Collecting unpaid debt

[Specop_007]

Go to the Circuit Clerks office in your county and file a small claim against him. You will have to pay a filing fee, I believe it is around $50, but that could have changed. The court will issue a summons which will be served by the County Sheriff. Bring copies of all letters of correspondence, pictures, billing statements and so forth to court. Let Him explain to the judge why he has not paid you. BTW you do not need a lawyer to file a small claim.

$4,000 might be out of the limit of small claims.

Either way I would go after it. You did work, you should be paid. While its easy as a sideliner in this to say "Well, maybe the guy hit a bad run of luck..." it doesnt excuse the fact you are running a business. On an emotional level you can feel sorry for the guy but you have bills to pay just like everyone else and on a professional level should not hold back any punches.

Just my opinion.

 

[Dozernut]

There is a $10,000 limit in Illinois. Illinois Small Claims Court Information

 

[AndyMA]

In conn the limit is $5000. The lien for not paying for work done on a property is called a "Mechanics Lien" at least in Conn and Mass. The problem is you have a very short time to do 2 things here. One is to file a notice of intent and either publish it or send him a certified copy and the second is to file the actual lien. The cost is minimal. The lien is very tough and if he does not discharge it in some pretty short time you can foreclose on it here in Conn. Usually the bank holding the first mortgage will step in and pay it off so as not to loose the property to you. Again I am not a lawyer, but have been advised by one on how to do this. In Conn at least if you are not licensed as a Home Improvement Contractor (which yes you need to mow and landscape) you cannot use any court services to help you collect a debt and you may face substantial fines. Andy

 

[TripleR]

Whatever you do, DO something. My father in law had significant amounts of money owed to him when he sold his business; Bulk Fuel Distributor. Some was recovered over the years, but he was too nice a guy to force the issue and when he passed away, my mother in law was left with a lot less money than she should have and no real way to collect it.

He did go to a cash only basis when people didn't pay, but by that time, significant debt had been accrued as his customers were farmers, construction companies and trucking companies in addition to individuals.

I have several relatives in business and almost without fail, the hardest to collect from are often the ones who really have no financial problems.

 

[Topstrap]

Over the years I've gotten stuck probably to the tune of about $30,000+ and know I'll never see any of it. But I'm prob a bit luckier than a lot of business owners, I'm older now, don't need that constant drive everyday to push for daylight till dark jobs to be finished. I am a sole owner/operator of a lil excavating company and now only do work that is "word of mouth only" type of references. I hope it isn't taken the wrong way but over the years I've learned that there are people that I go to look at a job and I never call back or decline to even give a price saying I'd rather not do it.

Maybe not good business practice but I no longer have to worry about receiving payment since most all my customers are now friends or friends of friends that are referred. This will get a few riled up but I do NOT usually work for Lawyers/Accountants/Doctors or someone that says "Treat me right cause I know a lot of people and can give you lots of work". Another group is the ones that put on the big front, look at what I drive and my big house that has no furniture in it. I belong to the country club, eat out every nite. You should feel privilidged that I'm even asking you to do work for me. That has never worked out. They usually are never happy with what you did, feel you owe them more than what was agreed upon and have a terrible time collecting your payment.

For most people they don't have this luxury if they own a business and have to bid and do work for a lot of people they don't know personally since they have overhead, employees and equipment to pay for. I guess being small and not having debt makes it easier to pick and choose but it all comes down to being really careful about choosing who to do work for. I don't ask for a deposit and usually have my customers wanting to know what they owe before I'm even done and they are standing there with cash or a check as I'm loading up.

I'll never be rich in some eyes but sometimes getting up and being happy doing what we do, make enough to have a decent living and not having big time worries is better than all the worries of having a big business. It is not right to have to worry about receiving payment when a job is done. We as Americans should be better than that, you contract for a job, don't try to beat the poor contractor to death on his bid, don't nitpic his work when done and please pay for that work when it is finished if it is done correctly.

I hope you collect what is owed you, people have a bad habit of always having bigger wallets than they really do and even small things pop up and puts a real damper on peoples finances they didn't anticipate which comes down to you usually not getting paid. Good topic but also lots of opinions and views on how others handle this situation.

Topstrap

 

[Coyote machine]

For what its worth, in times like these $4000 is too much money to be owed by someone you don't have a track record of regular payments from.
Personally, I wouldn't want to be out more than a grand unless I knew the person would not stiff me.
I would go with what dozernut said- sounds like he may have been in your shoes previously, (hope not), but waiting on someone who is evading you by not returning calls and has not stepped to the plate to make it right sounds to me like a potential bad debt risk. The sooner you move up the ante the sooner you will know what you are dealing with.
Good luck, and I would add require a substantial deposit on big jobs from 'new' customers to see where the money lies- no money up front- no work. I understand your position of not wanting to ask or put people in the position but try going to buy a special order item from H. Depot, for instance; they won't order it until you lay down the $. Its just good business practice for you and ultimately for the customer.
Another example, my gc brought in a local excavator and he required a deposit on a $20K job. I didn't want to pay out up front but I did. He has since this past 10 months done $150+K work on my place. He billed me for $80K on top of the 20K I had deposited at the start and now I have a $50K bill, (which reflects a 10% discount off the actual work done). I will pay him soon and he knows it, and we are both comfortable doing business after having established a relationship of trust at the beginning.
I hope you get all your owed $ from the guy. Here's hoping

