Collection Agencies and Collection Departments Utilizing Debt Collection Book
Our EBook Collecting Account Receivables has been getting very positive feedback. Our commercial debt collection clients have told us that they downloaded the book and have had their accounting staff read it. The book helps creditors set up internal debt collection strategies. Discussed is also the difference between a collection agency and a debt collection law firm. Collection attorneys can provide debt recovery services that commercial collection agencies are not able to provide legally.
Collection agencies are limited to making phone calls and sending demand letters for payment. Collection agencies cannot file a law suit, take depositions in aid of execution or garnish bank accounts to seize assets once a judgment is obtained. Obtaining a judgment is not the hard part if a debt is justly owed. It is how you collect on a judgment. A collection agency is not licensed to practice law and must retain a collection lawyer to implement a litigation strategy to collect on accounts. Collection agencies when forwarding a debt collection case to a collection attorney typically will charge their client’s a higher contingent fee because they have to charge a fee on top of the collection lawyer’s fee. Many credit managers realize that when it is apparent customer is not paying, it makes sense to retain a debt collection law firm rather than a collection agency. Not only will the credit manager save money but, putting the power of an attorney behind your demand for payment is more effective.
Collection agencies serve a purpose when there is a high volume of cases with relatively small balances to collect. We invite you to contact our commercial debt collection law firm to discuss the differences between utilizing a collection agency or forwarding your commercial collection accounts directly to a collection attorney.
Using a Florida Collection Agency or Florida Collection Agencies
Florida collection agencies continue to collect debt in Florida. A collection agency in Florida needs to register with the State of Florida to have a collection agency license. A Florida collection agency may be a good fit for company that has a high volume of low balance claims for collection that are too small to justify filing a debt collection law suit. Florida collection agencies typically send our collection letters and then use debt collectors to make debt collection phone calls from their Florida collection agency office.
Even though a Florida collection agency may hold a license to collect debt in Florida, there really is no oversight over the Florida collection agencies over what tactics they may employ or how effective they may be at collecting debt in Florida. More credit managers are recognizing that they no longer need to place their debt collection claims with Florida collection agencies. A Florida debt collection law firm offers the same services as a Florida collection agency. However, what is important to recognize is that Florida collection agencies do not hold a license to practice law.
Florida Debt Collection Agency
If a Florida collection agency want to suggest that a collection case needs to go to an attorney, the Florida collection agencies have to outsource the collection matter to a Florida collection attorney. The end result is the Florida collection agency has to charge you a higher contingent fee as the Florida collection agencies now have to act as a middle man and will charge a premium on top of what the Florida collection law firm charges.
Our Florida collection lawyers will be happy to discuss the difference between Florida collection agencies and Florida collection law firms. In some instances utilizing a Florida collection agency may be a good option. However, in most cases using a Florida debt collection law firm will prove to get better results as the debtor recognizes that using a Florida collection law firm over a Florida collection agency means that your company intends to use the Florida courts to help your company recover its money.
Having debt collection policies in place will assist a debt collection attorney when you need to hire a debt collection law firm to collect your money
Keeping copies of your customer’s checks can be very helpful to 0ur debt collection law firm after judgment is obtained. Our collection attorneys will ask our clients after a judgment is obtained if they have any information to assist our debt collection law firm garnish or attach assets. Sometimes a debtor is unaware that once a judgment is obtained a debt collection attorney can issue a writ of garnishment and serve the writ on a bank. Our debt collection law firm has found that many times the debtor is using the same bank account and may have some or all of the funds in the account necessary to satisfy the judgment.
Guide to Internal Collection Procedures
When setting up a credit and collection policy for your company your employees should be mindful that one day your customer may stop paying their invoices and your company may have to engage a collection attorney to help your company collect your money. Our debt collection law firm has been assisting companies with their debt collection policies and procedure. Some companies have credit applications but, surprisingly a lot of our clients learn the hard way once one of their customers stops paying. Having a credit application helps our collection attorneys not only find post judgment assets but, gives our collection lawyers a better chance of locating the principals of a debtor corporation in the event your customer closes its doors. Our debt collection law firm will also suggest adding an attorney fee provision to the credit application, if there is not already one in place. Without that provision, in some states, you will not be able to recover the fees paid to your collection attorney from your customer.
