Ask HN: What should I do when a client doesn't want to pay?

12 points by marcusEting 14 years ago | 10 comments

I have a client who doesn't want to finish a web project. He asked me for a "get out" price and I gave him one, which was very reasonable, but he thinks it's too much and doesn't want to pay. I collected an initial payment, but only for 20% because they are a "startup."

I have control over the DNS, the site is on my server, and I am also the administrator for google apps and google voice for the company.

Should I shut everything off until he pays? Is that legal? Should I try and take him to court?

The whole project was only supposed to be $2500 and I've asked for $1700 total, even though I've done about 90% of the project. He's only paid $500 so far. I have about $1200 invested in graphic design. Is this worth fighting over?

stephenbez 14 years ago |

"F*ck You. Pay me" http://vimeo.com/22053820?utm_source=swissmiss

Really good video about how to get clients to pay you.

First question is, "Do you have a written contract?"

marcusEting 14 years ago | |

this is pretty nice. thanks for sharing.

turtle4 14 years ago |

How bad is the relationship already?

Personally, I wouldn't burn a bridge with a client who could either return later or pass along some word of mouth, for $1200. If the relationship is already spoiled to the point that you don't think either of those things might happen, I would just explain to the customer that you can't afford to do any more work without payment, and then walk away. Don't retaliate/do additional work to turn off the site or whatever, just literally walk away from it as is.

If you still have a decent relationship, I would just explain to them that you have $1200 into the project, and you understand where he is coming from, but would really appreciate it if he could do better by you. If he returns with a negative, say thanks, and please pass along any other opportunities, give him whatever access he needs and walk away.

Retaliating in any way isn't going to get you paid, it just will spoil your reputation, which is worth alot more than $1200. Even if you are right and he is wrong, if he happens to be at a bar with someone and that person mentions they are having you do some work for them, whether he responds with "Oh yeah, he is a decent guy" or "Oh man, did he burn me once" could make a difference.

Life lesson the hard way.

erasmus777 14 years ago |

I think it's worth it to try to get the money. $1700 is a decent chunk of change. If you're running your own business, you deserve to get paid like anyone else. If you let this guy jerk you over, what about the next person who does it? After all, it's sure to happen again.

Write a letter that recaps your original agreement and explains what they owe you. Then set clear procedures for moving forward. Very clearly explain the penalties for failure to pay: * After 45 days, I will terminate your service. * After 60 days, I will turn this over for collection * etc Be professional and dispassionate. If you have a friend or relative who is a lawyer, have them print the letter on their letter head.

Emphasize that you've enjoyed working with the client and value your relationship. You can be empathetic: you know the economy's tought, yada yada. You can even offer them a bone: e.g., you'll take 5% off the bill if they pay within 30 days.

Even if you never get the money, you'll know that you stood up for yourself and gave it a shot and did so without being a jerk. Better to take a stand now and gain strength from it.

ericHosick 14 years ago |

Don't just shut things off. That may give the customer the ability to say they have cause against you.

Also, there is always small claims court and it would not be very helpful for your cause if the client claims that their failure was in part caused by you shutting down the website.

PonyGumbo 14 years ago |

If the website is live, shut it off until they pay you. This has worked for me 8/10 times (the other two times, they just disappear forever, and you weren't going to get that money anyway). If you've ever been broke or strapped for cash, you know that you pay the bills you have to pay first - the ones with consequences - and pay the others last. This is what they're doing. If you want to get paid, you've got to be the mortgage and not the Netflix bill.

jjm 14 years ago |

So you have no contract with terms?

Leave them be. You need to move on to your next contract, one with a proper contract. My guess is you'd make more money focusing on the next gig.

Live and learn right?

marcusEting 14 years ago | |

verbal contract, and then the first invoice, which they paid, included a list of items that were to be completed with the website project. no terms as far as payment due date tho. i think maybe payment of the first invoice with the items listed could count as acceptance of a contract in some places... you're probably right as far as moving on. it is fairly easy to turn off the website though - not sure if that is a ethical thing to do. of course not paying for work is also not that ethical.

codeslush 14 years ago | | |

Collecting on bad debt is difficult and time consuming. For the amounts you've mentioned, you can move on and make it up quickly enough as gp stated. If they don't want the work you've done, offer them a 30 day transition period so you both can move on. I would suggest you attach some form of payment to that, but it might just be better to give them control of their domains w/o your work product and call it a day. Next time, get proper contracts in place. Recognize that even with a proper contract, it would still be difficult to collect. Time & Effort vs. Reward.

ZipCordManiac 14 years ago |

Shut everything off if he doesn't pay up and move onto the next client. No reason to let their company rip you off.