 

[texasjohn]

I have a story to tell... just so you don't have to read the entire thing, the lessons are as follows:

1. When you can't find somebody, become a PI. Use the net, particularly search engines, google, copernic, etc. Insert the person's name, variations on the name, their town, State, whatever you know about the person, occupation, wife's name, whatever... not all at same time, but words in combinations which are likely to be rather unique and lead you directly to the right person.
2. When you get a lead on where the person might be, follow it by careful conversation phrasing which avoids lying, but leaves implications which will encourage the other person to give you better leads as to finding the person.
3. When you actually locate the person, plot a strategy PRIOR to contacting him directly. The strategy should be aimed at providing MAXIMUM embarrassment and exposure to him ... or at least threaten such so that he is motivated to settle up with you.

Now, the story.. which I agree is on a different $ scale than where you are.

My MIL did bookbinding for a fellow, contract was signed, total cost was about $400. Work done, notifications sent monthly to come pick up work and pay, phone number ceased to work, person was unlocatable.

MIL turned it over to me.

I got out computer, browser, search engine, inserted first name, last name, city and state of last known residence.

Quite a few hits... looked at each carefully...used "find" function to locate the name within web page.

One web page was the adult Sunday school schedule for a local church.

Offender was listed as the teacher the next Sunday.

I called Church office, got secretary, inquired how to contact the teacher, by name, because I was interested in the class, wanted to talk to him personally, embarrassed to leave a message. She gave me a number where he might be reached.

I called him... AMAZING...got his answer machine, recording had NOT even been changed, gave prior (now inoperative) phone number, so I knew I had the RIGHT fellow. Left message of interest and desire to attend Sunday school class he would be teaching and pled with him to return my call, left number, never mentioned my MIL name or anything about debt owed.

He returned the call (Friday night) and I verified he would be teaching the class on Sunday, said I really wanted to be there, got all info about time, place, directions, etc....

Then, I laid the trap, asked if he knew my MIL... he stammered, but being caught off guard, admitted he did... I said, good, because I thought he was the fellow who had left a bible to be bound with her almost a year ago and I need to to tell him that she had been carrying his bill without carrying charges for 6 months, but now was charging him $10/month extra for every month he didn't pay for the book...but, I would be willing to do him a big favor...

I'd be glad to bring the bible to Sunday School that Sunday and he could pay me DURING the class. He tried to bargin.... "I'll be by on Monday and pick it up... no need to come down to the class." I was soooo nice....."Oh no, it's no trouble for me to bring it to you on SUNDAY DURING THE CLASS...I CAN BE THERE WHEN CLASS STARTS." He began to get the message... agreed to come by on Saturday. We agreed on 9:00AM SHARP. Else, I was likely to be gone for the rest of the day and then I'd have to bring it to him on SUNDAY.

He arrived at 9:00, paid $500, was pleasant and left.

My MIL was soooo happy!!

Your search terms, engine, results may suggest a different embarrassment technique, but I hope your results are similar.

Best wishes!

 

[ctgoldwing]

Go to the Circuit Clerks office in your county and file a small claim against him. You will have to pay a filing fee, I believe it is around $50, but that could have changed. The court will issue a summons which will be served by the County Sheriff. Bring copies of all letters of correspondence, pictures, billing statements and so forth to court. Let Him explain to the judge why he has not paid you. BTW you do not need a lawyer to file a small claim.

+1

I ran a small business for 25 years and have run into my share of deadbeats. The small claims action is your best bet (check to see that the max you can sue for there is at least what he owes you).
Small claims is relatively informal and very effective (if the guy you ae suing has anything)
I successfully sued a customer who didn't pay about the same amount
($4000) in 1991. I received a judgement & immediately leined his property. He didn't have anything else. Time goes by. I was just contacted by his attorney. He is trying to refinance. With statutory interest its now about
$10K. Nothing happens until that lein is removed

 

[bstrom]

I have several relatives in business and almost without fail, the hardest to collect from are often the ones who really have no financial problems.

I have found this to be true. The people I have had the most trouble with are wealthy. Not to say all people with wealth are like that but I have had problems with some of them, when they could easily afford to pay me on time.

 

[ToadHill]

In the years I owned my own business I only had 2 dead beat customers. One was a Doctor and the other was a lawyer.

The lawyer finally moved and I didn't bother trying to get his new address, and the Dr. died. I filed a claim with his lawyer for payment from his estate but that never came.