Our debt collection law firm uses all information available to it to determine if there is a possible successor company that may be liable for the debt. Our debt collection lawyers will also explore the possibility that there may be personal liability of an officer for transferring assets. We invite you to call our debt collection law firm to speak to one of debt collection attorneys about your credit and collection policies. Our collection lawyers will be happy to make suggestions to help tighten up the credit application so in the event it becomes necessary to start a lawsuit to recover your money, the chances for successfully recovering your company’s money will be increased
Taking the Debt Collection Case to Trial with a Collection Attorney
If the collection case has gone as far as trial, it is important to be prepared to provide the proper witnesses and be able to produce key pieces of evidence to prove your case. In collection cases to it is important to provide the witness who can testify that they are familiar with company’s books and records and that those records are usually kept in their custody and control. In other words, the sales representative for your company typically is not charged with the financial aspects of the company and someone who ordinarily would track the books and records of the company. Courts adhere to rules of evidence and may not allow a sales representative to testify as to the account statement or invoices. It is important that you speak with the collection attorney in advance to make sure your company will be able to produce the proper personnel at trial. If not, you may wish to discuss the possibility of settling your collection case prior to the court date.
Collection Attorney Stephen B. Gebeloff
It is important to tell your collection attorney about third parties who may have knowledge about the case. Those parties may be subpoenaed to appear for deposition prior to trial to ascertain their knowledge about the case and or to provide relevant documents. If necessary these same parties may be subpoenaed to appear at trial to testify.
Besides witnesses, it is important to provide your collection lawyer with all the documents surrounding the case, including, but not limited to, contracts, statements, invoices, emails or any other documentation from any third party or the debtor relating to the case. Working with your collection attorney, together you will decide which documents will be offered to the court as evidence.
During the collection trial both your company and the debtor will be able to offer witnesses and other evidence for the court to consider. After all the evidence has been presented the Court will make a decision. If all goes well a Judgment will be awarded to your company. Unfortunately, obtaining a judgment does not obligate a debtor to pay the judgment. However, using a collection law firm to enforce the judgment will be the best way to ensure that if there are assets available to satisfy the judgment either through the debtor’s voluntary payment(s) or seizing assets using writs of execution your company will recover some or all of the Judgment.
Florida collection agencies are licensed in the State of Florida to collect debt. It is important when choosing a commercial collection agency in Florida to make sure the collection agency is in fact licensed. Several of our clients have come to our Florida debt recovery law firm after first utilizing the services of what they believed at the time to be a reputable licensed full service commercial collection agency.
Our collection law firm recognizes there are several good commercial collection agencies in Florida. As we have stated in past articles, a Florida collection agency can be a very good option for clients that have a high volume of debt collection cases with small balances. The collection agencies can send out several demand letters and make multiple collection calls in an attempt to collect on the past due account receivable. These small balance cases do not warrant filing a law suit to recover your company’s money as the cost would be prohibitive.
Florida Commercial Collection Agency
It is important for our law firm’s clients and potential clients to recognize that a commercial collection law firm can provide the same debt collection services as a Florida commercial collection agency. However, what is most important to recognize is that Florida commercial collection agencies are not licensed to practice law. The collection agency cannot file suit. The case must be referred to an attorney. The end result is that you will have to pay a higher contingency fee on the collection of your money as the collection agency will share the contingent fee.
If you would like to call our Florida commercial collection law firm, one of our collection paralegals or collection attorneys would be happy to assist you in deciding the best debt collection strategy that is right for your company.
