Late Payment Demands vs Letter Before Action

[doodab]

OK, I am expecting a payment on Thursday and I am fairly sure the agency in question has some cashflow issues so I don't want to beat about the bush. Is it acceptable to send a "letter before action" demanding payment and threatening legal action and so on straight away or must one send a fluffier late payment demand first? Something along the lines of

Letter Before Action

Our invoice XXXX is now overdue for payment.

Please pay the attached invoice within seven days or legal action will be taken, without further notice, to recover the full outstanding amount.

Please note that we have not yet levied any late payment charges under the Late Payment of Commercial Debts (Interest) Act 1998 as supplemented and amended by the Commercial Debt Regulations 2002”. Should payment in full not be received within seven days we will add these charges to your account.

Please note that our company has a policy of ceasing supplies of goods and/or services to organisations with an account more than 7 days overdue.

And then presuming non payment, follow up with a final letter with interest + compensation added to the bill and either instruct a solicitor or sell it to a debt collection agency. Also would I be correct in thinking that this covers me for withdrawing services in the event they fail to cough up on time.

either party may terminate the contract by Immediate Notice, if the other is in material breach of contract, or is in breach of contract and fails to remedy the breach within fourteen days of being required in writing to do so, or if the other becomes insolvent or ceases to carry on business, or if any preliminary step is taken towards the other’s liquidation winding up receivership or administration (other than for bona fide reconstruction or amalgamation).

[SueEllen]

When you send someone a "Letter Before Action" it's normal to have shown either:
1. You have tried to sort the issue out before going to court, OR
2. They are a persistent offender, you have complaint before and this is the final straw.

Due to the fact court action takes a while I would use a debt collector as you are more likely to get your money before they go bust.

So ideally our first step would be to send them an "Overdrawn Account" notice with lots of red print on it giving them 7 days to pay. Your next step would be your "Letter Before Action" in it demanding payment and telling them you will withdraw your services if you aren't paid within 14 days.

If you haven't opted-out then the agency has no excuse not to pay you.

[Antman]

Who's the agency?

[doodab]

Who's the agency?

I won't say at this stage, as they have actually been paying people and they haven't actually failed to pay me yet.

I am just on my guard because they are new, small, and owed a lot of money for work done months ago because of some bureaucratic complications with unsigned time sheets that were requested after the work was completed. I have checked this story out with other contractors and it holds water, so it seems that their end customer is using it as an excuse to delay payment. They actually suggested they might have trouble paying me on time because of this.

I now have a personal guarantee from a director that I will be paid, and agreement to 14 day payment terms for the work I am currently doing. The previous payment is due by the end of this week so I will know if things are going pear shaped then.