Advice on business debtor

Started by Lord Danoir the first, December 16, 2013, 07:46:45 AM

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Lord Danoir the first

So.... this time last year I had a little fall out with a client.... he kept changing his mind last minute costing me money, so eventually I had to tell him he was getting charged.... so he decides he doesn't need the services of an architect.

A few months later, I get a call..... he's landed himself in it and needs help (planning enforcements, builder costs spiralling etc) but as usual he doesn't want to pay.....he's a bit of a charmer and I'm a sucker for a sob story so when it comes to divying up, my fee is around £12K...... so I agree to do it at cost, less a few bits, so the fee agreed is £5K.

My invoice states £12 less client discount blah blah blah........ takes ages to get anything out of him, but eventually he stumps up £4K...... so owes £1K plus the VAT, so £2K in total.

The usual letters have gone out; which he's not responded to, so this Wednesday I'm pursuing him through small claims..... it's a small amount and I've never done small claims before, so fancy a crack.

My question is this...... can I pursue the full invoice of £12K as I made it perfectly clear it was a special client discount?..... I suspect not, or I should at least have threatened him with it...... the thought just came to me whilst having my morning brew.

Green_Ninja

The agreed fee, after discounts was £5K so no you can't pursue the £12k, also there is a £5K limit on small claims cases isn't there?

Manic636

I would have thought there would be grounds for interest and costs as long as they aren't excessive but unless the discount was detailed as prompt payment then I think you've only got the 5k invoice as a starting point.

Lord Danoir the first

Quote from: Green_Ninja on December 16, 2013, 08:07:26 AM
The agreed fee, after discounts was £5K so no you can't pursue the £12k, also there is a £5K limit on small claims cases isn't there?

under £10 is classed as a small claim; which this would be, taking in to account the £4K already paid.

In hindsight I should have stipulated that the discount was for immediate payment or something...... something I could demonstrate he breached.

Never mind.

Green_Ninja

Quote from: Lord Danoir the first on December 16, 2013, 08:19:14 AM
Quote from: Green_Ninja on December 16, 2013, 08:07:26 AM
The agreed fee, after discounts was £5K so no you can't pursue the £12k, also there is a £5K limit on small claims cases isn't there?

under £10 is classed as a small claim; which this would be, taking in to account the £4K already paid.

In hindsight I should have stipulated that the discount was for immediate payment or something...... something I could demonstrate he breached.

Never mind.


OK didn't realise they'll upped the limit to £10k, as you said if you'd put in writing the discount was for immediate payment you could have probably pushed for that, shame really.

mc101

#5
Dan - Pursue the bastard through MCOL if you've not already (I think it looks like you have). 

Charge him statutory late payment charges and the limit via MCOL is £100K.  Our experience is as soon as someone sees a claim from HM Justice Service they tend to cough up fairly pronto.

Going forward on your invoices, if your agreeing a discount put some text like:

"Rapid Settlement Discount of £NNN is applied if the invoice is settled by dd/mm/yy else the full amount of £NNN becomes due thereafter."



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Steve R1

Quote from: mc101 on December 16, 2013, 09:24:01 AM
Dan - Pursue the bastard through MCOL if you've not already (I think it looks like you have). 

Charge him statutory late payment charges and the limit via MCOL is £100K.  Our experience is as soon as someone sees a claim from HM Justice Service they tend to cough up fairly pronto.

Going forward on your invoices, if your agreeing a discount put some text like:

"Rapid Settlement Discount of £NNN is applied if the invoice is settled by dd/mm/yy else the full amount of £NNN becomes due thereafter."

I would also include some words around rapid settlement discount is not applied to part payment of invoice, so by paying £4k he would have lost the £7k discount you gave him.

Just another thought.

Good luck

David W

Ski masks, pliers and a blow torch.

Oh, sorry,  didn't realise you meant legal advice.