Collecting Final Payment from Client

[Deb Holder]

Hey Everyone,

It's been awhile since I've been here, but I'm in a sticky situation and thought I'd get your insights. I'm deadlocked with a client about the final payment he owes me.

Here's the deal. I actually gave him a bargain on the deal and did the work--a rewrite of an existing landing page. This company kept asking for rewrites, which seemed a bit excessive but I complied. I've never dealt with this situation before but always do my best to overdeliver. Four drafts later, they wanted more. I won't go through the entire chain of events, but it was beginning to get unreasonable. That was last week.

Fastforward to Monday (yesterday). I discovered that they were already using my copy online. I wrote to them and asked them to pay me since they were using the copy. They say they won't pay the final payment until they get the results they want, meaning they want me to do more rewrites.

My position is that once they've published the copy, they've accepted it. Once I receive final payment, I will do edits for the next 30 days as needed. They say the job isn't finished because they are not happy with the results. (The copy hasn't been online very long at all and they changed my headline, which was a mistake.) I've told them that I believe the biggest problem is that their claim is not believable. I won't reveal the client, but I will say that the claim is not credible--knowing what I know about this industry--and hurts their sales.

We're deadlocked. I won't write another word until they pay me what they owe me, and despite my request to pay me or take down the copy, they haven't complied. I've told them that they do not have permission to use the copy and do not own the rights to it until they've paid in full. They're accusing me of escalating this situation and want to resolve it amicably. So do I, but before the project started I told them that I could not promise specific results and any copywriter who does that is lying. They hired me with full understanding of that fact.

I did a name search and saw them on eLance. I think they're confusing my level of service with an eLancer. There's nothing wrong with eLancers, but I operate on another level.

I'm taking steps to have the site pulled down and have contacted a copyright attorney. Again, this copy has only been online for a few days, and they say that I can contact their hosting company to pull down the copy. Apparently, they aren't taking me seriously.

I'm curious if others have faced this situation and what steps you've taken to resolve the issue. This is new to me. I usually ask for 100% upfront payment and made the mistake of "working" with this client. Any suggestions?

[Loren Woirhaye]

You lose. It happens. As soon as the client gets your service
delivered their motivation to pay rapidly moves towards zero.

If you wanted to have leverage in order to secure your fee you
should have withheld the copy until you got paid.

There may be some cultural issues at play. Americans tend
to be straight-up but in some cultures what happened here
would not be considered dishonorable, it would be considered
a cagey negotiating tactic on the client's part... because they
got what they wanted for less than the agreed upon fee
through "after the fact" negotiation. To you, it's welching
on a contract... to the client it's just a short-term win they
are happy to get... because that is apparently the way they
think and what they are after.

[Jesus Perez]

Ouch....Sticky place you're in. You need to rewrite your contract. Specifically, you need to place details about what constitutes "acceptance". You also need to specify how many rewrites are available and stick to your guns. Something along the lines of "client agrees to pay in full any remaining balance upon publishing any copy". So work on that...please. Look up Web Design contracts...the work we do is very similar.

Now...here's the deal. They don't legally own your work yet since they haven't paid in full. They are in violation of your copyright. This means you can have their website pulled down with a DMCA notice. You can also resell the copy as a WSO or PLR and make back your money. These aren't exactly "great" customer-service routes...and I don't recommend them. But they can be pursued in a worst case scenario.

If it was me, I'd never contact them again and retire the project as a "lesson learned".

BTW, did you get any bad gut instincts before taking the gig? If you did...learn to trust that instinct a bit more. I've mastered this art and managed to dodge nightmare clients for a good long while.

[artwebster]

I'm curious if others have faced this situation and what steps you've taken to resolve the issue. This is new to me. I usually ask for 100% upfront payment and made the mistake of "working" with this client. Any suggestions?

Therein lies your problem. Trying to prove retention of copyright in this situation is likely to be problematical at best - a nightmare at worst.

You will probably find that having agreed to re-write what you sent to the client, you also accepted that the client owned the copyright and all the benefits that entails.

