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Hello, my name is ***** ***** it is my pleasure to assist you with your question today. Are they a business client?
We are a building company and they are people who hired our company to build an extension for them
so are they private clients?
as in they are not a business?
No it was a private house extension
ok let me check a couple of things please
The legislation allowing for the claims of interest on late payments only applies if a business is pursuing another business for late payment. As you are pursuing a consumer, not a business, then you cannot rely on this. You may have had a clause in your contract which deals with late payments and the penalties of doing so but if you do not then the law does not allow you to charge that as you are dealing with a private customer, rather than a business. Also the rate the law allows you to claim at is fixed at 8% plus the Bank of England's current rate so it would be at 8.5% at present - you cannot just select to charge 10%. So in summary you must have a specific contractual clause allowing you to charge for late payments and if you do not, then you cannot use the legislation as it only applies between business to business debts
Thanks Ben, I thought that might be the case but my M.D. wanted me to check it out anyway.
you are welcome, hope it clarifies things for you
Unfortunately it does, it means we are going to court, our client is a solicitor who deals with company disputes
Sometimes you may find that once a claim is issued the other party reconsiders their position, if not then you may have to go through the claims process I'm afraid
He has already advised us he is going to counter sue us but hopefully he is not going to want to have to go to court in the first place. Again thanks for your help. Sandra
No problem, best of luck