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millastrellas's avatar

Screwed without written contract?

Asked by millastrellas (425points) July 26th, 2010

Hello,
I have been doing freelance work for an advertising company (actually run by one guy) for about a year now. We have never written a contract, and it was never anything I really considered, since he would always pay me for all the work that I did right after. Being a current student, I also have no experience or knowledge of contracts, so I just never questioned it. I needed money, and it was an easy way to help pay the bills.
Well now, it had been nearly 4 months since I have finished about $600 worth of work, and I have not received a single penny. I have contacted him about it, and he always gives me the runaround, and same excuses of being busy, that he will get back to me, that he got screwed by a clients and things are tough right now. He finally contacted me saying that he would be able to pay me at least 25% of the total.
I have yet to get paid anything at all.
My assumptions are that, this is a lesson learned, that without a contract I am screwed, and I just need to let go of the idea of ever seeing that money.
But another part of me has hope that maybe there IS something I can do, that I may not be aware of.. I hate the idea of him taking advantage of me and my time, and other ignorant students like myself, knowing that we cannot do anything because we never questioned the idea of a contract.
I have heard that sometimes verbal contracts may be enough.. but I really don’t know if this is something worth pursuing, or should I just let go, and learn from this mistake?

Feedback is appreciated, Thank. :)

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16 Answers

wenn's avatar

Written contract is generally the way to go.

There is point to where ‘good faith’ can be taken to court, if you can prove you did the work, have the work archived and so on.

But if this guy lives/works near you, meet at his place and confront him face to face. Tell his cheatin ass to pay all or go to court.

Try to get what you deserve before you give up. and next time, draft a contract.

JLeslie's avatar

You can go to small claims court as suggested above. Since he has historically paid you, and you can show the most recent work, and if you have an email of him saying he is going to pay you, it seems like that would be enough proof if you want to go through the hassle.

It is better to get a contract in writing. You don’t have to use a lawyer, you can just draw up a simple agreement on a page next time you do work for someone. Just to make you feel better, the contract does not guarantee payment, it would just help you if you have to drag someone into court.

mammal's avatar

Get tough, don’t need a written contract although it helps, this is a clear Judge Judy case.

cazzie's avatar

Not completely screwed. You had an agreement and a president set by being paid for other work. And he’s written you emails acknowledging he owes you the money?. You could take him to some sort of small claims tribunal or court. He has to realise that you spent your precious time doing that work and you were counting on being paid for it.

In future, try this:

http://www.allfreelance.com/freelancing_blog/2007/09/05/tips-for-how-to-write-a-freelance-contract/

YARNLADY's avatar

Take him to small claims court, and try to bring as much proof as you can that can back up your claim in case he denies it.

Andreas's avatar

@millastrellas As @mammal mentioned Judge Judy, it may be to your benefit to watch a few episodes so you can learn how NOT to act. I’m convinced that MOST complainants and defendants are idiots simply by the way they act.

Instead of giving direct, short, sharp, to-the-point answers, they waffle. Or they don’t answer the question. Or they butt in when the other party is answering the judge’s questions, and some have even had their cases/counter suits dismissed because of their actions. So their examples are of what NOT to do in court.

You don’t need people like your dealing with in your life.

cazzie's avatar

@Andreas My mother took a tenant to small claims and it wasn’t all like you see on TV. I think Judge Judy is a whiner and bases her judgements sometimes on how much she ‘likes’ someone. A REAL judge is more objective, I’ve found. More about supporting paperwork than the rubbish of ‘he said’ , ‘she said.’ But paperwork doesn’t make for good TV, so she lets these annoying people go at each other and then chimes in with her ‘stern but folksy Jewish-Mother-from-Brooklyn’ style.. ick.

MissAusten's avatar

Early in his painting business, my husband didn’t use contracts. He was doing a mural for a restaurant, and didn’t find out the guy’s deposit check had bounced until he was halfway done with the job. The owner gave him another check, and that bounced as well. My husband stopped working on the mural and called the owner every few days to try to arrange some kind of payment plan. The restaurant closed, and the guy never paid.