[webspacce]

Originally Posted by artwebster

I'm curious if others have faced this situation and what steps you've taken to resolve the issue. This is new to me. I usually ask for 100% upfront payment and made the mistake of "working" with this client. Any suggestions?

Therein lies your problem. Trying to prove retention of copyright in this situation is likely to be problematical at best - a nightmare at worst.

You will probably find that having agreed to re-write what you sent to the client, you also accepted that the client owned the copyright and all the benefits that entails.

I agree, I had done a clone site for a client a while back and his funding source ended up falling through and the site was live and made him money till i pulled it down and canceled the hosting which was setup by me. See whenever i do a project big or small i always try to control as many aspects of the project as i can as sort of a last resort. So lets say they dont have hosting setup i will do it in there name but i will setup all the user,pass and email accounts for all work i do. Also i dont give out the user info to them untill its done. Ive never had any complaints and it works out in the end for me if they try to work you over. Hope that helps

[MikeHumphreys]

Originally Posted by artwebster

I'm curious if others have faced this situation and what steps you've taken to resolve the issue. This is new to me. I usually ask for 100% upfront payment and made the mistake of "working" with this client. Any suggestions?

Therein lies your problem. Trying to prove retention of copyright in this situation is likely to be problematical at best - a nightmare at worst.

You will probably find that having agreed to re-write what you sent to the client, you also accepted that the client owned the copyright and all the benefits that entails.

How could the client have the copyright to the sales letter when they didn't write it or pay for it in full?

I'm not a lawyer but it seems to me that the email correspondence would also confirm the previously agreed upon arrangement.

Copyright Act of 1976 - Wikipedia, the free encyclopedia

[n7 Studios]

Originally Posted by Deb Holder

Here's the deal. I actually gave him a bargain on the deal and did the work--a rewrite of an existing landing page. This company kept asking for rewrites, which seemed a bit excessive but I complied. I've never dealt with this situation before but always do my best to overdeliver. Four drafts later, they wanted more. I won't go through the entire chain of events, but it was beginning to get unreasonable. That was last week.

What are your terms on rewrites? Do you have a specific number / timeframe for rewrites?

Originally Posted by Deb Holder

Fastforward to Monday (yesterday). I discovered that they were already using my copy online. I wrote to them and asked them to pay me since they were using the copy. They say they won't pay the final payment until they get the results they want, meaning they want me to do more rewrites.

My position is that once they've published the copy, they've accepted it. Once I receive final payment, I will do edits for the next 30 days as needed. They say the job isn't finished because they are not happy with the results.

Do your terms state that once copy is published, it constitutes acceptance of work and so the project's complete / full payment required?

Originally Posted by Deb Holder

We're deadlocked. I won't write another word until they pay me what they owe me, and despite my request to pay me or take down the copy, they haven't complied. I've told them that they do not have permission to use the copy and do not own the rights to it until they've paid in full. They're accusing me of escalating this situation and want to resolve it amicably. So do I, but before the project started I told them that I could not promise specific results and any copywriter who does that is lying. They hired me with full understanding of that fact.

...

I'm taking steps to have the site pulled down and have contacted a copyright attorney. Again, this copy has only been online for a few days, and they say that I can contact their hosting company to pull down the copy. Apparently, they aren't taking me seriously.

They want to resolve amicably, you want to get the lawyers in?
Point out the copy's been published, and so you feel they must be pretty happy with the work. Agree a finalised list of amends the client wants to the copy (making it crystal clear these are the last amends), do them, then get paid. Put this one down to experience.

Originally Posted by Deb Holder

I'm curious if others have faced this situation and what steps you've taken to resolve the issue. This is new to me. I usually ask for 100% upfront payment and made the mistake of "working" with this client. Any suggestions?

I don't do copywriting, but in web design / development, I have part payments at agreed milestones (with each payment constituting client acceptance of work - appreciate for copywriting this might not be easy to implement). More importantly, the client never gets the source code / original files until I've received final part payment from them (although they can see all of the work and web site etc. on a staging / development server environment which I control).

