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How much is worth suing for?
Thread poster: Fan Gao

Fan Gao
Australia
Local time: 13:19
Member (2006)
English to Chinese
+ ...
Jan 13, 2007

This weekend's poll on the considered importance of payment orders led me to think of this topic. I have a few questions so I'll just list them:

1) Have you ever sued a client and won?

2) Have you ever sued a client and lost?

3) Have you ever begun legal proceedings but then given up because of the cost or stress involved?

4) Have you thought about taking legal action but then not bothered? Why?

5) I guess this depends on the economy of the country you live in, but what sum would have to be involved for you to consider taking legal action?

Touch wood and I'm probably tempting fate here, but so far we have not come across a non-payer. I just can't imagine ever being in the position where taking legal action would be an option.

There seem to be a lot of messages posted by people looking for advice on how to take legal action against a client in this country or that, but I think it would have to be a huge amount involved to go to that extreme.

Surely if you're taking on a large project over a long period of time then you'd ask for an advance or at the very least staggered payments after an agreed payment schedule had been arranged?

Wouldn't the cost of legal action far outweigh the sum involved?

I know there's a case for sticking to your principles and making an example of the bad client, but would it really be worth it?

I'd be interested to read about your views on the subject and any experience you've had.

Here's to 2007 and full, prompt payments for everyone....well everyone that does deserve paying that is:)

Mark


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xxxIreneN
United States
Local time: 21:19
English to Russian
+ ...
Well... Jan 13, 2007

If you can prove moral damages worth at least quarter of a million on top of all, and/or if the amount in question is tempting enough, and the case merits are solid enough for a lawyer to go for a kill to get his 30% without payment upfront - maybe... BTW, this way the lawyer will definitely be working harder and returning your phone calls faster:-)

Otherwise I would not even dream of it...

I guess no principles will be worth it - it's too easy to lose the rest of them and the entire trust in the mankind (together with your last pants) in the course of any legal proceedings:-). Stay well for your family, this is an important principle too!

Actually, I know the case when the translator got a quick 30K settlement for being fired from the in-house project. He was not even a staff employee. Unfortunately for the clent, there was a catch. The client slipped really bad, it only took a few written words:-), and from the standpoint of logic and simple human truth this was the case where I would be a 100% on a clients' side. Speaking of truth and justice...

[Edited at 2007-01-13 17:53]


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Sergei Tumanov  Identity Verified
Local time: 04:19
English to Russian
+ ...
I think it's a chinese saying ... Jan 13, 2007

To go to court is like giving away a cow to return a rabbit

++
I share this opinion.


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Lawyer-Linguist  Identity Verified
Portugal
Local time: 02:19
Dutch to English
+ ...
From a lawyer's perspective ..... Jan 14, 2007

Hi Mark,


1) Yes, legal proceedings were instituted but never got as far as the Court steps. Debtor paid in full with interest and my own legal costs to that point. Admittedly, being a lawyer and knowing my way round the system helped.

2) No

3) No

4) No

5) Any sum, other than small change.

Many countries have small-claims/fast track procedures for small amounts. I personally don't issue invoices for very small amounts as I bill each client monthly (and generally don't do once-off jobs), but anything in excess of a couple of hundred euros is worth pursuing through these channels.

Court costs in these matters are minimal, neither party is allowed legal representation (normally) which cuts down on the legal costs considerably and the presiding officers are often lawyers, law lecturers etc who also hold down full-time jobs and want their case-list cleared. There normally isn't postponement after postponement.

The rules of evidence also aren't as strict, equity and fairness (in addition to a strict interpretation of the law) are often taken into consideration and as the procedure is specifically aimed at the unassisted layman, it isn't as complicated (and so shouldn't be intimidating or stressful).

Another (somewhat off-topic) issue is many translators seem to spread themselves too thin financially, becoming too reliant on individual payments. I realise it's not easy in some cases, (especially if you are starting out) but ideally there should be some buffer to fall back on for when debtors are dragging their heels a bit.


[Edited at 2007-01-14 11:35]


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Clare Barnes  Identity Verified
Sweden
Local time: 03:19
Swedish to English
+ ...
Sort of... Jan 14, 2007

I'm currently involved in a legal case with a notorious Swedish-based non-payer... more than a few people on ProZ have come across him and his business dealings. He doesn't owe me any money and I've never worked for him, but after a posting on the forums about debt recovery procedures I was contacted by translators outside of Sweden asking for help with getting ther money back.

One such case has gone so far that it has gone all the way to court - total cost so far €60 (I believe, I didn't pay it as it's not my debt), which is the registration fee for the Swedish Enforcement Administration. After the debtor then rejected the claim the claimant decided to go to court, which is the natural and almost automatic next stage in the process, and I said I'd help - all the court case has cost me so far is the price of the stamps.

I don't have legal training, but the Swedish system is not particularly intimidating and there is plenty of help available for those who know where to ask. I personally would go to court for, as L-L says, anything over a couple of hundred Euros - at least within Sweden where I know my way around the system and have some grasp of how the law works.

We haven't yet had a decision in the case I've referred to here, so we'll see - it's for €3000+ so it's definitely worth it for the translator who is waiting for her money.


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xxxIreneN
United States
Local time: 21:19
English to Russian
+ ...
Preventive measures are cheaper Jan 14, 2007

Word-of-mouth and now BB.

I am having hard time understanding how is it possible to bring the situation to the point of a potential loss of thousands of dollars.

Investigate your business partners or risk a couple of hundred at most.


