What can you do when a client just disappears?

[jason]

I was working on a fairly sizeable project for a client recently and had received a percentage of the final quote up front, as per convention. They haggled a bit, but paid in the end because I essentially could not work for less/free. So the project started and the client was asked to make some simple, but key decisions regarding which way they wanted the end result to go (not just a website). They delayed significantly in providing this information, and resulted in us chasing them daily for weeks on end. Sometimes we would get to talk to someone and think "hurrah, we can move on!!", but it would be short lived as they would disappear again.

Now the time where we were supposed to be paid a WIP payment (as this is a larger project) has come and gone. Our client has disappeared completely and won't return our emails or calls and has not done so for weeks. Work on their project has ceased and will only continue upon receipt of the overdue payment. The project has also gone beyond the original scheduled timeline and all we ever wanted was for our client to stay in the loop.

What can be done? They have received very little work from us so far, which is a waste of their money IMO. We have however allocated a lot of our time and resources to this project and are due another payment. It's like they just wanted to get us to start the project, so they paid us what was due, and then just lost all interest. I have never seen the likes of this before and cannot understand it.

Any advice?

 

[php.allstar]

It all depends. I normally try to get a contract and service level agreement drawn up following the initial pitch, at least that way you have a leg to stand on if things go pear shaped.

However, the last thing you want to do is to scare a client off with legal documents and paperwork, especially if you're freelancing.

Have you used any online project management software for this such as Trac? I'm sure you're aware of these systems but essentially, you can set a payment roadmap through a series of predefined milestones. The client can log in and see all the progress being made, plus it integrates flawlessly with Subversion.

In this case why not upload a what you have completed so far to a server controlled by you. Give the client a login to view and hopefully they will see that progress has been made and will then be prepared to make the next payment.

If you have any sort of written agreement between you, then you may be in a position to set the dogs on them!

 

[achieve]

I had exact same thing happen to me. Client simply dissappeared into thin air. In over 10 years of business, this was a first for me! I have ended up getting a solicitor on the case. The most annoying aspect, is when somebody just will not answer their phone............ To be continued!

 

[TheMenace]

1) Vet your clients' backgrounds. 2) Always have a contract in place that will allow you to pursue legal avenues if the client won't pay up and/or meet their responsibilities to complete the project - provided they're still in business at the end of it of course.

jason - is your client still in business?

 

[Dara]

You could always try Viper Debt Collection!

 

[jason]

@TheMenace - Yes my client is still in business AFAIK. I have spoken with several staff members from the company and also a work colleague of his who is not aware of anything such as the company going under.

The last communication I had with the company was that my client informed his staff to not get involved with any further communications from us and to redirect all comms to him instead. When told this we said "fine!, can we speak with him then?" to which we were told, "he is unavailable". So how the fek is that approach going to work????

What is bothering us now is that essentially they have paid us a percentage and have received very little in return and now have gone all silent. Our company is struggling because of the situation we have been put in and we have to now turn to other sources for work to get back on our feet. We expect this will not be the last we hear from them.

Considering nothing was signed, what rights does our client have? We have never stated that we refuse to complete the project. We have however stated that we (in compliance with our stated terms of payment) will not proceed without receiving our WIP which is now a month overdue. The reason why I am somewhat concerned is because we never predicted that a client would pay us some money and disappear without seeing the project completed!

Does our client have any grounds to demand the percentage paid thus far back? Considering the majority of time spent on the project thus far was tied up trying to get our client to make some simple but critical decisions. We have code/databases designed/writen but nothing of use to our client.

At this stage we don't know if our client has gone away and will not want to continue this project with us any further, or if they will do the opposite. Their lack of communication has really left us in the dark and we have no idea why they are doing this.

I heard some negative stories through the business grapevine recently about our client and similar things happening to people he hired before, but of course I hear this he disappears.

For now we are moving on, but want to know what we can/should do if he comes back guns blazing?