[darrin_cooper]

You simply need to finish what was required of you. It's not a sticky situation at all.
The client simply requested to complete the rewrites. It seems to me that if things were not to their expectations after the 4 times, you should have taken it upon yourself, to have at least another 1 hour meeting to explain what is being delivered & what they are receiving.
You submitted the last re-write to the client, therefore, they have full rights to utilie what they receive completely, especially when it is not done. And the hosting company is not going to do anything at all.
I would recommend you simply re-write what you need to do & get it right.
Then request payment. If they don't pay, MOVE ON. You are spending more time fighting a battle vs. gaining more clients.

[seasoned]

Deb Holder,

I am certainly not an attorney, but think I know a lot about this. Unless you have progressive work they have signed off, with contracts,(That would show YOU did it and they agreed to payment) or a PRE existing copyright, I think you will LOSE a judgement.

Use your one INFALLIBLE Ace in the hole! Tell them they agreed, you did a good job, they obviously liked it(People won't publish it unless they consider it worthy), and they have 2 choices.....

1. DON'T pay you, and they lose ANY ability to use your work in the future, and could get hurt via publicity, etc...
2. Do the right thing, pay you, and all is forgiven.

BTW people here that say "do what they say" don't understand. This is NEBULOUS! Actually, NOBODY is EVER 100% happy! Look at advertising agencies. They ALWAYS change! I LOVED those coke bears, and that song. Were they ****PERFECT****? NOPE! But they did the job, and were NICE! You can bet the ad agency made a LOT! They deserved it. A good pleasant ad that had ALL the good and NEVER said anything bad!

Steve

[Deb Holder]

Thanks, everyone.

I usually have a marketing proposal that outlines three choices. This was a simple rewrite of a landing page. It seemed simple enough. I'll never do work without an agreement again. Of course, all of the e-mail correspondence is legally binding, so I have the proof to back up what we agreed upon.

I have contacted a copyright attorney. I do, in fact, own the copyright for the material.

I'm trying to resolve the issue. If you register your work with the copyright office for $35, you can get triple the damages, payment for your attorney, and, I believe, get the profits the client has earned from your work if you take legal action. I'm still looking into it. Also, once you write the material, you own it. It's not difficult at all to prove. I have the e-mail correspondence with my copy attached to it. If I chose to take legal action, they'd lose--hands down.

I'm curious as to why most writers just walk away from this type of scenario. I believe this is why companies think they can jerk around a writer and get by with it. I don't want to get the reputation as a writer who will willingly work for free or reduced payment. I've been paid for a portion of the work and have been advised how to handle this situation in the future. My clients have always been happy with my work and most rehire me. I've been fortunate to work with honest business people over the last three years. From now on, everything is paid in advance. No more deals. I normally operate this way but didn't this time.

I've contacted their hosting company. If they don't comply, I'll contact the registrar.

I have followed up with the client and have stated that I will take legal action if they do not comply.

By the way, this is an advertising company. I've looked at their site. The four rewrites happened over a period of a few days. I didn't rewrite all the copy. They'd say, "Add this. We've got to have it." I'd add it. Then, they'd say, "You don't have to say that" after they had told me to add it. Then, "Revise the last work." I revised it. Then I got, "You revised the wrong copy. You were supposed to revise the first one." Well, now, that's not what they told me. Every edit was an edit of the first copy. This is what's happening to me. I've been doing this long enough to know when I'm getting jerked around.

I'll let you know what happens, just in case you need it for future reference.

[RentItNow]

Originally Posted by Deb Holder

I have followed up with the client and have stated that I will take legal action if they do not comply.

Get a lawyer to write a demand for payment letter or you will sue. Have him attach the small claims form filled out (but not filed). Do not threaten legal action ever. Take legal action.

Welcome to business. I lost over $10,000 this way before I learned not to work for opportunistic people. When this happens it typically means they simply cannot pay you, never intended to pay you and do not care what you do.

I had a friend in this same position that actually did work for a lawyer, that when he didnt receive his last payment the lawyer threatened to sue him. The lawyer went to find 3 other clients that my friend had this same trouble with and they all were going to sue my friend for incompletion of work! The nerve!

What the lawyer didn't know is that I knew he could not pay for the completed work. That same lawyer actually bounced a $25 check to me. Unbelievable what people try to get away with.

