Client won't pay fee fairly due, what can be done?

angryparcel · 15 June 2017 at 10:13PM

tekton23 wrote: »

Thanks for your replies! In our contract, either party can terminate. If the client terminates then we are due any fees 'properly due'. We estimate this at about 60 hours work, the client says this is actually around 10 hours. We disagree with that and don't think they can fairly judge this. Should we just invoice, or go to court or a debt collector or other options?

before going to Court or Debt Collection you would need to have invoiced them, so you have an invoice on record. i would send them an invoice with a 7 day due date, so giving them 7 days to pay. then if you google search Express Debt Collection, then will pursue the debt on a no collect no fee basis. i use them all the time

tekton23 · 16 June 2017 at 5:13PM

Hi,

Thanks for your reply. I am slightly hesitant about using a debt collection service, due to damage to our reputation. Perhaps I shouldn't be, as we deserve to be paid fairly!

We have been asked by the clients to itemise the hours of work undertaken to date. The contract we have, states that this is only necessary if charging on an hourly basis. We are not. We have a fixed fee agreement for workstages.

To provide this itemised breakdown would take further hours of work, with no guarantee that we'd actually be paid. I believe it might be an attempt to prolong the process in the hope we just give in. Should we provide this itemised account of time spent? Or just invoice now.

Given that they have offered such a low amount previously, there is no suggestion to me that they would be a fair judge of the itemised breakdown if we do give it to them. I also don't see how someone outside our industry would know how long the services we have provided would take. So how are they in a position to judge this?

Thanks,

T23

00ec25 · 16 June 2017 at 7:42PM

put yourselves in their position....

they want to know what they are being asked to pay for. Not unreasonable therefore to request a breakdown of the sum

of course if your contract is priced expressly in "whole" work stages and you can evidence that you have completed however many stages you are billing for, then that is the basis of your claim and a breakdown could be refused

ComicGeek · 17 June 2017 at 9:49AM

Emotion shouldn't come into business decisions, but it's sounds like your client made a rash emotional decision to cancel the contract. Don't make the same mistake.

It takes time to chase through courts etc, even using the money claim online system. Much better to come to a compromise if you can, and chalk it up to experience.

We have had to take a number of clients to court over the years - we've won all cases, but haven't been to recover all money. Sometimes you have to step back and not allow it to affect your business, despite how much you feel that you're in the right.

paddyrg · 17 June 2017 at 11:42AM

If at all possible settle out of court as it just soaks up time.

Calculating ACTUAL hours, even if not in your contract sounds like a fair step towards reconciliation. Estimated hours are simply unfair and a court will also probably say so. Quantity your loss precisely.

FatVonD · 21 June 2017 at 12:56AM

I agree you need to bill them according to the stage in the process you had worked up to.

As a designer myself I would say it's going to be fairly impossible to give them an hourly break down, how do you, for instance, bill them for your thinking time?

Vectis · 21 June 2017 at 6:09AM

tekton23 wrote: »

Hi,

Thanks for your reply. I am slightly hesitant about using a debt collection service, due to damage to our reputation. Perhaps I shouldn't be, as we deserve to be paid fairly!

We have been asked by the clients to itemise the hours of work undertaken to date. The contract we have, states that this is only necessary if charging on an hourly basis. We are not. We have a fixed fee agreement for workstages.

To provide this itemised breakdown would take further hours of work, with no guarantee that we'd actually be paid. I believe it might be an attempt to prolong the process in the hope we just give in. Should we provide this itemised account of time spent? Or just invoice now.

Given that they have offered such a low amount previously, there is no suggestion to me that they would be a fair judge of the itemised breakdown if we do give it to them. I also don't see how someone outside our industry would know how long the services we have provided would take. So how are they in a position to judge this?

Thanks,

T23

If you really do have in your contract that you will be paid a definite amount at a definable stage of the work then you should be ok. If however you simply have stage payments (e.g. monthly) then you may well be expected to itemise the hours worked to date.

If you don't, as you say, want to spend any time on this then send an invoice and, if you don't get paid on time, a letter before action, then MCOL.

nomoneytoday · 21 June 2017 at 1:14PM

How far apart are your invoice and their offer amounts in real money rather than percentages?
How long could would it take you to earn the same amount using your resources on new jobs, as opposed to chasing a soured relationship?

2bFrank · 23 June 2017 at 11:18AM

Unfortunately as a freelance developer I get this now and again as well. I simply invoice for the time I have already spent, I itemise the invoice for each day and include a timesheet as well, which shows exactly which component or design I worked on and for how many hours.

If they refuse to pay after the time given on the invoice, then its a letter before action and court. I've only been to court once, and was found in my favour, which was helped by my contract and the timesheets.

My worry with you however is you state you spent several days on the project and charging 60 hours. To reach that at least two of you must have been working flat out for 4 days on the project. What was you designing for that? The court would definitely question this. It will definitely help to demonstrate the work you have already done to the court (concepts, research, first/ second drafts etc) and explain how many hours it took.

Client won't pay fee fairly due, what can be done?

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