By: Sibila D. Hujic
When do your credit card bills arrive? How about your telephone bill? There is a sense of urgency that is created when you receive your bill the same time every month. If my credit card bills arrived sporadically every few months or twice in one month, regardless of the 30 day due time, I would just let it sit and wait for the reminder notice. If I am getting a credit card at different times each month or maybe every few months, I might be tempted to wait and see how long it will take for me to receive a reminder phone call or a notice. Getting paid is important, I have never had an attorney disagree with me, however an average firm takes 180 days from the date of service to receive payment. Leaving uncollected money on the table is much more common than you think.
First and for most, make sure that your engagement letter is clear regarding billing and payment. I even suggest highlighting from time to time. Next, bill promptly, no exceptions. A bill should arrive at the same time every month, just like a credit card bill. Even if the client does not owe anything, a bill should be sent with zero monies owed. When a bill shows up at the same time every month the sense of urgency to make sure the bill is paid will increase. Three to four days before before payment is due have an employee or a collections company call as a friendly reminder, and make sure that they received the bill. If the bill wasn’t received fax or email. Make sure that the calls come at the same time every time. When your phone bill isn’t paid, you will receive a phone call asking for payment, you will receive the phone call at the same time. Stay consistent. NEVER allow unpaid bills to accumulate. If a client is unresponsive, send a letter:Dear [Mr./Mrs./Ms./Dr.] [CLIENT'S LAST NAME]: Re: Life can be so hectic at times that even our habits fall by the wayside. Many times, people call with requests, and we must drop everything to satisfy our obligations. Please let this serve as a reminder that we are awaiting receipt of this month’s payment in regard to the above. If this letter crossed paths with your check, please accept my apologies for this friendly reminder. Thank you for your assistance. Sincerely yours,
Continue to send letters each month thereafter. Assign a person or company to follow up consistently. In my experience the consistent phone calls and letters result in payment on average within three months, however there will be times where clients will refuse to pay. As I am sure you know suing a client for unpaid fees will increase the risk of a legal malpractice counterclaim or an ethical grievance, the best thing to do is cut your loses and move on. Make good choices about whom you sue and when, sometimes it is just not worth the headache. If the amount of unpaid bills is too large to walk away, proceed with caution.