Customer seeking refund

Pinkmoon19

Hi,

Really hoping someone can give me some advice. Phew, don't even know where to start, going to try and keep this concise.

I've just recently started my own business. In early June I received an inquiry from someone seeking some design work for a document which they intended to be printed as a book.

In the beginning, it started out as a set number of pages and we agreed on a set price for this project. The client then requested 3 additional items to be completed. At this point, we agreed that the project was much larger than expected and the client asked could they book me for a number of hours every day on a long-term basis and forward each day's work to them for review. Each day the client was satisfied with the work I sent.

As per this new agreement we agreed to switch from a project price to an hourly rate to be paid on a weekly basis. The client was sent an invoice for all work completed up to this point. This is where the problems started as payment was split into parts and paid over a number of weeks with numerous excuses given to me to explain the late payment. I should have stopped at this point but as a new business owner, I was eager to earn some money.

For a number of weeks after this I continued with the project, stopping on 2 separate occasions due to late payment. 2 weeks ago I asked the client to send me her printer specifications so I could finish the document accordingly.

I did not receive these specifications until 10 days later. At this point, 8 days of work had been carried out. When I received the specifications the document I had prepared required several amendments. The majority of these were done but I, unfortunately, could not get some of the imagery up to the correct resolution for print. For clarity, the client supplied the imagery that is falling below the printer specifications.

At this point, I had been paid 50% of the balance now due. Due to this, the number of amendments outstanding on the document and the volume of irate calls, messages and emails I was receiving from the client I decided to end the contract.

Understandably the client is frustrated as they have an incomplete document with flaws. I am frustrated as I haven't been paid for 8 days work. The client has sent me a series of emails demanding a full refund but I feel I owe her nothing as she hasn't paid for the work in question, just the work prior. The latest email she sent me is threatening legal action and informing me I will be receiving solicitors letter requesting a full refund.

I am trying to be as objective as possible and the questions I pose are:

1) Should I just issue a refund and put the whole thing behind me

2) If I challenged this would I have a case, to be clear there are flaws in my work and I accept that which is why I am not pursuing the balance owed to me?

3) Should I pursue the portion of the balance owed to me for all work carried out up until the point I received the printer specifications.

All advice would be so greatly appreciated.
Thank you!

fritzelly

Best advice is to compromise and finish the work for the agreed fee

You have an agreement by which I assume you mean contract so what does the contract say about non payment/unfinished work/termination of contract?

Pinkmoon19

fritzelly wrote: »

Best advice is to compromise and finish the work for the agreed fee

You have an agreement by which I assume you mean contract so what does the contract say about non payment/unfinished work?

That's good advice Fritzelly. Thank you. I would be more than happy to offer that but I don't think the client would go for it and I would be worried that if I did take the time to complete the work that I wouldn't be paid. Her track history isn't good. Is there a way to protect myself?

Unfortunately, in our naivety, neither of us discussed non-payment / unfinished work when we made out the agreement.

drunkmonkey

Don't mind anyone using legal action like that, there full of hot air, try and agree what you need to finish the job correctly from them and agree payment terms. Try not to lose them as they do appear to be ok as in giving you work and money has come through.
Not all customers are simple you just have to bite your lip now and again, don't play email tennis go look them in the eye and square things up.

fritzelly

Pinkmoon19 wrote: »

That's good advice Fritzelly. Thank you. I would be more than happy to offer that but I don't think the client would go for it and I would be worried that if I did take the time to complete the work that I wouldn't be paid. Her track history isn't good. Is there a way to protect myself?

Unfortunately, in our naivety, neither of us discussed non-payment / unfinished work when we made out the agreement.

Sometimes you have to take the misses with the hits, as you say most of the work is done so this is just the finishing touches (unless I read it wrong)

Your contract should have clearly defined resolutions to non payment, work issues etc. That will be your strong point if it goes to court over non payment

Pinkmoon19

Completely agree with you, I would much prefer to settle this in person and did offer to meet the client after our first payment disagreement but she declined, saying she was too busy.

drunkmonkey wrote: »

don't play email tennis go look them in the eye and square things up.

@Fritzkelly, "so this is just the finishing touches (unless I read it wrong)". You didn't read it wrong, there is one remaining task to complete but the images in question do add up to a sizeable portion of the complete project. In order to fix this, I would need to purchase a more sophisticated software than the one I currently use. This would set me back approx €1500, or alternatively, I could pay someone else approx €200 to bring it up to spec. The latter I think could be a good option and again something I would be happy to do if I were confident about payment. What do you reckon is the best way to approach this?

fritzelly

Does the software not have a trial?

