How can I collect payments for a residential job that was completed to satisfaction?

Nina L. Kaufman, Esq.

Nina L. Kaufman, Esq.

An award-winning small business attorney in New York City, Nina is a sought-after professional speaker and Entrepreneur Magazine online contributor. She is the go-to counsel for knowledge economy and creative companies, delivering legal services and educational resources that save them time, money, and aggravation.

Posted on April 3, 2015 in Business Transactions

Q.:  Our small business fabricates and installs granite countertops. We installed a kitchen for a client, and during and after the installation they seemed happy with the job. But here’s the saga ….

  • When it was time to collect payments, the husband left and the wife said she couldn’t give us a check because her husband had the checkbook.
  • Then, husband arrived and the wife left, and when we asked to collect money from the husband, he said his wife had the check.
  • We waited, and when the wife came back, they said they had to leave and did not have time to write the check—we should come back the next day to collect payment.
  • When we called the following day, the husband said he didn’t want to pay until he spoke to others to see if the job was done properly, that he didn’t know anything about granite, that there was variation within the stone and he did not know if this was normal, that he wants to research before he pays.
  • We reassured him that natural stones will have variations and reminded him that this was listed in the contract he signed.
  • We also gave him information from other websites about granite, but said we needed to collect our money.
  • He now says that we haven’t given him the time to research and to talk to the people he wants to.

In short, he won’t pay. What’s the best legal action to collect payments?

A.:  Excuses, excuses. As I cover in As outlined in my legal guide on making clients pay, your client is exhibiting all the classic signs of being a deadbeat to: having no complaints about the job, but using all possible stalling tactics to avoid your collecting money. Unfortunately, it seems likely that you will have to sue in order to collect payments owed to you. This does not sound like a situation where giving the client “more time to research” will result in their pulling out their checkbook. Your next step will be to get your documentation in order. Gather copies of your contracts with this client, any change orders, invoices, and statements. Show them to a local litigation attorney who can help you develop a strategy and estimate the fees and costs involved to collect your money.

Even more important is to ask yourself how you might prevent this kind of situation from happening in the future when you need to collect money. Do you need to include regular milestone payments or bigger deposits in your contract? Is this particular client really such a dope or might it be helpful to create a little promotional brochure on “Your Granite Countertops” that lets customers know what to expect from the look and feel of granite (versus other materials)? Either way, if you can take away some valuable lessons learned, you will benefit from the experience regardless of whether you ultimately get to collect payments owed to you.

Here are more law questions about handling business customers and how to collect money.

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