Contractors' Questions: Should I take my client to small claims court?

Contractor’s Question: A client of my 'Plan B' IT-design business who frequently emailed me design iterations throughout the project I did for them is now refusing to pay me, even though the project is complete.

This client, who I don’t have a written contract with and who I didn’t make pay a deposit, admits he doesn’t understand the technical specification I’ve produced; nor apparently does his commercial partner. From my 10 years in this specific area of IT, I’m confident that the partner (a factory essentially) is familiar with the spec. I also offered to redo the whole spec at my own cost in order to finish the project in a different way, but the client still says he is not going to pay. Shall I go straight to the small claims court?

Expert’s Answer: It does look like the debtor is looking for excuses, but the crucial evidence will be whether firstly the specification is good enough based on industry standards and, secondly, whether the design meets the reasonable expectations of the buyer. It will be very important to identify from the email documents what precisely was agreed. It will then be necessary to get an expert to say whether your specification was good enough for the buyer to replicate the design by manufacturing the items, and secondly whether the design met the reasonable expectations of the buyer.

If you issued a claim in the County Court Money Claims Centre, it will be allocated to the small claims track but only if it is defended, and if the claim (together with any interest claimed) is below £10,000. Please note; expert evidence is not permitted on the small claims track without the court’s approval, and if approved will except in exceptional circumstances be limited to the submission of a written report. The court will prefer a jointly instructed expert.

I would therefore suggest that you write now to the buyer suggesting that you try to avoid costly court proceedings by referring the matter jointly to an expert for determination, with an agreement to both abide by any decision of the expert. If the buyer refuses, you can draw that to the attention of the court when asking for permission to use expert evidence.

The expert was Nigel Musgrove, a solicitor at legal advisory Cousins Business Law.

Tuesday 13th Oct 2015
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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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