Legal Question in Business Law in California
Oral Contract and non-payment of invoices
My consulting firm worked on a project without a signed purchase order
for two months with a total of $30k in invoices. The client was fully
aware that we were proceeding with the project and met with us along
the way, including three design reviews. Now our invoices are over 120
days old, and they refuse to pay because we have no signed purchase
order.
At the end of the 1st, phase we had a design review and submitted the
an invoice, which was accepted and in process toward being paid (we
thought). We then commenced work on the next phase of the project. A
few days after we called to set up the design review at the end of this
phase, we received a call instructing us to stop work on the project
because there was no signed proposal. We went ahead and had the
design review (work was already complete) and delivered the work.
The client has agreed to pay one of the invoices ~$15k (which I did not
accept). Our hard costs on the project were ~$20k (which we've paid out
to our sub-contractors).
My questions are: Do we have a enforceable oral contract? What is the
best course of action at this point?
5 Answers from Attorneys
Re: Oral Contract and non-payment of invoices
You should be paid what you agreed. Do not allow this company to intimidate you. They accepted your work and finished product apparently. Retain counsel to assist and to communicate your resolve.
Re: Oral Contract and non-payment of invoices
You may have a valid enforeable oral contract. We need to review any memo's, confirming letters, etc. We handle cases throughout California. Please contact our law firm at 714 363 0220 so we can review your documentation.
Re: Oral Contract and non-payment of invoices
I would want to know more about the facts, particularly any discussions you and the client had about the cost of your services. From what you have said I think there is a very good chance you have an enforceable oral contract.
You should keep in mind that suing will require you to pay attorney fees and expenses, which may end up leaving you with little more (or maybe even less) than the $15,000 the client is now offering.
Re: Oral Contract and non-payment of invoices
In order to properly advise you I would like to review the documentation that you have to support your case. It is very important in a case such as this to bring in all correspondence to show the intent of the parties, etc. We are located in San Diego. Please feel free to contact me directly if you would like me to review your documents at 619.233.0900.
Sincerely,
Re: Oral Contract and non-payment of invoices
We are not supposed to be soliciting legal business on this website. Your contract, oral though it may be is enforceable, and you have every right to be paid the full amount of your invoice. Don't be intimidated into accepting less than you are entitled to. Your customer will respect you for standing up for your rights and probably opt to do more business with you. Go for it.
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