Liquidator chasing for debt that we dispute, what is best to do?

Greta_G

Hello, I need advice on my situation. I, or rather my husband, hired a surveyor over 2 years ago, then terminated the contract as the surveyor's work was unsatisfactory. The surveyor then sent a bill for an excessive amount, in our view, even if his work had not been unsatisfactory. And refused to budge and negotiate in any way for a partial settlement, just ignoring my husband's letters and demanding full payment, threatening to sue, of course.

It went on like this for nearly 2 years, in the meantime we got the work done properly, with the advice from a different surveyor showing that the advice of the first surveyor was absolutely wrong and would have resulted in a serious damage to our house. After that my husband has considered reporting that surveyor to his professional body, but hasn't so far. He did sent an email to every director of that company about it.

We haven't heard anything from them until the end of September, when my husband received a letter from a liquidator - the company is now in liquidation and can we pay the amount of the invoice. A copy of the invoice (with the wrong VAT on it) was attached to the liquidator's letter.

My husband didn't reply to that, so a few days ago a letter from the liquidator's solicitor arrived - demanding payment within 7 days, or else they'll sue.

The amount of the invoice is £500 plus VAT, so £600, though the invoice shows VAT as only £40, so £540 gross.

My question is, basically, what' is best to do for us?

More exactly, will the liquidator really sue for £600? If I understand it correctly, because the amount is small, it would go to the small claims court, and the liquidator would have to bear his legal costs even if he wins, though the solicitor's letter, of course, is threatening with legal costs and interest.

Can the liquidator really get interest awarded as well? There was nothing in the contract about the interest.

Should my husband write to the liquidator and demand proof of this debt? Is an invoice sufficient proof? I am not sure whether the liquidator has access to much else, as most of the communication between my husband and the surveyor was via email.

Should my husband write and explain why he thinks he doesn't owe them anything? In a way, that might be giving them more information that they don't have.

Can the liquidator win the court case without the surveyor's testimony? As the surveyor is hardly interested in going to court, now that the business is in liquidation.

Sorry if I sound confused, I just don't know what's best to do, now that it is not the company but the liquidator who is chasing.

I want to make it clear that we are not trying to avoid paying a legitimate debt - we have always paid everything else on time and in full, but this was a rip-off from an incompetent surveyor that my husband doesn't want to pay as a matter of principle. I would have been prepared to pay some of it, just to stop the hassle, but the company was very incompetent and unreasonable, it was impossible to negotiate with them.

Any advice greatly appreciated.

happy_bunny_2

Why not write back explaining the reason for non payment.

You have written proof that the advice was wrong?

If so, any sane judge shouldn't be ruling in their favour, so if it went to court you would defend it on that basis.

If you don't reply, they might think they can get a default court judgment against you. They need to send you court papers first mind.

Did the letter say 'will' sue or 'May'?

Sazzie23

I concurr with HB - ignoring it will make it look like you are avoiding paying. Write explaining why your didn't pay and don't intend to pay, show copies of your correspondence but I would save the evidence of shoddy workmanship in case the come back with court papers.

Hope this helps

I have no experience in these matters but I have personally won 2 cases by threatening small claims court.

sourcrates

I would say that the letter you received is a standard pay up or else affair, much the same as a DCA would send, I must agree with the above advise, keep all original paperwork, send them copies, and be sure you tell them you will defend any court action on the basis that the original work was incompetent and over priced, and that at the time they became involved the amount owed was in dispute, important to state that, as it puts the ball into there court, as liquidator they will be trying to collect on every outstanding invoice the company had hence them playing hardball with you, stick to your guns, you have a good case here for non payment, or possibly partial payment, see what comes back.

ValHaller

I think it was a tactical mistake not to reply to the first letter from the liquidator and make the case that the work was unsatisfactory and the bill excessive. That would have left them thinking that it would be hard to recover the money without the surveyor to back them up and they might have written it off or tried to negotiate.

If you reply quickly, you can make out that you were in the process of replying when the second letter came and just respond to the first.

Having left it, they have you down as avoiding paying rather that rightly aggrieved and a solicitor has his teeth into it, so you have a much bigger hill to climb to fight it.

Greta_G

Thanks for the replies,

The latest solicitor's letter said "will" sue, not "may", unless they receive our cheque within 7 days from the date of their letter. Mind you, they hardly expect to receive it within 7 days, with the time it took for their letter to arrive, we would have had to rush posting the cheque to them straight away, for them to receive it on time.

Previously, before the liquidation, the company's solicitor sent a similar letter, but no court action then followed.

