Scott on Writing

Musings on technical writing...

Partial Payment Received

 This is the fourth installment of my ongoing Small Claims Court Experience...

Well, I guess I wasn't being fed a load of lies when I travelled to the company on Wednesday with my small claims court papers and was told not to file, that partial payment was on its way.  After some thought and comments from interested readers, both in my blog and via email / IM, I decided nuts with it and filed on Thursday (yesterday).

Lo and behold, today I got in the mail partial payment, exactly half of what is owed to me.  The letter was postmarked June 30th, so I'm not certain if they really had “mailed out” the partial payments earlier in the week and they just had yet to get around to taking them to the post office, or if me showing up at the company with a short temper and papers in my hand prompted them to send me 50% in an attempt to placate me.

Any suggestions as to what to do now?  As I see it I have two options:

  1. Accept the partial payment and wait (hopefully not another six months) for the other half.  The upside with this approach is that I actually get to see some of the money owed to me materialize into my bank account.  That would be nice, eh?  The downside, of course, is that I believe acceptance of partial payment would require me to drop my suit, no?  As commenter Brian said, “ In Georgia and Florida too, I believe, if you accept a partial payment it is considered giving credit to the debtor. Giving someone credit means you have a different route to take to win your case and get paid in full. For example if someone owes you $1,000 they send a partial payment of $20 and say they will continue to pay you as they can then you cash the $20 check. You have now granted a loan to that individual and must give them whatever legal time they are entitled to repay the loan.”
  2. Reject the partial payment.  With this option I would be passing up the “bird in the hand.”  I like Brian's suggestion, though: “ My advice if you do receive the check go back to their office with the check and the legal paperwork and demand either another check to make the debt paid in full or return the check and tell them you are going to court.”  If they refused to pay I would then proceed to take the matter through the legal channels.

So, any suggestions as to what route I should take?  The total payment due is low enough that even if I don't see a red cent it won't impact me financially, but I would like to be paid as promised for services delivered, naturally.  Plus, I'm no Vanderbilt - whereas I won't go hungry or miss a mortgage payment if this payment is never paid, I'm still going to miss it, as I've always had a strong attraction and bond to every dollar bill I've ever met.

As I see it the benefits of going through with the court case are:

  • Education - I've never had to go this route before and this unfortunate circumstance presents a lesson to be learned that, if floundered, won't be a big deal.
  • Showing this company that they can't push around the little guy - this company really needs to review how it interacts with its instructors.  Did I receive one call explaining partial payment was on its way?  No.  And on Wednesday, when I wrote an email to the controller asking them to verify that partial payment was, indeed, on the way, did I hear back at all?  No.  This company's communication patterns mimic that of a black hole.
  • Getting paid in full (hopefully) - I know a judgement doesn't equal getting paid, but who knows if I'll ever see the other half of the payment if I accept their terms.

The major downsides of pursuing a case would be (and in this order):

  • Time - the courthouse is like 15-20 minutes away, one way.  Lines are long.  Filing the paperwork ate out about two hours of my day, two hours I could be working for clients who do pay.  I've calculated at this point that the time I've spent so far pursuing this, plus the additional time that would be required in court and whatnot, would end up costing me more dollar-wise than the other half of their payment.
  • Not seeing a dime - if I accept the partial payment I'm half way to getting what's owed to me.  If I reject it, who knows how this whole mess will turn out?  I might end up not seeing a penny.

Due basically to the time costs I'm leaning toward just taking the half they sent and waiting for the rest.  I'd really like to stand up against this company, but at the rate this is going I don't know if it makes economic sense.  Any insight, comments, suggestions, etc. most appreciated.  Thanks!

A complete list of blog entries related to this topic can be found at My Small Claims Court Experience and through Going Independent category.  Your feedback is most welcome - please leave a comment or drop me a line.

posted on Friday, July 01, 2005 11:51 PM

Feedback

# re: Partial Payment Received 7/2/2005 9:51 AM Nate

Have you tried reconnecting with any the other instructors who weren't paid? If so, have they all received half payments too or are you the only one they are trying to placate?

