How to recover money from a company who refuses to pay but are using your services/software?

Lbugb on 27/11/2016 - 01:20
Last edited 27/11/2016 - 01:50

Hi,

I built two softwares for a very small company and delivered them almost the same time. I sent invoices for both softwares to the company. However now for last 3 months, they are telling me that they will pay me in weeks time because they are having tax issues etc. I have confirmed that they are using both my softwares. I didn't get any contract signed and wondering if i have any options to recover the money? The money is in discussion is AUD $2100.

The company is a local company based in Wanneroo, Perth.

Financial

Comments

  • captobvious on 27/11/2016 - 01:57

    Debt Collector…., send your mother in law worst case bikies

  • Pigey on 27/11/2016 - 02:16
    +3

    Send a few stern letters, and threaten Magistrates Court/Small claims

  • bugb on 27/11/2016 - 02:23

    can i go to magistrates court/small claims if i don't have any contract signed from them. i do have the copy of invoices that i sent to them though.

    • blitz on 27/11/2016 - 02:59

      What do you have in writing?

      • thatonethere on 27/11/2016 - 09:57
        +1

        Even if it is emails/instant message/text messages that would assist small claims in determining who pays what.

        • blitz on 27/11/2016 - 15:04

          emails/instant message/text messages

          Great, but we don't know if the OP has any of those things. Hence my question.

    • SirFlibbled on 12/12/2016 - 10:44

      You don't need a signed contract for a contract to exist. But it will come down to evidence. Do you have copies of emails where they asked you to do the job, you quoted on it and they accepted? If so then you can show there's a contract.

  • chumlee on 27/11/2016 - 06:47
    +1

    Surely you at least have email exchanges from during the development of software stage that has correspondence from them on the project. Not as sold as a contract but a starting point. Also an emails you can get on them acknowledging they owe you the money is good

  • Randxyz123 on 27/11/2016 - 08:36
    +1

    I didn't get any contract signed

    WHY? OH WHY??

    Do you have emails negotiating prices or anything?

    Can you meet up with the manager of the company and have them sign a contract saying they will pay within 30 days?

  • charzy on 27/11/2016 - 10:15

    Is there a way to deactivate the software you've given them?
    Maybe if they come in Monday morning and everything's broken, they'll cough up.

  • bugb on 27/11/2016 - 10:39

    there is no way. i don't have any emails either i guess that's my bad. it was all over the phone or face to face. i was planning to send them a SMS threating that software will auto deactivate after 6 months in use and also saying about going to magistrate court. i had sms messages but only about when to come to install the software and nothing else. will that work?

    • 777 on 27/11/2016 - 11:04
      +1

      do you have EULA in installation or stored in their machines?

      • Kangal on 27/11/2016 - 11:11
        +2

        Good point, check the EULA.

        I recommend some careful planning before threatening to stop their service.
        Or actually doing it. They could in fact, turn around and sue you for losses.

        Maybe ask them to start a payment plan, like $300 per week… so in 7 weeks the payment will clear.
        That's not a price they can't pay. And its not a duration that is too unfair for you.

        But make sure you have proof of a payment plan/in writing, in case they cease doing it.
        Then you'll have everything you need for the small claims court.

        • 777 on 27/11/2016 - 11:16

          Good advice, I would threaten to hire a lawyer and tell them more likely they will loose and they will have to pay the your lawyers which can cost in excess of 10K plus. Not to mention stress and damages caused by the stress:)

        • Kangal on 27/11/2016 - 11:26
          +1

          @777:

          You should write something up like a contract about the payment plan.
          And that if they deviate from the payment plan (like miss a payment w/o prior consent), then they must pay Late fee charges.
          Also include a clause saying they can pay the whole outstanding payment at anytime without consequences.
          Print it out. And ask to meet with the manager.

          If the manager is smart, he will try to persuade you he is going to send the payment that day and he doesn't want to sign.
          Show him that this contract benefits him, as well as you.
          That if he wants to make the payment today, he should sign the contract, and make the payment… then the contract will be over.

          If he resists signing the contract, tell him you have already sought Legal Advice.
          I would then bring up that you will be taking him to court, and he should expect a summons.
          Tell him the cost of the court case is SUBSTANTIALLY higher.
          See his reaction.

          Worse comes to worse, leave the contract in his office.
          He might try to be sneaky and agree to goto court say he's been paying the contract.
          However, little does he know… the contract actually is missing your signature : )
          So his little antics will be obvious to any judge out there.
          And you could recuperate MORE than your losses.
          And this could be an expensive lesson for the owner…. stop being a sleaze bag to the OzBargain Master Race.

