Legal Question in Credit and Debt Law in Texas
Collection Fees
If I have a client sign an agreement for services and
one of the conditions states that 33% but no more than
33% will be added to any unpaid balance if turned over
to a collection company and the collection company
adds a % fee without our knowledge, which inturn
exceeds what was stated on agreement, Can client file
a law suit? and if so, can we file suit with collection
agency for wrongful collection? This is pertains to
business to business debt collection.
1 Answer from Attorneys
Re: Collection Fees
Did you add more than 33% to the outstanding invoice? If not, then you've not breached your contract. Did you warn the collection agency that you had a cap on the collection? If you did, they may be in the wrong.
Usually, though, the agency is not bound by your cap on the debt; they just can't demand more than your stated amount for repayment but attorney fees, etc. are added to that if it goes to litigation.
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