CASHING A CHECK WITH A RESTRICTIVE ENDORSEMENT / IS THE CHECK NOW PAYMENT IN FULL
CALL OUR COLLECTION LAW FIRM TODAY AND SPEAK WITH OUR COLLECTION ATTORNEY TO DISCUSS
It is important for creditors to consult with a lawyer. Our collection law firm is frequently asked to answer the question can cashing a check with a restrictive endorsement “paid in full” mean that they have accepted the payment as full payment despite the fact there is still a balance due. This a complicated area and we urge our client’s to call our collection law firm and speak to our collection lawyer. Any writing affixed on a check or words contained in some form of document, i.e., email, letter, that refers to an accompanying check is considered a “restrictive endorsement.” Creditors should be versed on the effects of “restrictive endorsements” as cashing a check with a restrictive endorsement could lead to the conclusion that the debtor has achieved an “accord and satisfaction,” payment in full. At our debt collection law firm, we receive many inquiries from our debt collection clients on whether or not to cash a check tendered by a debtor with a restrictive endorsement. Our collection attorneys always err on the side of caution and advise our debt collection clients not to cash the checks.
Restrictive Endorsements on Checks
Our collection law firm also receives inquiries to our collection lawyers about situations where a check is sent to a lock box and cashed. Fortunately for our debt collection clients, all states, have adopted the recent revision of the Uniform Commercial Code, Article 3, Section 311 (UCC3-311), which is commonly referred to as “Safe Harbor.” The Safe Harbor principal is applicable to payments received in a system that is serviced by a third party (such as a bank lock box or a post office box). Typically, this is the creditor’s banking institution whose lock box is serviced by banking personnel lacking the knowledge and expertise to make an informed decision relative to restricted endorsements. The Florida statute is found below but generally a creditor should look to state statute to find a similar Safe Harbor provision such as UCC 3-311. The UCC 3-311 specifies within 90 days of depositing restricted payment from a buyer, the seller can send one of their checks back to the buyer in the same amount of the restricted check and preserve the creditor/seller’s legal remedies. The creditor should make sure the “reimbursement” check should be sent back via some mode requiring proof of attempted delivery. Our collection clients should note the buyer/debtor need not cash the “reimbursement check;” as the creditor/seller’s right to proceed with litigation is preserved by the act of sending back the amount originally submitted under endorsement text or provisions. Our collection lawyers also counsel our debt collection clients to make sure they put specific language in their contracts and or credit applications pertaining to where and to whom payment should be sent. This is important because the Uniform Commercial Code provides that if a credit grantor is made aware of a dispute prior to any type of final payment being made the creditor’s claim for an overdue balance is not discharged if within a reasonable time before tender the creditor stipulates that a restricted instrument (restricted check) must be sent to a designated person, office or place. If those instructions are not followed, then creditor remedies are available.
Florida Statute Section 673.3111 Accord and satisfaction by use of instrument, provides: (1) If a person against whom a claim is asserted proves that that person in good faith tendered an instrument to the claimant as full satisfaction of the claim, that the amount of the claim was unliquidated or subject to a bona fide dispute, and that the claimant obtained payment of the instrument, the following subsections apply. (2) Unless subsection (3) applies, the claim is discharged if the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim. (3) Subject to subsection (4), a claim is not discharged under subsection (2) if either paragraph (a) or paragraph (b) applies: (a) The claimant, if an organization, proves that: 1. Within a reasonable time before the tender, the claimant sent a conspicuous statement to the person against whom the claim is asserted that communications concerning disputed debts, including an instrument tendered as full satisfaction of a debt, are to be sent to a designated person, office, or place; and 2. The instrument or accompanying communication was not received by that designated person, office, or place. (b) The claimant, whether or not an organization, proves that, within 90 days after payment of the instrument, the claimant tendered repayment of the amount of the instrument to the person against whom the claim is asserted. This paragraph does not apply if the claimant is an organization that sent a statement complying with subparagraph (a) 1. (4) A claim is discharged if the person against whom the claim is asserted proves that within a reasonable time before collection of the instrument was initiated, the claimant, or an agent of the claimant having direct responsibility with respect to the disputed obligation, knew that the instrument was tendered in full satisfaction of the claim.
