Dear Customer, I am sorry to learn of this significant breach of contract. Please keep in mind that I cannot provide you with specific instruction or legal advice, but I can provide you with the information necessary to evaluate the potential collection techniques to enforce your contract rights and collect your funds (the way you go about enforcing them is a business judgment decision you will need to make based upon your specific situation and needs, including long term goals and needs that may include business relations with this debtor).
The basic issue is that the debtor has breached its contract with your business by failing to pay on time. Your contract with the debtor will tell you the basic rights and obligations you have with the debtor (such as the interest rate attached to the delinquent debt, the right to arbitrate or mediate the debt prior to litigation, and any late fees or penalties that may attach). Most importantly is to check and see if there are any special procedures that you are required to follow (notice, written demand letters, etc. prior to filing a lawsuit against the debtor, as these will be required for your civil litigation if the debtor does not pay).
Many creditors will start their debt collection efforts with a simple demand letter. This will state that payment is overdue, interest is accruing under the terms of the contract, and gives the current amount. It states that the specific actions available under the contract to enforce the debt will be taken unless payment is made.
If the payment is not made within the time specified in the demand letter, many creditors will pursue ADR (alternative dispute resolution) they will do this for many reasons: it is cost effective in many cases, it is required by the contract, and it may assist in getting the matter settled prior to litigation. ADR may be arbitration (much like a court trial) or mediation (a settlement negotiation with a third party neutral - a retired judge or attorney helping to facilitate the negotiations).
If this is not successful, the creditor has a right to file a civil lawsuit against the debtor for breach of contract, and any related causes of action, (as your amount is greater than $10,000.00 you will be in general civil court), this can be a lengthy process, but you will be entitled to both the damages and interest on the claim. If the contract has a "prevailing party attorney's fees provision, or similar language, the winning party will be entitled to reclaim their attorney's fees in addition to the actual contractual damages.
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Very Truly Yours,
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