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DeAnna Villalobos
client not paying - need advice!
on Aug 5, 2009 at 5:43:00 am

Hi - I am a freelancer who provides services relating to video,photography & design. This is a fairly new venture for me as a fulltime business and I am learning the ins and outs.

Unfortunately, I am in a bit of a pickle with a "deadbeat" client. I did not get a contract (lesson #1)...

Here's my situation:
(I apologize in advance for the length!)

A few months back (April) I began a project with this client that started off fairly simple. I was to take some tapes she had shot of herself & edit it simply with a little text and a soundtrack & author into an instructional DVD. We agreed on a price and deadline - no problem.

THEN - things started to snowball and the project grew tremendously. I re-shot some footage; designed her DVD Cover, Label, Banner for her site, earth day wallpaper (!!), business cards,... as well as HOURS of additional editing. (tons more text, special effects, graphics)

She paid the initial fee for the original editing within 2 weeks of the start of the project. I would continue to add on each additional project to the list of work done. I would periodically email her the list, what she paid and what she owes.

Her payments gradually became fewer and farther between. I have been very lenient and more than patient with her - and now I see (finally) that she doesn't intend to finish paying up.

Trouble is, the project is 95% finished. She has a latest revision that still needs some good tweaking. She wanted something to show her investors & promised to get another payment in, so I chose to trust her and gave her a disc.

She has another $500 left to go on payment - her last payments were $100 then another $75 2 weeks after that. I keep telling her I need a timeline when the final payment will be made - she just keeps telling me she doesnt know when it will be.

She is refusing to return my phone calls for the last 2 weeks. She is forcing communication via text & email. I have even offered to accept collateral in the event she has NO money to pay (many sob stories of bills). But now she will not even talk on the phone about it.

She is clearly avoiding me.

I have stopped working on this project altogether. I have told her I would be happy to continue editing if we can come up with an agreeable payment arrangement. I just don't want to put any more time and effort if she can not pay in the end (as appears to be the case).

I would jump at taking her to small claims.. but the disc is not 100% complete. How would that affect things? Can she just continue to string things out?

Also, the total amount due includes ALL the work - graphic AND video.
So, if she is trying to sell her product using my DVD, Cover,Label,etc... without making a final payment - can I tell her that I own those & she can not use them without paying in full?
(i read about the copyright in previous post)

I have learned a lot of hard lessons on this one - never again will I do anything with an agreement in writing!

Any advice on what I should do next? I called her several times today - left voicemails and text - just to talk to her. I got an email back today saying she is busy and need to focus on other things.. she'll get to me when she can. !!!!!

Any help would be greatly appreciated!
thanks,
DeAnna



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Nick Griffin
Re: client not paying - need advice!
on Aug 5, 2009 at 11:09:24 am

DeAnna-
Sounds like you've already learned a few valuable lessons, although one not mentioned was the importance of getting a deposit. So... let's look at how to move FORWARD.

Stop calling her, or for that matter having any contact at all for the next several months. She's already avoiding you so return the favor. When she realizes that she needs something from you (which realistically may never happen), you'll be in a stronger position to demand full and immediate payment.

This does not seem like it rises to the level of even small claims court. That kind of activity is almost always more trouble and consumes more of your time than it's ever worth. Which leads me to:

Get on with it. Dwelling on this just takes time away from the better, and presumably better controlled, projects you have ahead of you. Go out and start looking for new business. Work on your reel. Network. Move on and don't waste any more time on this one.


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Mark Suszko
Re: client not paying - need advice!
on Aug 5, 2009 at 2:27:54 pm

Well, you can read this little gem...

http://forums.creativecow.net/readpost/17/865818


I agree, the little bit unpaid left owed to you, chalk it up to tuition in the school of hard knocks. Lock up all the clients materials, release nothing more, do not communicate except thru intermediaries, preferably a lawyer or at least a paralegal.

Also read Ron Lindeboom's classic article on "Grinders".

That's what you fell into by being too nice and trusting. It probably isn't much comfort today, but you are in good company here; the people in our business break down into those who've been ripped off by a client already, and those who's turn has not yet come. If you take the preventive steps outlined in those two references, you are as armored as you can practically be against it ever happening again.



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Todd Terry
Re: client not paying - need advice!
on Aug 5, 2009 at 3:06:41 pm

These guys are right, as they almost always are.

Move on.

Maybe there is something unfinished or something that you have that they still need that you can hold until you are paid. But maybe not.

Chalk it up to a hard lesson. I think you've learned what to do next time.

And don't so much as lift a finger for this client again until they have both paid in full, and paid in advance for any additional work they want out of you.


T2

__________________________________
Todd Terry
Creative Director
Fantastic Plastic Entertainment, Inc.
fantasticplastic.com






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DeAnna Villalobos
Re: client not paying - need advice!
on Aug 5, 2009 at 4:59:45 pm

Hi guys - Thank you so much for your quick response and knowledgeable advice - it is very much appreciated!

UPDATE: This morning I checked my paypal account, to find she had sent over a little $40 payment. She didn't let me know she was going to do that - no call/email.
Due to her recent behavior - not wanting to speak by phone - avoiding me at all costs... I think this is yet another ploy to string me along. So she can show that she is being "responsive' and doing her part to pay.

But at this rate, it will take months to finish off a little $500 balance!

Meanwhile, it looks like she is trying to use the disc I gave her as her product.. as well as all of the graphic work I did - to market and sell her product. So, this is her way of pacifying me while she uses the work I did for her.

