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How To Collect Debt

Discussion in 'Business Fundamentals' started by snomover, Dec 4, 2012.

  1. snomover

    snomover Junior Member
    from Maine
    Messages: 29

    Long story short, looking for collection advice. Last year we were a sub for another company. They stopped paying after last storm and never finished paying. They owe us over 12k What would you do? I've never been in this position before.
     
  2. Cover Guy

    Cover Guy Senior Member
    Messages: 224

    Take them to court
     
  3. snomover

    snomover Junior Member
    from Maine
    Messages: 29

    I get that, I was looking for a less expensive route. Represent yourself? Hire a Lawyer? From what I know, they formed a Corporation and it doesn't own Jack! I also know they owe money to other contractors. But, I know they got paid.
     
  4. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    You maybe out of luck if a year passed and you filed no type of claim in a court. But fine a lawyer and see if he'll collect it for a percent of the money instead of paying him outright.
     
    Last edited: Dec 4, 2012
  5. Mr.Markus

    Mr.Markus PlowSite Fanatic
    Messages: 5,164

    Simple letter to the paper about your plight and why you can't afford to buy your children Christmas presents this year. CC The CEO of the Corporation. (Don't send the letter to the paper.)
     
  6. joe2025

    joe2025 Member
    from NEPa
    Messages: 56

    You could try to file a court action through your local magistrate office. Most local courts have a max. On the amount of money you can file a suit for, usually $10,000. Each state is different so I would check first. You’ll be giving up $2,000 up front but it will cost you that much in attorney’s fees alone let alone the filing charge and all the other good big boy court stuff. The problem with winning is you still have to collect the money and that could take a long time if at all. At a minimum you’ll have a legal document in your hands that states that they owe you the money and you could then file a lean against the company. Again you may never get paid. Had a similar problem and that is the way my lawyer said would be the cheapest. Your only other alternative is to chalk it up to experience, move on and try to change things so you don’t get screwed again in a similar situation.
     
  7. ducaticorse

    ducaticorse PlowSite.com Addict
    from we
    Messages: 1,426

    Court. ..........
     
  8. snomover

    snomover Junior Member
    from Maine
    Messages: 29

    Even if we go to court and say I did get judgement for a certain amount. How do I then collect? As far as I know they are still not forced to pay from what i've read, and been told.
     
  9. jhenderson9196

    jhenderson9196 Senior Member
    Messages: 615

    If the Corp was formed after the debt was incurred, I think the person who hired you can be held personally responsible. File civil suit. You can't avoid the judgement in civil court. Even by declaring yourself bankrupt.
     
  10. joe2025

    joe2025 Member
    from NEPa
    Messages: 56

    Like I said before, good luck trying to collect the money. Even if you win, if they do not want to pay you, you’re not going to see any money from them. Even if you both had lawyers involved and they made an agreement to pay you, if they refuse to pay it will be a long drawn out and very expensive process to try and force them to pay. Talk to a lawyer about it and I’m sure they will tell you the same thing. You “might” get half the money when it’s all said and done. Like jhenderson9196 said, if it was not a corp when you did business with them you can try a civil suit. But if the person you were doing business with is married then that throws another obstacle into the equation as to what they own and what is jointly owned. It can get very confusing. Good luck with it, I hope you get paid.
     
  11. buckwheat_la

    buckwheat_la 2000 Club Member
    Messages: 2,254

    I know some people are going to disagree with me, but I am all for going back to the contracts that you did as a sub, and informing the powers that be that the subs are not getting paid. Any contract would have to worry at that because if the company that they hired is not paying its subs, eventually it may affect service, and that is never good.
     
  12. Antlerart06

    Antlerart06 PlowSite Veteran
    Messages: 3,437

    In future they get 2-3k behind stop the work dont keep going and getting deeper in the hole
    Fill a lien on them next time
     
  13. nighthawk117

    nighthawk117 Senior Member
    from Ma
    Messages: 165

    Continue to invoice them with the past due amount plus interest, sent certified mail. Track everything you do, file a lien on everything they own , try to report this to a credit bureau , hire a collection agency as a last resort. The continued effort on your own behalf will get you much further than our ridiculous justice system. There is a good chance you will not see the money, but continue with collections. A collection agency will harass them to the point that will really anger them, make sure you provide them with ALL there call numbers, both home, cells, business, relatives info. Good luck and don't back down !! :gunsfiring:
     
  14. KBTConst

    KBTConst Senior Member
    Messages: 426



    I agree 100% I used to work for a builder and we was building a house he didn't pay the lumber company and they sent a letter to the home owner stating that a lean was going to be placed on their property the next day the lumber company was payed because my boss didn't want to lose the job because they had other houses for him to build. So maybe it will work in this case the OP has nothing to lose at this point.
     
  15. PushnSnow

    PushnSnow Junior Member
    Messages: 13

    With that example, it would be the same as the Sub Plow contractor filing the lien on the properties he serviced for the contractor. That may be an option, and if that were to happen, the people that pay the contractor might apply the necessary pressure to get him to pay you. The down side is that I doubt the customer would ever want to do business with either of you again. Was this $12,0000 from one monthly billing cycle, or did you continue subbing to these guys while they were behind paying you? If you bill once a month and are Net 30, I could see them owing you 2 months easy enough, but once an account is past due by even a day, I'd stop providing service until it's paid.
     
  16. snomover

    snomover Junior Member
    from Maine
    Messages: 29

    They were a couple to a few weeks behind on the first couple payments, but I figured if I quit i'd get nothing because we were already owed, and it seemed worth the risk because they kept 3 of my trucks moving. Looks like I got burnt. and that 12k is 3 months payments.
     
  17. PushnSnow

    PushnSnow Junior Member
    Messages: 13

    I understand. I was in the same situation with an employer I had years ago. Month after month, he didn't have enough to cover me. He'd give me a little here and a little there to get by with. I stuck it out for several months hoping he'd catch me up. Over $6,000 behind when I finally had enough. Tried to sick the labor dept on him, but that got me nowhere, even though they ruled in my favor. After months of fighting it I finally gave up. I think I managed to get $1200 out of the 6k he owed. Never again. Past due, and you don't get anything from me.
     
  18. snomover

    snomover Junior Member
    from Maine
    Messages: 29

    I feel for ya. They kept stringing me along with partial payments, I did quit working at one point but, then again they came up with a little money so I continued. After the snow stopped falling the money stopped coming in. Really hurts when I basically worked all summer to pay for a big mistake. I still had to pay my guys. Sucks real bad! Never again......
     
  19. 90plow

    90plow Senior Member
    Messages: 737

    Id say go with a collection agency at this point you know they arent going to pay. My fiance worked at an mri center she said they were on a first name basis with the agency guys they puy everyone in collections.
     
  20. Earthscapes

    Earthscapes Senior Member
    from WNY
    Messages: 577

    Get all your paperwork & proof in order and go see a lawyer. Don't wait as your pushing your time limit. 95% of the time they will settle out of court, because it costs them more to go to court. If they offer you a payoff, go no less than 10K. The lawyer will probably cost you 1K, but at least you will recoupe something.
    I had this problem last season with a property managament company. I was owed 27K going into May this yr, I settled for 25K & my lawyer fees were 1.5K. So yea I took a loss, but got paid within 3 months instead of draggin it along forever.