If your business is like many others, you may offer clients the ability to be billed at a later date for services rendered as a convenience to them, and you may expect them to pay promptly when you send out an invoice. However, in many instances, you may send out a 30-day, 60-day and 90-day reminder of a payment due with no response. Eventually, many of these outstanding debts will be placed with a corporate debt collection agency for debt recovery services. In some cases, companies will respond immediately when they receive a notice from a collection agency. In other cases, the debt may continue to be outstanding. This is where commercial litigation comes into play.
When to Use Commercial Litigation
Through the services of a commercial litigation lawyer, you can send a legally-drafted letter to your clients with the most outstanding debts that states your intent to escalate their lack of payment to a legal matter. This may be when the account is three, four or more months past due, so you have already given the client ample time to pay. Commercial litigation uses the threat of a claim against the business to encourage action. This is highly effective at producing a response. In some cases, businesses choose to bypass hiring a corporate debt collection agency and move straight to corporate litigation.
Corporate litigation may not be the step you want to take immediately with outstanding debts. You may want to give your clients a few months to make payments. After all, they may also be in a financial situation because of their own clients not paying them in a timely manner. However, if you have not received a response within a few months, commercial litigation may be a viable option to consider. Find more information and learn from the resources available on the Elliot S. Birnboim website.