* Can I use the fact that she has not paid in full and therefore should not be using my work - as leverage?

I was thinking of sending her a letter - stating that her final disc will be released upon final payment; AND that any use of ANY graphics I created for her is forbidden until final payment is paid.
* she is also using a short sales video I shot for her on her sales/squeeze page.

What do you all think?

I totally understand and can appreciate your advice to chalk it all up as lesson learned - and I am, believe me... but, times being what they are and little mouths to feed at home... this little $500 is alot for me right now. I just want to exhaust all options before I give up.

Any other thoughts on small claims?

thanks again guys!!
DeAnna

*


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Mark Suszko
Re: client not paying - need advice!
on Aug 5, 2009 at 5:11:33 pm

You won't have the time to waste on this in small claims, plus the time spending on the collection end if the judge finds for your side.

If the client posts to youtube, you can protest it as not legally belonging to her and get it knocked off, at least, temporarily.

You could complain to whomever she is trying to sell to/work for. But I do NOT advise taking that step yet.

Document, document, document, every transaction. On the paypal, send back a notice that payment was accepted but the balance is still due. Keep a paper trail and it's electronic version. If it goes to court you can show a judge there was consideration paid, which validates whatever unwritten contract you had with her. This factor was what let me win such a case long ago against a guy who had ripped me off in similar fashion to what you've experienced. He tried to say we had no real contract. My proof that he had started payments, then stopped before being done, was a huge factor in making my case. But it was for much more money than you're missing, I was unemployed and could make the case itself my "job" for as long as it took to pursue. Your better bet is to work on getting a new client as soon as possible, not wasting your time actively chasing that $450.


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Nick Griffin
Re: client not paying - need advice!
on Aug 5, 2009 at 5:39:50 pm

I agree with Mark (and with earlier me). The remedies you have available, ie. - claiming ownership, letter from a lawyer, etc., are more appropriate if the balance due was $4,600 or $46,000. If you want to send her a letter from you stating that she can't use your stuff two things are going to happen: 1) She's going to get defensive and 2) She's likely to stop the micro-payments.

I truly believe that you should be able to make $500 ($460) from someone else with far less effort and way, way, way less negative energy than pursuing this deadbeat. Let it go and move forward.


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Greg Ball
Re: client not paying - need advice!
on Aug 5, 2009 at 5:40:41 pm

It seems like you've learned a lesson the hard way. I agree with the others. Move on to finding good clients. One thing you should always do is provide a written contract that they sign and also NEVER release a video without payment in full. You'll be amazed how quickly (good) clients pay when they know you have their video ready but won't release it without payment.

We send the client their video with timecode burned in until we receive final payment.



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Mike Cohen
Re: client not paying - need advice!
on Aug 5, 2009 at 5:55:00 pm

There has been a ton of talk here about all the wrong things in a contract, or the wrongness of not having a contract. Now might be a good time to talk about what a good contract should look like.

In many cases, we have a simple one-pager along these lines (simplified for illustrative purposes):

Statement of Work

We will produce video X.

Process and Costs

Video scripting - estimated 30 pages, 30 minutes
$1000

Video shoot at location to be determined. 1 day, 1 camera + audio, lights, etc
$1000

Editing

We will perform initial edit following script. Client to give feedback
$2000

2nd Edit incorporating editing revisions.
$1500

Final edit - including music, 5 original illustrations and final narration
$2500

Approved final edit to be delivered on DVD, h.264 and WMV files.
$500

If editing revisions beyond 2nd edit but before final edit exceed 10 additional hours, client will be billed $395/hour.

Travel and lodging billed separately at cost.

Payment Terms

upon Acceptance - 50%

Upon delivery of DVD master - 50%

Client will own final edited video. Upon final payment according to the terms in this contract, we will, at client's request, provide copies of raw footage and master video on DVCAM tape or AVI file.


____


The above is the simple version. Some larger corporations have a statement of work format that you have to use, including a lot of uses of the words WHEREAS, HERETOFORE and ESTOPPEL.

But most of the non-payment situations discussed on this forum seem to be in need of a simple contract that lays out the payment terms and who owns what.

The moral of the story is, get paid something before you do work, and make sure the customer knows the terms of what they are buying and when they can get it.

Mike Cohen


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Nick Griffin
Re: client not paying - need advice!
on Aug 5, 2009 at 6:51:59 pm

[Mike Cohen] "get paid something before you do work"

Not the easiest thing to do when just starting out, but a good idea in principle.

Of course the flip side of this, which I'm sure is true for many of us, is working with reliable long-term clients where the expectation is NOT an advance deposit rather periodic or project billing on a regular basis which is paid within normal prescribed terms, ie- 30 days net. If someone is giving me work month in and month out I'm not about to ask for a deposit on each project. The sticky part is making sure that you have approval at all the steps and that everyone stays happy.


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Kenton VanNatten
Re: client not paying - need advice!
on Aug 6, 2009 at 5:12:42 am

"Of course the flip side of this, which I'm sure is true for many of us, is working with reliable long-term clients where the expectation is NOT an advance deposit rather periodic or project billing on a regular basis which is paid within normal prescribed terms, ie- 30 days net"

I can't believe the irony of my reading this thread today - maybe it's the time of year?