# re: Partial Payment Received 7/2/2005 12:53 PM Brian

That is awesome. 1st thing I would do is call the bank that the check is drafted from and see if it is good. Depending on the bank it will be an automatic (BOA for instance) or manual process. They will only verify funds are available at the time you call. If it is bad you know the deal. If it is good, and I never expected a 50% payment from them. You have to decide if it is worth continuing to pursue or cash the check and get educated by the judge when you day in court arrives. If you still have access to your friends Dad, the attorney, ask him about the legalities of accepting the partial payment for the entire debt owed to you. If that check IS good, go back and demand the balance due in exchange for dropping the lawsuit. It would also be interesting to know about the other authors checks. Give those people a call again and see if they were paid. If not, I think, you have a better chance to get the other half and maybe the court filing fees from them in exchange for dismissing the case. Whatever you do, DO NOT give that check back to them. It is your proof that they accepted your services in exchange for a fee and they know they owe you. If the check is bad it is your best piece of evidence in court. 50% is better than nothing and is more than most debt collection companies expect to recover. I think it is obvious that I'm not a lawyer. But programming and law are not too distant cousins, both require you to use logic, ingenuity, and persistence to get the job done right.

# re: Partial Payment Received 7/2/2005 4:35 PM Rich C

I vote for continuing forward - mostly for the first two reasons of Education and Making the Point.

If it was just you, it would probably not be worth it, but as this has affected several other people in the same way as you, I think you can benefit your peers by going forward.

A hassle to be sure, but likely a worthwhile persuit.

# re: Partial Payment Received 7/2/2005 11:48 PM Dick

Cash the check, if you can, an continue on with your lawsuit. Small claims is very lenient on procedure. If you originally filed for $3k and they now only owe you $1,500, just tell the judge that at the start of the trial. Make sure you are wearing your inexperienced-just-trying- to-make-it-on-a-shoestring-entrepeneur face. Chances are the check won't clear. If it does and the court date nears, they will pay the rest. They owe 50 people and the squeaky wheel, etc.. etc.. Fight the good fight and don't let these people of the hook.

# re: Partial Payment Received 7/3/2005 3:14 AM Rob Walling

I feel like you’re better off taking the bird in the hand and seeing if you can’t get the rest out of the money over the next few months.

If you go through with the claim and get a judgment against them, who’s to say they will pay you? If they’ve been putting you off for 6 months, they will likely continue to do so, even after you have a claim against them.

Good luck, whatever direction you choose.

# re: Partial Payment Received 7/3/2005 9:01 AM David Yack

I would take the partial payment, and tell them if they pay the remaining between now and some date prior to your court date, (plus your filing fee and service charge) you will drop the case.

Make sure the partial payment doesn't have any hooks like "Settlement in full" or any other things that could be used in the favor of the company...

# re: Partial Payment Received 7/3/2005 10:50 AM Scott Mitchell

David, how would I tell if the partial payment has any 'hooks' in it? All I got in the mail was a check. The check stub just shows the date the invoice was made (1/27/2005), the original amoutn due, and the amount of their payment.

Also, I emailed the instructors I had emailed earlier asking if any of them had received partial payment. Only one instructor has responded so far, but he has received half of what was due to him as well, which is a positive sign.

I think what I'm going to do is on Tuesday call the bank and make sure there is sufficient funds backing the check. I'll then deposit it. Once it clears I'll approach the company and make them an offer they can't refuse... hehe... by that I mean I'll let them know I'll drop the court case for payment of the other 50% and filing fees by the end of July, or something like that.

# re: Partial Payment Received 7/3/2005 10:55 AM Brian

I think David is refering to any text on the back of the check where your signature or "For Deposit Only" goes, or even on the front in the memo or other fields. It is a sneaky trick to put "By Cashing this Check you agree to X terms".

# re: Partial Payment Received 7/3/2005 3:06 PM Mike Gale

You've made this partially public. I suggest taking it to a proper conclusion.

Get all the information you can. (Private blog for the instructors who have been cheated might be a useful forum.) Publish it.

I'd go for BOTH the cheque AND pursue the claim. (These guys seem to be clearcut criminals and should be sorted out, so the court is important. Hopefully the legal system has enough sense to allow that.)

It's also important that future potential instructors are warned off. The only way, I can see, is to publish the name. Whether that's you or someone else isn't so important. What's important is they have less chance of cheating people in future. (The cost of chasing these people and the time waste should really be carried by that company, that cost is huge.)

# re: Partial Payment Received 7/3/2005 7:41 PM Russ

Scott,

I would NOT deposit the check into your account. I would go to the bank the check is drawn on and CASH IT.

If the company decides to be REALLY bad they could issue a stop-payment on the check, couldn't they? This way you'd be guaranteed NOT to be effected by that.

