Back to Blog

What's in a Name?

When you are in business, getting a new customer is a great feeling…  You get to grow your income, develop new and potentially long-term relationships and show how well you can do what you do! However, in the haste to get started, taking a few steps at the beginning are imperative. Read this article to learn about two of our most important areas to protect what is owed to you when it comes time to involve a Debt Collection Agency… Firstly, in our industry we are forever talki...

Travel Industry

CollectIT’s client (Client A) in the travel industry was owed $13,057.11 by an ex-employee who had promised to repay the money. Funds were misappropriated in 2007 and although some payments had been made these were not consistent. In November 2011 CollectIT was asked by Client A to commence debtor management. After this was ignored by the debtor, Court action was initiated in December 2011 and a charging order was put over the debtors’ home in May 2012. In August 2012 a second party (Client ...

Small Business Sale

CollectIT's client B sold a lawn mowing business, and generously left approximately $25,000 in the business allowing the new owner to get established and then repay the amount. As you've already guessed, the fact that it was placed in CollectIT's hands, means the debt was never repaid! The debtor did not respond to the many letters, phone calls, texts or even messages left with family. CollectIT were instructed to proceed with court action and a Notice of Claim was served on the debtor; however,...

Signed Credit Application Form puts the cost onto debtors …

CollectIT was engaged to pursue a sole trader from Dunedin who owed our client invoices worth $12,612. Once it was put into the hands of CollectIT, interest was oncharged as well as collection costs as per the creditors credit application form. The debtor began making payments after a month of discussions, and these continued sporadically for nine months totalling $6,000. The payments then stopped. After many more follow ups with the debtor, but no further payments, CollectIT applied for a court...

Why terms of trade are important no matter what the size of the debt...

Our client - in the advertising industry was owed a total of $462 by a client in Christchurch. The debtor promised to pay on many occasions and never did. As our client was able to charge interest and recover collection costs CollectIT recommended proceeding to court. Our client was dubious due to the small amount involved but when CollectIT explained that under the terms of the agreement the debtor had signed with them, all costs would be added to the claim, instructions to proceed were granted...

Advertising

Our client - in the advertising industry was owed $1,200 by a sole trader in Christchurch for advertising carried out. Debtor B disputed the amount claiming the advertising never took place despite being provided with evidence showing dates and times, so off to the Disputes Tribunal the case went. At the hearing Debtor B requested certain information was supplied to him so another hearing time was granted. Debtor B did not show up to the next hearing and so Client M presented their case and rece...

Logistics Industry

This was the comment made to CollectIT by a client referred by their Accountant. The client desperately needed some assistance with slow payers and bad debts, but had had poor results from other debt collection agencies. The client was persuaded to try CollectIT and after a few months referred 13 debtors. One of the concerns raised by the client was CollectITs’ 20% commission. CollectIT prepared terms of trade for this client so costs could be passed onto future debtors. Unfortunately, this cl...

Irrigation

Our client had carried out irrigation work for a company in Napier and the job had run smoothly with the client paying installments as and when requested. There had been no concerns with the job so it came as a surprise to the creditor when his final $10,000 invoice went unpaid. CollectITs client wasted no time in handing the matter over for assistance. When CollectIT was asked to recover this debt, it was two months overdue. The debtor decided ignorance was the best way to handle the outstandin...

Tenacity pays off …

CollectIT began pursuing a debt for an Auckland Accountant in April 2013 when the debt was 18 months old. After approximately 20 unsuccessful attempts at contact which included text messaging, letters to two different addresses, emails to three different addresses and phone messages, the debtor company was loaded as a default debtor on Veda. The husband and wife had both provided personal guarantees on their contract prior to work being carried out by the Accountant and so were also loaded as de...

So many outstanding accounts you don't know where to start?

CollectIT's client (an Accountant) had a pile of files that he had not been paid for and was procrastinating about whether to pursue them or not. He decided he had nothing to lose by sending them in to CollectIT and so forwarded 11 files.  Result: Within the first three days one file was paid. By the end of the first week another file had been paid. After CollectIT had been working the files for only six weeks, six out of the 11 files had been paid and closed. This amounted to $10,500 ...

Accounting Industry

Sometimes an outside negotiator who knows what they’re doing makes the difference ... CollectIT was engaged by a large accounting firm after the firm had spent two years chasing money owed by one of their clients. CollectIT carried out a lot of negotiation with the debtor and came up with a satisfactory solution. Result: The debtor began repaying their outstanding debt at the amount of $2,000 per month with a couple of larger payments thrown in occasionally. There was constant follow up o...

Sometimes you need to go the whole way!

A Cambridge builder built a beautiful new home for his client. When he sent in his final invoice for $6,387.02, there was no payment forthcoming. The builder had undertaken a labour only contract and so was unable to withhold the Code of Compliance pending final payment as the client was organising this herself. CollectIT became involved and as per the Builder’s contract, interest and collection costs were added to the original debt. The debtor promised she would pay once the Code of Complianc...

Building Industry

CollectITs expertise in the construction industry was requested by a leaky homes specialist in Auckland to chase an outstanding amount of $8,000. The debtor, who had had work carried out on his property, decided his best defence, was to attack. The debtor threatened to take CollectIT to the Commerce Commission, tried to hide behind a Family Trust, and sent numerous emails and phone calls to the creditor and CollectIT threatening legal action -  all in the time frame of three weeks! Needless...