I'm in a very similar situation with a client that I've done a number of projects for in the past. I have always billed my clients at the end of the week for the work performed during that week and have only ever asked for a deposit/Contract from new clients. So, the first invoice for the latest project came due on 7/20 - no payment was received. So, I waited another week, and sent a reminder on 7/27. 8/3, still no payment. Now it's over 14 days past due and I emailed again. The client responded, that money is a little "tight" for them right now and that the sooner we finish this current project, the sooner I get paid. Needless to say, I was very frustrated with that.

So, now I'm wondering at what point does one start billing late charges for long-standing clients? On my invoices I say that "if payment is not received by the due date late charges may be applied to the overdue balance", and I've only once ever had to resort to actually charging late fees to a deadbeat client who went incommunicado and took over 6 months to pay.

To make the situation more complicated, this same client who's money is tight (who's money isn't tight?) has booked me on another project already. I certainly don't want to turn down the work (well that is, if I'm to be paid for it - lol)

Regarding DeAnna's situation (to avoid my question from appearing like I'm hijacking the thread): It may be better actually to keep the communication via email that way (as others have stated) you have a document of what was said and when. Just remember to keep your responses professional and fact-based at all times. It's easy to want to vent and finger-point the client's faults, but it would be in your best interest to maintain your position of what is owed to you in as professional manner as you can. Most times, the client knows that they are stiffing you, hence the avoidance, if you keep stating the facts of the project (what was done, when, how much was billed/paid), then eventually (hopefully) the client will realize that you are serious and you're not going to back down.

A couple of years ago I started working on a project that quickly went south with the producer/client. He had 75 hrs of footage that he wanted cut into a documentary, we agreed on 8 weeks (for rough cut) and I quoted an amount. I got a deposit on that one and started digitizing all 75 hrs of unlogged material. After two weeks of digitizing, I had enough material that I thought maybe I'll cut a scene together and send it to him. I got a frantic call within minutes saying that he wasn't sure what I was doing the past two weeks and that he thought that I would've been much further along than just a 3 min segment (he also made sure to tell me that the segment I cut had nothing to do with the piece he envisioned - nice) So, he tells me that he wants me to stop work and that he's going to find someone else because he's already missed deadlines for two film festivals, etc etc. I said, "I told you 8 weeks for the rough cut - you would've missed those deadlines anyway." He wasn't having it.

So, I sat down and calculated a pro-rated amount for the 2 weeks I had done based on the original contracted amount minus the deposit. I invoiced him and agreed to deliver his tapes back to him. He called me and very angrily told me that there was no way he was paying "$xxxx" for just capturing. I explained the contract terms, that he chose to terminate the contract and that I was pro-rating him for 1/4 of the total amount. He didn't get it and was refusing to pay. Eventually he emailed me and I just kept the tone serious and stated facts and terms of the contract. After about a week or two, he agreed to pay the amount - I'm assuming because he realized he was obligated to via the Contract. The kicker is that he tried to screw me again when I went to go meet him in person to pick up the check (I wasn't having the "check's in the mail" story from this guy) - He tried to say that the amount of the invoice was a considerable amount lower than what it really was.... luckily, I had printed a copy of the invoice and contract prior to going to meet him. It was a very nice victory.

Sorry for the long diatribe there - the point is stick to your guns if you know you're right, keep it professional (even if they stoop) and hopefully it will all work out for you. Good Luck.

Kenton VanNatten
Avid Editor (for hire)


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Brendan Coots
Fight Back! You are NOT a doormat
on Aug 5, 2009 at 7:17:40 pm

"I was thinking of sending her a letter - stating that her final disc will be released upon final payment; AND that any use of ANY graphics I created for her is forbidden until final payment is paid. "

That would be a retroactive contract and, like all contracts, without her signature of agreement it would be thrown out by any judge before they even read it. It's a waste of your time.

I would, however, immediately send her a certified letter containing a Cease and Desist Order (if you can't afford a lawyer, here's a standard C&D that can be modified to your needs) covering all the materials you provided to her. This is legally binding since you CAN prove you created the works and own the copyright. If she continues to use the materials after receiving the notice you can sue for much more than the $450 she owes you ($150,000).

Even if you have no plans to sue, this is smart business to preserve your rights and remove the "doormat" sign from your back.

Brendan Coots

Splitvision Digital

http://www.splitvisiondigital.com


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DeAnna Villalobos
Re: Fight Back! You are NOT a doormat
on Aug 6, 2009 at 3:14:30 am

Thanks to all who have responded - I really appreciate all of the sound advice.

Although I do agree with the idea of not wasting negative energy on this "grinder" - I am still in the Fight Back mindset at this point and am willing to do what I can with minimal focused energy.

Brendan - thanks for the link to the Cease letter...I am taking a look at using that now. My last concern at this point is offending the client - I just want to wrap this thing up the best way I can with minimal loss.

I am finished trying to call her - I will be writing her via email and by post. We'll see what reaction I get - I'll be sure to let you know! Going to try the C&D letter, plus give her an option of payment.. I'm even willing to offer collateral, so it's not like I havent been offering alternate routes, which is more than most would do. She has refused, so I'm taking the next step... we'll see!

thanks again,
DeAnna


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Brendan Coots
Re: client not paying - need advice!
on Aug 5, 2009 at 6:55:30 pm

No contract = you're hosed, plain and simple. Giving a client finished goods before payment, without a contract? That's just plain suicidal.

The only way you could even hope to win in small claims is if you have emails or other written correspondence wherein she agreed to pay a certain amount that she has not paid. Even then, good luck getting a judge to side with you because that's not strong evidence since it could be fake, and she could claim it is, your word against hers. In a toss-up like that the judge will opt to do nothing, rather than financially reprimand the defendent without clear proof. The most likely outcome is that the judge will excoriate you for not using a contract and send you on your way.

