Delinquent Account

[Summer99]

My business is in Seattle, WA

Hello,
I have an out-of state client (NY) whose account has become delinquent, and they have also become very uncommunicative (avoiding my calls and not returning my calls.) I strongly suspect they will not pay their Invoices totalling about $2,000.

I have done 3 projects for them. The first was paid by Credit Card, since I require pre-payment from new customers. After this, they asked to be billed for the other 2 projects, and they seemed reputable enough that I felt comfortable doing so. However now they have not paid.

My question is - since I have a Credit Card number for them on-file from the first order, is it legal for me to charge the $2,000 they still owe me to that Credit Card, since they have not paid by check as they had promised? If so, how long would you recommend waiting for check payment before charging their Credit Card? At this time the Invoices are about 60 days old.

Any advice would be appreciated. I'd like to receive what is owed to me, but I don't know if there are laws against charging the card in this situation, since they had said they would pay via check and technically did not authorize use of the card for the second 2 orders. However I think I'm entitled to payment for the work I've done for them. Would they be able to take legal action against me if I charged the card, or am I justified in doing so?

Thanks.

[seniorjudge]

Originally Posted by Summer99

My business is in Seattle, WA

Hello,
I have an out-of state client (NY) whose account has become delinquent, and they have also become very uncommunicative (avoiding my calls and not returning my calls.) I strongly suspect they will not pay their Invoices totalling about $2,000.

I have done 3 projects for them. The first was paid by Credit Card, since I require pre-payment from new customers. After this, they asked to be billed for the other 2 projects, and they seemed reputable enough that I felt comfortable doing so. However now they have not paid.

My question is - since I have a Credit Card number for them on-file from the first order, is it legal for me to charge the $2,000 they still owe me to that Credit Card, since they have not paid by check as they had promised? If so, how long would you recommend waiting for check payment before charging their Credit Card? At this time the Invoices are about 60 days old.

Any advice would be appreciated. I'd like to receive what is owed to me, but I don't know if there are laws against charging the card in this situation, since they had said they would pay via check and technically did not authorize use of the card for the second 2 orders. However I think I'm entitled to payment for the work I've done for them. Would they be able to take legal action against me if I charged the card, or am I justified in doing so?

Thanks.

Q: I'd like to receive what is owed to me, but I don't know if there are laws against charging the card in this situation, since they had said they would pay via check and technically did not authorize use of the card for the second 2 orders.

A: If you charged them now, then technically you would be stealing.

[Summer99]

But isn't the client stealing from me by not paying?! I am rightfully owed that money!

[Chien]

Q. How long would you recommend waiting for check payment before charging their Credit Card?

A. Forever. SJ is absolutely correct and, after they dispute the new charges and you get charged back, they and the credit card company are going to be coming after you for the unauthorized use. I'm sympathetic to you too, but find another way.

Maybe offer to waive the building interest and they'll get the hint. Hope it never comes to it but, if you ever had to sue them, the credit card would give you the data to track back to bank account information. But that's pretty involved for a relatively small amount.

It might be a hard pill to swallow but, if you offered them a small discount (eg. 5%) for immediate payment, my guess is that it would be cheaper for you in the long run.

Finally, there's the old adage about the squeaky wheel. Keep making your demands.

BTW, a small business running *only* 60 days behind is not so uncommon.

[Chien]

Q. But isn't the client stealing from me by not paying?! I am rightfully owed that money!

A. No one is diputing your entitlement and we hope you get it soon. But they're "delinquent", subject to being sued. You'd be stealing, subject to being prosecuted. Big difference.

[Summer99]

Thanks to you both. Definitely a hard pill to swallow, though.

[Dandy Don]

Take them to small claims court and get a judgment against them, which you can enforce by getting the money from their bank accounts and a collections attorney can tell you how this is done.

[You Are Guilty]

Originally Posted by Dandy Don

Take them to small claims court and get a judgment against them, which you can enforce by getting the money from their bank accounts and a collections attorney can tell you how this is done.

Seattle ---> NY probably = a lot more than $2k in expenses

[GregG]

Your right.. More than 60 day turn around is quite common in business... I have several clients who take over 90 days to pay.. The paycheck is there when they tell me the date they pay.. So I either have to accept the 90 day terms or no longer do future work with that client.

Better off not touching the charge card.. What would you do if a collection agency did it to you? Those are unauthorized charges.. Not to mention the company would be bitter and probably will make your wait much longer..

I would probably wait till 90 or 120 days and write a certified letter demanding payment..