Customer has no money for finished on-site work!!

[RedFoxComp]

I have been fuming about this since it happened 2 days ago:

I got a call from someone for a quote. He wanted 6-7 computers internally cleaned at his home business, checked for hardware issues viruses, tuned up etc. Also a new switch (which he provided) installed and a DVD drive and some other stuff installed. I gave him a quote over e-mail and he agreed. I called him to confirm on the phone and mentioned that I only take cash, debit or credit.. no cheques. He said he understood.

So I show up and get to work, he is asking me questions the whole time and being pretty pushy about the way he wants stuff done. So after 4.5 hours I finish and write him up a bill totaling $460.02

"Can I write you a cheque?"

NO YOU CAN'T!!

So with a crabby look he pulls out his wallet. "These probably won't work but here you go.." First card.. declined Second card declined.

He shrugs. so I ask him, "is there a bank nearby?"

I follow him to the bank and stand outside as he spends a LONG time pushing buttons. I see him pushing his card in and out repeatedly and entering his pin. He finally calls me over to show me that the card is locked, and shrugs again.

So I ask him to go to a teller and he explains that this is not his bank. After some discussion and prompting it is decided that I will follow him to his own branch. He spends a LONG time at the teller and finally comes over to me and shrugs again saying his account is empty. There were some cheques that should have cleared that didn't. No apologies or offers to correct things.

So, in frustration I told him to wait, got a service sheet from my car and had him sign an agreement. I wrote. "I xxx, agree to pay xxx of.... in the amount of xxx for services performed at xxx on Sep 20th 2011, by September 24 2011.

So, my question is should I have followed him back to his house and called the police to at least have a record of the incident? I have a feeling I will be sending this to collections. Anyone have any experience with anything like this?

It was really apparent he had no remorse over the issue and seemed more annoyed than anything, which angered me even more.

 

[comprx]

What you should have done is accepted the check at that point. Once it bounced you would have criminal legal recourse. That and a paper trail

 

[anonymous Mac Tech]

What you should have done is accepted the check at that point. Once it bounced you would have criminal legal recourse. That and a paper trail

^This. Or collected up front if you weren't sure about him in the first place.

 

[Mushin]

What you should have done is accepted the check at that point. Once it bounced you would have criminal legal recourse. That and a paper trail

+1 To this.

Also, did you have anything in place before starting the work that would indicate that he approved of the work and was informed of the costs associated with the services that you were performing?

If so you at least have that document. If not get that in place for the future as soon as possible. From what you stated it sounds like payment terms were not exactly talked about in advance of starting the service.


For anyone facing this or wanting to avoide this here are some ideas.
------------------

Before the appointment you should always state what forms of payment are accepted, weather payment is due at the time of service or will be invoiced. You should also state any prelimnary requirements such as cancelation fees and minimum charges.

While on the appointment and before you actually start the work you should review the above, review your terms of service, and get a signature from the customer that they agree to your terms of service. If possible you should also have them sign in advance that they are approving the repairs. Only then should you start working.

At first you may feel like you may scare them off and for those who can't pay then you will thus preventing this problem. The reality is that customers appreciate this and expect this this type of paperwork since it is very common in any on site service calls. I have also found that doing this leads to higher quality clients and a higher work order revenue.

The hard part is getting to the point that you don't feel like you need every job. If you feel like every job is make money now because you may not later it is much hard to stick to own "processes." Also be cautious of not "self-discounting" your services out of fear of loosing the call out since this often happens when people are not booking many appointments.

I say put in as many layers of profesionalism as possible with your processes and procedures becasue it will also make you that much more credible to the customers. In turn they will respect and trust your business more.

 

[ATTech]

What you should have done is accepted the check at that point. Once it bounced you would have criminal legal recourse. That and a paper trail

This.

Once the cards get declined, that should have been a red flag. Just take the check with the expectation it will bounce. Then at least if it has to go to court, you're practically guaranteed a judgement in your favor. In certain cases area, the police have "Bad checks" teams that you could get in touch with.

 

[jeubank]

In arizona - you have the Prompt Payment Act / Mechanic Lien as an option that you can take.

You have the right to take what you worked on or installed as long as it is not bolted to the structure or building, pending payment.

