Questions

What would you like me to write about for SavvySME?

Next week I will be putting together my writing strategy for March and April, so I am wondering,... read more

Jef Lippiatt
Jef LippiattOwner at Startup Chucktown
I know that it is important to have clearly written contracts and agreements, but when disagreements arise would it be wise to have them drawn up and signed as an audit trail to limit the same problem from resurfacing at a later time? If that is the case, would it be wise to have a third-party or notary sign-off on the disagreement document as well? I think knowing more about that would be helpful (at least for myself).
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Questions

Disclaimer text: is there any point to it?

Does the disclaimer text inserted at the bottom of many corporate emails actually hold any legal... read more

Asked by:
Lisa Creffield
Yes a well worded disclaimer clause that is clearly stated will be enforceable. There are a number of different types of disclaimers or exclusion clauses. One type you have identified is on the bottom of emails but they are also found in most consumer contracts such as gym agreements, mobile phone contracts etc. They are enforceable as by signing those documents you are stating that you have read and understood the terms of the agreement and consent to waiving your rights. Exclusion clauses are also found in car parks, again if clearly displayed and worded will be enforceable. My advice is always make sure the clause clearly states what you are excluded, if it is vague it will be unenforceable. In terms of indemnify the company from inappropriate - remember you are vicariously liable for the actions of your employees. That means in simple terms -- you are responsible for every idiot you employ and the actions of that idiot. However if you have a clear social media and email policy then it could be a disciplinary action against the employee.
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Questions

How do you handle small bad debts in your business?

What do you do with a client who after 90 days still hasn't settled a $209 invoice they keep saying... read more

Asked by:
John Belchamber
John Belchamber Owner & Senior Consultant at Invoke Results
I assume you have had enough contact with them that there is no doubt this amount is neither overlooked nor disputed.  So it depends on the commercial value of the client to you: 1. This is the only invoice.  Send a letter advising legal action if not paid within 7 days.  They will either pay or not.  If they don't, write the debt off and move on.  Spending more time and money on a small, slow-paying client is just not worth it. 2. You have ongoing business for a reasonable amount with them.  Send a letter / email advising that your policy is to do no further work for clients with bills 90+ days overdue so their account has been suspended.  They need to pay within 7 days.  All future work will require a deposit in advance / be on a 7 day payment term. 3. You have no business at present but hope for some in the future.  Build it into the pricing for the future work and make sure the payment terms on that future work are cast-iron including an advance payment, and that they sign for the work before you start doing anything. Including a clear statement of payment terms in your T&C is also a good idea. BTW I once had a client who only ever paid on receipt of a 7 day warning letter.  Non-payment was clearly a cashflow management issue for them and the 7 day letter acted as a warning to them that it was time to stop resisting and pay up.  Once I knew the pattern I just made sure they got 7 day letters at 60 days when other clients didn't get them till 90 days.
Phil Joel
Phil JoelDirector at SavvySME
This website (http://www.business.vic.gov.au/operating-a-business/managing-finances-and-tax/invoicing-and-debt-recovery/debt-recovery) gives very useful advice on steps you should take but to be honest you'll get a much faster response if a lawyer send the letter of demand. I went online and found that Somerville is offering to do this for $38.50. 
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