Getting paid can sometimes take longer than expected. But, how long? That depends on whether your client has a deep pocket. And also how long they want to stretch out and avoid payment.
Consider this: A contingency fee is the most common way to handle claims. When there appears to be a possibility of collection, your collection attorney will continue to work on the case until you receive payment.
The same does not hold true for your nonpaying customer. Unless your client is an attorney and will self-represent or has a friend who is a lawyer or one on staff, the corporation you sue for nonpayment must hire counsel to represent them. They cannot represent themselves.
The non-paying customer will have to pay for representation.
Generally, their counsel will request a retainer to familiarize themselves with the file, prepare an answer, counterclaim, if appropriate, and perhaps make some discovery demands. To accomplish this, the client will have to give their attorney a lump sum payment. In some instances, the attorney can accomplish a stall for a good 6-9 months. To help keep this from happening, your lawyer should know the friendliest court for your case and file the lawsuit there.
Other nonpayers looking to stall may pay additional monies to have their attorneys make a frivolous motion to dismiss your case. Or they may ask for unnecessary depositions that require you to come in and testify to support your case.
If your collection attorney believes that the court will see through the smokescreen, they can make a motion for summary judgment. That requires the nonpaying client and their gun for hire to oppose and put forth their evidence to substantiate their case. The nonpayer’s attorney will require compensation for this as well.
If you have the appropriate documentation, you may end the case there.
However, even waiting for the court to decide the motion can buy the customer an additional 3-9 months depending upon the court’s backup.
If you don’t have buttoned-up documentation and/or the other side refutes and comes up with something to support their position, the case will continue.
The more you push your case, the more they need to come out of pocket to pay. The defendant will need to pay every step of the way. He will be paying his attorney but not you.
At some point, usually before trial, the customer sees the light and attempts to resolve. Now the nonpayer becomes tired of paying his attorney and recognizes he will soon need to pay you too.
If you need help getting paid please reach out to us either through our Contact Us form or give us a call at (212) 686-0100.