Chalk it up to learning and never work without a contract again.

Brendan Coots

Splitvision Digital

http://www.splitvisiondigital.com


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Bill Davis
Re: client not paying - need advice!
on Aug 5, 2009 at 8:27:13 pm

DeAnna,
This has clearly been a huge learning experience for you.
It's also probably been a huge pain in the butt for you. Particularly since you note that the money you're NOT collecting is important to your family.
So the plentiful advice you've been given here is an excellent foundation for considering and re-thinking some of your business practices so that you'll have less of this kind of thing to deal with in the past.

However, I'd like to address a different area that these things bring up.

What this circumstance and - equally importantly - your reaction to it - will do to your reputation and your business outlook in the future. Yes, it's true that no business person wants to be seen as a "pushover" who won't go to bat to collect what's due. It's equally true that few business people want to be seen as heartless scrooges who's first and primary thoughts are ALWAYS about the money.

I'm not going to tell you which end of the spectrum is best - or even best in this unique situation. In fact, in my experience, the spectrum shifts based on a lot of variables. Perhaps a client will stiff you and you'll learn that they have plenty of assets to use to pay the bill. These people ratchet UP the desire to collect at all costs. Perhaps another client will prove to be someone who's great idea truely crashed and burned - leaving them struggling to pay even their small bills. This *might* cause you to look at their situation and be more lenient. Or not.

The important thing is to stop for a while and think about what kind of business person you wish to be. Where will you position money in the range of importance available to you? Would you want that last $500 if it shifts serious burden from your kids to the client's kids? How much?

Again, I'm not advocating a position here. Just noting that most of us entered business thinking that it would be fair, equitable, and we'd be dealing mostly with others of equal moral compass. And we discover that this is not always true.

Personally, I think the lingering hurt you're feeling about being treated poorly is the MOST valuable part of the whole exercise. And it's instructive that when hurt, some hold grudges - others forgive.

What's important is to find YOUR way to move on as quickly as possible - feeling OK about your response - and returning your focus as quickly as possible to efforts that can grow your business - the action that will ultimately do more to "heal you" than spending the next 3 months digging after this old debt. Maybe.

Good luck.



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Bill Paris
Re: client not paying - need advice!
on Aug 6, 2009 at 12:18:04 am

DeAnna,

Great advise from everyone. I would just like to add a couple of thoughts.
1. Make sure your communications are all in writing from this point on. Perhaps send an email outlining the steps you will be taking.... (ie. All materials relating to the project will be retained until payment is received in full.....)
2. Be professional. State the facts, not emotions.
3. Like everyone else is advising you.... let this one go!

You may be surprised, your client may need the rest of the project or portions of it and be forced to pay in full. If they do..... complete it professionally and keep the door open. You never know how these situations can turn out in the long run!

Good luck!

Bill Paris
Crew Hawaii Television



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Max Baker
Re: client not paying - need advice!
on Aug 6, 2009 at 8:58:22 am

A lot of good advice. My initial thought, which you mention but is not deeply pursued in this thread, is your copyright to the product, i.e., when it transfers to the client. She could claim that it is hers as you were retained to create it on her behalf, but as you point out, you could argue that it transfers on full settlement. I like the idea of the cease and desist letter. I, too, would recommend moving on, but if you are rabid about pursuing this, like on a vengeance scale, small claims court is probably your only venue. You never know, just the summons may prompt settlement. You've certainly exhausted the direct communications approach. Also as pointed out, you have to take into account the goodwill aspect. How likely is this to impact your brand name in the future? Someone already framed out some basic concepts for ingredients of a contract; I would add a clause that states when the copyright transfers. That's a lot of leverage, since they can't use your product commercially if they don't have the copyright, which reduces their enticement to stiff you.

Good luck!

Max


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Sutharsan Bala
Re: client not paying - need advice!
on Aug 6, 2009 at 11:27:47 am

Sorry to hear about your predicament. I'm a recent filmschool graduate and I've just gotten my first job. It's doing a documentary for a firm in my town. This is not a film company, and they don't (as always) have any money for the project. Regardless, I've been very stringent about the contract, and signing it, and we've been negotiating it for almost three months now (with summer vacation in between, some time was taken off discussing the issue).

To get back to your post - I recommend you join a union of some sort that offer legal assistance and / or financial help. I joined a union right after I was offered this job and my union has helped me a lot concerning what kind of pit falls to avoid and what things that I should remember to have in my contract. ALWAYS make a contract for your work. You probably know this by now.. :)

As for copyright etc. You are ENTIRELY entitled to the copyright of your work if you haven't signed anything that says otherwise. In other words, you have a pretty good case concerning her using your work. I'd def. use this as a leverage. You're entitled to your money and you HAVE TO go and get it. So I'd suggest you hire a lawyer, or join a union (my union has legal services for free) - and tell her that. You tell her that you will be forced to take legal action unless she is willing to sit down and communicate with you like an adult. You'll see that as soon as you involve authorities, things usually have their own way of working out.. :)

All the best to ya!

-n0c-

P.S - Remember, just because it isn't copyrighted don't mean you don't OWN the copyright. She could be facing a lot of costs if she is using your work for her own benefit. You HAVE TO use this to your advantage.

