When an owner owes a contractor money, this can lead to a lot of stress. Perhaps subcontractors need to be compensated, or maybe this lack of payment results in not having enough working capital to invest in other projects. There are many negative consequences that can transpire because of an owner’s refusal to make payment. Fortunately, a Florida contractor lawyer is here to assist you.
In this three-part article series, we are discussing the art of the demand letter. As we discussed in the first section, this legal document notifies the owner that you are owed compensation and that you are considering legal action if you remain unpaid. In this section, we will feature many of the elements that make up a well-written demand letter.
Diplomatic and Direct
Demand letters should be diplomatic, but direct. It’s important to create a well-defined foundation of what exactly transpired and why you are owed compensation. You want to chronologically list what happened in what order, how this led to the dispute, and why you have a great legal argument if presented to a court. If the owner was in violation of your contract, the clauses that were breached should be referenced and attached as exhibits to the letter as well. Again, this document should be clearly worded and include all of the relevant issues related to your case.
Clearly Define a Payment Plan
Along with presenting your prospective case, the demand letter should also make a specific request of how you want to resolve the dispute. For example, if owed payment, the letter should entail the exact amount of money you are owed, how you came to this total (along with other exhibits like invoices or your contract), the requested deadline to receive payment, and the form of payment you want to receive.
Here are a few other things to consider when sending an owner a demand letter:
- Keep extra copies of all legal documents including any communication you have with the recipient of your letter
- Send the demand letter in a timely fashion
- Have your letter mailed to the recipient and utilize a mailing service that requires a signature verification to obtain the document
- Request that the recipient contact your attorney to verify that they received the letter
As we will discuss in more detail in the third section, your demand letter also needs a call to action. In other words, if the owner refuses to agree to your demand request, it’s best to specifically state what the next legal step will be in order to seek compensation.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.