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Stuart J
Stuart J, Solicitor
Category: UK Law
Satisfied Customers: 22591
Experience:  PGD Law. 20 years legal profession, 6 as partner in High Street practice
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I use a factoring company but want to get out of it. Can I

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I use a factoring company but want to get out of it. Can I divert payments to me that are not assigned to them and pay any dues in a payment plan as they have wrongly allocated my funds getting me into a mess.
JA: Are you in the UK or are you in the States?
Customer: U.K.
JA: What action has been taken so far? What's your ideal outcome?
Customer: I would like them to find the invoices that have been paid into them but I have tried for 3 years! Now I just have a crazy limit so would rather divert funds directly to me and pay them back as quickly as I can so they don't cause me upset. I can't see a way to prove what they have wrongly allocated and not factor anymore
JA: Anything else you want the lawyer to know before I connect you?
Customer: I just need to divert payments and so I can arrange to clear factoring account

Let me summarise this please.

They have been paid invoices which you factor through them and you haven’t had the money.

They cannot account to you for those.

You want to terminate the contract and deal with all future invoices yourself but pay them any money they are entitled to on a payment plan. Is that it?

What does the agreement say about you giving notice?

I need as much background detail as possible please. Thank you

Customer: replied 1 month ago.
Hi there. I have to give one months notice to them. Yes , I believe there is a large amount of money in the factoring account and when i send in payments made to me (into their account from my customers) I don't get any assistance to tie them up.
I wanted to terminate the agreement, ask them to audit my account and enter a payment plan if i owe anything to them (which is doubtful as they have received all payments from my customers.I have used them for 5 years and my limit is 115000 and i am at that limit but with not mush outstanding to be paid by customers so they have to have received my money.Thank youKate

Thank you. What’s to stop you simply giving them the notice which is contained in any agreement you have?

Customer: replied 1 month ago.
Because I am frightened they won't allow me a payment plan - and I will need to change the bank details to my own bank for all further payments. I just wondered what happened because if I stop payments going to them I am frightened they will bankrupt me even though it's their fault

Thank you. I still don’t have a copy of the agreement or know what notice period there is in the agreement to allow you to get out.

They don’t have to accept a payment plan but they can’t bankrupt you unless they first go to court to get a judgement. If they took you to court, you would obviously defend it using whatever evidence you have and if they will not produce the evidence that you’ve asked them to, you would asked the court to order that they didn’t produce it, use that in your defence.

They could only bankrupt you if they went to court and got a judgement and that you didn’t pay whatever the judgement was against you and also provided that was then over £5000.

Does that answer the question?

Can I answer any specific points arising from this?

Please don’t forget to use Star rating box at the top right hand corner of the page to rate my answer positively. If you don’t rate it positively, I don’t get credit for my time dealing with your problem.

However even after rating, the thread does remain open and if anything else need clarification, we can still exchange emails.

Kind regards.

Stuart.

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