  • 777 on 27/11/2016 - 11:06
    +1

    Any piece of script I make for work, i put my name on it. Even intellectual rights belong to company you work.. but you never know

  • cypher67 on 27/11/2016 - 12:03
    +1

    When I produced software like you did, I built in a timer that would shutdown the software after 3 months unless they enter a password in the settings, as a once off that I would provide after I received payment. I pitched it as a try before you buy "feature"

  • windale on 27/11/2016 - 12:11

    Just tell them you have booked a meeting with your lawyer next monday and if you do not have payment by then you will be taking legal action. I have done this successfully. If they call your bluff just pay a lawyer to send a letter of demand. add that cost onto what they owe.

  • Almost Banned on 27/11/2016 - 12:37
    +5

    For that amount of money it is not worth seeing a lawyer.
    Go to http://www.magistratescourt.wa.gov.au/M/magistrates_court_ci…
    and complete a Minor Case Claim.
    At this value you can't have a lawyer act (without leave).
    File it at Court and make sure it is served on the customer.
    Wait and see what happens.
    6 times out of 10 it will show them that you are serious and they will pay up.
    3 times out of 10 they will do nothing in which case you enter default judgment.
    1 time out of 10 you will need to go to hearing.
    Good luck.

    • isidore12 on 27/11/2016 - 13:17
      +1

      I think the piece of advise from blaircam is certainly the best.

      The amount you want to recover is not worth a lawyer (about 3k the letter) and may not work anyway.

      I would start with a letter (registered), nice but very firm, with the terms of contracts, and a dead-line to pay. Don't give them any information about what you are going to do. The less they, know the better. Threats from an individual means you are desperate.

      If they pass the delay, then go to the court as advised by blaircam. It is always better to show that you tried to resolve it before going to the court.

      The debt collector is another solution. I heard about it used between individuals even for few hundreds of dollars.

      Anyway, next time, take care of legal aspect before any transaction. The legal in a company is as important as the products or the services you want to sell.

  • bugb on 27/11/2016 - 18:19

    thank you everyone. i have threatened the person with sms and he has called and said will pay me back in installments. not sure whether he will or not. thanks for all the advice though.

    • CandyMan on 27/11/2016 - 21:23

      he has called and said will pay me back in installments.

      You still dont have anything in writing. Smart strategy from that person

  • bugb on 27/11/2016 - 23:39
    +1

    @CandayMan i spoke to my friend and he said going to small courts is a pain and it's more headache and may not be worth it. there is no way i can force this guy to give me anything in writing and looks like i can either let it go or trust him to pay me until unless you suggest some way easier to recover money?

  • kaos on 28/11/2016 - 12:48

    Candyman, I'm sorry to say this but people pull this type of shit all the time, and if you don't stand up for yourself you will end up a talented but broke person. They are currently using your intellectual property. If he does not pay the first instalment at the correct time, send him a message asking when would be a good time for you to come in and uninstall your software?

    If he doesn't respond, send him a message that you will be coming in at x date and time and you will be bringing a security guard with you, and you'll be billing them your costs. Turn up. The 'security guard' could be a mate, but better if he is real and wearing a uniform. They'll probably call the cops, but you will be just sitting there asking for access. If you do this a couple of times they will be forced to take action against you and they may decide it's cheaper to pay you.

    Remember to bill for your 'recovery costs'. And don't ever do work without a paper trail again.

  • blitz on 01/12/2016 - 14:14

    I have confirmed that they are using both my softwares

    How?

  • bugb on 02/12/2016 - 00:01

    @blitz: by speaking to them

  • bugb on 11/12/2016 - 21:25

    I sent this guy another message saying that how hard i worked to build these two softwares and i would appreciate if he pay up even in installments. he called me up saying he would teach me a lesson to keep on bothering him and will send someone to my house to beat me up. can he do that in Australia?

    • djkelly69 on 11/12/2016 - 23:44
      +1

      Can he? It is possible I suppose. It is legal? Of course not.

      A contract does not have to be in writing to be enforceable. Stop mucking around with messages and calls. Send them a letter by registered post setting out the full amount owed, and requiring payment within say 14 days. If they don't pay, go to Small Claims or whatever is relevant for your state. Yes it is a bit of mucking around to do, but should work ok.

      And I would also start recording your phone calls when this guy calls.

    • SirFlibbled on 12/12/2016 - 10:45

      I'd certainly go to Small Claims then. He clearly doesn't respond in writing so there's no evidence of what he says.

  • megamilinda on 26/12/2016 - 20:39

    Contact consumers affairs and get some advice from them, they can even call the customer on your behalf.

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