More legal advice
Discussion
Im taking a "big" cilent to court, and need some advice.
The parent company turns over millions, and is a big company. I am dealing with one of the smaller companies the parent company owns. But the amount Im taking them to court over is £4200+vat which is £4935
1) Over such a small amount, will they likely bring in their own laywers. The company Im dealing with is its own seperate entity I think, which is part of a larger group. Or will the MD of the smaller company likely represent the company he runs.
2) Im confident I will win. And this (being under 5k) goes to small claims. I dont think I'll loose, but IF I did, and IF I didnt go to small claims, then I could be liable for their legal fees. They cant "bump" the cost up, from £4395 to £5k can they? Im wondering because... when I take them to small claims, Im entitled to my court costs back (fees to initiate proceedings) arnt I? And wouldnt that bump the cost up to £5k+? Meaning this would be too big for small claims court, and I could be liable for their legal fees, IF I lost?
3) Your opinion please. We spent 3 months programming a complex website to meet the specification they outlined (a 60 page document!!)
They said they were too busy to provide feedback, as they were busy with their own work. Fine.
They also said (later) that the website did not meet the specification, and had "issues" which needed to be corrected. Fine I thought. They just need to outline the issues.
They also demanded "inhouse" training, which was not agreed, and was not in our contract.
They then cancelled the project (big surprise, no warning!) on the premise that
a) The website did not match the specification
b) We would not provide inhouse training.
In short, I bent over backwards trying to get their feedback on the website, what needed correctiing etc. I phoned and email them a dozen times in 2 months asking for their response to our work (which was stunning) got 2 emails outlining 30 points, all of which were corrected within 1 day of them pointing them out. They refused to give more feedback.
Also, re: the training, they said they were "led to believe" we would provide inhouse training
and have recently changed their stance to say that "we promised them inhouse training" They also contradict themselves saying they "assumed" we provided training (I dont have that in writing). They even offered us money to train them inhouse, which contradicts their statment saying "we agreed inhouse training" I dont have that in writing either 
But its only normal, and fair, that regardless of the fact that we have a 60 page technical specification, when we complete our work they provide us with feedback, suggested tweaks and changes, etc. I get dozens of emails following the completion of a small 5 page website as we work towards giving clients exactly what they want.
To provide 2 emails with feedback on 3 months of programming, and then claiming the spec does not meet the website is ridiculous. Ive bent over backwards telling them Im here to help, will provide unlimited changes, and flexability... but they refused to work with me in helping us perfect the website to their specification.
Opinions?
The parent company turns over millions, and is a big company. I am dealing with one of the smaller companies the parent company owns. But the amount Im taking them to court over is £4200+vat which is £4935
1) Over such a small amount, will they likely bring in their own laywers. The company Im dealing with is its own seperate entity I think, which is part of a larger group. Or will the MD of the smaller company likely represent the company he runs.
2) Im confident I will win. And this (being under 5k) goes to small claims. I dont think I'll loose, but IF I did, and IF I didnt go to small claims, then I could be liable for their legal fees. They cant "bump" the cost up, from £4395 to £5k can they? Im wondering because... when I take them to small claims, Im entitled to my court costs back (fees to initiate proceedings) arnt I? And wouldnt that bump the cost up to £5k+? Meaning this would be too big for small claims court, and I could be liable for their legal fees, IF I lost?
3) Your opinion please. We spent 3 months programming a complex website to meet the specification they outlined (a 60 page document!!)
They said they were too busy to provide feedback, as they were busy with their own work. Fine.
They also said (later) that the website did not meet the specification, and had "issues" which needed to be corrected. Fine I thought. They just need to outline the issues.
They also demanded "inhouse" training, which was not agreed, and was not in our contract.
They then cancelled the project (big surprise, no warning!) on the premise that
a) The website did not match the specification
b) We would not provide inhouse training.
In short, I bent over backwards trying to get their feedback on the website, what needed correctiing etc. I phoned and email them a dozen times in 2 months asking for their response to our work (which was stunning) got 2 emails outlining 30 points, all of which were corrected within 1 day of them pointing them out. They refused to give more feedback.
Also, re: the training, they said they were "led to believe" we would provide inhouse training
and have recently changed their stance to say that "we promised them inhouse training" They also contradict themselves saying they "assumed" we provided training (I dont have that in writing). They even offered us money to train them inhouse, which contradicts their statment saying "we agreed inhouse training" I dont have that in writing either But its only normal, and fair, that regardless of the fact that we have a 60 page technical specification, when we complete our work they provide us with feedback, suggested tweaks and changes, etc. I get dozens of emails following the completion of a small 5 page website as we work towards giving clients exactly what they want.
