Many times a subcontractor, laborer, or equipment lessor providing materials or services for a construction project, does not have a direct contractual relationship with the owner of the property. For example, a property owner may hire a general contractor to redo his kitchen, and the contractor may then hire a subcontractor to provide the carpentry. […]
Can I Cash This Check Without Compromising My Claim?
What should a creditor do if a debtor sends a check with the notation: “paid in full” or other similar language, but the creditor believes a greater amount is owed? Does cashing the check settle the claim, thereby preventing the creditor from pursuing further collection? What happens if creditors cash this check without realizing the […]
Prejudgment Writ of Attachment
Collection is sometimes a race: the priority of liens, or who reaches an account or tangible assets first, can make the difference between collecting a debt and being left out. Even when the debtor is solvent, placing pressure on the debtor is what it’s all about. Debtors stall, and litigation can take a year or […]
What to Do When Your Debtor Goes Out of Business
When a company winds down and closes its doors, it can frequently leave creditors holding a bill. Your debtor goes out of business. Generally, California law grants wide deference to the protection provided by corporations to shareholders and directors, and grants similar immunity to new companies. It erects a wall against the former company’s creditors, […]
Contract Damages in Collection Lawsuits
A delinquent account forces a number of costs onto the creditor. Employees spend time calling and writing the debtor attempting to collect. The creditor may be forced into delinquency on some of its bills, or fail to meet client demands. Then the creditor places the delinquent account with a debt collection law firm and may […]
Why Use a Credit Application
1) Protection From Bad Debt At the inception of a new business relationship, it may be difficult to imagine that this exciting new client will one day become a frustrating debtor. However, all debtors start out as customers. It is crucial to protect yourself from the beginning, and it is easy to do so with […]
When a Client Becomes a Debtor
Tools and Pitfalls When Collecting Delinquent Bills When a client becomes delinquent on its bill, but there’s still some hope the situation will be rectified short of writing off the account and placing it for collection, there are several tools available to a creditor to pressure the client to pay. Attaching Interest on a Debt […]