UK Client in Breach of Contract

[animateMA]

My small Massachusetts company has been doing animation work for an advertising company in the UK. Though they have paid for work in the past, they had a tendency to be late with payments and often gave us the run around about tracking the payment.

In an effort to motivate them to pay on time, our last two large contracts with them included a late fee (2% per week after 45 days after invoicing). As usual, the expected date of payment passed and still no money.

Eventually, the office head there said he had no intention of paying the late fees and that he wouldn't be paying us until he has billed HIS client. He said that we should "understand the situation". Since then he has not returned a single email or phone call.

He currently owes us over 40K and if we were to persue the late fees, there is probably another 5K on top of that. Our contract states that legal matters need to be addressed in the UK.

What should we do?

Thanks
animateMA

[randalljd]

You may file a police and/or FBI report for fraud if you suspect actual fraud, and file in court where they live as well if you know who and where they are. World law can also track them down, prosecute and collect though they do charge a basic fee for that. WLD has over 380 lawyers in the group covering all U.S. states and 26 countries. Email them on the site home page above.

Originally Posted by animateMA

My small Massachusetts company has been doing animation work for an advertising company in the UK. Though they have paid for work in the past, they had a tendency to be late with payments and often gave us the run around about tracking the payment.

In an effort to motivate them to pay on time, our last two large contracts with them included a late fee (2% per week after 45 days after invoicing). As usual, the expected date of payment passed and still no money.

Eventually, the office head there said he had no intention of paying the late fees and that he wouldn't be paying us until he has billed HIS client. He said that we should "understand the situation". Since then he has not returned a single email or phone call.

He currently owes us over 40K and if we were to persue the late fees, there is probably another 5K on top of that. Our contract states that legal matters need to be addressed in the UK.

What should we do?

Thanks
animateMA

It would appear that you have two options - to negotiate a solution for payment (possibly including the threat of litigation) or find an attorney in the UK to file a claim against the company.
In order to file a claim you will need to lodge a claim form with the relevant Court, and seek a judgment against the company. If you were to obtain a judgment, you could then enforce payment of the debt.

aee

[animateMA]

I've recently heard that suing for legal costs is a long shot and the thing I'm most concerned about is legal fees.

Neither myself or any of my employees have taken anything to court and we're looking at 40K (not including late fees if we were to win those). Not alot I'm sure for other companies, but its a months costs for us. Huge loss for us considering how tight our budget is currently.

Filing criminal charges seems like a good option, but wouldn't companies do that all the time for breach of contract if it meant no legal fees?

Thanks
animateMA

[annjd]

World law can sometimes effect collection by out of court means--you may want to email them.

[animateMA]

We have emailed them, but they don't return them anymore. They don't even return phone calls. We're looking in to other methods now since we don't feel negotiations can continue until we threaten them legally in some way.

Originally Posted by animateMA

We have emailed them, but they don't return them anymore. They don't even return phone calls. We're looking in to other methods now since we don't feel negotiations can continue until we threaten them legally in some way.

have you thought about using a UK debt recovery agency? i could arrange this but would want £5K when the bedt has been recovered, if you are interested email me, mdrifle@yahoo.co.uk and i will disclose more information.

regards