Terminating contracts and retrieving equipment

Lisa Lane-Collins

Lisa Lane-Collins

Sophomore
Dec 9, 2012
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Adelaide, Australia
Wondering if there are any standard courtesies people practice when their hire clients have stopped paying and it comes to crunch time?

At present I have sent the polite email inquiring as to what is happening with getting invoices paid. This was met with a complete derail. I've responded with another email expressing that there needs to be payment in order for the arrangement to continue and that I am sure non payment was an oversight and will be remedied promptly. But that if it isn't and nothing is communicated one way or the other I shall assume the client wishes to terminate the contract. I've given a date by which that will happen if I receive neither payment nor communication of intent to pay.

When that day comes and goes and I've heard nothing, is there anything else I need to do before physically going in and pulling my gear? This is going to disrupt their ability to do business, but the client hasn't paid hire in the last 2 months so, feeling like I should be pretty contractually clear of any obligation to leave my equipment on site or maintain it in working order. Still, feel apprehensive about following through.
 
What Chad said.

If the first polite email doesn't work, phone is next, then meet in person.

Another rule of thumb - email for good news, phone for bad.
 
Like everyone else said. NEVER let this drag out so long. I'm guessing your gear is in a bar somewhere. Sadly, many bar owners are of the very shady persuasion and will let bills lapse until the banks step in. Once that happens, and the space is secured, your stuff will be very difficult to access. Something that would be a good idea going forward is making sure to do a credit check on the potential client before providing gear to them. Knowing their credit history can help you adjust the rate for the rental against the risk of stuff happening.

Personally, if a payment was missed, I'd make a phone call, or personal visit instead of an email. Depending on the duration of the contract would determine how fast I respond in getting my gear pulled. If it's a couple years into a multi year contract and it's the first time this happened, and I don't suspect other financial issues, I'll take the payment and be OK with it. If this has happened before, or there are other signs of financial trouble, I'd use the cause in the contract that allows the contract to be immediately cancelled due to non-payment and pull my gear. If they want the gear put back in, then there is the labor charge to re-set things up.
 
Here is what I did one time when I was owed money and the club wasn't paying.

I had a crew and a couple of trucks and went to the venue.

This was a Friday at 5pm

I told they guys to wait about 5 minutes before coming in after me.

I took a large pair of wire cutters and went to the amp rack and cut all the speaker wires.

I went to the owner and asked if they had my money-they of course they said no.

It took us 4 days to install the system.

We had it out of there (except the wires installed in the ceiling) in about 30 minutes.

 
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Thank you all for the fortifying words.

Now I am even more dilemmaed. The client has paid off the 3 most recent invoices including one for a stolen microphone that I suspected he would contest, but the 2 that are the most overdue are still outstanding.

Technically speaking I said he needed to pay All of them by the 4th or I would consider the contract terminated. (And I reeeeeeeeally don't want getting paid to stay this hard).

I'm not sure how to proceed from here. In the past I would have let it postpone D day, I really don't want to stay in this cycle of chasing invoices though. As per the advice to deliver bad news via phone call I presume I should call him but what do I say?
 
You may need to have a discussion with a lawyer. Do you have a written contract or a verbal contract? This has been discussed on other sound forums in the past. The laws in different areas of the world vary a lot. In some places you would be trespassing and can’t just go into their place of business and remove your stuff. In others you can do almost whatever it takes to get your stuff back. It might actually be worth it to have a lawyer write up a standard contract for you that spells out what happens if the client defaults on payments.
 
Lisa Lane-Collins said:
Technically speaking I said he needed to pay All of them by the 4th or I would consider the contract terminated. (And I reeeeeeeeally don't want getting paid to stay this hard).
Click to expand...

Sounds to me like a classic "Slow Pay" Client - one that pays off the squeaky wheel (at least, partially) at the expense of others. You have do decide whether or not you want to deal with this type of customer, as they are not likely to change behavior.

If and when that Client shutters his doors, you will be left holding whatever outstanding invoices remain. In other words, the unpaid balance will always be at risk - if not today, perhaps tomorrow. And, depending on the Laws of Oz, your equipment may be seized as part of his assets.

I'm certain that Collections are not why you got into this business. Hope you can grow your Client base to allow excluding bums like this.

Dave

 
Going today with bump out crew and the contract and printouts of the last 2 weeks email conversations (in case of police).

On the one hand feel like he ought to be notified and given the chance to catch up (through staff I guess). On the other hand, my gut (and every person I've asked with a modicum of experience) says "don't hire to this person", so, maybe sufficient to email him after and say something like "Please be advised due to the lack of payment and lack of communication our contract is void and the equipment has been removed"?
 
If he hasn't paid his bill for 2 months, he'll know exactly why you picked up your gear.
If anything, send an invoice/statement for the money that he still owes you (and will continue to owe you even after you terminate the contract)
 
Went in Thursday with my repo team. Staff told me there was a $20 000 function booked for Friday and if I took the equipment, they'd be stuffed, which tugged on my heart strings a lot. Client continued to offer nothing but empty words and annoyance at my actions and I settled on a partial bump out, take everything non essential to the Friday booking (including most of the rigged lights scattered through out the space and surplus outboard). Sent the client a message expressing as much and informing them I'd be back at midnight Friday to take the rest. This yielded a phone call during which he told me he was "getting sick of your games" and that he could "meet with you Saturday", and, after reading everything here and talking with local techs and everyone says the same thing about slow payers, (plus the whacked out emails he'd been sending in response to legitimate business inquiries), I told him I didn't mind leaving the gear one more day but I want out. He hung up on me and next minute the duty manager is telling me the client is on the phone telling him to call the police. So, we switched to strip the joint. And when the policeman got there, he concluded it was a massive grey area and opted to supervise the rest of the bump out (a good hour and a half, very patient, very awesome policeman).

Massive, Massive relief :-D
 
Did you end up pulling all the gear before the big friday show? Good for you. I'm sure after getting paid $20,000 there still wouldn't be money for you.

Good riddance.
 
If the guy is going out of business you are just enabling him. Pull the gear and get help as he will be expecting you.

The partial payment looks like he is trying to maintain the contract, but does not have the money. Unless he describes how he will have more money to pay you soon, it's over. He is probably stringing along other vendors too... worst case the place gets padlocked and your gear is impounded as bar assets.

Good luck and be careful.

JR

PS: This is why written contracts up front describing how such scenarios will be handled avoids trouble.
 
Yeah, most definitely get gear first, discuss after. Too many times stuff disappears. You can easily negotiate a new deal afterwards, knowing your gear is safe in the meantime. And there's ALWAYS a big gig coming that will pay your bill if it goes ahead....


Sent from my iPhone
 
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