"Two things are infinite: the universe and human stupidity; and I'm not sure about the universe." - A. Einstein


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Chuck Green
Re: client not paying - need advice!
on Aug 6, 2009 at 1:20:17 pm

There are many great responses here, and I want to address a different part of your issue. The project started off simple (small?) you state; I have found that clients tend to lock in their minds the lowest rate first mentioned, even though the scope of work may grow significantly. It is important to keep them aware after things start to expand that the project is now larger, that they have enlarged the scope of work, and that new scope of work is what is now being billed for. Do this repeatedly over time as you communicate with them!

Similarly, if in your initial discussions you say the possible price range will be $ 4,000 to $ 7,000, they will likely be holding $ 4,000 in their minds from that moment on, while you might be thinking $ 7,000, whether the scope of work stays the same or expands.


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Ron Lindeboom
Re: client not paying - need advice!
on Aug 6, 2009 at 2:48:40 pm

[Chuck Green] "in your initial discussions you say the possible price range will be $ 4,000 to $ 7,000, they will likely be holding $ 4,000 in their minds from that moment on, while you might be thinking $ 7,000, whether the scope of work stays the same or expands."

THIS is one of the best points in this whole discussion.

Burn it onto the inside of your eyelids so you do not forget it in your next negotiation with a new client, DeAnna.

DeAnna: Some of the people telling you all this great advice about going to court and legal rights, yada, yada, yada, are well, I hate to say it, not giving you practical business advice. In fact, if I were to qualify some of it, I'd place it in the category of cow manure: yes, it's warm to the touch when your eyes are closed but to those whose eyes are open, they are less apt to touch it -- not to mention that it has a not-so-subtle and less-than-piquant aromasity (I love to make up words) all its own.

Why do I say that? Because some very smart people on this forum have been telling you that you are about to trade $450 for A LOT MORE COSTS in wasted time, filing fees, travel, time taken away from your business that you could be working on productive work, etc., etc., -- and these costs are far more than you ever stand to make.

THAT is bad business. Repeat those words after me: Bad business.

The Legendary Bob Zelin™ hasn't logged in to this thread to give his own Zelinized™ bit of advice to you, so I will do my humble best to fill in for him during his absence: Only a rotten businessperson trades a few hundred bucks for destructive behavior that is quite likely to cost them far more than they will ever get out of what they are doing. Get out of business now, he'd say. So I am saying it to you: if you can't see that the real value of $450 is far less than the cost of pursuing that $450 (especially in light of what it's already cost you so far), then you need to quit now. Your business will fail. You cannot run a business because your judgment is not sound.

Yes, Brendan Coots C&D order is tempting and if left there, it is not a bad play. Use it, there is indeed some power in it -- and most importantly, if left there, it won't take you a lot of time. But all this court crap is senseless and anyone here who would recommend that you fight a small claims court case for money like this is chasing chump-change and isn't really in business anyway and their advise is not something I'd follow across the street.

There, Bob Zelin will hopefully be proud of me.

Ron Lindeboom


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Jeff Bonano
Re: client not paying - need advice!
on Aug 6, 2009 at 1:29:26 pm

This really has become a group effort!

DeAnna,

Again, a full agreement is made with everyone here plus with what you are shooting for. As a creative artist myself, I have been in this situation too. I've lost a lot when I first started, and have found that my "written production agreement" (I avoid the word "contract" because it can put a scary thought in some peoples eyes as a paying customer) is often updated to cover my butt when a client finds a loophole in it. Starting now, I would say type up an agreement that you can use BEFORE you look for that next client. Read it over and over, then make adjustments. Put a revision date at the bottom too so you know that if you make changes, you are always using your most current agreement form.

With that said, the rights to your work can be preserved if you can prove to the court that you have the original work. (Not necessarily the most current work because if that was the case, then I could ask to borrow what you have so far, spruce it up even more, and claim to be the owner of all the rights....which isn't how things work) If you have anything with original dates or documentation that she doesn't have, then you have a better chance. With that in mind, if you can produce anything that shows you have the original rights to the work you have done, you could be a sport and offer her the chance to pay in full in order to receive a written license agreement from you that grants her the right to use your work commercially.

Now I do have to say, that these tactics may not be the best route to go and as mentioned by others may have some side effects on how you look in the business world. But with how determined you seem to be without the tool of a written agreement in your arsenal, the only way I see you having a fighting chance is to either be patient, wait it out, get other clients and income in the meantime....or be down and dirty, and fight like a lawyer would.

Finally, I agree with the timecode stamping that Greg Ball mentioned. I actually add a watermark that pops up from time to time with my website or "unfinished work" in the middle as well as digimarking my work too. I hope all of the information you've gotten in one way or another helps you out. I wish you the best of luck with this battle whichever route you decide to pursue.

Jeff Bonano
http://www.bonanoproductions.com


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Karel Juhl
Re: client not paying - need advice!
on Aug 6, 2009 at 2:01:39 pm

I suspect the primary problem is she's having trouble paying, and is embarrassed. You might try taking advantage of that: I'd write her a letter (postal mail, hand-addressed envelope with no return address will help get it opened). Tell her you understand she may be in a predicament, budget-wise, and that while you'd like to give her a pass, your family relies on your income, as well. Reiterate your willingness to accept regular payments (a year of $40 monthly payments is better than no payment at all), because "I know you would pay for the work I've done if you had the means to do so." Tell her you understand that she may need to receive income from your work before she is able to pay for it, and that you can accommodate that. But just so she knows you're not a total pushover, withhold the piece of the final product that you do still retain. This has worked for me.