This DOES get down to a time issue. If the company is solvent and they're just trying to get away with it, they deserve to be taught a lesson. In that case, a class action lawsuit would be MUCH better than you going to small claims court, which in turn doesn't help any of the OTHER instructors who are in your same boat (not that it's your responsibility to do so).

# re: Partial Payment Received 7/4/2005 5:24 AM James

Take a read of "What they didn't teach me at Yale Law School" by Mark McCormack.

http://www.amazon.com/exec/obidos/tg/detail/-/0006372694/qid=1120468320/sr=8-1/ref=sr_8_xs_ap_i1_xgl14/104-3686831-1478306?v=glance&s=books&n=507846

IMO required reading if you are thinking of going to court.

# re: Partial Payment Received 7/5/2005 10:49 AM xxxxx

Give them the money back - registered mail - and demand the full amount. Continue with the legal process.

# re: Partial Payment Received 7/5/2005 12:18 PM David Yack

Scott - Brian caught on to what I was referring to in regard to terms on the check. It happens less and less now days and I beleive they don't hold up as much anyway. Used to be a big deal in the collection world.

I also agree with Russ that if the name happened to get posted oh well....Just report the facts..if they don't like the facts they should pay on time.

I'm not sure though you have any basis or value in doing both taking the $ and going to court - your court case is simply on non payment for services - if paid for prior to the court date there is no issue of merit to discuss.

While I agree in concept they should be penalized - that's what late fees are for in the contract :) If you have them - enforce them and in theory if they are within the legal allowed rates/ amounts that would be damages incurred if not payed and therefore have merit in court, however might not be worth the time and effort if that is all that remains.

I think it's unfortunate that consultants have less of a precedent for the concept of a retainer compared to attorney's. It's very rare that an attorney will do work without one, but consultants do all the time.


# re: Partial Payment Received 7/5/2005 1:48 PM Keith J. Farmer

*** DANGER ***

NEVER assume legal advice given in websites or (with all due respect) blog comments is accurate.

Talk to an actual lawyer who can evaluate your case against something more than hearsay.

# re: Partial Payment Received 7/5/2005 3:46 PM Brian

If you bothered to read all the blogs and comments you would know that no one is giving legal advice. Lawyers are not always needed, especially for a claim this small. The only thing a lawyer will add to this case is the instant removal of 30-50% plus expenses of any recovered money.

# re: Partial Payment Received 7/5/2005 5:30 PM Benoli

If you consider only your own benefits, I would recommend taking the half payment and not pursuing the legal road. My friend, who is a lawyer, says the best lawsuit is one that you don't have to pursue.

On the other hand, you seem like the type of person who is willing to spend time and effort to learn something new so others can benefit from your knowledge. You have spent much time and effort writing articles that benefit developers in numerous ways. You probably have not always thought about how much the dollar value of you time writing has been, but it has made you a guru in the techie world. If you look at this as a way to benefit other developers and to further solidify your reputation, it might be worth pursuing even if there is not a direct dollar benefit.

Whatever you do, this has been an interesting topic to read about.

# re: Partial Payment Received 7/5/2005 5:31 PM David Yack

I don't play an attorney in real life or on TV so take my comments as just that - my comments based on past experience and nothing more...

Good attorneys are great - we value ours very much for his advice as required. I also always enjoy the bill that comes following those great discussions!

In my opinion regardless of attorney or where you get your info, you need to absorb it and apply it to your own situation. Only you can do that!

# re: Partial Payment Received 7/8/2005 5:06 PM A Michigan Attorney

I read your post on misc.legal.moderated. I understand this takes place in California, so you should note carefully that I'm not licensed to practice law there. Consult a California attorney for specific, reliable advice.

Generally speaking, acceptance of partial payment does not prejudice your rights to pursue collection of the balance of the debt. There are exceptions, of course -- the most signficant one being the legal defense of "accord and satisfaction", which requires a disputed debt, an agreement to compromise the dispute for a lesser amount, and payment in accordance with the agreement. This is probably what other posters have alluded to in warning you that acceptance of partial payment could extinguish the remainder of the debt.

I'm not versed in the intricacies of California law. However, the general rule is that an accord and satisfaction or other waiver of a debt balance will not be implied from mere acceptance of partial payment. And the general rule of civil procedure is that a party who asserts a defense has the burden of proving it, so the debtor would have to persuade the judge that you have waived the remainder of the debt by accepting the partial payment -- an argument which in my experience usually fails unless there is some pretty strong evidence that the recipient actually intended to accept the payment as full satisfaction of the debt.

If I were in your shoes, I would opt to take the partial payment and continue collection efforts.

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