Customers and clients can fail to pay their business debts for a variety of reasons, good or bad. As a business owner, you try to be understanding and patient, but there’s a limit. You need to make payroll, cover expenses, keep a little liquidity, not turn a blind eye to unethical behavior, and not establish a bad precedent. For those reasons and maybe others, you’ve decided that you need to exhaust all legal options for getting paid.
If your business has been affected by a significant failure to pay, Chatow Law can help. We can help you get your business customers to pay what they owe you. Not only is it more likely that we’ll recover the debts, but it’s also likely we can do so more quickly than you could on your own.
We can help in at least one of two ways.
The first is we can collect the debt by sending notices to the debtor, as per California and federal debt-collection laws. Many people are more likely to heed a warning from a law firm than from a collection agency, presumably because the legal “teeth” may be clearer to the debtor. In some cases, the first letter from us is all it takes to secure payment.
The other possibility is litigation. If the outstanding payment is large enough, or if there is an attorney fee provision in your contract with the customer, we can help you pursue your payment in court.
We don’t recommend litigation unless the debt is at least five figures or you have an opportunity to be awarded attorney fees if you prevail in court. You should account for court costs and legal fees when making your decision.
You should also consider whether the debtor has any assets to pursue. Suing an indigent debtor may blacken their credit further, but it won’t get the debt paid if they don’t have anything to pay it with.
We can advise you on your specific debts and help determine when those debts might worth be pursuing in court.
Most debts in California have a statute of limitations of four years, starting from the date of the last payment or activity on the account.
It’s a good idea to act quickly, because by the time you realize a customer is delinquent, other creditors may be attempting to collect from the customer as well.
We’ve helped many California businesses collect on their invoices and other debts due. Plus, we can help you come up with policies and procedures that make delinquencies less likely in the future.
Stay profitable by reclaiming the money you’re owed and protecting future repayments. If you have business debt challenges and your business is in Orange County, Los Angeles County, San Diego County, or elsewhere in California, contact us to start getting back what’s owed you.
It is possible that we can litigate your case on a contingency basis, rather than on a pay-as-you go hourly basis. Because of the non-payment and possibly for other reasons, your money may be tied up temporarily. We understand that, which is why we may be able to work you in such a way that you only pay a percentage of the settlement or judgment if and when we win your case and you collect your award. You can find out more about the contingency business litigation option here.
If you’re dealing with a business debt collection issue in California, Chatow Law may be able to help. We work with clients in Orange County, Los Angeles County, San Diego County, and beyond. Contact us today to schedule a free initial consultation.