Small claims court for late payer who has paid but totally ignored late charges?

loko2468

Agreed to do a job for expenses (£30). My invoice clearly mentions that I'll exercise my statutory right to charge statutory interest and debt recovery costs if payment is later than 30 days. 3 weeks from the initial invoice I send a friendly reminder. Still not paid after 30 days so I sent a new invoice where I charged interest (8.5% annually) and debt recovery costs (£40) in accordance with late payment legislation (as in the Late Commercial Payments page of the government's website).

The payer ignored those charges when she finally paid (at 40 days from the initial invoice) - can anyone tell me what the chances are that I can get those charges paid by going to small claims court?

Thank you

bris

It's all penalties and not a loss so forget it. You can claim for actual losses not what you think is justifiable.

loko2468

Thanks. But then...what's the point of all that late payment legislation? It says you can charge interest/debt recovery costs but can choose not to.

Checking that I've been paid, only to find that I haven't, and then amending invoices and resending them all costs time for me. Time is money no?

elsien

Do the recovery costs not mean those you've actually had to pay out? Which in your case you don't seem to have had to do.

loko2468

Hi elsien, on page 3 of the Late Commercial Payments section on the government website, it says "You can also charge a business a fixed sum for the cost of recovering a late commercial payment on top of claiming interest from it." Then it lists the amount you can charge which is based on the amount of debt. It is £40 for anything up to £999.99.

Is the "cost of recovering" not the cost to me of rewriting/resending invoices? It may be negligible but there's still a cost.

But if I'm wrong please enlighten me as to when a debt recovery cost can be charged!

unholyangel

Is the customer a business?

loko2468

Hi unholyangel. Customer is self employed, freelance.

unholyangel

loko2468 wrote: »

Hi unholyangel. Customer is self employed, freelance.

When they engaged your services, was if for the benefit of their business activities or something a regular consumer might contract for?

For example a buider might be self employed & freelance, but if they were to contract you to provide electrician services for a job they were working, thats a b2b contract. However if they were to contract you to do something completely unrelated to their business activities, then its not necessarily a business contract unless they held themselves out as acting in the course of a business.

Quentin

It will cost you a minimum of £50 to take this to a court hearing which you are unlikely to get back (you pay the court fees upfront and only get this back if you win the case and the defendant has the funds to pay you)


Move on!

pinkshoes

You can charge for losses, e.g. sending out a debt recovery firm etc..

By the sounds of this, you didn't do this, so you can charge interest over the 10 days late (so 7p) and the cost of a 1st class letter with proof of postage (60p???)

For the extra 67p, you would be laughed out of court, so I would just let it drop.

ARandomMiser

I would say that you need to accept that you got paid for the work done and cut your 'losses' on what basically is an extortionate charge for debt recovery - and quite honestly looks like a bit of profiteering. Slow payment is a pain but you should be budgeting the basics in as part of your costs or, for small jobs, demand cash on completion.

How would you feel if a bank, for instance, charged you £40 for reminder letters etc. ..... they used to charge less and, even though it was clearly laid out in the T&C, customers eventually got to claim it back plus interest.