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Chris The Lawyer
Chris The Lawyer, Lawyer
Category: New Zealand Law
Satisfied Customers: 22974
Experience:  38 years qualified as a lawyer; LLB, MMgt and FAMINZ.
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I am the owner of an IT Support company - we have a client

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I am the owner of an IT Support company - we have a client who has entered into a monthly support & Maintenance agreement for their server and network. They have been doing this approx 3-4 years.

They have always been really slow payers - but they havnt paid us anything this year - we have been chasing them every month - and they keep putting us off.

We have finally got to the point of saying their account is on stop credit and they need to pay before we do any more for them. - now they have demanded the network administrator password.

Do we have the right to withhold the administrator password XXXXX them until they pay?

christhelawyer : HiWelcome to JustAnswer. My first response will follow shortly. Please feel free to follow up if anything is not clear
christhelawyer : The usual place for holding information like this would be in your contract. If your contract says that you can withhold this then there is no problem. However I assume that you have no such clause.
christhelawyer : In this case, you can as a practical response, simply refuse to provide this. It is not something they would normally need unless they intend further breaching the contract, possibly by going somewhere else for their work. I see no reason why you should provide this because it is not necessary to do so in the normal running of the contract. As long as you are doing your part of the contract, then there is no reason why they would need this.

Thanks Chris, you say "as long as you are doing your part" are we able to stop doing any more work for them until the account is paid?

christhelawyer : Yes, you can stop work. Does the contract have a term or is month to month?

month to month


If we stop providing services and the client gives notice to terminate the support contract are we then required to hand over the administrator password XXXXX can we refuse to do so until the outstanding debt is settled? In this situation the administrator password XXXXX XXXXX only leverage to get our account paid.

christhelawyer : I see no reason why you should hand this over without payment. Perhaps however the next stage is to meet with the client and see if a discussion will resolve this, with an agreement to pay the arrears, and whether they want the contract to continue.
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