Letter before action, dishonoured cheque. Options

[Korting]

Just before Christmas, I carried out some work on two vintage audio items. The customer lives approx 150 miles from where I'm based.

I delivered back after repair one of the items back in early January and was given a company cheque with a request to make the bill out to 'repair of electronic equipment' or industrial equipment. The amount was £528.00 for both items

A few days later the cheque is returned 'Payment Stopped'

There was no communication from the customer up to the point that I tried to call her and sent her an email.

She replied to that email which was quite lengthy, making excuses as to why she stopped the cheque and offering me £200 + £25 for a new bluetooth (which actually cost me around £50 with my making up a special lead).

I replied to her telling her that her offer was unacceptable and that I would return to put right any problems or if she didn't want me to return, I would take £100 off the bill.

She didn't respond

I'm now in the process of sending a letter before action

Dear A.....,

Thank you for your email of the 16th January, which I replied to (copy attached) but to date have had no reply.

In that email, I explained that I was not prepared to accept £200 from you and I explained my reasons why. I also included an invoice which clearly explains the work carried out and materials used.

I’m sure that you will understand that in any business/service, things don’t always go to plan and there can be unforeseen problems, but in that eventuality I would endeavour to try and put things right, as I’m sure you would if that happened in your business. I have offered to come back to you, collect the radio, have another look at it and find out what has gone wrong and repair it so that it works in your house. This would be carried out at no further cost to you. I would also extend my guarantee for 1 year starting on the day it was returned to you. This would all be done at your convenience.

I feel that it is only fair that you give me the opportunity to put things right.

I also gave you the option of paying a reduced amount of £428, but that would be without carrying out any further work to the radio. This offer is available to you until Friday 15th February.

However I must regretfully inform you that should I not receive payment from you, or be given the opportunity to collect the radio by 15th February in order to repair it, then you will give me no alternative than to issue proceedings in the small claims court against your company, Xxxxxx Ltd, for the full sum of £528.

If this becomes necessary then I will add a fee of £120 to cover my time in dealing with this, plus the court fees.

I have to also inform you that if I am required to travel to you for any court hearing, then I will require your company to pay for my travelling costs and if the hearing is scheduled for the morning, my overnight accommodation.

I really do hope that this will not be necessary and that we can find a friendly and amicable solution to this.

I look forward to your early reply.

Yours sincerely

My wife thinks that the lat two paragraphs (beginning with If this become necessary....) is too heavy.

I'm trying to be fair to the customer, but feel that I should set out any charges that she may incur if I have to take this further.

So I'm inviting anyone who would like to to comment.

This post has been edited by Korting: Mon, 28 Jan 2019 - 23:20

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[notmeatloaf]

It would, IMO, be sensible to reply by letter if you prefer. Pre action protocols strongly lead you into attempting to seek a resolution out of court.

Pre action protocols say that if you receive a reply you should put things on hold for a further 30 days. This is all included on the information sheet that hopefully you included with the reply form.

Because it is a dishonoured cheque you are in a strong position - she can only realistically allege misrepresentation - but why take the risk of reduced costs.

[Redivi]

I see Southpaw's point that it's the company that's dishonoured the cheque, even if she issued it
It also has the advantage that any hearing will be at your local court not hers

I agree about writing letters, not emails or texts
Keep it formal

When you send the letters, ask the Post Office for a certificate of sending
Head them "Without prejudice save to costs"

Did you ever check if she's the company owner ?

[southpaw82]

Head them "Without prejudice save to costs"

Why?

[Korting]

She is the company owner. I agree with your previous post Redvi, that I should inform HMRC though I'm not sure if I should put that in the letter!

Without Prejudice means that any reply cant be shown in court, where in fact If I'm writing to her politely, It should be easy to show that I'm the nice guy.

If the PAP says i should give her another 30 days, each time i reply, then she could theoretically string it on for months. I will give her until 5th March, then issue proceedings.

I will draft a reply later.

[The Rookie]

Without prejudice means what you’ve sent can’t be shown in court, so if you want to show how reasonable you’ve been by trying to settle out of court, you couldn’t. I wouldn’t be using without prejudice in this case. It’s usually used ‘save for costs’ so you can make a lower offer to settle without, erm, prejudicing your claim for the full amount in court.

[Churchmouse]

Without prejudice means what you’ve sent can’t be shown in court, so if you want to show how reasonable you’ve been by trying to settle out of court, you couldn’t. I wouldn’t be using without prejudice in this case. It’s usually used ‘save for costs’ so you can make a lower offer to settle without, erm, prejudicing your claim for the full amount in court.

"Without prejudice" is used to make "genuine offers of settlement" non-admissible in court. Is Korting offering to settle the debt for less than the face amount of the cheque? If not, there is no reason to make the letter inadmissible.

--Churchmouse

[southpaw82]

I see absolutely no reason to make it without prejudice at all. Unless I’m offering less than I’m going to claim for I’m not going to make an LBA without prejudice, as it then looks like I made a claim without attempting to settle the dispute first.

[Korting]

I have already made her an offer of a lower amount of £480. I did that in my original letter before action.

When I reply to her, I will state that all the parts fitted belong to me until the invoice is settled in full. I could of course remove them if she invited me to her house to do it, but it would result in her equipment not working at all and most likely unable to be repaired in the future. I don’t have the original parts, they were given to her to dispose of.

[Korting]

This is a draft of my reply to her text

Dear A..........

Thank you for your text in reply to my letter before action. (Screenshots have been saved)

As I said in my original letter, I’m not prepared to settle for less that £428, I am prepared to repair the radio at no cost to you.