To provide 2 emails with feedback on 3 months of programming, and then claiming the spec does not meet the website is ridiculous. Ive bent over backwards telling them Im here to help, will provide unlimited changes, and flexability... but they refused to work with me in helping us perfect the website to their specification.
Opinions?
I very much doubt that they'll settle on this and they might well wheel out the lawyers to deal with it because they can.
I have to say upfront though that I don't "do" risk and my advice tends to be tempered by that (which is why I'm not a litigator!!).
I'd be concerned about the values - you can't claim very much for bringing the claim, only fixed costs which are probably pretty small. I'd imagine that once you put interest onto the claim then you'll be close to £5k. There is however every likelyhood that the claim will be allocated to the fast track anyway rather than the small claims track. There is no such thing as a "small claims court" and the court that you issue through will decide what track to allocate the matter to. If it is felt to be complicated and it involves two businesses it is possible that they would allocate it to the fast track anyway.
It's difficult to say from what you've posted what the outcome will be. Remember though that everyone thinks that they have a cast iron case when they go to court. It isn't always proved to be the case!
Be aware that if you issue proceedings and then withdraw them, you run the risk of being responsible for the defendants costs to date unless they agree otherwise (outside of small claims track). With a claim of that amount you might want to bear this in mind before issuing (unless it's too late!).
Lurking Lawyer is probably your boy on this issue though for better advice.
I have to say upfront though that I don't "do" risk and my advice tends to be tempered by that (which is why I'm not a litigator!!).
I'd be concerned about the values - you can't claim very much for bringing the claim, only fixed costs which are probably pretty small. I'd imagine that once you put interest onto the claim then you'll be close to £5k. There is however every likelyhood that the claim will be allocated to the fast track anyway rather than the small claims track. There is no such thing as a "small claims court" and the court that you issue through will decide what track to allocate the matter to. If it is felt to be complicated and it involves two businesses it is possible that they would allocate it to the fast track anyway.
It's difficult to say from what you've posted what the outcome will be. Remember though that everyone thinks that they have a cast iron case when they go to court. It isn't always proved to be the case!
Be aware that if you issue proceedings and then withdraw them, you run the risk of being responsible for the defendants costs to date unless they agree otherwise (outside of small claims track). With a claim of that amount you might want to bear this in mind before issuing (unless it's too late!).
Lurking Lawyer is probably your boy on this issue though for better advice.
I'm sorry I don't know the fine details of your legal system but if that case was happening down here one of two things could happen first.
You could lodge your Statement of Claim, get their Statement of Defence, and then see where you are before deciding how to proceed.
Or in some cases you can start with discovery claims both ways.
If you get ALL contracts, reports, memos, letters, e-mails, file notes, and all other relevant documentation from their side it would give you a much better picture.
You could lodge your Statement of Claim, get their Statement of Defence, and then see where you are before deciding how to proceed.
Or in some cases you can start with discovery claims both ways.
If you get ALL contracts, reports, memos, letters, e-mails, file notes, and all other relevant documentation from their side it would give you a much better picture.
Piglet said:
Lurking Lawyer is probably your boy on this issue though for better advice.
You remembered me, Piglet - I'm touched!
I almost feel like a PH regular now 
Not much to add to what Piglet has already told you, UKBob. Value of the claim isn't an absolute determinant of which track the claim gets allocated to. There is a presumption that claims below £5K will be allocated to small claims but it's not a cast-iron guarantee. If the matter is factually or legally complex it may well be allocated to the fast track, or even the multi-track, even if of limited financial value.
Interest from due date of payment to date of issue of the claim has to be added to the principal amount. If that bumps it over £5K, all the more reason why it would be allocated to the small claims track.
I note you're counting VAT towards the total. Are you VAT-registered? If you are, you can't claim it as part of the claim as it's not a true loss, since you can recover it. If you're not VAT-registered, it can validly be claimed in the proceedings.
Whether the defendant brings in lawyers is really a matter for them. Unless their management is familiar with the system and/or has some legal trainign of its own, my experience is that they tend to instruct lawyers even when there are faced with not being able to recover their costs. Of course, it also tends to make them more pragmatic about considering settlement if their point of principle is going to cost them more in legal costs then amount in dispute....
