helping businesses of all sizes with disputes over non-payment of goods or services. If you find that you are having difficulties with a client and are wondering what action to take – speak to us.
We will get to know you and your business and ensure that we have a thorough understanding of the terms of your agreement, allowing us to identify the best possible resolution to your dispute. We always make sure that we put your business needs at the forefront of everything that we do; we are mindful of preserving your business relationships and seeking ethical and efficient solutions, avoiding court proceedings where it is possible to do so.
We work with a range of clients across many industries and whatever the cause of your non-payment issues, we are well placed to help you to resolve them. We’re based in Yorkshire, but we work with businesses across England and Wales – get in touch with us today and we’ll be happy to help you.
We provide a personalised service, with sector specialists and extensive resources to ensure we are giving you the best solutions to your problems.
Lupton Fawcett has long been recognised for our expertise in Commercial Disputes and Litigation.
Our Contract Dispute Solicitors act regularly for clients across the United Kingdom including Bradford, Birmingham, Hull, Liverpool, London, Manchester, and Nottingham.
Our experienced team can support your needs wherever you live in England, Wales & Northern Ireland.
Call today or complete the enquiry form and we will get back in touch with you quickly.
We will always respond promptly, and we will be happy to help.