Talk to the Organ Grinder
I have a client (the Client) that operates a subscription service that renews automatically if the customer does not give the appropriate notice of termination. Recently on behalf of the Client I collected two invoices with a total value of £24,000. Both debtors had deep pockets so it was a wonder why they hadn’t paid the invoices.
I addressed the letters of claim to the director of each debtor. In one case I got a telephone call from the Marketing Manager soon after the letter of claim was sent, whereas in the second case I got no response at all until I escalated the matter to the parent company’s legal department.
The Marketing Manager Monkey
The Marketing Manager challenged liability on grounds that allegedly notice of termination was given and offered to pay 1/4 of the outstanding balance. I insisted on full settlement because notice of termination was not given consistent with the Clients’ terms and conditions. In a telephone conversation with the Marketing Manager she said that my client should not upset such a big customer because it would be damaging for them. I replied a contract is a contract and the Client is entitled to enforce it. The Marketing Manager eventually agreed to settle the full contract price, but when she did made a smug remark about how coincidentally a potential customer had asked her opinion of the Client that day, and she told them about the poor service she received. I warned her to be careful with her words when discussing the service of the Client with third parties because the Client may have a cause of action for libel or defamation. She got angry with me telling me she has a law degree, knows the law and has the backing of the legal department. Despite her promise the debtor never paid the full amount by the deadline. As a result remembering that the debtor has a legal department I contacted the Legal Manager when I discovered contrary to the Marketing Manager’s comments they knew nothing about the Client’s claim. Much to the embarrassment of the Marketing Manager the debtor settled the full amount in 2 days from the date I raised the claim with their legal department.
The Management Consultant Monkey
In the second case although letters were addressed to the director of the company unlike the first case I got no reply whatsoever. As a result I enquired with the receptionist of the debtor whether or not they had a legal department, I was told that legal matters are referred to the legal department of the parent company. The receptionist confirmed the details of the parent company and contact telephone number of their legal department. Wow I thought, the parent company is huge, this will be interesting. I had a conversation with the Legal Manager and sent her copy correspondence demanding payment of the full contract price by the end of the week. The day before still no reply, I called the Legal Manager and left a message on her voice mail. Shortly after I got a telephone call from the Management Consultant of the debtor. The first thing he did was explain his disappointment in getting the parent company involved. Hmmm, I thought have I embarrassed you or exposed something you were trying to hide from them. Like the first debtor he said that the Client should not upset such a big customer because it would be damaging for them. I replied a contract is a contract and the Client is entitled to enforce it as does the parent company with their debtors. Like the first case he challenged liability on grounds that allegedly notice of termination was given and offered to pay 1/4 of the outstanding balance. I insisted on full settlement because notice of termination was not given consistent with the Clients’ terms and conditions. He then said he would have to get approval for settlement of the full balance. I got an e-mail the day after from the Procurement Manager making the same arguments as the Management Consultant the day before. I sent a reply copying the Legal Manager of the parent company, dismissing his arguments demanding 90% of the contract price. The debtor agreed settlement and the Client received 90% of the contract price within 2 days of asking the Procurement Manager for the same.
It is remarkable how despite 2 different debtors from 2 different sectors they made the same arguments and warning not to upset a big customer. But these comments came from individuals that were not decision makers, using the ‘Organ Grinder’ analogy they were ‘monkeys’ who evidently were embarrassed about the situation trying to save face. I insisted by making noises to the right people within the respective businesses and got a result. I spoke to the Organ Grinder not the Monkey to get the money !!