Live and learn.

[Deb Holder]

I'm a little frustrated with the "just move on" advice. This isn't how the business world operates. I get a stack of bills in the mail every month from businesses who want me to pay for the services they've provided to me.

This is one of those "Lose 50 pounds in 2 months" diet products. I told them I thought their claim was hurting their sales. I changed their existing copy, which was apparently written by someone who did not understand copy. The claim is too outrageous but that's what they're using to sell the product. They have sold more product with my letter but not enough to satisfy them. They've made this decision over the course of a few days. I don't know how they're targeting traffic. I know nothing about that.

Anyway, I'm not wasting time when I could be getting other clients. I've just launched a new marketing campaign and am actively seeking new clients. I just want to get paid. They changed the terms. I didn't. It's evident from our correspondence.

[WritingMadwoman]

Deb, if you don't make progress with your current actions, there are some helpful tips in this article:

More Than One Way to Expose a Deadbeat By Angela Hoy

If nothing else it might prevent other freelancers from being ripped off by this same company.

Wendy

[seasoned]

Originally Posted by RentItNow

Get a lawyer to write a demand for payment letter or you will sue. Have him attach the small claims form filled out (but not filed). Do not threaten legal action ever. Take legal action.

Welcome to business. I lost over $10,000 this way before I learned not to work for opportunistic people. When this happens it typically means they simply cannot pay you, never intended to pay you and do not care what you do.

I had a friend in this same position that actually did work for a lawyer, that when he didnt receive his last payment the lawyer threatened to sue him. The lawyer went to find 3 other clients that my friend had this same trouble with and they all were going to sue my friend for incompletion of work! The nerve!

What the lawyer didn't know is that I knew he could not pay for the completed work. That same lawyer actually bounced a $25 check to me. Unbelievable what people try to get away with.

Live and learn.

As I recall, small claims courts, at least in the US, do NOT allow attorneys. They also limit certain judgements. Maximum judgements VARY by state.

Steve

[newbyr]

Sounds like a tough situation since they really own the rights to the copy. I myself have been stiffed in a situation like this and I agree, it is a deadlocking situation that took a long time to rectify. Good luck!

[Deb Holder]

No, newbyr, they do not own the rights to the copy. I know a little about copyright infringement. Remember your dreaded English teacher who was a stickler against plagiarism? I've got a decade of teaching college English experience. I've got a lot of experience playing plagiarism police. ;-)

If you read my posts above, you'll see that I've verified my rights with a lawyer.

I'm running a business. Pure and simple. I can't dwell on woulda, coulda, shoulda right now. Both sides made mistakes in this transaction. I'm trying to resolve the situation as it stands now. They're ignoring me.

They asked if I could guarantee results. I said, "NO." No copywriter could do that. They hired me after I gave that response. Now, they're holding payment until they get the results they want.

Copywriters, learn enough about copyright law to protect yourselves. That's all I'm saying.

[Deb Holder]

Originally Posted by seasoned

As I recall, small claims courts, at least in the US, do NOT allow attorneys. They also limit certain judgements. Maximum judgements VARY by state.

Steve

Steve,

I've consulted an attorney who specializes in copyright law and Internet marketing cases. I don't want it to go that far, though. I'm just asking for feedback from people who have experienced this type of thing. That's all.

[ny_mariposa]

When I do work for a client, I host it on my own site for review and when they pay me, I send them the original files. That prevents them from getting the product and using it but then not paying me.

I'm sure there are ways they can still steal it, but I try not to make it easy for them.

[Free PLR]

Hi Deb

I can empathize with you in this. In February I had a situation where a client decided to terminate a web design job on the grounds that it was running late when 98% of the job was complete and only 50% payment had been received up front.

I think he changed his mind about the website, perhaps due to insufficient funds to complete it. Since he did not use the website I did not follow him for the remaining balance.

However I recently received a letter from him demanding his whole initial deposit returned and stating that he would take court action if he was not informed of a refund date within five days.

The lessons I have learned are firstly that you need to get the money up front and secondly that even then the client may attempt to get his money back, so there are still no guarantees of a peaceful life.