The cost of issuing the claim works on a fixed scale depending on the amount claimed. From memory, I think it's either £80 or £120 for a claim up to £5K. It's on the Court Service website (in the Forms and Guidance section) if you want to check.
Hope that helps. Drop me a PM if you have any further specific queries.
Piglet said:Thanks for the advice. Im going ahead, and will post a "notice of intent to persue legal action" letter tomorrow, giving them 7 days to pay which I doubt they will. IMHO, they dont stand a chance. I guess everyone feels that way, or there wouldnt be a dispute.
if you issue proceedings and then withdraw them, you run the risk of being responsible for the defendants costs ... you might want to bear this in mind before issuing.
Lurking Lawyer said:Ive not added interest, nor will I make a claim for it. But you are saying it could go either way? Cant I request that it stays in small claims court?
Not much to add to what Piglet has already told you, UKBob. Value of the claim isn't an absolute determinant of which track the claim gets allocated to. There is a presumption that claims below £5K will be allocated to small claims but it's not a cast-iron guarantee. If the matter is factually or legally complex it may well be allocated to the fast track, or even the multi-track, even if of limited financial value.
Interest from due date of payment to date of issue of the claim has to be added to the principal amount. If that bumps it over £5K, all the more reason why it would be allocated to the small claims track.
I note you're counting VAT towards the total. Are you VAT-registered? If you are, you can't claim it as part of the claim as it's not a true loss, since you can recover it. If you're not VAT-registered, it can validly be claimed in the proceedings.
Whether the defendant brings in lawyers is really a matter for them. Unless their management is familiar with the system and/or has some legal trainign of its own, my experience is that they tend to instruct lawyers even when there are faced with not being able to recover their costs. Of course, it also tends to make them more pragmatic about considering settlement if their point of principle is going to cost them more in legal costs then amount in dispute....
The cost of issuing the claim works on a fixed scale depending on the amount claimed. From memory, I think it's either £80 or £120 for a claim up to £5K. It's on the Court Service website (in the Forms and Guidance section) if you want to check.
Hope that helps. Drop me a PM if you have any further specific queries.
Also, surely if they owe XX + VAT, then they have to pay the vat. If they pay me, the government will be wanting their share. No price is exempt for vat registered business (yes, vat registered). Also, im on the flat rate scheme meaning I cant claim vat back. I charge vat at 17% and pay only 13% vat, so I need to claim for vat if im not to be out of pocket, Id guess?
mybrainhurts said:
That's right...I think LL is confusing his output tax with his input tax....
Most likely! I'm very hazy on tax and profess no great knowledge of it!
If you can't claim it back, and you would be left out of pocket if the VAT was not recovered, then yes, you can claim it. I had understood from looking at this in the past that VAT could be recovered on unpaid invoices (bad debt relief, or something like that) but don't know whether that would necessarily apply here.
Bob, as far as allocation goes, after a Defence is filed you get sent a document called an Allocation Questionnaire by the court to fill in and return. One of the questions asked in it is which track you say the claim should be allocated to and, if that's not the usual track for a claim of that size/amount, the reasons why you say your selected track is the right one.
Lurking Lawyer said:
Lurking Lawyer is probably your boy on this issue though for better advice.
You remembered me, Piglet - I'm touched!
Of course...us non contentious lawyers are always keen to have a litigator around to pass our clients onto for some free advice!!
fasterpussycat said:
Why aren't you claiming interest on the due amount? If you are starting the claim then you might as well.
Agreed, in for a penny....
Page 2 here explains all www.hmcourts-service.gov.uk/courtfinder/forms/ex302_1105.pdf
Hey Bob, how you doing?? Is this the same jerk from your last thread? You do lead an interesting life. 
I thought that you could not claim costs in the small claims court. The idea is that each pays their own which gives the little person the chance to take the big person to court without the risk of paying for their superstar barrister.
This thread may be helpful.
www.pistonheads.com/gassing/topic.asp?h=0&t=243464
Hope it all goes well for you.
I thought that you could not claim costs in the small claims court. The idea is that each pays their own which gives the little person the chance to take the big person to court without the risk of paying for their superstar barrister.
This thread may be helpful.
www.pistonheads.com/gassing/topic.asp?h=0&t=243464
Hope it all goes well for you.
Zod said:This is why im not charging interest, or asking for more money. Im happy to just take what im asking, and keep it below 5k so it can (hopefully) stay in small claims.