I had to do this with a national IT company for Chase Bank. I installed hardware, and troubleshooted their Teller Express software for teller machines. Usually they paid, but to no fault of my own, they were skipping payments on some finished work orders.

After 60 days of the run around. I sent a notice of my intent to take / lien hardware not paid for at a few branches in the area.

I Went in, told the manager, they said no. They called police, and police said it was my legal right and I took 9 Computers in total from 2 branches. By the time i went to the 3rd branch, the Regional VP of Chase, contacted me, (please remember.. Chase does not pay me directly, the national IT company does) - and asked, what is owed, and he said he would personally send a money order fed ex overnight with tracking in under 20 minutes if I stopped my lien on the computers. I agreed. and sure enough, I Was given the tracking number + $100 for "my troubles" and i returned the hardware the next day after i cashed the money order.

I cannot say you have those rights in other states or countries. However, in Arizona - every contractor, or subcontractor (not just car mechanics) have the right to collect + hold property that was serviced (labor or parts) that does not pay the invoice.

I have used this technique twice on home-visits. It gets ugly, and at the end of the day, they never pay, and i just sell the equipment 90 days later. (I think the law is 30 but i give benefit of the doubt)

Also - by law, if I sell the equipment for more than what is owed, I am obligated to give the remaining balance to the customer. (If i dont, it is a crime)

 

[Mushin]

In arizona - you have the Prompt Payment Act / Mechanic Lien as an option that you can take.

You have the right to take what you worked on or installed as long as it is not bolted to the structure or building, pending payment.

I had to do this with a national IT company for Chase Bank. I installed hardware, and troubleshooted their Teller Express software for teller machines. Usually they paid, but to no fault of my own, they were skipping payments on some finished work orders.

After 60 days of the run around. I sent a notice of my intent to take / lien hardware not paid for at a few branches in the area.

I Went in, told the manager, they said no. They called police, and police said it was my legal right and I took 9 Computers in total from 2 branches. By the time i went to the 3rd branch, the Regional VP of Chase, contacted me, (please remember.. Chase does not pay me directly, the national IT company does) - and asked, what is owed, and he said he would personally send a money order fed ex overnight with tracking in under 20 minutes if I stopped my lien on the computers. I agreed. and sure enough, I Was given the tracking number + $100 for "my troubles" and i returned the hardware the next day after i cashed the money order.

I cannot say you have those rights in other states or countries. However, in Arizona - every contractor, or subcontractor (not just car mechanics) have the right to collect + hold property that was serviced (labor or parts) that does not pay the invoice.

I have used this technique twice on home-visits. It gets ugly, and at the end of the day, they never pay, and i just sell the equipment 90 days later. (I think the law is 30 but i give benefit of the doubt)

Also - by law, if I sell the equipment for more than what is owed, I am obligated to give the remaining balance to the customer. (If i dont, it is a crime)

I love Arizona!!!! They are so business friedly! Maybe I should put them on my expansion map.... lol

 

[Tony_Scarpelli]

I would have unplugged and taken the two best servers/computers and taken them with me. They would have to bring cash to my office to pick them up.

 

[RedFoxComp]

I would have unplugged and taken the two best servers/computers and taken them with me. They would have to bring cash to my office to pick them up.

Not a bad idea, although if he had said no I'm not sure if I had any recourse. I'll definitely have to check into that. He had a nice I5 2500K with 16 gigs of ram and a 560TI in it for his main desktop rig.

This was the first time in 3 years I've had something like this happen, so I count myself lucky. I'm considering this a learning experience so from now on I will have a better understanding of local laws and will better protect myself with my documentation.

I have a feeling I will end up sending this to a collection agency. It's not enough to bother with small claims court.

 

[Tony_Scarpelli]

I am sorry this happened to you or any of us. This guy was clearly a scumbag never planning on paying you.

You could always drive by his house and ice pick the sidewalls on his tires. that will cost him $500 deductible on his insurance.

 

[Cornerstone Technologies]

I have a feeling I will end up sending this to a collection agency. It's not enough to bother with small claims court.

Chances are, if its enough to send to collections, then it is enough to bring a dispute to small claims court. A win in small claims court would also be a plus when working with collection agencies. In any case, you could sue for what he owes you, plus court costs and lost wages in pursuing a case. $460 would be enough for me to pursue, its a car payment.

