We all had a good chuckle last week at the dust-up between gym chain FitnessSF and their freelance web designer Frank Jonen, who hijacked FitnessSF’s website as comeuppance for unpaid invoices. As gutsy as Jonen’s move was, it had many longtime freelancers rubbing their brows wearily, and was condemned by some as a bad move.
So what did Jonen do wrong in this case? There are three main issues with what happened.
If the contract between Jonen and FitnessSF did not explicitly state he would suspend hosting (or, in this case, replace the website entirely), he is potentially opening up his business to a claim for damages. FitnessSF could very reasonably argue that being without a functional website for almost a week has cost them dearly.
Of course we don’t know that this clause did not exist, but we get the impression that if it did FitnessSF would not have reacted the way they did.
In situations like this a bit of give-and-take will usually be required from both parties to reach an agreement. Taking action like this will almost definitely kill off any remaining goodwill, and drastically reduce the chances that an agreement can be reached without the need for litigation.
The US legal system is an awkward jurisdiction for international creditors owed relatively modest amounts. Unlike most jurisdictions a signed affidavit in the hands of local counsel is not enough. Courts usually require that creditors attend hearings personally and usually at their own cost. This means that if Jonen decides to lawyer up, it could end up costing him dearly.
We had a word with our resident credit control experts Safe Collections, who had this to say on the subject -
“If you are owed a relatively modest sum from a US debtor, you need to think carefully about your options. Legal action will necessitate your physical attendance in a US court and the costs for this are largely unrecoverable.
Genuine offers of settlement should always be considered and any loss weighed against the costs involved in litigation.”
For more info on collecting overdue payments from the USA, see Safe Collections’ blog.
Photo by RikkisRefuge