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Lawyer-Linguist  Identity Verified
Portugal
Local time: 02:19
Dutch to English
+ ...
Risk management vs. when the proverbial **** hits the fan Jan 14, 2007

IreneN wrote:

Word-of-mouth and now BB.

I am having hard time understanding how is it possible to bring the situation to the point of a potential loss of thousands of dollars.

Investigate your business partners or risk a couple of hundred at most.



Couldn't agree with you more about risk management and prevention being better than cure but the questions posed relate to when the situation actually does arise - anyhow, even the best/most reliable of clients can run into difficulty.

No, I wouldn't dream of extending credit for thousands to an unknown entity or one with a poor credit rating either.

However, if you're translating 60,000 - 80,000 words a month or more (at Northern European rates), it's quite easy to have a single agency owe you a couple of thousand euros for individual jobs completed over the past month, without having all your eggs in one basket.

If they've faithfully paid you over the past few years on a monthly basis, have an excellent BB rating and something now unexpectedly goes wrong (e.g. their new bookkeeper misappropriates funds. makes a blunder or there is a shareholders' dispute etc), it's hardly a question of poor risk management.

It's a question of what to do next .... which may or may not include the need for legal action (eventually).

If I had to invoice clients separately for every job delivered, for example, I'd be issuing 5 invoices tomorrow alone, 2 of which would be to the same client. I'd simply be spending too much time monitoring my bank account and following up separate payments.

Invoicing monthly is quite normal (this side of the Atlantic at least) for regular clients.

It's also why I mentioned the need above, especially as a freelancer not to spread oneself too thinly financially and make sure you've got enough savings to cover unexpected delays.



[Edited at 2007-01-14 14:48]


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Sergei Tumanov  Identity Verified
Local time: 04:19
English to Russian
+ ...
I vote for preliminary action Jan 14, 2007

1. There is such good thing as a "credit limit".
If a client reaches it , no more translation before outstandings are settled.
For example, you did one translation worth 150 usd, and the second one worth 200 usd for a client. If your invoice is not paid, no more translation for this very client.

My personal credit limit for clients - 200 euro. For well known clients a credit limit size usually bigger.

2. You can say that sometimes big money are at stake and there is one text/job, which cannot be split and respectively big time needed. Two or three thousand, even more. That is one job exceeds the credit limit immensely.

I see no problem. If our colleague says that court procedures are reasonable to recover amounts starting from 200 euro/usd, I wonder why don't we use letters of credit? Especially for translations worth of several thousands?

[Edited at 2007-01-14 15:04]


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Lawyer-Linguist  Identity Verified
Portugal
Local time: 02:19
Dutch to English
+ ...
Different markets, different rules Jan 14, 2007

Sergei Tumanov wrote:

My personal credit limit for clients - 200 euro. For well known clients a credit limit size usually bigger.



Markets and business customs differ.

Personally, if I had to impose a credit limit of 200 euro per client before starting the next job, it wouldn't get me from one day to the next and often not through one and the same job.

Yes, risk management is vital (adapted to your specific market) but the question here was not about the prevention aspect, it was about the cure, when the need arises.

Just for the sake of clarity, I was referring solely to small claims/fast track procedures only with regard to claims of a couple of hundred euros.






[Edited at 2007-01-14 19:57]


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Harry Bornemann  Identity Verified
Mexico
English to German
+ ...
The safest way to avoid a legal proceeding is to thoroughly prepare it Jan 14, 2007

I have never had to sue a translation client, but in one case at the beginning of my career, when I was not choosy enough concerning clients, I had to prepare legal proceedings.

However, at the moment when everything was ready to be sent to a lawyer, the client gave in and paid.

When it comes to legal proceedings, there is no such thing as 'small amounts', because they will quickly increase by the fees of the lawyers and the court(s). But this same effect which makes me hesitate to sue will make my opponent hesitate to get sued, hence on balance it has not much influence on the chances for success.

For the decision whether to sue or to forget, it is more important for me how angry I am with the behaviour of an opponent. If he makes me angry enough, the 'risk' will rather be an 'investment' and the 'stress' will be 'fun' to me.
(Presumed that I have good evidence.)

Of course, life is much more comfortable without fighting, but I think you have to be prepared for it to make sure it won't happen.

(I don't think I am superstitious, but I still got the impression: The things for which you are well prepared will never happen.)


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ViktoriaG  Identity Verified
Canada
Local time: 22:19
English to French
+ ...
Preventive measures Jan 15, 2007

Why is it that translators in general don't ask for money up front for large contracts? If you work on a contract worth $3000 and it will take you a month to complete the contract, why not ask to be paid weekly? At the end of the first week, you invoice for the work delivered and you give them, let's say, 10 days to pay (a cheque in the mail can get to pretty much any part of the world within a week). If you don't get your cheque, you don't deliver anything until you get paid. In the meantime, the clock is ticking for the client - they will want to pay you fast.

Also, with clients you don't know yet, why don't translators simply ask to be paid up front, especially for smaller contracts?

This has been discussed so many times and it's been recommended all over the place, but the truth is, those who use these methods are few and far between - and because we don't all generally use these means, most clients say they've never heard of this before and you have to literally sell the idea to them.


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Sergei Tumanov  Identity Verified
Local time: 04:19
English to Russian
+ ...
clients will not buy your service Jan 15, 2007

Viktoria Gimbe wrote:

Why is it that translators in general don't ask for money up front for large contracts? ...


You will immediately get a reply that no one serious company in business acts like this (pays in advance).
That it is a custom of trade to buy on credit....

They teach it in business schools. And companies-clients of translators are usually full of business school graduates :0(

[Edited at 2007-01-15 22:10]


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