Even without a contract, my husband was able to take him to small claims court and win. He had the returned checks from the bank and photos of the mural he’d started. The restaurant owner didn’t even show up in court and my husband won the case. However, just because he won, doesn’t mean he got any money. The court does not force the other party to fork over a single dime. Instead, he was contacted by people who, similar to a collection agent, would work on his behalf to get the client to pay. They take a percentage of whatever money they get for you. The amount of money in question was about $600, but this was so long after the initial problem (several months at least) that he decided not to hire one of those groups. He’d also found out that this client had all of his assets in his mother’s name, so there was nothing to put a lien against.

Anyway, there was never any payment. The guy filed for bankruptcy and my husband just wrote it off as a lesson learned. He always uses contracts now. So, you can go to small claims court and win, but be prepared for the possibility that you still won’t see any money from this person.

Andreas's avatar

@cazzie That sounds about right. But the advice about answering directly, answering only when asked, etc is probably still good advice. No judge wants irrelevancy in their court.

millastrellas's avatar

Wow, thank you all for your advice and feedback. It has given me a lot more courage to know that I should not feel helpless, and that even just $600 is worth fighting for. I have contacted him yesterday and he agreed to meet me Thursday or Friday for payment. Let’s hope this is not another flaky week. Thanks all.

YARNLADY's avatar

Take a pre-written I. O U. with you in case he flakes again, and ask him to sign it. At least that way you will have some proof.

srmorgan's avatar

You don’t need a formal written contract to do business. In fact, I think you have a binding contract merely by agreeing to his offer to have the work done for a specific price. The lawyers describe this as “consideration for a consideration”. A contract like this can be oral and frankly a written document is not going to make it any easier for you to get paid on time.

Next time you do a project for this guy, just write up a summary of the work involved, title it a work order and include an estimate. That puts you on firmer ground about what might be owed to you.

Unfortunately getting paid is the biggest problem for many self-employed people. Once the work is done, your leverage is gone.

The advice you have received about small claims court is good, but let this guy know that your intention is to take him to small claims court and see what happens.

One other thing, if you should find yourself doing another project for this person, assuming you get paid for this one, try and get some payment upfront. This is not easy to do but it never hurts to ask, especially in view of what has gone down already.

SRM

MissAusten's avatar

@srmorgan You make a good point about getting paid up front. My husband requires a deposit to book a date for the work to begin, usually ⅓ of the total cost. He gets another ⅓ when the job is halfway done, and the final ⅓ when it’s finished. He doesn’t usually have problems getting paid, but when he does, it’s always that final payment that he sometimes has to chase after.

srmorgan's avatar

@MissAusten
In my experience in business, we gave 30% (almost ⅓) up front on maintenance and repairs to cover initial costs and to cover cost of materials to be used in a project.

If I were purchasing something like software development, I usually tried to set milestones such as outline, preliminary screens and other deliverables such that about 60% or so was paid by the time the beta version was delivered. This way the vendor did not worry about cash flow and would not hurry the job in order to get paid upon completion. Holding back 40% of the total tended to get the project finished along with correcting bugs and making final changes.
Change orders were added to the 40%.

NOT EVERY vendor liked this. One felt that it tied him to the project for too long.
Other consultants were paid at the end of a project but our company had a track record of paying people on time, or close to the due date, and that wasn’t a problem for most.

SRM

BuzzTatom's avatar

All good advice from above. Have taken people to small claims court and have batted 1000. My guess is with emails and approvals you probably have you would win. I have written contracts and that helps you and if you can do it by all means do it. Problem is neither guarantees you getting paid. What you want to do is get paid. Getting paid from someone like this requires pressure. Nice pressure but definite pressure. If you are persistent enough and show up in his office enough he will pay you if he has the money. Tell him I’m here to collect. When he makes his excuses. Nail him down. When he says I don’t have it now, you ask will when will you have it, I need a specific date. If he says something outside a week you tell him sorry but that is not good enough. The work was done the bill needs to be paid. Keep very calmly, nicely and firmly pressing. Tell him you will be showing up on that day and if he isn’t there you will be showing up everyday after that until you get paid for the work you produced. If he has the money he will very quickly decide you aren’t worth the hassle and write you the check. If he doesn’t have the money you will not be paid no matter what. Persistence is the key. One last thing, if he says I forgot my checkbook or some excuse like that tell him that’s alright I’ll wait then sit down in a chair. Again, nice but firm. Over 22 years of doing this the only ones that did not quickly pay were the ones going out of business. If you aren’t persistent without firm timeframes you will not be paid by someone like this. Good Luck.

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