I advise to just finish the job as long as you are not physically out of pocket - so if that €200 can be born out of what you have already been paid and still leave you something for your time then do it and take it as a lesson that:
1. You need a contract
2. You need a contract
3. See previous points.

Will avoid these headaches in the future so you don't have to start negotiating halfway thru.
Chances are you will be paid but first step is contact and say look I'm new to this, we should have had a better terms of contract in place, I don't want to leave you high and dry etc etc.

Pinkmoon19

Really appreciate you advice fritzelly. Thanks for taking the time! Believe me, I have totally learned my lesson regarding contracts. If only I could roll back the time

fritzelly

I'm curious what the software is that Photoshop wouldn't be able to do?

Glass fused light

Pinkmoon19 wrote: »

Completely agree with you, I would much prefer to settle this in person and did offer to meet the client after our first payment disagreement but she declined, saying she was too busy.

Being too busy to resolve payment would be a big red flag on the clients willingness to pay what's owed while still wanting the finished product. The wanting a refund and the threats of a solicitor could indictate the client has form for this carry on. If you have other projects but are going to do any more work make sure that all the current outstanding monies are paid for first. Dont hand over the printers version without an agreement and lodged funds or you are unlikley to be paid as all. is the client ever likely to be a repeat client.

Pinkmoon19 wrote: »

@Fritzkelly, "so this is just the finishing touches (unless I read it wrong)". You didn't read it wrong, there is one remaining task to complete but the images in question do add up to a sizeable portion of the complete project. In order to fix this, I would need to purchase a more sophisticated software than the one I currently use. This would set me back approx €1500, or alternatively, I could pay someone else approx €200 to bring it up to spec. The latter I think could be a good option and again something I would be happy to do if I were confident about payment. What do you reckon is the best way to approach this?

Ae per Fritzkelly said you need a expanded contract which covers all eventualities that you can think of and using a solicitor who works in the area would be a good long term investment.
Like a provision for moving from a fixed fee to the hourly rate etc.
Payment terms should be clearly stated and you should retain the IP to work product until paid in full eg in this case you would have the right to contact the printer directly and inform them that they had no right to use your work product if not paid.
If the client is supplying product and it needs adjustment this is a separate term and a separate pricing ie to cover the outside contractor

rock22

Pinkmoon19 wrote: »

Completely agree with you, I would much prefer to settle this in person and did offer to meet the client after our first payment disagreement but she declined, saying she was too busy.

@Fritzkelly, "so this is just the finishing touches (unless I read it wrong)". You didn't read it wrong, there is one remaining task to complete but the images in question do add up to a sizeable portion of the complete project. In order to fix this, I would need to purchase a more sophisticated software than the one I currently use. This would set me back approx €1500, or alternatively, I could pay someone else approx €200 to bring it up to spec. The latter I think could be a good option and again something I would be happy to do if I were confident about payment. What do you reckon is the best way to approach this?

Why not return the images , as being unsuitable, and ask the client to supply you with correct resolution images. Have you explained that the images are unsuitable?
I assume the client feels that they have paid a substantial amount and , unless you agree to finish the project, will have nothing to show for it. For reputation , it might be better to try and agree some way forward with the client.

Pinkmoon19

Ok so, this is a little besides the point but I have been doing some research on this client's company and found out that they have a two year suspended sentence for stealing €XXX,XXX from a former business they worked in. While this has nothing to do with my situation with this person I think it does point towards the type of person they are.

fritzelly

Well unless they are gonna give you full payment up front to finish it I would probably cut my losses

Pinkmoon19

Absolutely.

fritzelly wrote: »

Well unless they are gonna give you full payment up front to finish it I would probably cut my losses

On further research, the person actually stole €XXX<XXX to repay an earlier theft of €XX,XXX and it appears they avoided prison citing mental illness. With this new knowledge and given the number of times the client lied to me about payment and even sent me a fake remittance advice form I think I will be steering well clear. Unbelievable really that after everything they have been through that they are still dishonest about money.

Glass fused light

Pinkmoon19 wrote: »

On further research, the person actually stole €XXX,XXX to repay an earlier theft of €XX,XXX and it appears they avoided prison citing mental illness. With this new knowledge and given the number of times the client lied to me about payment and even sent me a fake remittance advice form I think I will be steering well clear. Unbelievable really that after everything they have been through that they are still dishonest about money.

a leopard can not change its spots, this (ex-) client will always be dishonest.

As you are starting off in business join as many business networking groups as possible, there is no better credit control starting point than being able to phone a contact to get a character reference for a new client. And google and the CRO are good research tools.