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A friend asked me to develop a website for his sister who is a realtor. I developed a proposal and she signed it. I developed the site which works perfectly and includes everything in the proposal. She has been using the site for 4 months now.
She said that times were tough and asked if I could hold off on the invoicing for a couple of months to let her get a couple of sales under her belt. I agreed as a favour to my friend and have not sent a single invoice yet.
Now she wants to scrap everything I have done, not pay me, and use the "free" website that her parent real estate company is offering to her and all other agents.
This is the first time I've been "screwed over".
How do I respond to this?
Do I just throw her into collections? That will leave me and my friend in a bitter situation (I can see that conversation already).
Perhaps I can take the high road on this one and be forgiving, respond in a empathetic tone towards her financial hardships and take it as an expensive lesson learned.
Lessons learned:
1. Some form % of payment is now required up front.
2. I done doing favours for people. There are no friends in business.
3. If the client tells you they "can't afford it" - don't do it.
[edited by: tedster at 6:18 pm (utc) on Jan. 21, 2008]
The client is crazy...he just emailed someone else and told them to pay me! This someone else is the fellow who made the introductions. Crazy talk...
I sooooo want to pull the plug on his PPC campaign for a day which brings in anywhere from half what he owes me 4X what he owes me... in a day! But alas it apparently would be unethical to do so... :-)
If she never pays, you can always use the layout and design and sell it to someone else.
Collection companies will do nothing for you. I had to do that once on a client. It cost me 200.00 and I got nothing... dont bother.
You could however take her to small claims court. Cost ya 35.00 to file.
No replies yet from her via email or phone.
I have not had any conversation with my friend about this issue. It's kinda wierd that he doesn't even want to talk about it and avoids the topic like the plague.
I think he might feel bad about his sister shafting me but doesn't want to be involoved in our business dealings.
I think his (the brother) absense in the issue is a good place for him as this might get ugly between me and her (his sister/the client).
Contacting the parent realtor company might stirr up the **** but as the realtors are independent contractors, I'm really not sure what the parent company can do about it.
The wierd thing about all of this is that as a realtor, she preaches to people about the defacto laws of real estate which shuns people from making a private deal with the owner of a property even after a broker helps you find the property. Apparently this type of activity is unethical.
Yeah... she's real ethical alright.
Again... I'll update in a couple of weeks when final notice is sent or if anything happens before that time.
[edited by: Essex_boy at 6:34 am (utc) on Mar. 4, 2008]
but as the realtors are independent contractors, I'm really not sure what the parent company can do about it.
I am not sure what state you live in, but in my state Realtors MUST have a broker to hold a real estate license. Therefore if this is also true in your state the broker does have some power to pressure her. If they wanted to they could probably ask her to leave the brokerage if she doesn't pay because it makes them look bad. Not sure they would do such a thing, but it is probably worth looking into.
The other thing you can do is fight really dirty. Most Realtors are subject to some very strict rules of conduct from the state real estate board. A complaint from ANYONE is usually enough to cause their life to fall into chaos for a while. You can tell her that if she doesn't cough up the money you are going to file an ethics complaint with the state real estate board. If the board in your state is anything like my state she will kill herself to pay you yesterday rather than face the serious pain she will get from a board inquiry, even if she wins it would not be worth it the hassle and problems an inquiry would cause her. In other words if she had a brain her head she will pay you the cash and get rid of the problem, I know I would in her place.
He can't expect you to just eat that time and swallow the loss... no real friend would.
The trouble with services is you can't return them and the person who supplied the service can't "re-sell" that service to another.
If you painted her house and she couldn't pay, then her boyfriend moves in months later, and he owns a siding company, and so he decides to put siding on the house for free... that isn't your problem and she still has to pay for the painting service you provided her. It isn't like you can transfer that paint job to another house to recoup your losses. Same with a website.
Your other option is to barter with her. Maybe she can sell or buy a house for you for ZERO commission, she can do all that paper work and legal stuff, throw in an inspection... see how willing she is to "give away" her services... maybe that will clue her in to what she is asking you to do for her.... you can throw in a "Welcome to the real world" speech as well.
For future always get a commencement fee, 50% of the estimated total isn't unreasonable. But I can see why for a friend you would bend that rule.
Remember.... no good deed goes unpunished.
[edited by: Demaestro at 7:08 pm (utc) on Mar. 6, 2008]
Tell her, sister, you signed a contract. That's because I work for a living. If I planned to work on spec, I wouldn't have made you sign the dotted line. If I wanted to be a partner in your business, I'd have said so in the contract. Times are tough all around. If you couldn't afford the work, you shouldn't have hired me and been so ready to mess up your brother's friendship. I'm offended that after all my work that you used for 4 months...you plan to use a free website now. (I'm assuming that you never pushed her in order to make a sale...if you did, then this entire thread looks different btw). I'm offended that you don't seem too concerned about all my time you wasted.
Sell some dresses and shoes and pay me. I'm not your boyfriend or father. Have some other men take you out to lunch and dinner so you can pay me. You've obviously been spoiled your whole life and had people pay your way through life. Well it's time to grow up sister.