[ny_mariposa]

Originally Posted by Free PLR

However I recently received a letter from him demanding his whole initial deposit returned and stating that he would take court action if he was not informed of a refund date within five days.

Is there a way around this? Such as clearly stating that the deposit is non-refundable? Or is that bad business practice and the best thing to do is simply eat the loss and give him his money back?

I have given away work myself when a client changes his mind. So I started requiring a small deposit, which then seems to scare people away.

I don't ask much for my services to begin with, but it does hurt to put a lot of time and effort into something and get nothing for your time.

[Loren Woirhaye]

I got f-ed a bunch of times when I was a contractor - I built
beautiful custom cabinetry and got screwed a lot of times...
there was seldom any malice on the client's part. It was just
that they didn't want to pay or could not afford to pay after
the work was delivered.

Admittedly, I like to be relaxed about business. I like doing
business with honorable people. Some people mean well
but they are hapless with money, especially other contractors
who are acting as middle-men. When the middle-man doesn't
get paid by the end-client or unexpected expenses come up
in his business, who do you think doesn't get paid?

That's one reason to work towards dealing directly and only
with qualified (capitalized) clients.

The real trick is to build a clientele and referral base of
people who act from honor.

You can fight this if you want. You can try to negotiate to
the client's higher values. Get one of Roger Dawson's books
on negotiating and you'll get some ideas for how to approach
it best.

[Kezz]

I would agree that you shouldn't just let this slide. By the sounds of it I'm assuming it's not a small amount of money you're owed. The fact of the matter is that sometimes people will get whatever they can, for as little as possible, including avoiding payment if they can get away with it. No, you shouldn't just let it happen.

As you pointed out, the issue clearly can't be that the quality is not to requirement, or the copy would not have been published. They are simply trying to stiff you.

My suggestion, is just to make your presence known, in a very prominent fashion. You don't have to be aggressive, in fact being aggressive will usually make things worse, as it will tend to make the other party more stubborn. I would take the same approach that debt collectors take, (which in this case is essentially what you are), that being to simply pester them into paying the amount owed. Contact them over and over again, with the direct question, please let me know when you will be paying the remaining amount - or words to that effect.

And, as you said, let them know that you are well aware of your rights. You don't actually want to go to court over this, and I'm sure they don't either. They are trying to avoid expense and trouble, so make it clear to them that the easiest and cheapest course of action is to simply settle up the amount they owe you.

There's no point talking about the coulda shoulda wouldas of the scenario - you're obviously clear on how you'll conduct business from here on in. As for how to deal with the non paying persons, paint two very clear pictures for them - the hard way where they fail to pay monies owed, and the easy way where they just complete the agreed transaction and be done with it.

[Jesus Perez]

Originally Posted by Deb Holder

I'm a little frustrated with the "just move on" advice. This isn't how the business world operates.

No need to be frustrated. No one here knows your exact position or monetary loss. Most lawyers cost $1000k+ simply to retain for the purpose of writing a letter. If your client owes you <$1000....you've dug yourself into a hole. If they owe a little bit more (say $2000), then you need to ask yourself if the opportunity cost is worth it. You could be spending your time pursuing other tasks that could bring in additional income. Every extra hour you waste on pursuing legal action is one hour you could have promoted your services and secured a new client. After all is said and done, will this action be worth it? In my mind...unless there's a substantial amount of money to be collected...it's not.

Ultimately the decision rests on you. Only you know the numbers.

Good luck.

[Deb Holder]

Thanks, everyone. I have been paid.

If you don't take yourself seriously as a business person, then the clients won't, either. This is one hiccup in several years of working with clients so I'm lucky.

Here's the kicker: The remaining balance wasn't that big. I gave this client a discount at about 1/3 of my cost, so I felt like I was really taken advantage of. This was to lead to other projects. I actually underestimated the project, but I was willing to eat my own mistake. I just wasn't willing to give away the work.

[n7 Studios]

Great stuff. Take it the promise of legal action did the trick?

[stevenbrandon411]

I'm glad you got your money. I thought all the advice by people on here was really helpful.