Karel Juhl Writing & Editing
kareljuhl.com


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Paul Lundahl
Re: client not paying - need advice!
on Aug 6, 2009 at 3:10:47 pm

DeAnna,

After years of work and being on both sides of the cash flow crunch, I have a somewhat different perspective on your problem.

Pursue business where there is real opportunity.

Your client is a client, no matter how little money they have.

Clients are rare and extremely valuable. Especially when you are just starting.

In your shoes I would do everything I could to make their business a success, that's really why they hired you. If your video is well produced and helps your client's business, then they will be able to pay you sooner. Happy clients refer you to other clients, they refer you to other clients, soon you'll move up the ladder to higher profile, and more profitable projects.

This is a very personal business and people who care about their client's needs and learn to advance their client's needs prosper. In this case it's not about the remaining balance of $460. It's about having a successful project that you can point to, and then get the next one. Rather than trying to lock up the materials and make sure that the client can't benefit from them, I would use my energy to get the video linked far and wide and seen by your client's potential customers (as well as yours). Have them write you a referral letter and pledge to make introductions to 3 other potential clients. Do an on camera interview with them talking about your professionalism and quality of work and post the video on your website or blog.

Move on to the next opportunity. Then every month send a bill in a physical letter reflecting payments to date and balance owed. You will be paid. And you will get that next, better job.....

Good luck!

Paul Lundahl
creative director
eMotion studios
http://www.emotionstudios.com


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Jim Harvey
Re: client not paying - need advice!
on Aug 6, 2009 at 3:50:45 pm

Paul, you must live in a very nice town.

Jim Harvey
JHV Digital


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grinner hester
Re: client not paying - need advice!
on Aug 6, 2009 at 3:45:51 pm

1. Hop in your car.
2. Drive to where she is.
3. Collect your money.
4. Go to Chilis and eata bigass burger or some nachos.



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Jim Harvey
Re: client not paying - need advice!
on Aug 6, 2009 at 3:46:20 pm

Reading all the responses, you certainly have a lot of choices to choose from. from my perspective, Small Claims court is just another way to lose an additional few thousand dollars. If you don't think that the time that you will spend chasing this client into SCC then you really don't belong in business in the first place. More importantly, what makes you think that you'll win? SCC is NOTORIOUS for delivering bad decisions and if your client has a more compelling story than yours, or a judge that is incompetent, you could find that YOU OWE HER. Don't laugh, it has happened more times that you could imagine.

Some of the suggestions that I like are burning timecode into unfinished projects (we place a "NOT FOR BROADCAST" overlay on the piece dead center in the frame which appears for 5 seconds periodically through the piece). It is dead center so that the footage cannot be re-edited and masked out. Get it? Yes, there are clients out there that will do that.

The other thing is to be very clear on your fees, religious in requiring payment and just as dutiful in delivering content when promised. NO one likes to get stiffed for $500.00. I don't like to get stiffed for $50.00 but it still happens from time to time. At the first point when a payment is missed, I stop all work on the project, inform the client that all work has been stopped and will not resume until payment has been made. I NEVER EVER deliver a finished project unless I am paid in full.

You may wind up being paid for this project, but it won't feel like you did. If I borrow $100.00 from you and pay you a dollar here and a dollar there, it won't feel like you paid me back. As unpalatable as it may be, you just might have to chalk this one up to experience and make sure that you don't put yourself into this trick bag in the future.

Jim Harvey
JHV Digital


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Nick Griffin
Re: client not paying - need advice!
on Aug 6, 2009 at 4:57:26 pm

[Jim Harvey] "I NEVER EVER deliver a finished project unless I am paid in full."

Should we infer from this that you live in a not so nice town, Jim?

Am I in a distinct minority, working for many of the same people over and over again? Of course strangers and first timers put down an initial payment and some are not allowed to walk with finished work until payment has been made, but in my case that's a tiny fraction of the overall business. It's also why our work is almost 100% B-2-B and with established, credit-worthy companies.

Look, I feel for DeAnna and her situation. In my case something very similar happened when I was just starting out and a lawyer friend had to actually file papers before "an upright member of the local business community" (Car Dealer) would pay me $350. That's why I gave the advice I did, because I know this game from personal experience. It's also how I know that moving on is, in the long run, far more productive than hours and hours and hours of negative energy.

[Paul Lundahl] "In your shoes I would do everything I could to make their business a success... then they will be able to pay you sooner."

While I admire Paul's upbeat approach to this and agree with his philosophy of happy clients bringing in more happy clients, DeAnna's situation seems to have moved well past the point where that's an option. Good stuff to focus on in the future, but probably not now with this client.

DeAnna, do what you feel you've gotta do, be it a cease letter or whatever. Then put it out of your mind and immerse yourself in getting the next project. It beats the hell out of sitting around stewing about the one that's gone bad.


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Franklin McMahon
Re: client not paying - need advice!
on Aug 6, 2009 at 6:59:54 pm

There are several national collection agencies that you can google for on-line, they take a cut of the take but don't charge you anything. And if they fail to collect there is no charge. You supply all the clients info, phone numbers, etc. and they take it from there. They treat these much the way small claims court does, it is a differing of opinion. They don't work with you as an adviser, they don't care if you did or did not have a contract, they just collect. Much like Grinner's daughter.

You may want to tell the client that this is your next step, and it could impact their credit rating. It may be all you need to do.

I have never subscribed to the theory that if you don't have a contract, well there is NOTHING you can do. There is a lot you can do.