I will point out that the parts supplied are my property until the invoice is paid in full or you accept and pay me the lower amount.

For the record, I didn’t intimidate or bully you into writing that cheque, you wrote it of your own free will. You put a stop on it without even having the courtesy of informing me of your intention.

In your text, you said I should either accept your offer of £200 + the Bluetooth or to put you in court in which case I’ll get nothing.

From this I have deduced that you intended to obtain my services and materials by deception, and that you are attempting to blackmail me into accepting your offer.

You wrote that cheque on your business account, requesting that I made out the invoice for ‘engineering work.’ I presume that you therefore intend to deceive HMRC.

I will re-iterate that I’m not prepared to accept your offer.

You therefore have three options.

1) Pay me £428 in full and final settlement

2) Allow me to collect the radio, find out what’s gone wrong and repair it at no extra cost yourself

3) Pay me £528 as per the invoice.

As stated in my letter before action, I will issue proceedings without further notice to if you do not pay me, or allow me to repair the radio.

Yours sincerely

I'm not sure about the paragraph in red.

This post has been edited by Korting: Sat, 2 Feb 2019 - 14:08

[Slapdash]

Is the company incorporated ?

Is she a director ?

The point being that she may well be entitled to write the business cheque.

It needs to be properly treated in the accounts at the appropriate time that is all. The company is also perfectly entitled to settle peoples individual debts (albeit with tax consequences from the transaction).

An assertion that she must be trying to defraud HMRC in some way is wide of the mark (she may well be but it is a big jump to she must be).

This post has been edited by Slapdash: Sat, 2 Feb 2019 - 14:26

[Korting]

Its a limited company, shes a director.

[Slapdash]

In which case it seems reasonable that she was perfectly entitled to write that cheque.

You cannot know how the accountans would eventually deal with the transaction.

I dont really see how her tax affairs relate to the dispute.

[Korting]

Why would she ask me to put something different on the invoice to the work that I'd actually carried out?

[Slapdash]

I am not saying she wasn't "up to no good" related to asking you to invoice "repair of electronic equipment". It doesn't seem to be an unreasonable description of the service provided though.

I don't see how you can know, for example, that the equipment was not owned by her company. I used to have a lot of companys equipment at home.

It seems largely tangential to the stopping of the cheque.

[southpaw82]

I’d leave anything other than the issue of recovering your money aside. It’s irrelevant.

[Redivi]

Dear A..........

Thank you for your text in reply to my letter before action. (Screenshots have been saved)

For the record, I didn’t intimidate or bully you into writing that cheque, you wrote it of your own free will. You put a stop on it without even having the courtesy of informing me of your intention.

In your text, you said I should either accept your offer of £200 + the Bluetooth or to put you in court in which case I’ll get nothing.

I’m not prepared to accept your offer.

As stated in my letter before action, I will issue proceedings without further notice to if you do not pay me the full value of the cheque

Yours sincerely

The issue is a dishonoured cheque
Nothing else is relevant

If Ann has a problem with the equipment, her company has to issue a claim afterward

This post has been edited by Redivi: Sat, 2 Feb 2019 - 19:54

[cp8759]

t’s usually used ‘save for costs’ so you can make a lower offer to settle without, erm, prejudicing your claim for the full amount in court.

That's not what 'save for costs' means at all.

Dear A..........

Thank you for your text in reply to my letter before action. (Screenshots have been saved)

For the record, I didn’t intimidate or bully you into writing that cheque, you wrote it of your own free will. You put a stop on it without even having the courtesy of informing me of your intention.

In your text, you said I should either accept your offer of £200 + the Bluetooth or to put you in court in which case I’ll get nothing.

I’m not prepared to accept your offer.

As stated in my letter before action, I will issue proceedings without further notice to if you do not pay me the full value of the cheque

Yours sincerely

The issue is a dishonoured cheque
Nothing else is relevant

If Ann has a problem with the equipment, her company has to issue a claim afterward

+1

[notmeatloaf]

For the record, I didn’t intimidate or bully you into writing that cheque, you wrote it of your own free will.

What is the point of this sentence?

The OP cannot know what the other person was feeling, and it is irrelevant anyway. I never see the point in these situations in engaging in debating an irrelevant point that can't be proved anyway.

Stick to the essentials.

[Korting]

This is probably better.

Dear A..........

Thank you for your text in reply to my letter before action. (Screenshots have been saved)

You gave me a cheque on my returning the equipment and demonstrating it to you. You put a stop on it without even having the courtesy of informing me of your intention.

In your text, you said I should either accept your offer of £200 + the Bluetooth or to put you in court in which case I’ll get nothing.

I’m not prepared to accept your offer.

As stated in my letter before action, I will issue proceedings without further notice to if you do not pay me the full value of the cheque or the lesser amount of £428 in full and final settlement.

I'm not prepared to enter further correspondence with you save for acknowledging receipt of payment

Yours sincerely

[Redivi]

This is probably better.

Dear A..........

Thank you for your text in reply to my letter before action. (Screenshots have been saved)

You gave me a cheque on my returning the equipment and demonstrating it to you. You put a stop on it without even having the courtesy of informing me of your intention.

In your text, you said I should either accept your offer of £200 + the Bluetooth or to put you in court in which case I’ll get nothing.

I’m not prepared to accept your offer.

As stated in my letter before action, I require the full value of the cheque
As a gesture of goodwill, I am prepared to accept the sum of £428 if payment is made within 14 days of the date of this letter

After this date I will presume that my offer has been rejected and will issue proceedings against (company name) without further notice

Yours sincerely

This post has been edited by Redivi: Sun, 3 Feb 2019 - 14:28