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I have a contract with a customer that refues to pay the balance

Customer Question
due, Can I go...
I have a contract with a customer that refues to pay the balance due, Can I go onto site and remove my equipment? or what other options are availble to me? I have to get this resolved in the next 72 hours please help
Submitted: 9 years ago.Category: Business Law
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1/3/2009
Business Lawyer: ADillon, Attorney replied 9 years ago
ADillon
ADillon, Attorney
Category: Business Law
Satisfied Customers: 441
Experience: experience with business disputes andl litigation
Verified

Hello.

I will try to help you with this.

What state are you in?

What type of equipment is this? Have you asked the customer to return your equipment, or to allow you to go and retrieve it?

What kind of site is this? E.g. new residential? Are you physically prohibited from obtaining it now? (E.g. locks or barricades?)

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Customer reply replied 9 years ago
I am in the state of Idaho, The equipment is a phone system and server. It is in a business and has around 100 employee's. The equipment is in a secured site and he is using it for there company, I believe he is tring to hang in there as long as possiable and then will file chapter 11 or 7 on me and his other vendors, I am a small telecommunications company, and a 40 thousand dollar loss would more then likley close are door's, We know we have to move quick but not sure what all the option's are.
Business Lawyer: ADillon, Attorney replied 9 years ago

Thanks.

I will check some aspects of ID law and respond to you soon.

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Customer reply replied 9 years ago
I have an employee that he has offered a job to, He is willing to be employed by him and at that time go into the server room and walk out with are equipment. would that be an option that will work for us and would we be with in the law.?
Business Lawyer: ADillon, Attorney replied 9 years ago

I have reviewed the relevant Idaho laws.

I percieve two potential claims for you.

If someone wrongfully has your personal property, then the general remedy is a lawsuit called a "claim and delivery." You can find the relevant ID statutes for this process here: http://law.justia.com/idaho/codes/08ftoc/08003ktoc.html. I could not find a sample Complaint to use for this action online.

This link here has a sample of the Writ that is issued by the Court.
There are, however, a couple of problems with this process. First, you must post a bond to use this procedure. Second, it is not clear that this would apply to your phone system, which I am inferring has become to some extent incorporated with the building. E.g., the Sheriff could not easily just go in the building and walk out with those items. (Also: this remedy is ideal where the other person never had a claim to the property. Here, the situation is a little muddy because the other party was originally in lawful possession of the item, and there is now a dispute.)

The other remedy would be to file a lien. You are probably entitled to assert such a lien under ID law, if you are not beyond your deadlines. You can find a discussion of that law in ID here: http://lawdigest.uslegal.com/contractors/construction-liens/1652/.

The interplay between bankruptcy and this type of lien is very complicated, but you will probably have a fairly good position in any bankruptcy proceeding (i.e. ahead of most unsecured creditors).

I do not have a terrific answer for you here to avoid your risk, and there is a chance that you could take a partial or complete hit here. You probably do not have a right to simply reclaim your property. If the property is easily removed, then you could try a "claim and delivery," but that is somewhat problematic also.

As for your last question, I think it would be risky for your employee to walk out with the equipment. The other party has a sufficient interest in the property to render your employee in some jeopardy of violating a criminal law if he leaves with the items.

If this has answered your question, please click "ACCEPT" so that I may receive credit for this response.

 

ADillon
ADillon, Attorney
Category: Business Law
Satisfied Customers: 441
Experience: experience with business disputes andl litigation
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