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Self employed - demanding payment of invoices

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#1 Moo point

Posted 09 March 2016 - 02:59 PM

I'm hoping someone can provide some quick advice.

At a friend's request, I was hired to do an administrative contract project last year, by a company that she was working for. Terms agreed with my friend over the phone, I went in for the first meeting with the client in February 2015.

The verbal understanding was that I would submit invoices for my time, no more than around 10 hours per week, with no agreed timeframe - it was "whatever you can do, however quickly you can do it."

I submitted 10 or more invoices last year that were all paid (none on time). However the last 2 invoices remain unpaid, issued in October 2015. I have sent 2 further emails since requesting payment. My friend quit working there in July 2015, but called the office manager today to enquire about payment. The business owner does not understand the work I've done (computer illiterate) but all of the staff do, and feel terrible I haven't been paid.

The owner is now overseas for 10 months. What is the best course of action? Another email requesting payment seems futile, would a letter of demand be appropriate? And if I send a letter of demand by registered post, what happens as she's out of the country? It's not a huge amount, just under $2k, but I haven't worked since and could really use the money.

Edited by Moo point, 09 March 2016 - 03:01 PM.

#2 Greatmum

Posted 09 March 2016 - 03:01 PM

I would send the letter. They must b paying other invoices while she is away.

#3 27plus

Posted 09 March 2016 - 03:24 PM

Owning a small business my self, I would send a letter of demand stating if it is not paid by such and such a date you will take further action.

And follow through with the further action if they don't pay.

#4 Luci

Posted 09 March 2016 - 04:51 PM

There must be someone paying the bills. Could you try to find out via the office manager / other staff the name of the person?

Good luck

#5 rainycat

Posted 09 March 2016 - 04:54 PM

I would speak directly to the person responsible for paying bills and take it from there.

#6 Moo point

Posted 09 March 2016 - 05:01 PM

Unfortunately the business owner is the only one who will sign off on invoices - the accounts person knows of the issue but has been told not to pay them. She's been trying to pay them for months, apparently. But the office manager today said to my friend that because I hadn't sent yet another reminder recently that maybe I had "washed my hands of it." WTF? I've been tied up for a month or so with challenging personal stuff, and these invoices were due in October! 'm kicking myself for giving them an up to date copy of the documentation before final payment, but they needed it for an event. Lesson learned.

Thanks for the advice, I'll draft a letter of demand tonight and send tomorrow.

#7 MrsWidget

Posted 09 March 2016 - 05:10 PM

I'd give them 7 days to,pay and state if not paid by then you will take them to the small claims tribunal. In VIC it's called VCAT and very straightforward.

#8 Luci

Posted 09 March 2016 - 05:21 PM

Given your update I think it is time for a letter of demand.

Good luck


#9 Caribou

Posted 09 March 2016 - 05:24 PM

Think a letter of demand from lawyer or a notice for small claims tribunal will get the owner onto it quickly. You have enough witnesses to back your claim.

#10 Moo point

Posted 09 March 2016 - 07:24 PM

Thank you for all of the advice. Hopefully a letter will be enough, I'm not sure I have the mental energy for small claims court.

#11 yellowtulips74

Posted 09 March 2016 - 07:44 PM

Oh how stressful.

What reason did she have for telling the bill-paying person not to pay? Did she communicate any concerns with you?

I assume the business is still operating while she is overseas?

#12 Beancat

Posted 09 March 2016 - 07:46 PM

Letter of demand. I had to resort to this last year and it worked. You can find templates on the relevant gov website in your state. You need to make sure it has certain wording to make it legal

#13 LenaK

Posted 09 March 2016 - 07:59 PM

It actually sounds like she is counting on you not having the energy and letting it go.

I agree with PP's, its time to send a letter of demand.  There are some specific requirements for it to be valid, so check them out at Caxton Legal (free template) or business.gov.au.

Small claims tribunal is just an administrative process and not so hard to navigate.

#14 Coffeegirl

Posted 09 March 2016 - 08:09 PM

We use this company to monitor our debtors.  They have a good template for Letter of Demand.  If you join and get their free trial, you can use their logo on your demand as well.

It looks pretty scary ;)

I manage to get payment of 99% of my overdue accounts using their letter and logo.


#15 Moo point

Posted 09 March 2016 - 08:35 PM

Wow, these are all great tips, thank you!!