Parties pay their own costs in the Small Claims Court.
Tuska said:Hey Martin
Hey Bob, how you doing?? Is this the same jerk from your last thread? You do lead an interesting life.
I thought that you could not claim costs in the small claims court. The idea is that each pays their own which gives the little person the chance to take the big person to court without the risk of paying for their superstar barrister.
This thread may be helpful.
www.pistonheads.com/gassing/topic.asp?h=0&t=243464
Hope it all goes well for you.
Me, an interesting life I usually walk away from these things, but its high time I stood up for myself. I truly believe think they stand a chance in hell - it'll be a good learning experience, especially for me as I tend to shy away from confrontations and tend to let others get away with having what they want faaar too often. OK, one more question...
I want to take 'evidence' to the court. Im sure the judge will be reasonable enough to see our side, but Id like to point out to him that:
"It is entirely reasonable, normal, and necessary for a client to provide some feedback regarding specific points of the web site, following the completion of a web project, so that the project meets the clients needs."
Every one of my clients will agree with this statment. And Id like to gather these statments from my clients.
1) Can I do this, and bring the statments to court? Will the statments be valid if I tell my clients about "the court case" or must I just ask for their signature without mentioning the case, so as not to bias them, or...?
2) Is doing this necessary, might it even help? Or should I just leave to to fate and trust I get a sensible judge who will see the point that we cant finish a project without their feedback.
Bob, I can't see any reason why you can't collect statements whether you tell the clients about the case or not. To ensure that any evidence is admissible it must be served on the court and the other side prior to the hearing but that will come out in the procedure before you get to the hearing anyway (discovery - which is where you exchange any documents you have that either help OR HINDER your case - this is a whole new topic for the future!).
The difficulty you'll have is that the Judge won't really care too much about any of this and won't read the papers too far in advance and then won't have understood much of the detail of the case. You will need to get your point across as simply and succinctly (sp?) as possible or you'll lose him. So whilst lots of statements may be helpful don't bank too much on the Judge having read them all!
The difficulty you'll have is that the Judge won't really care too much about any of this and won't read the papers too far in advance and then won't have understood much of the detail of the case. You will need to get your point across as simply and succinctly (sp?) as possible or you'll lose him. So whilst lots of statements may be helpful don't bank too much on the Judge having read them all!
Cheers piglet
How short should my statment be, would 5 pages be too much? And the opposition will see this before we go to court, and base their case on the statment, correct? Will I be able to see their statment before we go to court? I assume you only get one shot at submitting "the statment"?
How short should my statment be, would 5 pages be too much? And the opposition will see this before we go to court, and base their case on the statment, correct? Will I be able to see their statment before we go to court? I assume you only get one shot at submitting "the statment"?
I'd be guided by Lurking Lawyer on the length of the statement - it's a thin line, you need to get all of your points across but you need to keep the judge with you!
You will have to exchange witness statements before the hearing but they should be "exchanged" so you'll send them on the same day.
The defendant will though get to see your claim and will no doubt base their defence (and any counterclaim) on that so you need to make sure your claim gives enough detail but not enough so that you give them all the ammunition that they need!
I know that sounds a bit woolly but it's not an exact science unfortunately - it's why I gave up litigation!!
You will have to exchange witness statements before the hearing but they should be "exchanged" so you'll send them on the same day.
The defendant will though get to see your claim and will no doubt base their defence (and any counterclaim) on that so you need to make sure your claim gives enough detail but not enough so that you give them all the ammunition that they need!
I know that sounds a bit woolly but it's not an exact science unfortunately - it's why I gave up litigation!!
Piglet said:Hmmm
The defendant will though get to see your claim and will no doubt base their defence (and any counterclaim) on that so you need to make sure your claim gives enough detail but not enough so that you give them all the ammunition that they need!
I thought that the statment should contain everything, because the judge reads all papers in advance of court, meaning its possible (using facts) before the trial to sway him in my favour. If I chirp up in court "ahh yes but..." it might seem Im debating the points. If I lay them out in stone before we start, they they become the grounds for my defence rather than a verbal attempt at defending myself. Or...
One of my clients is a solicitor and gives me free advice as we scratch their backs with gratis web stuff. But I feel like Im taking the piss as she says she values her time as £250 per hour, and after a handfull of hours of chitchat over the last 6 months, I dont want to take the piss. She didnt mention holding anything back.
I can see why you gave up litigation
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