SPEAK TO A LAWYER
From the vantage of Abo and Company’s accounting and tax consulting practice as well as our affiliate, Abo Cipolla Financial Forensics, it’s interesting for us to observe businesses utilizing lawyers to write collection letters to customers as a more economical means of recovering receivables than litigation.
We’ve seen attorneys' fees much lower for this service than if litigation is undertaken. It’s even interesting to note that an envelope with the attorney's return address could indicate that a legal notice is enclosed which, in turn, might indicate the initiation of litigation or worse. We’ve observed these letters often get considerable respect from delinquent debtors. Hey, it even often leads to payment or a negotiated settlement of the amount owed.
However, if there is no response, we understand the business owner should still follow up. To our knowledge as non-lawyers, threatening legal action without any intent is may be illegal.
The takeaway? We believe enterprises, large and small, should regularly confer with their lawyer. If you don't have one for your business, as we believe you should, well, let us know if you'd like us to recommend a credible attorney to confer with.
But a few miles from Philadelphia, was it not Benjamin Franklin’s axiom that read “an ounce of prevention is worth a pound of cure”. Perhaps put another way to quote Managing Member, Marty Abo, “…I don’t go to the doctor and afterwards say what a waste of money…she didn’t find anything wrong with me.” Better to speak to your lawyer BEFORE you have to.