How to pursue a company for payment?

UPDATED: Sep 30, 2022

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How to pursue a company for payment?

We are a small truck and trailer repair shop. We did work on a few trucks for a big company. They had 1 truck that kept going down and they blamed us for the work not being finished. This company has bad debt w 3 other companies for non-slow payment as well. We were aware of this but wanted their business. We’ve been open for 2 years and never have we had the same truck come back with the same issue every week. We have contracts with our customers, and it’s all verbal, except for a few. However, this company when they were coming to us agreed to pay in terms of 30. However, they are 8600 past due, and their

invoices are dated back to july. They just send in 200 – 300 dollar payments here and there. We have asked them to pay weekly since they do not come to us no more. They Have stated they will pay us but what they can. They said they are paying someone else to fix our so called repairs that weren’t finished. Now remember i said in the beginning they owe 3 other companies plus us, now they owe 4 plus us. We do not warranty our work unless the customer asks us to. We have asked them to bring the receipts by so we may look at the repairs that

were done that

Asked on October 4, 2016 under Business Law, Texas


B.H.F., Member, Texas State Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

You can attempt to hire a collection attorney to send general demand letters, but it sounds like this is simpy a bad company that milks one repair business after another.  You, do however, have a few options:
1.  See if you can get them to confirm in an email the actual amount due.  This will help you later in a future claim if they try to say that amounts are not due.  Even if they acknowledge that a partial amount is due, that admission can still be used as an admission later in court.
2.  Visit with a collection attorney to determine whether or not it's cost effective to file a collection lawsuit against the customer.   Small amounts are not usually cost effective unless you pursue them in small claims court.  A larger lawsuit can be effective if the customer has assets.  If you obtain a judgment against the customer, you can then ask the clerk to issue a writ of attachment.  This is where the sheriff can seize assets to pay for the debt.
3.  Visit with your accountant.  It may be more cost effective to simply write the account off as a bad debt. 
Going forward, you need to at least visit with a business attorney to assist you in drawing up a basic service agreement or notice that puts your customer's on notice of your collection procedures. This will give you added protection going forward.  You may also want to consider running credit background checks on certain companies that you intend to do business with so that you are doing business with stronger, solvent companies.  Walk the dead beat customers to your competition and let those non-customers bleed the competition instead of your business.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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