NSW Getting client to pay money owing``

[michaelfranseze]

Hello all - I run a small digital business, where we sometimes do custom development work in the property technology space.

Anyway, a client signed a 'statement of work' document with me about a month ago, which was the trigger to start some development work. The 'statement of work' specifies that money up-front is required to commence work, however my team commenced work in good faith.

However a few weeks later the client who signed the statement of work emailed me saying he didn't want to proceed as he felt it wasn't a fit for his requirements.

My team spent time and I have to pay them the amount they spent to date as they are contractors.

So I emailed back the client saying no worries but we need to pay the developers for work completed, which is only a small amount - we are talking about $900.

The client has not responded and I know he doesn't want to pay - I've sent him the $900 invoice so we can close the matter.

However I want to know what options I have if he doesn't pay me (which is likely) - obviously hiring a lawyer wouldn't be worth it, however given I have a signed SOW from him and it's clear he asked me to proceed with work, he is liable for costs to me - is there a small claims local court I can raise this with to put some pressure on him to pay which won't cost me much, or are there other avenues to suggest it?

It would be a good experience for me to sort this out, as it will help me deal with any similar bigger impact scenarios in scenarios as I grow the business.

Thanks in advance.

 

[Tim W]

Is the client in Australia?

 

[michaelfranseze]

Hi Tim W - yeah mate, client is in Sydney NSW.

 

[michaelfranseze]

Any ideas people? I want to put some pressure on this half-wit to pay.... he signed an SOW....

how can i put some fire up his a** to know he's got consequences?????

 

[Nighthelyn]

Dear michaelfranseze,

From what I see, you have already sent a letter of demand which is ignored, then your options, assuming you do not wish to involve a lawyer’s expenses, are, from free to costly:

1. lodge a complaint to NSW Fair Trading - doesn’t cost, but very little impact and no likely action from Fair Trading unless this company has some form of negative public impact or there are other people who also complains in similar way;

2. negative review to this company on a review website - be careful that you don’t infringe defamation law by not specifying a person in the negative review, be truthful and factual, or be a valid personal opinion how your experience dealing with this company, no cost;

3. Contact NCAT tribunal - if this arrangement can be considered a consumer commercial claim (IT service can be a consumer service) you could lodge a claim there - it is designed to be a low cost alternative to litigation and unfriendly to lawyers (who need special approval to be involved, hard for dispute <$30k), cost (I don’t know <$100.00 to begin - check website, need to attempt mediation, if you initiate a claim you need to be ready to show evidence of your agreement, show evidence you have done work) if you win or if the other party doesn’t show and you succeed in a tribunal order you can register it as a judgment at local court to enforce your judgment;

4. Initiate a claim in the small claim division of NSW local court, search lawaccess for more guidance how to proceed. Cost - ~$200.00-$300.00 if you do every step yourself without involving legal help. https://www.lawaccess.nsw.gov.au/Pages/representing/debt/making_a_claim/making_a_claim.aspx

Good luck!

-Nighthelyn

 

[Scruff]

Don't get ahead of yourselves guys - we need to know if there's a valid claim here first.

The "trigger" to commence work is not having a signed agreement, but the receipt of an up-front payment as required by that agreement.
You therefore need to explain this statement:

... however given I have a signed SOW from him and it's clear he asked me to proceed with work, he is liable for costs to me ...

That might be clear to you, but it isn't to us, which raises some questions:
1. How exactly did it come about that you were authorized to commence work contrary to the signed agreement?
2. Did the client actually agree to pay for any such work?
3. Do you have any evidence that both parties agreed to altering the original terms?

The fact is that work commenced contrary to the signed agreement, so unless you can provide evidence that both parties consented to the terms being changed, I doubt that you have any valid claim here. Without any such evidence, then on the surface, it looks like you breached the agreement, not the client.

 

[michaelfranseze]

Hi Nightelyn - most appreciated, at best I'll get the money, at minimum I'll put this Piece of Sh*t under pressure this weekend, which he deserves.

Scruff - yes, I thought about this too, and it's probably my bad. In SOW it says he needs to pay upfront but he agreed to pay half - I have email correspondence where he asks me to send him invoice but he didn't pay. I realise I may not have followed SOW exactly, but do you really think if I brought this to small claims court, the judge will rule in his favour? This idiot asked me to proceed based on a signed SOW and asked me 'hows progress' verbally and then next week decided not to proceed.

What are your thoughts??? Worth me pursuing this through courtS??