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James Mather
James Mather,
Category: Law
Satisfied Customers: 22629
Experience:  Senior Partner at Berkson Wallace
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During 2012 we were working with a web development agency to

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During 2012 we were working with a web development agency to provide them with outsourced web development services. At present they have a number of invoices which are over 6 months overdue and they are claiming that the quotes provided were never approved, yet they still briefed us on their requirements, provided us with all the design assets and took delivery of the end result. Do we have a leg to stand on in pursuing for the debts?

The two key invoices which are in dispute were verbally approved by someone who is now an ex-employee of the agency in question.

There is no formal agreement in place between our two companies.
How much in total are the invoices for?
Customer: replied 5 years ago.

The total amount outstanding is £7218 (inc. VAT). This includes 2 invoices which they have confirmed as approved but have not yet paid.

The total value of the disputed invoices is £6138 (inc. VAT)

Are they using whatever you produced?

Do you have no TCs at all and no signed order?

They agree £1100 of what is invoiced?

Who authorised that?

Do they have the money or are they broke?

Customer: replied 5 years ago.

They have used the work for the necessary promotions / campaigns and have subsequentl taken the work down.
Out of naivety and the urgency of work at the time no contract or t&cd were signed; only an NDA.


The £1080 are approved but unpaid based on bonuses achieved on another project.

They are very much still in business and are growing.

I have done several sets of terms and conditions for web
building companies and IT support companies and they are essential to prevent
the kind of problem that you are having. To get a solicitor to draft them
properly to cover all the foibles of a web design company, expect to pay
probably a couple of grand. As you have now found out, it would have been money
well spent.

I assume that the bonuses achieved on the other project
are not documented either, but you do not mention that being in dispute.

Under the Sale of Goods and Services Act you are entitled
to be paid a reasonable price for a job and whether the price you have charged
is reasonable would come down to what a court would think.

They would need to produce some quotes, from other
companies, showing that your job was overpriced. It seems however, that they are
not disputing the price they are disputing that the work was ever approved to
be done at all. They are using the fact that the employee no longer works
there. Now, whilst they may think they are being cute, it doesn't really help

You are entitled to believe that anyone in their company
that gives you the go-ahead to do a particular job has the authority to do so.
They have what is known as "implied authority".

I assume that they are not disputing that you got the
go-ahead, they are simply disputing the authority of the employee to give you
that go-ahead

In addition, it appears that the company gave you every
assistance to complete the job which they would not have done if the work had
not been approved. It also appears that they used the service (although I do
not know for how long they used it). It may be that it did not produce the
result that they wanted it to produce and as a result they are looking for
excuses not to pay you.

You are entitled to add on interest at 8% per annum
calculated monthly, per month under the late payment of commercial debts
(interest) act and a fixed payment of £70 under the late payment of commercial
debts regulations, provided your terms and conditions do not mention any late
payment penalties. Here is a little bit of reading for you

ultimately, if they do not pay you, you will have no
alternative but to take them to court.

As the amount they owe you is over £5000. It will not be
Small Claims Court and so there is a cost, risk if you lose because the judge
preferred their version of events to yours. You can always ask for the former
employee to come as a witness, although if he left on good terms. He may be
reluctant to do so. If you left on bad terms, he may well give you a superb
witness evidence.

If you can manage to negotiate the amount that they owe
you to under £5000, you can then generally take what is on offer and then sue
for the balance on the basis that you accepted the original sum under
protest/duress. There is a way that they can thwart you suing for the balance, but
the chances of them knowing the legal loophole (unless they asked me or have
legal knowledge) is unlikely.

Can I help further?

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The thread remains open for us to continue this exchange

James Mather and other Law Specialists are ready to help you
Customer: replied 5 years ago.

Thank you for the detailed response.


In October 2012, I asked the ex-employee for his take on the situation and this was his response:


"I do remember receiving invoices for the work you did for us

I would reccomend sending through the invoices again so that Gareth has a copy and then directing him through to our correspondence on my old machine for the outstanding invoices to be paid.

I hope this enables you to get this resolved, all of these items were within our agreed budgets.

I do not currently have any other ties with Standout, however I would reccomend that course of action."


If the ex-employee is not willing to speak out against his employer any further how much weight would this hold?

I think that evidence is about as good as you will get if
he is not prepared to go to court.

I assume that when he's sent that email or letter, he was
not already serving his notice to leave.

I think that evidence is about as good as you will get if
he is not prepared to go to court.

I assume that when he's sent that email or letter, he was
not already serving his notice to leave.

There is no harm in letting the company have a copy of
that correspondence and telling them that you will produce this in court if
they defend any action you bring.

You will have to produce it at some time in any event

Customer: replied 5 years ago.

The employee sent me the message via Facebook after he had already left the company and had served his notice.

The message has also already been shared with the agency in question but they did not specifically respond to it.

I attempted to reach out to the ex-employee again today but no response as yet.

Thank you. It is still extremely useful.

Don't worry about the fact that it was on Facebook
because there is, I assume, no issue that he wrote it.

Thank you. It is still extremely useful.

Don't worry about the fact that it was on Facebook
because there is, I assume, no issue that he wrote it.

I assume that he had not handed his notice in when he
gave you the order was not feeling particularly disgruntled with the employer.

Even if that were the case, I presume it was the employer
that gave you all the documentation you need to finish the job.

Customer: replied 5 years ago.

Yes correct - the client and the said employee provided me with all the documentation and associated designs. I also have the email threads from their project management system which show the various quotes from myself and then the subsequent messages from them with documentation & designs to assist with the completion of work.

A number of people were included in these on going conversation threads and it is clearly shown at the bottom of each of these conversations who was included. The client who is denying he provided approval was always included in all project correspondence carried out via this system.

The evidence gets better. I wouldnt be hanging around wasting time on copious letters though
Customer: replied 5 years ago.

Under The Late Payment of Commercial Debts Regulations can I give them a strict deadline to respond to me on how they plan on proceeding with this matter and another deadline to make the due payment? What would be a reasonable timeframe?

The timescale for interest to kick in and for the single
payment penalty to kick in is as soon as the payment is one day overdue.

However, it appears that you have agreed no payment terms,
so I would tell them that you are charging the single payment now, and interest
at 8% per annum from the date the invoice was due which was 30 days after the
end of the month that you submitted it.

To be frank, it is not worth arguing over whether the
date has passed or not, because in the whole scale of things it is a nominal
sum in any event. Let the court decide whether the dates have come or gone.

You need to make sure that when you do terms and
conditions, the time given to pay an invoice is laid out quite clearly

Customer: replied 5 years ago.

All invoices had 30 day payment terms clearly noted.

All subsequent clients have had T&C / Agreements in place and signed.

This was an unfortunate experience and the lessons have definitely been learnt!

Excellent. That is the applicable date then...BUT BUT BUT...

BUT it is debatable if you can rely on it if it is on the invoice at that is post contractual UNLESS you had done lots of work for them previously.

You are getting into lots of different areas of law including whether terms actually apply and have been "incorporated".

If this is 1st lot of jobs, the TCs on the invoice are not enforceable. I hope you dont rely on those TCs on the invoice or delivery note for other customers

Customer: replied 5 years ago.

Total invoices to this client were over £20k; all bar the £7k have been paid. When the engagement began they were fairly good at making payment and then things began to go sour.

And no we now have specfic T&C documents/agreements in place with other clients which are used to backup invoices and delivery.

Excellent. In that case as you appear to have a "regular and consistent course of dealing" previously, you can rely on those terms on invoices.

Golden rule: No signature accepting TC, no start work