 

[TheMenace]

Sounds like a bit of a mess you got yourself into. Why didn't you have a contract and terms of work outlined?

 

[mneylon]

Do you have any records of communication between you and the client?

Even if you don't have a formal contract in place presumably there is some trace of what happened ie. any monies they paid would have had to have been invoiced etc.,

I wouldn't feel bad about going legal with them. If they aren't paying you and you've done the work etc., then why should you let them get away with it?
If you're running this as a business and not as a hobby then you need to treat it as such

 

[link8r]

The only problem with chasing people for money is the legal costs. A solicitor can want up to €2,000 or more for all the steps it takes to get a judgement. Here's a summary from past experiences:

1. Send an e-mail/letter outlining your position, the state of affairs of the project and the budget

2. Regardless of whether it's a WIP project or completed one, you can then send a letter outlining what you plan to do next. You could use a debt collector, someone like EC Credit Control, a solicitor. Most of them want a payment (from €50 to €500) at this stage. They will write a letter of varying levels of strength of a threat. Individuals are more likely to take action. A Limitied company probably won't (please dont point out changes in law, I'm well versed in them at this stage - persuing directors is a difficult and expensive affair)

3. What happens with most companies at this point is they simply dispute the invoice :- i.e. they dispute the work was done, done properly, on time etc.

4. Your solicitor, if you have one at this stage, can now determine where the contract was entered into (i.e. which court jurisdiction) and open a case. They will get a letter from the courts with the date

5. Getting a court date will take 3+ months in Ireland

6. Chances are they won't turn up. You will win the case by default. Temporarily.

7. Your solicitor will petition the sherriff of the court who will be unlikely to do anything. Sherriffs tend to be self-employed-type-operators. They are legally entitled to charge a fee for each visit they make. The court defends this automatically for them. Once they are paid they give up.

8. Your solicitor could move to have them listed in a journal, like the Stubbs Gazette, the company that is. If they're trading this could have a big impact on their credit rating/bank relationship. They will no doubt petition at this point, which means you're back to court

9. I haven't ever tried arguing a case in front of a judge and I dont intend to unless I really have to. I would imagine you would have to be chasing in excess of €10k to make it worthwhile - remember that you could end up paying the other sides legal and other costs if you bring them to court and lose - a bitter sting.

Remember that in business-to-business contracts, you can forget consumer law. I've seen dozens of posts where some people postulate that they are a consumer. This is nonsense. Why would a consumer want a business website? If a contract says for example, that the client may cancel the project with a written notice, then almost anything will suffice for them to say they cancelled a project at some or other point and you will have nothing to help you. So make sure that the terms and conditions of trade you have will stand up in litigation to protect you. Argue them out with someone who can play devils advocate for you.

 

[Spiralli]

I've been through this a few times, and now insist on contracts for all but the smallest jobs - a good contract protects the client too. Even if you don't have a contract, you should have a paperwork and email trail as well as any work you have done in terms of wireframes, etc. This will go a long way to show the work you have already done if it gets legal.

We were once in a rotten situation where the client paid a deposit but made all sorts of excuses about delaying signing the contract. They then got completely unreasonable, expecting us to come up with their web copy by chasing down marketing material from their suppliers. They even expected us to prepare their HR documentation for them. When we drew a line in the sand, they lawyered up, looking for the deposit back, and told their solicitor that we had done no work. We responded with a phonebook's worth of documentation of the work done to date. Our own solicitor wanted us to pursue them for the remaining value of the contract, but we didn't feel happy about doing that.

As it happens, the company went out of business soon after leaving a trail of unpaid bills and misery behind them.

 

[link8r]

If clients do go under, there's generally nothing you can do. You will just have to write it off. You can expect any business to be completely protected from bad debts. Thoughts of 5% per annum enter my mind when thinking about it, but I'm expecting - and seeing - an increase in that in 2009.

 

[Spiralli]

Yes, it is a worry. I know that if we got stung on a big contract, our own survival could be threatened.