Recovering for Business Damages Where Customers Fail to Pay for Goods Sold


The subjects of breach of contract and commercial damages are a bit off the beaten path of Being Prepared.  However, our office has always handled commercial matters and other cases outside of the realm of personal injury and insurance.

climb-stack-of-paper.jpg image by ny2ks

In this troubled economic time we suggest that sellers of goods and services do the following:

  • adhere to a system of follow-ups and calls on outstanding invoices;
  • have a system where unpaid bills get sent to an attorney for collection and then suit;  e.g., do not hold onto an unpaid bill for more than 6 months;
  • determine whether “slow paying” customers should be granted further credit or be made to pay C.O.D.;  
  • refuse to do further business with customers who are not current in their payments; and
  • where you want to keep the customer who might have fallen behind in payments, instruct your attorney to be diplomatic and reasonable in collection efforts.

Generally, the problem of an unpaid invoice will not get better unless there is further action.  Foreign sellers should not be intimidated from using the U.S. legal system for collection.

If you have a commercial matter which requires legal intervention, please feel free to call me at 800-531-1434 or write to letters@seitelman.com.

Mark E. Seitelman, 4/27/09, www.seitelman.com.

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