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JGM
JGM, Solicitor
Category: Law
Satisfied Customers: 11135
Experience:  30 years as a practising solicitor.
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I have been Factoring my invoices a few

Resolved Question:

Hello,
I have been Factoring my invoices for quite a few years now. The service deteriorated really badly and I cancelled the agreement as of 7 Apr-16 and settled the ledger.Now a customer has paid the Factoring Company wrongly and the Factoring Company is refusing to release the funds to me unless I sign a satisfaction letter. I am not happy to do that as there are pending issues with the ledger. Mainly customers claiming that they paid the Factoring Company but the funds are not allocated.
Any advice would be appreciated.
Submitted: 1 year ago.
Category: Law
Expert:  JGM replied 1 year ago.
Did you terminate in accordance with the provisions of the agreement you had with the factoring company, eg, give correct written notice etc? If so they can't withhold funds from you and blackmail you into signing a satisfaction letter. You can sue them for the funds due to you.
Customer: replied 1 year ago.
Yes the termination was conducted as they wanted and I paid the minimum fees required under the contract for the 3 months notice period.They are well aware that I am very dissatisfied with the service as they weren't sending statements to my customers and they weren't chasing them for overdue invoices but they were more than happy to charge me refactoring charges for all the customers that weren't paying because there was no one to chase them..I think they are worried that I will sue them somehow and that's why they're trying to blackmail me into signing the satisfaction document.In order to sue them, do I start a court case or make a complaint to the ombudsman?
Expert:  JGM replied 1 year ago.
To sue them you have to go to court. However from your narrative, perhaps a letter from your ok icitor would suffice as they have no leg to stand on asking you to sign a satisfaction letter.
Customer: replied 1 year ago.
Thanks for this, just one last confirmation if you don't mind?I have detailed below the body of the email that the sent me followed by the text of the letter that they want me to sign before releasing any of my money currently held.The body of the email reads:"Please arrange for the attached Accord and Satisfaction letters to be executed and emailed across.Upon receipt of the attached letters we will formally write to you to confirm the book debts have been legally reassigned to Ontime Logistics Europe Ltd, we will request for Companies House to remove our Debenture Charge and we will confirm in writing the Personal Guarantee given to support the facility for the above named company have been fully satisfied.The trust account that was set up for the company normally stays open for a period of 1 month after the reassignment confirmation is issued by us, if you would like for this trust account to be closed immediately please do let me know and I will get this arranged.Any debtor payments we receive will be transferred via BACS payments, as long as we have cleared funds and you have provided a remittance or a copy of the invoice relating to the payment received prior to the transfer being made for audit trail purposes."The letter that they want me to sign reads:"Accord and SatisfactionWe hereby acknowledge and confirm that on reassignment of the book debts of Ontime Logistics Europe Ltd1) Bibby Factors Ltd Have fully discharged all its obligations to Ontime Logistics Europe Ltd of the Factoring Agreement.
2) There are no outstanding claims against Bibby Factors Ltd and any further claims are waived.Do they have the right to hold my money until I sign this? Do I have anything to fear? Would you be in a position to write to them? Many thanks
Expert:  JGM replied 1 year ago.
Unless the original factoring agreement has something about this in it they have no locus to refuse to pay you unless you sign this document. Clearly they want a clean break. If you do think you have a financial claim against then then you can't sign this. However, if you are just trying to close the factoring agreement down and reclaim any monies due, then there is probably no prejudice in you signing it. I hope that helps. Please leave a positive rating so that I am credited for my time.
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