Builder very late with payment...advice wanted!

[Manny]

Hi there,

I have been working for this construction company for about a year, we never trusted them completely, however we ended up doing several small projects for them, all paid alright, few months ago we started having bigger projects, and unfortunately they didn't pay for the last project delivered! and we are having 2 other projects, bigger than the first, 1/2 way through with a total sum owned around 10k...

We have found that the owners are not good, they have ripped off many customers so we heard, obviously it is a bit late to know now...

I have a bad feeling that they don't want to pay these last 2 bigger projects, and they will try to keep the money to maintain their lavish life style... The problem is that I need to pay my mates and my wife is 7 months pregnant now, we cannot afford to get ripped off!

Normally I was providing them with a Part P before getting paid, for small jobs, however the trust is gone because of this unexpected delay, and I will be asking for the money first now, before the certificate. However I think they are one step ahead already, we have a feeling that this is being played out! They are on the market for a long time doing this, and they know they can get away some how... perhaps they will get a cold certificate or something... So, I am afraid that if I ask for the money, which I will, they will find a way to go around me and it could be impossible to get paid. At this stage I think they could have several law suits already from customers and my one would only add to the pile of complains...

What to do? I wanted to keep it down, however I think at this point, keeping hold of the certificates is the best that I have... but how good is that?

I am about to contact the legal support that I have with my electrical association, but I would like some advice if some folks with experience on the subject can help.

1st- Should we finish the last 2 projects? The 2nd fix still pending for both, the finished projects will be valued around 10k.

2nd- If we ask for the money first before finishing the jobs, they will probably refuse, can they contract another electrician to get it done and perhaps even sign for the job with all our materials installed in the 1st fix? Even if they cannot, how can I find out if that is exactly what they are going to do, and hire someone that doesn't know what is going on? How can the other electrician know that there is a dispute in progress and decline the work?

3nd-The builder will be looking for the Part P to get the final payment from the customers, how can I stall it? If they get a Part P from someone else can we cancel it? However I am afraid that if the builder gets his money from the customer, cancelling the 'illegal' part P will not be good to get the money that they own us.

4rd- All electrical equipment and cables on site was bought and installed by our team, how can we prevent someone else taken over it? how can we protect our right in this case? Is the equipment still our property technically or not?

5th- Should we involve the customer and tell them that the Part P will not be issued until the contractor pays us, so they can put more pressure on the builder to our favor?


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[Hudzspark]

Tread gently with them for starters but try politely press them for a progress payment. Tell them you just had a customer go under and take you for a few grand which has hurt your cash flow and may affect there projects so you need a few large ones to pay wages and materials etc. if they refuse then it sounds like your instinct is right, any decent builder won't see you short in those circumstances.

alternatively offer them an invoice discount for early payment (say 3%). This gives them a small incentive to pay you on time.

The above could backfire and they might not throw you more work as they think you have cash flow issues but tbh it sounds like a good way out for you.

Get paid and f%# them off! Plan ahead next time, get your accounts receivable insured for this type of thing and have a solicitor on standby at all times. 1st reminder, 2nd reminder, 3rd and final = charge over there business.

Dont use debt collection agents, they hire 18 year old dumb blondes which is great if your into that but not great for collecting cash! They take weeks ****ing around going back and forth when you need to nip it in the bud quick time.

Finally, don't assume big players can't go down the S#^tter too, a few large ones in my time have nearly ruined me, in particular be cautious with Shopfitters!

 

[Manny]

Thx Hudzspark, it is a strategy that I haven't thought about... I feel like I am walking on eggshells.

 

[Hudzspark]

Don't let these people walk all over you, play the cards I dealt you and you will either get paid or see the writing on the wall. Look at your business and think 'could I take a 10K hit' what if ... Then put a plan in place to make sure it doesn't happen.

Another great way is ask your book keeper/ accountant/ Mrs to politely request payment (twice a day) after the third day they will get the hint and cough up. This way you deny all knowledge and say 'oh yeah our accounts receivables are pretty keen' and laugh it off and it keeps you in the clear and doing the job you love and them on a tight leash.

Squeaky wheel gets the oil as some wise old Yorkshireman once said (I think)

 

[shanky887614]

Don't let these people walk all over you, play the cards I dealt you and you will either get paid or see the writing on the wall. Look at your business and think 'could I take a 10K hit' what if ... Then put a plan in place to make sure it doesn't happen.

