An important factor to consider in your analysis is business goodwill your client will probably not like you very much after you’ve sued them and may tell other potential clients or blast your reputation negatively on social media. Sometimes (and occasionally, you will have a client who counts on this), it is a cheaper option to simply take the loss. If payment still isn’t forthcoming after the reminders, conduct a simple cost-benefit analysis where you consider whether the costs of suing are greater or less than the amount of money that you are seeking from your client. If the answer to all these questions is yes, and you didn’t get paid, the next step is to think about your relationship with the client and what sort of “gentle reminders” you can send to the client to encourage payment. When you suspect an invoice hasn’t been paid, the first step is to make sure that you followed all the right procedures and provided all the necessary information to your client so you could get paid.įor example, did the invoice go out on time and to the right contact person? Was the scope of work clearly outlined in a written or verbal contract, and was it actually performed? Was the rate of pay for services clearly established? Was the method for making payment clear? Negotiating for a settlement, both before litigation and during litigation, at strategically important junctures.

Evaluating the facts and evidence of your case.In addition, your attorney will be able to provide such assistance as: Therefore, you need an experienced attorney who understands the nuances of business contracts and will fight tirelessly to ensure you are paid what you are owed. But the help of a lawyer is recommended as business lawsuits are often based on express and implied contractual terms. As a result, some businesses suffer to the point of needing to suspend certain activities, close the business, and in extreme cases, file for federal bankruptcy protection.Ĭonsidering all of the expenses already in play with a non-paying client, you may want to try to sue a client yourself to save some money. Finally, many backed-up and unpaid invoices can hurt your business’s bottom line. Another reason is lost business opportunities from other clients. Just think about all of the invoices, the demand emails, and the tense negotiation about whether and for how long your business can or will continue to provide services in the future when a client owes you money from the past. Most notable of these reasons is that your business has wasted time and effort to provide services to one client, most likely at great time and expense, to the detriment of other clients (because no one can be everywhere at once!)īesides wasted time and effort, businesses often have to waste resources to collect payment. There are several reasons to sue a client for not paying bills due and owing to your business. Reasons to File a Lawsuit for Non-Payment of Services This is where a skilled breach of contract lawyer in Houston like Seth Kretzer can help you collect your unpaid invoices through a variety of techniques. If you are facing a non-paying client, you probably want a quick resolution, but you don’t want to gain a bad reputation that might scare future clients away.

These consequences include interrupted cash flow and the inability to pay employees, suppliers, vendors, and investors. The experienced business owner also knows the consequences when more than one client ignores an invoice, starts making excuses, or goes silent at the same time. It’s a simple enough concept – you’ve done work for a client, and now, you want to get paid.Īnyone who is in business knows the sinking feeling that creeps in when dealing with a shady client who doesn’t seem like they are going to pay their invoice.

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