Ask HN: Last 7 invoices haven't been paid, what now?
I've been working with a 'friend' of mine on his website for the last year. I was paid by check which was sent to my place while I was traveling and lost track of which invoices were paid. After consolidating everything in the last month I realized that I haven't been paid for the last 7 months.
We had a contract that stated I could bill them monthly a max amount. I never heard negative feedback regarding my work, only positive conversation and full steam ahead. I took over the code a year ago from a development firm, and am the sole developer on the project.
All efforts of communication on my part have been met with radio silence. Emails, texts, phone calls have not been returned for the last 2 weeks.
What do I do now? I'm short of cash at this point and not sure bringing a lawyer in will help as they have significant more money than I do. Is it legal to revert all the code I checked in for the last 6 months long as it doesn't break anything?
Any advice would be appreciated.
19 comments
[ 2.5 ms ] story [ 33.4 ms ] threadIf he doesn't respond to that, you could get more extreme by posting your own status and tagging him in it: "I've been working for @[friend] for months, and he hasn't paid me or responded to my emails. Anyone have any suggestions?"
Phone calls, in-person visits to his office, and emails to other friends or employees at his company will also be effective. It's very easy to ignore a personal email. It's very hard to ignore something that starts to affect your reputation and peace of mind.
Other than that, you might have some luck selling the debt to a collection agency.
You can, of course, always sue him, but if you don't have a pretty tight contract, it would be more trouble than it's worth.
The businesslike way to handle payment disputes is with a demand letter send by registered mail, so that there's no dispute about whether it has reached the recipient. No social shaming (which makes people behave irrationally and vindictively), no surprise encounters (likewise), just a simple observation that 'on reviewing my accounts, I see you've fallen behind on payments. Specifically, you owe me X, Y, and Z; please remit the full amount with 7 days or I shall have to act to recover the money by other means etc. etc..' As I said above, the best thing is to get a lawyer to draft the demand letter.
Make possibly defamatory public statements about someone, especially someone you might end up in a legal battle with later, is not a great idea.
And using these kinds of tactics in an attempt to resolve a business dispute could hurt your reputation with potential future business clients.
You could, of course, say something like this:
"Because you have failed to pay me for my work, I feel it would be morally justified for me to revert all of my changes unless we reach an agreement in the next 10 days."
You're not actually saying you're going to do it. You're just saying you think it would be ok.
Also, (kindly) remind them that as they have not paid for your work, it is actually your IP & they cannot use your software.
And dear God, please PLEASE use this as a lesson & start to better manage your invoices. I use Harvest getharvest.com & it manages follow-up emails for late payments automatically. You could use any system though - they're well-worth the $10 p/m.
That's unlikely to be effective. As soon as they heard that, they'd just make backup copies of all the code and change the passwords on their servers.
"You're not actually saying you're going to do it. You're just saying you think it would be ok."
A statement like that could be considered to be extortion, even if made as a hypothetical. If you owed me money, and I told you "that's a nice car you have, it would be a real shame if anything were to happen to it", you'd take that as a threat, wouldn't you?
In this case, it doesn't seem like they have a contract, so the remedy might be to just "undo" the deal as best they can.
Unfortunately, without a contract, there probably isn't a statutory remedy, and they'd have to go to court. That's why I said s/he definitely should not actually revert the code.
My suggestion also took into account the 1st Amendment, which protects speech that has content. In this case, s/he's saying "this is how I feel about it" and "it would be morally justified", both of which have content beyond any sort of implied threat.
All that said, I'm not a lawyer, and no one should take anything I say as legal advice.
You are fortunate in that you have an actual contract and a paper trail, which puts you far ahead of most claimants in 'I got exploited' situations. Organize everything and bring it to a lawyer, who will explain your options and then offer to write a demand letter on your behalf. If the matter is as clear-cut as you say, then you should be able to ind a lawyer who will handle it on contingency. If you don't have a lawyer, call your state or country's Bar Association and tell them that you have a contractual dispute involving non-payment in the amount of $xxxx, and they'll recommend some lawyer sin your area that arelikely to handle disputes of that scale. Most lawyers will give you a free consultation.
Of course, look through your contract carefully first - it might include a clause that requires the matter to go to mediation or arbitration. The more familiar you are with your contractual situation and the better organized your paper, the faster and cheaper resolution will be.
What else you can legally do depends on the terms of your contract. To protect yourself, you probably shouldn't take any action until you've talked with a lawyer. You don't have to bring an expensive lawsuit against them - just pay the lawyer for an hour to review the contract and advise you of your legal rights and responsibilities.
Also each state has a set amount of interest that applies to unpaid invoices if no other fees or interest have previously been agreed to. Look up the statutory interest and start computing and invoicing your late fees.
It's tough to know how much pressure to apply. You don't want anything to blow up in your face. For 7 months of unpaid work, it's a big enough deal that a lawyer could really help.
The way to reduce this sort of risk is screening clients and requiring retainers applicable against final invoice. And no favors for friends. I mean the reciprocal of you lowering your rate or being flexible on terms is your friend paying more than the standard rate under terms more favorable to you. Somehow that is not where people usually come from.
Don't be anyone's bank.
Good luck.
If it's not a lot of money, forget about it, tell them you aren't doing anymore work for them, stay on top of things better next time, and move on.
If it's an amount of money that justifies chasing, I have had luck showing up physically at people's businesses. If you can't do that, I guess a lawyer is your only option.
Not to be a downer... but you probably aren't ever going to see this money. They may not have it. Maybe you can offer to take some of it a bit at a time rather than wopping them with a thousands of dollar bill at once? But be careful about doing any more work of them of course.
Given that, my bet is the amount is relatively small and not worth litigating or really starting a war over. Don't post publicly on Facebook, Twitter etc, it does you no good but people/companies will see and remember it. Most usually not in the positive way.
Unless the amount is significant just write it off. I get when you need cash that this can be a hard thing to do, but it is the most likely outcome anyway, so put your efforts into finding a new source of funds.
However, that said, after you get it in your head that you aren't getting paid (changes you mindset), then try this. Send a personal email, voicemail and text saying something like: "hey look, I worked for 7 months for you and yea, I'm an idiot and didn't stay on top of my invoices, but man, I am hurting and could use the payment like we agreed." And say you are willing to take it in some smaller chunks instead of one lump sum if that helps his team out.
Your friend may have initially just screwed up too, and now be embarrassed that he got so far behind. He may have wanted to pay you, then realized the sum is larger now then he has free cash. But if you offer him a hand and a graceful way out, he may surprise you. At worst, he doesn't answer and you haven't lost anything more than a little time to write a note and make a call etc.