Another great way is ask your book keeper/ accountant/ Mrs to politely request payment (twice a day) after the third day they will get the hint and cough up. This way you deny all knowledge and say 'oh yeah our accounts receivables are pretty keen' and laugh it off and it keeps you in the clear and doing the job you love and them on a tight leash.

Squeaky wheel gets the oil as some wise old Yorkshireman once said (I think)

Or the nail that stands proud gets hammered

 

[Manny]

Exactly!

That's why I feel like walking on eggshells, the big question that I am wondering, is how not to put more pressure and get my frustration on the open... To be honest, I am fed up with these people, I will not leave money behind and they will have pay one way or another... However its time to be very careful...the less conflict now the best I guess, perhaps being insistent is something, but I still wondering if I should hold the certificates before the money, I mean how good is that going to protect my money really?

 

[monjoor]

Do you have a written contract with them?

When a certain mile stone is complete a payment must be made. This is where the client and yourself have to sign.

This forms a contract which is legally binding and can be used in court should any party breach the contract.

If everything else fails I would simply go on site and rip / cut every thing that I have put in!

 

[Manny]

Hi Monjoor,

I think this option is a loser's solution I am afraid IMO mate, the reason is that most of the value of our work is the SERVICE itself, not the price of the cable... also that can be really disruptive for the customer, we could be sued, the walls and ceilings in parts of the sites have been already completed and plastered, so doing this you would get far without the Police coming around, not smart taking a revenge on the cables... also the customer is not the villain but the builder, and finally if that would to be done, we wouldn't never see the money!

We want to be paid for our work for God sake !

Anyone with any better experiences with this ??? It's like playing chess with a gorilla !

 

[T&Earth]

Hi Manny

Sorry to hear this mate, as bad as it is don't let it spoil this time with your wife and your new baby when it arrives, the stress will not help. I'm sorry I can't think of any business advice for you, this will get resolved good or bad but the time you have spent worrying about you will not get back.

Good Luck Mate
Steve

 

[Geordie Spark]

Hi Monjoor,

I think this option is a loser's solution I am afraid IMO mate, the reason is that most of the value of our work is the SERVICE itself, not the price of the cable... also that can be really disruptive for the customer, we could be sued, the walls and ceilings in parts of the sites have been already completed and plastered, so doing this you would get far without the Police coming around, not smart taking a revenge on the cables... also the customer is not the villain but the builder, and finally if that would to be done, we wouldn't never see the money!

We want to be paid for our work for God sake !

Anyone with any better experiences with this ??? It's like playing chess with a gorilla !

Do you know the customer?

I'm thinking a chat with him outlining your problem MAY result in some help from him.

At the end of the day HE is the one holding the purse strings and there will come a point when the builder will be expecting to be paid by him.

 

[Manny]

Thx Steve,

That is a good point... I will try but the bills are mounting... and I have recalculated they own us more than 15k now...

 

[Manny]

Hi Geordie,

That is what I am thinking, I will have to unveil whats happening with the customer if I am forced to... However that would be a declaration of war mate, think about it... it could make my chances of getting something back slimmer...

Anyway, I have been speaking with the other subs, plumbers and builders, and the conclusion was going easy and playing the game like everything was wonderland, and try get the money for one contract at the time, holding the certificates and the jobs with the others... I also was surprised to know that all the other subs are on the hook too:hanged:...
In the end of the day, I was a bit greedy, I shouldn't ever have started so many projects in once with them...

For now on I will stick with the following:

ONLY Start a new project once you get the last one paid, or least 50% of it.
Get 50% in the beginning of the jobs, extras and the other 50% can be later.
Sign a contract, no matter how small or big the job is, and include terms and conditions.
Get some kind insurance for this purpose, if there is any.
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I will keep you folks posted as a warning for others sparks, but If I am lucky this will be rolling for a good 6 months or more... I will have to be patient.

 

[Octopus]

You'd like to think "our" schemes would help and advise wouldn't you........

 

[Cyberprog]

Why not look into escrow schemes?
There's been changes mooted to the late payment schemes for big projects also where the contractors are paid from a special account for the project, and payments must be made for all the contractors involved from this account in turn.
https://www.gov.uk/government/consu...inance-building-a-responsible-payment-culture had more info - it's been closed now sadly, have to see where it goes!

 

[Southern22]

Act professional and mature .... rip the lot out