 

[Appleby]

No chance I'm going to force this guy to drive all over town to try and get cash. I accept checks. 90% of my payments are by check. I have on average 2 bounced checks per year and usually one of them is a simple mistake and it's made right almost immediately. The other is usually a pain in the rear and it takes a long time to finally get the money. I've never had a bounced check for over $150.

If someone is dumb enough to write you a hot check for $400, I'd take it. It's large enough you can file charges and its worth going to small claims court over. I realize alot of people here don't accept checks but I'm in a small town and I guess I'm still old school and trust most people. I can understand in a bigger city where I might have a different view. That being said, I'd let people know up front I only accept cash or credit/debit cards and obviously they should be expecting to have one of them ready when I'm done.

I do think you were really wise to write up the receipt of work done and have him sign it. That is worth something but to a judge it's worth less than a hot check in your hand.

 

[Tony_Scarpelli]

No chance I'm going to force this guy to drive all over town to try and get cash. I accept checks. 90% of my payments are by check. I have on average 2 bounced checks per year and usually one of them is a simple mistake and it's made right almost immediately. The other is usually a pain in the rear and it takes a long time to finally get the money. I've never had a bounced check for over $150.

If someone is dumb enough to write you a hot check for $400, I'd take it. It's large enough you can file charges and its worth going to small claims court over. I realize alot of people here don't accept checks but I'm in a small town and I guess I'm still old school and trust most people. I can understand in a bigger city where I might have a different view. That being said, I'd let people know up front I only accept cash or credit/debit cards and obviously they should be expecting to have one of them ready when I'm done.

I do think you were really wise to write up the receipt of work done and have him sign it. That is worth something but to a judge it's worth less than a hot check in your hand.

Many towns will not enforce bad checks. I had to stop taking checks because the city decided that they couldn't pay police officers needed elsewhere to handle payment disputes.

Crazy as it sounds that is Wichita's philosophy. If they can write a check then a debit card should go through for the same amount. In KS if I accept a check that I know the money is not in the account then I have no case in criminal law if he doesn't pay it regardless of size of the check.

 

[NETWizz]

You will never get paid. May as well just pass it on to Collections...one that only gets paid if he pays. Basically, They will try to collect maybe $400 from him... If they succeed you might get $300 and they keep $100.

You get the idea.

 

[Cornerstone Technologies]

Many towns will not enforce bad checks. I had to stop taking checks because the city decided that they couldn't pay police officers needed elsewhere to handle payment disputes.

Crazy as it sounds that is Wichita's philosophy. If they can write a check then a debit card should go through for the same amount. In KS if I accept a check that I know the money is not in the account then I have no case in criminal law if he doesn't pay it regardless of size of the check.

Years back when I lived in California, I wrote a check at Ralphs that ended up bouncing. I know that the check was passed to the county and they pursued the issue vigorously. After making good on the check, I had to go to a 'check writing class' and pay the county some absurd fee that was a few hundred dollars. While some places might not pursue bad checks, the other end of the spectrum does indeed exist.

 

[NETWizz]

I am sorry this happened to you or any of us. This guy was clearly a scumbag never planning on paying you.

You could always drive by his house and ice pick the sidewalls on his tires. that will cost him $500 deductible on his insurance.

And that would be CRIMINAL not CIVIL... It might cost him $500 and you 50 days in jail!

 

[NETWizz]

Years back when I lived in California, I wrote a check at Ralphs that ended up bouncing. I know that the check was passed to the county and they pursued the issue vigorously. After making good on the check, I had to go to a 'check writing class' and pay the county some absurd fee that was a few hundred dollars. While some places might not pursue bad checks, the other end of the spectrum does indeed exist.

Check writing class? "If you don't have the money, don't write the check."

That must be like driving class... "If you got a speeding ticket.... Don't speed???"

 

[jeubank]

Whats a check?

(I dont even think I remember how to write one. Dont you have to write out in long form the amount on that line? ugh... )

 

[Tony_Scarpelli]

And that would be CRIMINAL not CIVIL... It might cost him $500 and you 50 days in jail!

You live in NYC right? Come on, you telling me no one you know would do that?

 

[Knightsman]

Id visit him everyday for the money, sit outside his business with a lawn chair about how he is a crook

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