The saying, “Timing is everything,” still holds true when it comes to identifying and pursuing a claim against a buyer. The timing to initiate a potential claim is not up for debate; it should be when you first become aware of a problem with a shipment. Whether it is a potential truck claim or a dispute with a customer, the situation needs to be addressed immediately and documented. You can document a telephone conversation by sending a timely email to confirm your position.
You should never put a problematic load on the back burner, but keep it front and center at all times. Disputes can start small and turn into complex issues if not acted upon in real-time. Therefore, it is necessary to document all telephone calls and any verbal agreements made with customers via email. As the adage goes, “The one with the most documentation wins the dispute.” Remember, if it is not documented, it never happened. It is a Best Practice to ensure that all discussions and agreements are documented.
I have linked an Arrival Inspection Check List to aid you with asking the right questions in determining if there has been a breach of contract.
What if your invoice is paid short, do you immediately pursue a claim against your customer? Unfortunately, there are times when your buyer will unilaterally remit less than the original invoice amount by taking an unauthorized deduction from your invoice.
If there is no dispute, follow these steps:
- Immediately contact your buyer seeking the full balance due.
- Explain to your buyer that no deduction was ever granted and that you expect payment in full.
- Confirm all conversations by email. Very important!
- Issue a balance due invoice.
It is essential to establish an internal process that keeps a record of buyers who consistently short pay your invoices. This diligence involves asking yourself whether you want such customers as partners. This discipline can help you avoid buyers who tend to cost your company more money over the course of the relationship.
If you have exhausted all attempts to resolve a dispute or no-pay situation with your customer, it is important to remember that you have a 9-month statutory window from the date of payment default to file a Perishable Agricultural Commodities Act (PACA) complaint.
For example: Payment due date of Tuesday, July 19, 2022.
April 19th is your last day to file a PACA complaint.
As an additional Best Practice recommendation, if you have not resolved the dispute within 60 days of the shipment date, it is recommended to contact me to further assist in reaching out to the buyer regarding the disputed transaction. If necessary, we can pursue payment through the power and jurisdiction of PACA.
If you have a claim or dispute that you are not exactly sure what your next step should be, please give me a call directly at (949) 885-4808 or by email at firstname.lastname@example.org. I stand ready and poised to assist our regular member companies in recouping monies that are owed. Don’t wait until it’s too late, contact me today to ensure that your company’s financial interests are protected.