Considering that the solicitor's letter wasn't by registered delivery, maybe we could ignore it and just reply to the liquidator's letter?

Yes, we do have written proof that the surveyor's advice was wrong. Not specifically stating that but we have an engineer's report stating what the problems were and the remedial work needed, and why different work (as recommended by the first surveyor) was unsuitable. We have had all the work carried out since.

happy_bunny_2

I would reply to the liquidators letter, that way you replied to the bigger threat, especially as said they will sue. If they do after your letter, hopefully, a court will see sense with your evidence.

Also feel free to respond to the prior letter, unless at the same address.

Greta_G

I got my husband to reply to the liquidator's letter (rather than the later one from his solicitor) today, telling him the debt has been disputed with the surveyor company. The reply was by email (given on the liquidator's letter), hope this is sufficient? The email also includes forwarding the email my husband had sent to the company several months ago, giving the reasons why the surveyor's work had been unsatisfactory.

How long can this drag on? I mean the liquidator presumably isn't going to pursue it for 4 more years (until it becomes statute-barred), he'll either sue or write it off?

This has just been so frustrating - it has dragged on for 2 years, with demands for payment, ignoring our correspondence, threats of legal action. Is it possible to stop it other than by paying? I mean to sue ourselves in the small claims court, to get a judge to rule whether we should pay or not. And if not, then to be left alone? Or can the company, and now the liquidator, just demand, threaten to sue but not actually do so for years and years? And we must respond to every demand and threat, or else it will look bad on us if the case does eventually come to court?

It is out of frustration that we didn't respond to the liquidator's letter straight away - over the last 2 years my husband has already explained his position to the surveyor himself (to no avail, the surveyor insisted on the full payment, would not budge or negotiate a settlement), then 2-3 times to their finance team who totally ignored his letters, would just wait for several months and then send another demand, eventually threatening to sue. Then to the company's solicitor and to every director of the company. Again, the directors totally ignored it, the solicitor responded with further threat to sue and get us to pay legal costs (which presumably is a lie, as it is a small claim, so costs wouldn't be awarded).

How realistic is it that the liquidator decides to sue, once he realises that he wouldn't get a default judgement, considering the amount is relatively small (£600)?

fatbelly

Greta_G wrote: »

How long can this drag on? I mean the liquidator presumably isn't going to pursue it for 4 more years (until it becomes statute-barred), he'll either sue or write it off?

I think that's right. I would expect them to make a decision one way or another very quickly.

And they will realise that it will be a difficult case for them to win, though I wouldn't rule out them starting a court claim (cost £60) and seeing if they can get a settlement figure from you.

Greta_G

fatbelly wrote: »

though I wouldn't rule out them starting a court claim (cost £60) and seeing if they can get a settlement figure from you.

Do you think they'll start a court claim first, then try to settle? Maybe it would make more sense for them to try to get a settlement first, considering the cost (£60) vs the claim (£500 + VAT)? I mean, if they pay £60 to start a court claim, and then we agree to pay, say £120 + VAT, they'll presumably have to pay the VAT over to the HMRC, and be left with £120-£60=£60 better off, and if we don't agree to any settlement, they will be just £60 out of pocket. Unless they pay more to a solicitor to go to court, with no guarantee they'll get awarded anything. Even if they win the case (unlikely), they'll be left to bear their legal costs, so not that much will be left from £500.

I don't see my husband agreeing to pay much more than £120 + VAT, or so. I was initially prepared to pay the company up to half, that is, £250 + VAT, just to stop this hassle, but that was before we found out just how wrong their professional advice was. If that was all the surveyor originally billed us for, we would have probably paid then and there, with disgust, but just to get rid of him.

But we never got as far as offering to pay that much, as the company was just not engaging with us at all to find an acceptable settlement, just proceeding along with their initial demands and then threats of legal action. Eventually we decided to wait for the legal action as trying to communicate with the company was just a waste of time. We did think that the company would go out of business before too long with such behavior, and it has finally happened.

Greta_G

By the way, would the liquidator need to show the court some proof that we owe this money, when starting a claim? Or is an invoice copy sufficient? My husband originally agreed to hire the surveyor by email, and then at the surveyor's request signed a copy of that email and gave it to him. But I am not sure the liquidator has that, or the access to the surveyor's emails.

That email contained the total figure of £800 + VAT for the work from start to finish, nothing to specify how it would be split in stages or what would happen in the event of work being terminated part way through by either party. There was also nothing about interest on an overdue bill, but we have already been threatened with interest several times. Can any interest be charged?