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TJ, Esq.
TJ, Esq., Attorney
Category: Legal
Satisfied Customers: 12250
Experience:  JD, MBA
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hi - I have a question, I have a running overdue balance with

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hi - I have a question, I have a running overdue balance with a vender and I was under the impression that they we ok with this arrangement as they never demanded full payment and continued to process new COD orders until the other day. I approved 2 credit card charges for 2 new orders and they sent me receipt of payment and acknowledged payment they even sent me the tracking number. This was on a Thursday. I placed a new PO on Friday and allowed them to charge 4.8K to the same card to process the order. They took an authorization and told me the order was in process. On Monday I received an email from their lawyer saying that they were withholding my orders and sent me a settlement amount. I disagreed with their methods but paid the the settlement amount and even though they applied the 4.8K to the balance rather then the new PO I also paid for that PO. Then today I expected all three orders to be shipped however they are telling me that they applied the first cc payments to the balance and not the orders (the ones that they already sent me receipt and acknowledged payment) and that the first two have not been paid. This is so unethical and I doubt it's legal as I've now paid for goods that have not been shipped thus do i have a case against them even though I had maintained a overdue balance for months and they didn't demand payment like this until now)? Basically, they want another 3.9K to settle yet I feel like they deceived me 100%. Help?
Hello and thank you for allowing me the opportunity to assist you.

I agree that the company has acted unethically and has deceived you. Unfortunately, however, you would not likely prevail in a lawsuit. The reason is that the company can countersue for what you owe it, and thus offset the debt.

For example, let's say that you owe $8k and haven't timely paid. If you paid $4.8k for a new order, and you sue for $4.8k when the order isn't filled, then the company can countersue you for $8k. The company would ultimately win a judgment against you for $3.2k. Accordingly, suing would not be productive.

Now, using that example, if you have an agreement with the company whereby you do not have a legal obligation to pay the $8k yet, then you could win a judgment for the $4.8k because the $8k debt is not yet due so the company has no right to demand it. But if you are past due, then it can demand that money.

I am truly sorry to give you this bad news, but please understand that it would be unfair to you (and unprofessional of me) to provide you with anything less than an honest response. However, if your concerns were not satisfactorily addressed, then please let me know, and I will be happy to clarify my answer. I do ask that you rate me based upon whether I answered your question, and not based upon whether the answer was good news or bad news. Your positive feedback is greatly appreciated.

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Customer: replied 4 years ago.

Thank you however they sent me receipt of payment and told me they shipped the goods then they sent me a settlement amount to bring the account balance to zero. I paid that amount plus the new order - over 11K. Now they are telling me that two preexisting orders - the one's they said they shipped have not been paid yet they sent me receipt and acknowledged payment of of these goods. They are not honoring their settlement agreement yet I have - I never asked for settlement but they sent me an ultimatum nonetheless. Surely there are legal ramifications for this - at least I could call me cc company and claim that they never shipped goods which is true. Would I win in small claims court when I would have the opportunity to show the judge that they acted unethically?

Hi again.

You may be able to have the charges reversed by the credit card company. But that would depend on the credit card company's policies, and not the law. I definitely suggest that you ask that the charges be reversed. It doesn't hurt.

As for suing and showing that they acted unethically, I do not believe that you'd win for the reasons stated above. They will claim that you are in default and owe it money. When two parties owe each other money, then they can offset each other. The judge isn't going to award one party money and not the other just because one party was "more wrong." The judge is only going to determine if the debts are owed. If so, then they will offset.
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