To sue or send to collections?

Question

I have a cleint who had me arrange some advertising for him for a RE seminar he put on, then refused to pay the bill. I am being chased by the advertising company because I mistakenly put the contract in my company name instead of his. I am going to invoice him for the cost of the advertising and I am sure he's not going to pay it.

Is it better to sue him for non-payment or just send it to a collection agency and have them do all the work?

Thanks in advance for any assistance offered.

Marc

Is it better to sue him for non-payment or just send it to a collection agency and have them do all the work?

Thanks in advance for any assistance offered.

Marc

Dev Horn · Answer

Will really help if you have a CONTRACT with him where he has legally agreed to the liability.  Without that, if it is simply a verbal agreement, you may have difficulty getting a 3rd party (collection agency) to pursue it, or to get a court judgment in your favor.

Dave Toelkes · Answer

@James Wise

Yes, selling your judgment to a judgement recovery company is doable.  In some cases you can assign your judgment to the recovery company and their fee will be a percentage of the total amount recovered.  In other cases, such as in my state of SC, you must sell your judgment to the judgment recovery company.  The consideration may be a fixed amount or based upon some percentage of the value of the judgment.

Collection agencies don't normally buy judgments, but only make some attempt at collection.  If successful they retain up to 40% of the recovery as their fee.  Collection agencies have no power of enforcement and must stop contacting the debtor if the debtor tells them to.  A judgment gives the judgment recovery company more powers to garnish wages (when permitted by state law), to seize bank accounts, put liens on property,etc.

Dion DePaoli · Answer

It sounds like you will likely have to go to a court to get a judgement on him prior to being able to send it to a collection agency.  The court is needed to impute the costs and charges on the other guy, you can not simply say he owes something and send him to collections without proof of him actually being obligated to it.

James Wise · Answer

Thanks Dave NA

Marc Ramsay · Answer

Thanks everyone. I found some documentation last night that may get me out of harms way on this one so I may not have to pursue it. I'll know in a couple of days. Otherwise I wil take it to court to get a judgement as suggested.

James Wise · Answer

Slightly off topic but still in the same boat.

The other day I seen a post from somebody who got a judgement on a tenant and was considering selling that to a collection agency. Rather then tracking down the money himself.  Don't think it got any responses.  Any of you guys have any experience doing that? Is that a doable thing?

To sue or send to collections?

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