And to your friend, I understand you don't want to mess things up and you don't have to. He did you wrong somehow, he's the one to feel guilty, and as long as you don't push him too hard, he shouldn't dump you as a friend. But you can ask him why he didn't warn you that his sister was this way? Give him enough that he will pressure the sister to try and pay you...
Some of the lines I mentioned above are a bit of dirty pool. It's psychologically loaded. But it might be effective if you can pull it off. I don't know much about her, but she does sound like the kind of girl who never learned responsibility...so you may wind up both collecting and doing her a favor.
How old is she?
I sooooo want to pull the plug on his PPC campaign for a day which brings in anywhere from half what he owes me 4X what he owes me... in a day! But alas it apparently would be unethical to do so... :-)
I disagree... is it unethical to repo a vehicle for non-payment even if that vehicle is used to generate revenue?
If an independent delivery guy buys a truck to deliver stuff and doesn't pay for the truck you better believe they will have no issue or ethical or otherwise taking it right from under him... even in mid-delivery.
[edited by: Demaestro at 7:12 pm (utc) on Mar. 6, 2008]
Of course there were exceptions for repeat clients where a level of trust was established, but all first time clients were always C.O.D. without exception.
It's kinda wierd that he doesn't even want to talk about it and avoids the topic like the plague.
Probably not so weird because he's probably completely embarrassed about it.
If you have a conversation just let the guy off the hook and actually thank him for the referral and let him know it's not his fault it didn't work out.
How were the invoices delivered? by mail? email? I would go to her office to drop it off.
Did she every say why she isn't paying?
I'd not go for the legal action, talk it out with her if she cannot pay, a partial payment might be better than a full payment and the lawyer running away with it all.
As for the friend: real friends don't let their friends get hurt. It might be a test of the friendship, but thats about it.
It needs to be in writing, it needs to be signed by her, it needs to include reasonable interest, and it needs to include an initial payment.
If you get nasty they just get nasty back
If you get passive, they just sigh relief.
I'm guessing the amount is more like small claims court money. You can have them served for $35 in most states (by a sherrif with a gun)
That's a lot more embarassing in front of the neighbors than a call from a collector
I would explain that you don't want it to come to that. that you both know you deserve to be paid something (as opposed to zero) Ask what she can afford to pay to keep the whole deal from getting ugly....take it and move on.
FWIW
As a part of our contract, we have the terms of payment defined, which includes a certain percentage to be paid by the client after we work with them and finalize the wire frames / static pages. After this, the next payment is due when the coding is completed and the third payment is due when the final sign off is done on the testing server. (Please note that we do not give the code to be launched until the application is signed off and this payment is made). Finally, we release the code, assist with migration to live site, and then at the end of this, get the final payment.
This approach is required to mitigate the risk and at the same time it justifies the amount paid in parts by the client is in proportion to the amount of work done.
Double the price and write it off as an uncollectable loss.
Put a message "this website [ owned by "person" ] has been closed due to non payment." Put a notice on this page saying "If you are the owner of this site . . . ."
On your site, add a bad debt department page, and add the non paying customer to it with a screen shot of the site you created for them. Link to this page from the above domain.
A realtor's biggest asset is their reputation. As long has you have firm documentation, and you are willing to take some risks, you can let them decide what their reputation is worth.
Delete the site off the server.Put a message "this website [ owned by "person" ] has been closed due to non payment." Put a notice on this page saying "If you are the owner of this site . . . ."
REAL bad idea!
There are a number of possible legal liability issues.
Defamation is probably not one, BUT - nothing to stop somebody from filing a lawsuit that they will lose. You will still have to go to the time and expense of defending a lawsuit, and prove that you are telling the truth.
If you have a mutual non-disclosure agreement, posting about the bad debt may be a violation of that agreement, and in that case, you may well lose if a lawsuit is brought.
Plus, it's just plain nasty. I don't think I'd do business with somebody who I knew to go about things in this way.
Here is my take:
1) What does the contract state? Does it discuss non-payment and what happens? Did she just sign the proposal or did she sign the contract?
2) File today in small claims and don't just file for what she owes you. Include late fees, interest and bill her for the time it took you to file. You may also want to include time to get advice on what to do as well. Remember, a judge will either award you in full, award partial, but never award you more than you filed for.
3) Who owns the domain? Where is it hosted? If it is on your server, I see no problem with turning it off. I've done that and it gets prompt attention. You've waited nearly six months for payment. I guarantee in that time she has paid her rent and car payment.
4) My guess is that she has done this before and is a pattern for her. For some reason she believes that if she really doesn't want it anymore, she shouldn't have to pay for it. You need to pay for the work that you did and she needs to pay you.
This is why I'm glad I don't do client work anymore.
Your friend probably has an idea that something is going on with his sister.
Send her the invoice and just let your friend know while telling him that you're not expecting him to do anything but wanted to give him fair warning that the sister might mention it.
Hopefully, if he values the friendship he will put a little pressure on her.
The lawyer and notifying her managing agent and board of realators are also great ideas.
Just be sure not to spend more money/time than you will recoup if everything works out right.
In terms of what to do, my sense is that Karma will kick in and you will get your money back some other way; and they will be forced to deal with whatever comes their way.
