A debt of £8.4K has been recovered with minimal fuss and hassle to the creditor once Advocate commenced action. Taking away the pain of late payment is always Advocate’s aim, but this case had a more personal degree of discomfort. In the same year Pilot 1000 PDAs and Power Macintosh PCs first rolled off production lines, our client founded their business. The founder diligently recruited their dream board of directors. The board held a wealth of technology, manufacturing and development expertise. They set about putting it to good use. Over the next 25 years, the business weathered financial storms and surfed the waves of technological advancement. In more recent times the business branched out into developing new products. When the word ‘turnkey’ is used, it conjures up images of a family being handed keys to a newbuild that is ready to live in straight away. With reference to manufacturing, it is the same kind of concept. A customer has an idea for a product and turns to a company to run with it. From prototype to the finished product rolling off an assembly line, this is the pièce de resistance of the founder’s journey.
With no intention to remain at the helm for another quarter of a century, the founder (also our client) sought an exit plan. The call of an affluent retirement in tranquil surroundings is one few can ignore, although most need far less convincing! Selling the shareholding and walking out would leave the company with a gaping wound and only a postage stamp to stem the bleeding. The founder already had a second income providing consultancy services to divested company interests. It would now be used to provide similar services at an hourly rate. This was designed to ensure founder and company would be separated cleanly without placing the latter in jeopardy.
With shareholding sold, the founder’s legacy now became the debtor. Our client commenced their consultancy role raising invoices totalling £8.4K at the two-month final exit point. In the following couple of months, our client grew increasingly frustrated with the lack of payment. Letters were ignored, phone calls were not being returned, and emails were being read but not responded to. Despite having left the debtor in a strong commercial position and conducting a thorough handover, final gratitude was not being provided by way of payment. What was once a close-knit family of directors and colleagues now seemed to be giving one of their own the cold shoulder. Following discussions with Advocate in which the client was apprehensive about turning the tables, action was tactfully commenced.
Closing the Circuit
The debtor initially refused to accept Advocate had been instructed. Time was requested to consider their position. In the absence of anything to show why the debt might not be due, our action continued regardless. On the eve of the Final Demand being raised, our client got an email from the debtor acknowledging the previous chasing and proposing a payment plan. It stressed that full payment was not an option and dictated the terms of payment by instalment. Even though it was an unfavourable proposal over a long period of time, our client would of most likely accepted it had Advocate, not been instructed. The debtor was also trying to avoid paying the statutory late payment charges now incurred. If a client enters into dialogue with the debtor after Advocate’s instruction, it dilutes the urgency and reduces the chance of a successful recovery. Being aware of this, the client informed Advocate and the debtor was reminded of their obligation to pay in full without any further delay. The debtor promptly conceded and made payment for the full £8.4K plus statutory charges. Having been faced with payment over several months that morning, our client received full payment before close of business the very same day. With the founder’s journey completed courtesy of another successful commercial debt recovery by Advocate, their chapter and our file were duly closed.