The debtor company started life as a small bakery shop in London in the 1960s. The managing director and son of the founder has built up a multi-million-pound turnover business specialising in supplying middle eastern flatbreads to take-aways, restaurants and supermarket chains. They now operate from 3 large purpose-built bakeries in East London and Essex. The managing director still oversees almost every aspect of the day to day operations of the business and he is well known throughout the industry for his frugal approach to dealing with suppliers and his appetite and ability to haggle.
You can’t Help Some People
The creditor specialises in machinery moves including decommissioning, transportation and commissioning at the new site. They supplied a quotation for moving a large conveyer belt system from a bakery in Birmingham to the debtor’s site in Essex. The managing director of the bakery company claimed the quotation was too expensive, that they could not afford the costs and asked what could be done to reduce the cost. The operations manager at the transportation company advised that if the machinery was de-commissioned ready to be lifted and loaded that the overall cost could be reduced by £800.00, this was accepted by the Bakery MD and a date was agreed upon.
Two weeks later the creditor’s vehicle arrived at the site in Birmingham to find that the machinery had not been dismantled and was still connected to the water and electrical supplies. When the seller of the machinery was questioned on the issue they were advised that the buyer had negotiated a reduced price on the basis that they would be responsible for the decommissioning costs. The operations manager of the transport company was notified and called the bakery MD, who advised it was not a problem, he would cover the additional costs and to get on with it.
The de-commissioning took the two-person crew 4 hours to complete before the machinery was ready to be loaded. They still managed to transport the machinery to Essex and install it at the new site the same day, albeit, finishing the works at 10 pm. An invoice was issued for £3,440.00 based on the original quotation including the £800.00 decommissioning costs. Once the invoice became overdue for payment the creditor contacted the managing director. He advised that he was not happy with the additional costs and requested a discount. After much haggling, the creditor just wanted to get the invoice paid and reluctantly agreed to reduce the decommissioning charges by 50% to £400.00. This was accepted and the debtor promised payment that Friday.
You Can’t Trust Some people
No payment was received and each time the creditor chased the debtor for payment they continued to haggle over the costs requesting a further discount. The invoice was now 3 months overdue and the creditor was not prepared to allow the situation to continue. They instructed Advocate to collect payment of the debt. We issued the debtor with a Notice of intended Court proceedings by post and email on the day of instruction. The Notice included the late payment charges that make up our fee. Our client received a direct payment 2 days later in settlement of the principal invoice sum. The debtor did not pay the late payment charges. We advised the client that we would continue to pursue the debtor for payment of our fee and thanked them for their instruction.
We advised the debtor that the late payment charges were applied under statutory late payment legislation and they remained legally enforceable. Further that if they were not paid within 24 hours, a claim would be issued in the County Court to recover payment of the charges. It was no surprise when we received a telephone call from the managing director of the bakery company and that he wanted to haggle over the late payment charges. He had a list of excuses as to why the payment was late, all of them the fault of our client and all of them clearly fabricated. We advised that the charges were valid, correct, that they were non-negotiable and they must be paid to prevent Court action. We received payment later that day.