Our debt collection clients are often confused on what they should do with a check with a restrictive endorsement ” Paid in Full.” Please feel free to contact our debt collection lawyers at our debt recovery law firm. Our collection attorneys are always willing to discuss a collection strategy to help our client’s minimize risk and bad debt.
USING A DEBT COLLECTION LAW FIRM TO ASSIST COLLECT PAST DUE RECEIVABLES
Our collection lawyers recognize, in this tough economy, many businesses are struggling with cash flow. Our collection law firm can assist a company in collecting their past due collection accounts. Our collection attorneys are sensitive to the tough economy and work with our collection clients to implement a debt collection strategy. Not every debt collection matter is the same. Each one of your customers is unique and our collection lawyers work with you to identify the specific issues presented. Our collection attorneys work with you to identify what may have put your customer in a situation where they are now behind in paying their past due invoices. Our collection law firm will not only send a collection demand letter but, our collection attorneys will investigate the customers corporate status, attempt to speak with the owners of the company and then make a recommendation as to the best debt collection strategy for your company. Sometimes we may suggest that your company may better be suited using a debt collection agency. Our collection attorneys will ask you specific questions that will help you decide whether to use a collection agency or a collection law firm.
Palm Beach County Court House
If your company has many low balance past due accounts, a collection agency may be ideal. However, a collection agency cannot give legal advice and a debt collection agency cannot file a law suit if necessary. Not every debt recovery matter needs a collection lawsuit. That is why it is important to speak to our collection attorneys and decide together a debt recovery strategy. Sometimes it makes sense to place some of your past due accounts with our collection law firm and other accounts with a collection agency. Call our collection law firm and ask to speak to one of our collection attorneys. Together, we will devise a debt collection strategy that is just right for your company’s past due accounts.
A collection attorney has the ability to send out collection letters to customers that owe you money. The collection attorney can provide insights to you on alternative methods of effectuating debt collection. Our collection law firm is constantly looking for ways to pierce the corporate veil and assert personal liability against corporate officers of a company even when there are no personal guarantees on the account securing the debt.
Another advantage in using a collection attorney law firm over a collection agency is that the collection attorney can file a lawsuit to help you collect your money. If your customer does not enter into a payment agreement with our collection law firm, our collection attorney will enter judgment. Once judgment is entered, there are many different ways our collection attorney can discuss with you on how to locate assets to satisfy the debt.
Palm Beach County Court House
If you have smaller balance accounts that it does not make sense to litigate with a debt collection law firm, a collection agency may be the answer. The collection agency will also send demand letters and make phone calls. But, of course a collection agency cannot provide legal advice or file a lawsuit to collect your money.
If you need to discuss your account receivable issues with our collection attorney, please feel free to contact our debt recovery law firm and our collection lawyer will be happy to devise a debt collection strategy that is just right for you. [email protected]
When collecting debt, time is critical to maximizing your recovery of your past due account receivables. As a collection law firm, we see time and time again our clients waiting on their customers repeated promises for payment. Our collection lawyers have spoken to hundreds of debtors. Our collection attorneys know when a debtor is truly experiencing financial issues that are not allowing the debtor to make payment. Our collection lawyers also know when a debtor simply is stalling and / or simply has no intention of paying for the goods or services your company has provided.
Our collection law firm strives to quickly advise our debt collection clients the dynamics surrounding each debt collection case. Our collection attorneys believe that our clients when they engage a debt recovery firm should have all the facts surrounding a debt collection matter so they can make informed business decisions prior to spending additional time and resources in attempting to recover their money.
Palm Beach Court House
Our debt collection firm and attorneys have the tools to assist our clients to paint a picture of a debtor’s situation. Our collection lawyers want to provide our clients with the information they need. Not every debt collection case can be recovered. But, our debt recovery firm wants to at least let our collection law clients know that we leave no stone unturned in at least presenting scenarios that effect the collectability of our clients past due accounts.
At our collection firm, one of our debt collection attorneys would be happy to discuss your particular debt recovery case. Our collection lawyer will devise a debt collection strategy that is tailored to your company’s particular debt recovery needs. Please call our collection attorney or email us the particulars of your debt collection case.