The client has put a burden on you, you push a burden back on them. Collection agencies are very burdensome and tiresome. Angst can sometimes work better than a contract (most of which are not honored anyway or easy to get out of).

The bottom line is not you need contracts, the bottom line is you need communication. People get mad and upset and avoid things because they feel they are misunderstood or things are not how they envisioned. Being crystal clear upfront by explaining everything that will take place can work more wonders than a contract ever could.

___________________________
Franklin McMahon / Host
CreativeCow.net PODCAST
frank@fmstudio.com
Creative Cow Podcast Page
Creative Cow Podcast in iTunes

Media Artist Secrets Blog / Franklin McMahon TV Show: FranklinMcMahon.com
Studio Page



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Mark Suszko
Re: client not paying - need advice!
on Aug 6, 2009 at 7:52:18 pm

"They come at you with a knife, you come back with a gun. They put your guys in the hospital, you put theirs in the morgue. THAT's the Chicago Way."

Well, that's one extreme.:-) First-timers, you treat with suspiction; no matter what, the new customer pays a deposit and in full, or no laundry. After you've both got a feel for each other and have "trained" each other on expectations and built some trust, then is the time you can ease up a bit on the COD requirements for delivery. Try not to confuse business with personal. Thatn is easy to do in creative endeavors.


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Jim Harvey
Re: client not paying - need advice!
on Aug 7, 2009 at 12:09:08 am

"Should we infer from this that you live in a not so nice town, Jim?"[Nick Griffin]

Hey there Nick! Well I live and work in New York, so maybe the answer to that is "yes" LOL!

I suppose that I should have said NEW clients. Of course we all have clients that are solid gold and we have our own payment arrangements with them because we know that we can TRUST them. Trust is something that is EARNED not automatically given. In the case of new clients, a solid expectation and explanation of fees and payment is essential to establish trust and future goodwill. Once you've established a good solid working relationship with a client, then you can modify your payment plans accordingly. However, there is NOTHING wrong with expecting payment in full a the conclusion of a project and delivering that project only when payment has been remitted. I don't think that's being a harda$$, just a good businessman.

You don't get to drive the Ferrari home unless the dealer has been paid in full. (The Loan is from the bank, the dealer gets paid in full)


Jim Harvey
JHV Digital


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Ron Lindeboom
Re: client not paying - need advice!
on Aug 7, 2009 at 12:13:47 am

[Nick Griffin] "Am I in a distinct minority, working for many of the same people over and over again?"

Like you, Nick, we work with mostly the same people, over and over and we do not demand payment up front nor always at the completion of a job. Sometimes we do, depending on the job, but many times, we do not.

Also like you, all new accounts go on contract and pay either a substantial down payment or payment in full. On occasion, we have opted for a 1/3rd down, 1/3rd when job is half finished and the final 1/3rd upon completion and before delivery.

That places us in a distinct minority too, I guess.

;o)

Our best to you and Deb,

Ron & Kathlyn


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David Roth Weiss
Re: client not paying - need advice!
on Aug 6, 2009 at 8:56:20 pm

[Jim Harvey] " Small Claims court is just another way to lose an additional few thousand dollars. If you don't think that the time that you will spend chasing this client into SCC then you really don't belong in business in the first place."

Jim,

I really think that's overstated and it could be very easily misconstrued by any casual reader as a warning that a typical small claims case can easily backfire, costing the claimant thousands. I understand that your intent may be to make the point that your time is better spent pursuing new work, but I don't think that's the way most will be view your words.

And, with regard to most small claims suits most Cows might file, the fact is, it's very easy in most instances to prove a loss in court in our business simply by showing a judge the paper trail of communications between yourself and the client. Hopefully, no one here would go to court without an invoice and a few documents showing previous attempts to collect the debt. And, seldom does a countersuit in small claims court ever prevail, unless the deadbeat client could prove incompetence or negligence on the part of the filmmaker, which itself would typically require its own paper trail generated in advance of the claimant's attempt to collect the bad debt.

[Jim Harvey] "More importantly, what makes you think that you'll win? SCC is NOTORIOUS for delivering bad decisions and if your client has a more compelling story than yours, or a judge that is incompetent, you could find that YOU OWE HER. Don't laugh, it has happened more times that you could imagine. "

Again, I think this is overstated. As I stated before, the typical paper trail we all generate during our day to day communications most often clearly establishes that we have provided certain goods and/or services and that attempts to collect on all or part of an invoice has failed. Anyone who knowingly pursues a claim in court against a client who has established a paper trail of their own that would indicate the provider of services was incompetent or negligent would have to be a real dope, as that might actually provide cause for a valid counterclaim.

Sure, judges are human, and as humans they are prone to mistakes, and thus they might toss out your case, but judges are not stupid. Small claims judges know why they're in small claims court, and they are reviewed quite vigorously, as most aspire to higher judicial positions. So, no one should live in fear that they will take a big hit for filing a claim in small claims court against a person or company who clearly has failed to pay.

David



David Roth Weiss
Director/Editor
David Weiss Productions, Inc.
Los Angeles

POST-PRODUCTION WITHOUT THE USUAL INSANITY ™


A forum host of Creative COW's Apple Final Cut Pro, Business & Marketing, and Indie Film & Documentary forums.


