A Midlands-based electrical distribution company had placed three orders for commercial LED lighting products over a period of 5 weeks. The products were delivered on the dates agreed to the site addresses requested. Proof of delivery notes were signed at each of the sites.
The Surrey-based LED lighting manufacturer and supplier issued three invoices complete with purchase order numbers totalling £8,824.97 to the debtor’s accounts address and accounts email address as advised. Monthly statements were issued, and when the invoices became 90-days overdue, a 7-day Letter Before Action was issued. All of the creditor’s correspondence was ignored, leading to the instruction of Advocate Debt Recovery.
Could pay, but won’t
After investigating the debtor company, there was no clear reason for non-payment. The company was long-established with a good credit rating. The latest accounts filed at Companies House showed assets of just over £1.7 million and cash in the bank of more than £400,00. No County Court judgments were registered against the company, and it was decided that the threat of Court action and its adverse effect on the company’s credit rating would have the desired effect and result in payment.
A 7-day Notice was issued by post. The demand included a claim for late payment interest and debt recovery costs. It also advised the debtor company in no uncertain terms on the serious business and financial consequences of non-payment and Court judgment. Copies of the Notice were sent to a total of four email addresses, including those of two of the directors of the company, on day two of our action. Telephone action commenced on day three. However, it was difficult to make any headway and get to speak to anyone with authority in the company.
Still won’t pay
The initial Notice expired without response, and a 7-day Final Demand Notice was issued. The demand included additional late payment interest and debt recovery costs, as warned of in the initial Notice. Telephone contact was attempted throughout the remaining 6-days of our process, and the debtor remained determined not to engage with us.
At the end of our 14-day debt recovery process, we advised that our file in the matter had been transferred to our solicitors, Askews Legal, with an instruction to issue a claim in Court against the debtor company. The advice included outlining the Court fees and solicitor’s issue fees that would be added to the total amount claimed in Court.
Within an hour, full payment, including late payment interest and debt recovery costs, credited Advocate’s bank account. Funds equal to 100% of our client’s invoice balance were transferred to our client’s bank account via a faster payment within 30 minutes of receipt.
Last-minute payment at a cost
No remittance advice or notification was ever received from the debtor. It’s baffling how often we come across debtors who clearly can pay but simply won’t until the very last minute. In this case, it cost them over £1,500.00 in late payment charges and debt recovery costs.