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Roger
Roger, Attorney
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Im a small business owner that builds industrial control panels.

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I'm a small business owner that builds industrial control panels. I built a control panel for a company (A) in Oklahoma and delivered it on 8/15/10 with terms of net 30. I received a check for 20% ($7,960)of the estimate ($26,536). There was no purchase order issued to me, no formal contract, & no specification. I was unable to complete the programming portion of the project ($2,800) due to there being a possible patent infringement with an existing customer of mine. My existing customer (B) informed me that if I continued work on this project (happens to be a disgruntled former employee) they would pursue me in court for working on a patented piece of equipment. I had no idea that Company A was building a patent infringing piece of equipment. I immediately let Company A know that I could no longer continue on the project for legal reasons. I had already shipped the control panel to them (Company A) and performed 4 days of remote debugging (I'm located in Wisconsin). I referred them onto another programmer so they could continue with the project. I deducted any programming costs associated with the control panel I delivered. My second invoice for $15,699.13 was delivered on 09/03/10. Company A has ignored all emails, phone calls and text messages until yesterday about the past due invoice. Company A indicated they were holding payment until the whole system that the control was operating was running 100%. They also required me to sign a lien waiver which I did (waived after deposit of final payment). They've been using the product I supplied on the system. Do I have any legal action against them? Can I put a lien on my equipment? What's the easiest and fastest way to receive payment?
Submitted: 4 years ago.
Category: Business Law
Expert:  Roger replied 4 years ago.

You have a right to recover payment for the work you performed. However, if the company incurred additional expense as a result of your backing out of the rest of the agreement, the company could sue you as well. The most common grounds for suit would be that you agreed to do this portion of the contract for $5000 (example) and the substitute the company hired charged $10000 you would be liable for the difference.

If this is not the case, there's probably no real threat to you being counter-sued.

 

If you signed a lien waiver, you can't file a lien. However, you can file suit to recover the money due to you. Also, if your work has gone into a project the company is doing for a customer, etc., you can issue a stop payment notice to the owner, which will hold up any funds due to the company until your claim is resolved.

Customer: replied 4 years ago.

Kirk, thank you for the quick reply. The person that I referred to them did the programming for the same price I was going to do the programming. Some of the delay could be attributed to me, but most of it was because they actually had mechanical issues with the equipment that were unrelated to my equipment. Some of which I helped them debug. The lien waiver they sent me is not active until I receive final payment.

 

 

"Upon receipt by the undersigned of a check from American Environmental Fabrication & Supply, LLC in the sum of $ 15,699.13 payable to Aspect Electric Engineering & Service, LLC. and when the check has been properly endorsed and has been paid by the bank upon which it is drawn, this document shall become effective to release any mechanic's lien, stop notice, or bond right the undersigned has on the job of Control Panel and associated electrical contracting completed on thermal oxidizer equipment located at 18991 S. 410 Road, Hulbert, Oklahoma.

 

This release covers the final payment to the undersigned for all labor, services, equipment, or material

furnished on the job, except for disputed claims for additional work in the amount of $0.00.

 

Their customer is who I would issue a stop payment to?

 

Mike

 

Before any recipient of this document relies on it, the party should verify evidence of payment to the undersigned."

 

Expert:  Roger replied 4 years ago.

Yes, the owner of the project or their customer.

 

My suggestion is to get a contract attorney in your area to write a letter demanding payment, and if none is given, you will issue a stop payment to the owner for the money you're due.

Customer: replied 4 years ago.
Kirk, is there a time limt I have to do this? They've indicated they will process payment next week, but I have serious doubts. Mike
Expert:  Roger replied 4 years ago.
There are short timeframes to issue a stop payment - usually 90 days. However, I would do this asap.
Customer: replied 4 years ago.

What if they do not have a customer at this time?

 

Expert:  Roger replied 4 years ago.
In that case, all you can do is sue the company for your money.
Roger, Attorney
Category: Business Law
Satisfied Customers: 27244
Experience: BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
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