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DeAnna Villalobos
Re: client not paying - need advice!
on Aug 6, 2009 at 9:34:19 pm

The latest update:

* I have quit calling her and am communicating only by email.
* I sent her an email today stating that due to the lack of response to my calls and offers of payment plans & other choices (collateral) : I have stopped all work on the project until payment arrangements are made.; I will be holding the final DVD until final payment is made.; She must immediately discontinue the use of all materials I have created for her in relation to the project until full payment is made. (dvd cover,label, graphics,etc as well as the DVD itself - even though it is really not 100% complete, she is still trying to sell it - I've checked her sales page)

* her latest response is that she is glad we are emailing because is shows she is responsive; she is glad she is paying me ($40 when she gets around to it) because it shows she is paying.... yada yada... and that she is coming up with a "document" for me.

She is stringing this out and being as smart as she can to cover her end. She is playing me like a fiddle.

My question is :
* Now that I have told her to Cease & Desist using all materials - what do I do to enforce it?
I don't think she will actually take anything down or stop using any materials, judging from her response.. (and lack thereof)
* will these little micro payments every so often help her in SCC if it goes that far? (i don't want it to, but we'll see)

Looks like i'm up the river on this one. What do you think?


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Kenton VanNatten
Re: client not paying - need advice!
on Aug 6, 2009 at 9:47:01 pm

"will these little micro payments every so often help her in SCC if it goes that far?"

Absolutely, and she probably knows that.

If she is paying "all that she can when she can" and can prove that, then I don't think that any judge will rule to make her pay more and more often.

I got behind on a car payment a number of years ago and couldn't come up with the minimum monthly payment for a few months - the collections/loan officer told me, "if all you have is $100 pay that because it shows that you're attempting to pay off the debt, they are less likely to go into collection/repossession if you can show that you've been attempting to make payments."

Kenton VanNatten
Avid Editor (for hire)


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David Roth Weiss
Re: client not paying - need advice!
on Aug 6, 2009 at 9:52:05 pm

[DeAnna Villalobos] "My question is :
* Now that I have told her to Cease & Desist using all materials - what do I do to enforce it?
I don't think she will actually take anything down or stop using any materials, judging from her response.. (and lack thereof) "


Too late now DeAnna, you should have asked this question before sending an open-ended threat. Threats made without a very clear and precise "call to action" are always ignored.

That stated, in a few days you can rectify that mistake by reissuing a registered hard copy letter, that gives the client exactly three days to respond or to pay in full before you file a civil action in court seeking the amount you're owed, plus treble damages, and a court order to cease and desist until all balances owing are received.

David Roth Weiss
Director/Editor
David Weiss Productions, Inc.
Los Angeles

POST-PRODUCTION WITHOUT THE USUAL INSANITY ™


A forum host of Creative COW's Apple Final Cut Pro, Business & Marketing, and Indie Film & Documentary forums.


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Jim Harvey
Re: client not paying - need advice!
on Aug 7, 2009 at 12:19:57 am

Ah David, you restore my faith in the human spirit, but not, unfortunately, in the judicial system. I'm not saying that every SCC case will result in an erroneous decision, but I AM saying that for $500.00, it's just not worth the time, most of the time. Perhaps the judges in LA are more "judicial" but I can assure you that having the proper paperwork is NOT a guarantee that you will prevail in New York State. We have worked with many lawyers who have lost cases that were "ironclad" with contracts and paper trails and the horror stories that come out of those hallowed halls are enough to make one think quite decidedly before attempting to bring a suit for a small amount of money. Additionally, what many people don't understand is that even if the decision goes to the plaintiff, that in itself is no guarantee of payment and the amount of time spent tracking down the money will STILL cost you more than you were originally owed. Maybe it's just that we don't have the time to diddle around with what we perceive will be a total waste of time (cynical New Yorkers and all), but I think that if you learn a good solid lesson by being burned for 1/2 a K, then it's money well spent.

Spending an entire day in SCC COSTS YOU more than you're likely to recover in the long run, which was my original point although I did not make it so succinctly.


Jim Harvey
JHV Digital


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David Roth Weiss
Re: client not paying - need advice!
on Aug 7, 2009 at 12:39:44 am

Jim,

I do think there is a cultural difference at play here between our two coasts that accounts for our differences on this matter. In New York, where the likes of Bernie Madoff are bound to win awards, and where going to court requires squeezing into a sardine can called a subway, small claims may be more of a nuisance than it's worth. Here in L.A., where you might meet a girl or land a gig on a new TV pilot wherever you go, small claims is a whole lot more enticing.

David

David Roth Weiss
Director/Editor
David Weiss Productions, Inc.
Los Angeles

POST-PRODUCTION WITHOUT THE USUAL INSANITY ™


A forum host of Creative COW's Apple Final Cut Pro, Business & Marketing, and Indie Film & Documentary forums.


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DeAnna Villalobos
Re: client not paying - need advice!
on Aug 7, 2009 at 12:54:03 am

Everyone has given such great thorough advice - thanks for your time & knowledge!

I am not all fired up on taking her to SCC, really... only if I really feel it will be beneficial..

BUT - my main concern now is that she is using everything related to the project that I created for her without paying for it all in full.

So, I am looking more into the C&D - what I need to do to get it enforced.. civil court and all.. if she pushes it that far.

Even if I don't get paid fully, she should not be using the DVD and all graphic materials.

Thanks again!
DeAnna


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Jim Harvey
Re: client not paying - need advice!
on Aug 7, 2009 at 12:54:29 am

BINGO! If I knew you could meet chicks at court, I'd have sued you long ago! Of course, Mrs. Harvey would then haul me into the BIG Courthouse and I'd be back at that underpass on the Cross Island Parkway....

Jim Harvey
JHV Digital


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