Some debts do get paid quickly ...

CollectITs client in Waikato whose line of work was effluent pumping, had not been paid by their farming client, despite numerous follow ups. The invoice worth almost $4,000 related to work carried out more than one year prior and the farmer had been happy with the service provided. CollectIT sent their first letter demanding payment be made within seven days. Result: Seven days later the debtor paid the invoice amount plus collection costs that our client was entitled to charge....

Farming

CollectITs’ client had provided milking cups to a farmer in Taranaki at a cost of approximately $4,000. Months later and still no payment had been received so the creditor sought help. When CollectIT became involved the farmer said he would return some goods in lieu of payment - goods which had been given to him free of charge! We didn't think that was quite the done thing and certainly wasn't going to resolve this issue. The debtor disputed the work so CollectIT prepared a claim to be lodged ...

Roofing Industry

A roofing contractor carried out work for a developer in Wellington who failed to pay invoices totalling around $14,500.00, despite numerous attempts by the roofing contractor to obtain payment. CollectIT was asked to collect the debt. The roofing contractor had a signed agreement with the developer which included terms of trade, this meant that interest and collection costs could be added to the debt. Eight days after CollectIT became involved, payment of $13,000 was received from the developer...

Privacy – Can you use information about your clients?

In this age of respecting the privacy of others, care must be taken when collecting and holding information about your clients. The law about this topic is found in the Privacy Act 1993. The Act has a number of privacy principles that must be complied with. The Privacy Act 1993 controls how ‘personal information’, information about identifiable, living people is collected, used, disclosed, stored and given access to. At the heart of the Privacy Act are twelve privacy principles which set out...

Bright Line Test - Will This Impact You?

The “Bright Line Test” which previously imposed a tax on landowners who dispose of residential land within two years of purchase has been extended by Parliament.The Third reading of the Taxation (Annual Rates for 2017 – 18, Employment and Matters) Bill has taken place.  Revenue Minister Stuart Nash included the change in an amendment to Section FB 3A.The Bright Line test has been extended from two to five years.  This extension came into force on 29 March 2018.Mr Nash says the ex...

Do you know your legal obligations if you are in the business of repossessing goods?

Business owners who sell goods on credit with a right of repossession in the event of default are obliged to comply with the Credit (Repossession) Act 1997. One important section of this Act is section 35 which prohibits a lender from recovering more than the debt balance outstanding after goods have been repossessed and sold.What this means is that after you have repossessed and sold a vehicle (or the goods you held security over) and you still have an outstanding balance owing, no further pena...

Can I recover money from debtors living in Australia?

Time and time again we hear from clients whose debtors have moved to Australia. If your debtor is contactable in Australia (phone number, email address, physical address) recovery is always possible. Each debt is different and we have certainly managed to recover funds from debtors in Australia in the past; however, recovery options via the court are limited. If you have a NZ court order against a debtor who now resides in Australia, there are very few options available for enforcement of the ju...

Are debtors causing you anxiety? Could you use a Statutory Demand to encourage payment?

If your debtor is a limited liability company, then provided certain requirements are met, the Statutory Demand procedure can be used as a means of debt collection.Abuse of this procedure is not tolerated by the courts. Getting it wrong can be an expensive mistake.The most important requirement is that the Statutory Demand procedure is only available if there is no dispute that the money is owed. If there is a dispute you cannot issue a Statutory Demand.At CollectIT we are often told by our clie...

Legislation Introduced to Modernise Courts and Tribunals

On 1st August, 2017 Associate Justice Minister Mark Mitchell introduced into Parliament two new bills.These bills are called the Court’s Matters Bill and the Tribunal’s Powers and Procedures Legislation Bill.Viewed as enhancing the work of the Court’s and Tribunals, the Bills amongst other things have been introduced to ensure that financial thresholds and levels of Tribunals reflect the needs of society today.Of relevance to CollectIT's clients is that the Bills raise the threshold of the...

Privacy Commission Critical of Debt Collector

At CollectIT we pride ourselves on our service. Our success rate and testimonials from so many of our clients speak volumes.Not all debt collectors get it right however.  Late last year the Privacy Commission was highly critical of one such entity.  Which debt collector it was is not important (it certainly wasn’t CollectIT). The facts give a good example of what not to do.In this matter the unnamed debt collector pursued the father of two young children for a debt on behalf of a cli...

Need Cash for Christmas?

We only have a few weeks to go before the Christmas break is upon us and that means taking action and sending any overdue debts into CollectIT, TODAY! One of our clients, John Brosnan from Cooper Aitken Accountants, had this to say about CollectIT's service and professionalism. www.youtube.com/watch?time_con...There is no minimum time period in which you can engage the services of a debt collection company for overdue invoices. If you have any invoices that have not been paid by the due date, it...

7 Ways to Improve Your Chances of Getting Paid

At CollectIT we often see invoices which lack information, such as incorrect entities that have been invoiced, no addresses on the invoice, no due date for payment etc. Do you want to get paid in a timely manner? Read on for useful tips or watch this video.www.youtube.com/watch?v=nN3rVa...1. Provide terms of trade to your clientHaving well spelt out terms of trade with your client before work is carried out gives you a contractual agreement which then governs the contractual relationship between...