Even though I tried to have a meeting with her to update her on the documentation before we went overseas in December, she kept cancelling - 4 meetings in as many weeks. She told her staff that she doesn't understand what I've done (it's a complex excel spreadsheet) so doesn't want to pay until she does. But she will never understand, she's computer illiterate, her staff understand everything and were the ones giving instructions to me, and she's just gone overseas for the rest of the year. So hasn't made any effort to try and meet with me. In fact I've never had direct contact with her apart from one meeting.

This client is a very well known person - hopefully a letter of demand will make her pay up so as not to cause public embarrassment. (ETA not that I'm planning on notifying media, but any legal claim would be public record I believe).

Edited by Moo point, 09 March 2016 - 08:37 PM.

#16 Chocolate Addict

Posted 09 March 2016 - 10:25 PM

So, she has gone overseas for 10 months and given instruction not to pay any invoices or just yours? Does she really think other businesses would be happy waiting 10 months to be paid?

$2k is a lot of money, hell I did some contract work and am waiting for $700 and that is a lot of money to me.

Definitely do with the letter of demand.

#17 Moo point

Posted 10 March 2016 - 08:16 AM

No, just mine. But I know that when all my invoices were paid late last year, so were everyone else's. They went through 3 accounts staff members in that time, one girl left and agreed to keep doing payroll until they found someone else, but not the accounts. The owner is notorious for not paying accounts on time but she is a very popular person that people want to work with. So she gets away with a lot.

At least if it goes to court I have history of her not paying on time.

Hope you get your money, too, CA.

Edited by Moo point, 10 March 2016 - 08:16 AM.

#18 Caribou

Posted 10 March 2016 - 08:16 AM

Involving a debt collector is fine too. people don't like those, and I get being stuck waiting for payment. I have a medium business, and we've dealt with well known companies who would take a good 6-7 months to pay, They just didn't care what they did to everyone else who supplied them. We've been fortunate not to be crippled by delayed payment or refusal of payment and playing phone tag with these people (seriously, calling us outside of working hours so they look like they're 'trying')

It ties up a lot of money, time and staff into chasing up owed payment. 95% of our customers are honest and pay up. but sadly there's just a few who just tell us they will pay when they're good and ready to!

#19 Lunafreya

Posted 10 March 2016 - 08:25 AM

I'd involve a debt collector if it's not paid in seven days, and then follow through. Debts collectors are not nice or understanding people, and you end up paying more.

#20 *-*

Posted 10 March 2016 - 08:31 AM

You need to send them a letter of demand and state that as payment is well outside trading terms, from this date forward it will accrue a percentage in administration fees, you can decide the percentage amount.

The owner can't just go away, and not pay anyone!  There will be a plan in place for paying invoices.  I guarantee it!

#21 Coffeegirl

Posted 10 March 2016 - 08:48 AM

View Post*-*, on 10 March 2016 - 08:31 AM, said:

You need to send them a letter of demand and state that as payment is well outside trading terms, from this date forward it will accrue a percentage in administration fees, you can decide the percentage amount.

Unless admin fees were part of the original terms, you can't now ask for them.  Same with charging interest on the outstanding amount.  Unless it was part of the original terms of your invoice, you can't just start charging it.

However, you can send them to debt collector and they will have to pay the debt collection fees as well as any court costs.  Often once a judgment is handed down, you can also then accrue interest on the outstanding after that date.

#22 yellowtulips74

Posted 10 March 2016 - 09:38 AM

Lol, it sounds like people like the idea of working with her, but the reality is very different.

She sounds like a very selfish person who exploits her popularity whenever given the chance.

If her reputation is important to her, perhaps throw into the conversation that you might contact A Current Affair...

#23 Moo point

Posted 10 March 2016 - 09:07 PM

LOL, not a bad idea! Wouldn't look good for business.

And yes you may be right, the right people love her but she's shocking to work for.

#24 yellowtulips74

Posted 28 March 2016 - 09:01 AM

Hi OP, any luck yet?

#25 Moo point

Posted 28 March 2016 - 09:22 PM

Not yet, thanks for checking in. A few life things got in the way, finally sent a letter of demand by registered post on my own letterhead last Monday, giving them 7 days to pay.

Spoke to my friend who originally set me up with the job, I'm going to email the office manager and accounts person tomorrow reminding them of the letter of demand (if the pay hasn't gone through). Hopefully I won't need to resort to legal help or small claims court :(

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