Unpaid Receivables? Time To Call A commercial litigation lawyer


A commercial litigation lawyer gets hired because business-to-business money disputes are rarely simple. If you are running a business and have a client, supplier or partner who isn’t paying their invoices on time, you have a complex and multi-layered problem that isn’t as easy to solve as you might think. Most people who get their legal education from reality television shows and dramatizations might think all they need is a really harsh letter from an attorney and the money spigot will open by itself.

“If only a threatening letter were all that was needed!” they would say. The truth is a deadbeat with a significant outstanding balance is a threat to your company, and you need expert advice to avoid it.

Chapter and Verse
Suppose you’ve been chasing Deadbeat Inc. from one province to the next trying to get your invoice for 90,000 pounds of wild cabbage paid for the last six months. Finally you get tired of living on food stamps and redeemed aluminum cans and you sue. Deadbeat Inc. then lives up to its name and goes bankrupt on you. Guess what? Now you’re 11th in line to get paid. See if you can guess how long it’s going to take to collect?

The problem with this situation is a bankruptcy of any flavor generally puts an automatic stay on all litigation, which means regardless of how strong your claim might be, you have to get in line and wait and there’s no guarantee you’ll get anything.

What a debt collection lawyer does is collect on your behalf. Since they know they can’t do that if your counterparty goes bankrupt, they are likely to employ other kinds of strategies less liable to frighten your non-paying friend into running for the nearest Superior Judge. They can set up payment plans, obtain in-kind compensation, offer legally binding settlements and generally straighten the path between here and there so you and your counterparty both feel they’ve been treated fairly.

Inter-Province Adventures
The other major tangle a competent attorney will help you avoid is the jurisdictional issue of inter-provincial debt. For all intents and purposes, the Crown has operational jurisdiction over interstate commerce, which means if there is a dispute between businesses in different provinces, the federal courts likely have jurisdiction.

The problem with this situation is when you go to sue, you may find your case is pre-empted by your client filing a motion to dismiss on the grounds the Provincial court has no authority to hear the case. This is of particular concern in Canada since, unlike the United States, the Federal government has blanket jurisdiction over commerce.

Since there are cosmically high barriers to even having a run-of-the-mill dispute heard in a federal court, this is something the average litigant will want to avoid. All of your potential counterparties know this, which is why you are best served by finding an attorney who will help you avoid the jurisdictional nightmare and get your case settled favorably.

On the Record
This might seem like a trivial thing, but having an attorney involved early ensures your case will be properly documented and you will not later be required to backfill, spend additional funds or do unnecessary research because you don’t have the proper records. Attorneys are often required to keep certain kinds of documentation so they can properly bill their clients. All of this information can be authorized by you to be entered as evidence in your case in the event there is a dispute over the details at issue.

There are big differences between debt collectors and debt collection attorneys. The latter is an Officer of the Court and has the legal knowledge to speak with authority on legal matters. While it can be expensive to pursue a debt by retaining legal counsel, in many cases it is less expensive in the long run to take the dispute to trial as soon as possible and get a judgment one way or the other.

For more information about debt collections visit plus120days.com

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