One common mistake we find is where the credit manager sends over a file for litigation without an updated spreadsheet or accounting showing each and every charge and payment made by the Defendant back to the point where the Defendant had a zero balance. We have seen cases where a client will allow a customer to buy $2o,000 or $50,000 worth of product every month, never paying off the previous balance in full before the next order is placed. Unraveling the payment stream can become a nightmare and is not the task best left to your attorney. If the case is an hourly case, the attorney will bill you significant time trying to decode your accounting system. If the case is a contingency case, the attorney will spend unnecessary hours on the case, and become discouraged from the paperwork. Worse, your opponent will turn the messy paperwork against you, accusing you of poor bookkeeping, claiming they have paid the bill. Even worse, the Judge is not going to spend the time it takes to decode a complex payment history, and may deny the creditor summary judgment, forcing a case to trial. In the long run, the creditor will either have to straighten out its own books or accept less money than it is owed to settle the account. Having a clean set of books increases a creditor’s chances of being paid in full, and a proper spreadsheet or summary bill increases the creditor’s chances of being paid.
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