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Hello everyone. I am brand new here, so please don't be too harsh on me if I make mistakes. Anticipated thanks to anyone kind enough to offer advice in the matter, your help is appreciated.


I will try to keep this short, while still giving enough info to create a helpful context.


1. My story: I worked as a self-employed professional handyman last year, sub-contracting for a maintenance/construction company called Project1. It all went well for the first 2-3 months: I was working around 10 hours a week for them, being paid a month's wages in hand, on a hourly rate. They then started giving me increasingly more work as time went by. Then one day, I get a call from the owner/director of the firm and he offers me to work full time for them. He said he would pay me a set day's rate, give me a company van and fuel expenses, plus a card for buying materials. Being taken by surprise and being a Friday, I said I would like to consider it over the week-end. I eventually accepted and started working under that arrangement, with him saying that he will come to meet with me on Monday to talk all about it. Days went by and while he kept telling me over the phone that he will come and discuss the details with me, he never did. I kept being sent to various sites to do various tasks, but I was still using my car and my petrol and my money to buy materials, while I was working for the agreed rate, which should have included van/petrol/expenses. The new arrangement also Included that I get paid at the end of every week, rather than after a month, as it had been before. But although everyone else was getting paid every Friday, my wages never turned up. About 3 weeks later, realizing he was all talk and no walk, I informed him that unless I get what was agreed upon, I will no longer turn up for work. By this time I was owed over £3000 and my patience was wearing thin. I hear nothing from the man himself or from the office, but the day I walk out I get a surprise deposit in my bank account, a £1700 lump sum from a job I had done about 2 months back, while still working on a hourly basis. I thought to myself that my ultimatum had worked and that he will start being more upfront, but after waiting a few days, no communication was received. I never did any work for Project1 after this.


2. Action to date: for the last 9 months, since June 2015 when I sent in my last invoice, I have been engaged in e-mail communications with their office. They played all the tricks in the book, bending backwards to try and delay payment.

-they asked me what my rates were again

-told me that the director was not available

-that the temporary worker has dealt with the invoices and they are not up to date on the latest

-disputed invoices done the same day under the pretext that the amount was too high to be paid for a days work, despite the jobs having been performed at various locations and under the agreed hourly rate

-asked for the invoices to be resent

-asked me to call the director and have a chat with him over the phone about payment(which I declined, stating that I would like all our conversations to be in written form)


3. Latest: Early March this year I informed them that I will start legal action to recover my money, should they not pay the outstanding amount of £1700 within 7 days. They did reply saying that they will only agree to pay me £1400, as they would be deducting £300 for repairs that they had to go back and fix on a couple of jobs. I wrote back and asked for exact details, what jobs, who reported, when that was, how it was established it was due to my fault and how each deduction was calculated. I was pretty intrigued by the fact that this was suddenly coming up 9 months later, just as they decided to pay me what they owed. I knew for a fact that there had been nothing wrong with the jobs I performed, as I always inspect a job on completion. They replied regarding one job, while mentioning the other no longer. I asked them why I should have to pay in the first place, since the company had liability insurance and I was working for them at that time. They gave me a 'take it or leave it' reply, stating that they will not negotiate or enter into any further correspondence. I didn't really want to accept the offer, but by this time I was fed up with the struggle and decided some money is better than no money, so I accepted. I never got any reply, but 2 days later I get a cheque through the post, for the £1400 they said they would pay. I deposit it, only to have it bounce, due to 'the name of the payee not being the same as the account holder'. Grrrrrrr...apparently, they had spelled my name wrong...which they did. So I write to them again, informing of the result and suggesting they transfer the money, rather than pay by cheque. That was on the 9th of April and still no reply as yet. No deposit has been made and no new cheque issued. They are now completely ignoring me, despite another email sent, informing them that I will be starting legal procedures, in order to recuperate the £1700, plus interest and any additional expenses.


I have been spending the last few days researching online, which is great, as I got to learn a few interesting things. But it's also a bit unsettling, as I would not want to make a mistake and give them an opportunity to keep my money even longer than they have already. My next action is to write them a LBA today, as suggested on Lovell's site. Wait 7 days and then take it through to moneyclaim.gov.uk if no reply.


What do you think, is this the correct approach?


Thanks, Michael

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A LBA seems a good idea at this point but allow 14 days to show you are being reasonable should you end up in court.


Keep all your correspondence to date, including the cheque if you still have it. or at least the letter from the bank saying it has bounced. The fact they gave you a cheque shows they agreed they owe you





I am not legally trained or qualified, any advice i offer is gleaned from experience and general knowledge, if you are still unsure after receiving advice please seek legal advice.




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in your lba make it clear what you are asking for and when you want it. If you dont get it you can them issue a claim without further warning and they will have to pay the fees as well or the debt will not be satisfied. No lba and notice then you bear the costs of the claim up until the hearing.

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Thank you for the replies guys. Having looked around on the internet, I came across Contractorcalculator.co.uk. According to them, I should contact a debt recovery agency as my next step, before sending a LBA. Also, the interest that I can claim is 0.40 a day, meaning I can only ask for £108 to date. That doesn't seem very fair, seeing that the company that has withheld the money has caused me and my family financial hardship, plus a lot of stress and aggravation. According to Lovetts:


'The compensation you can claim


You can claim compensation for every invoice that was not paid within the credit period. You can claim compensation even if the invoice has now been paid. Remember, you have up to 6 years to claim the compensation!

The amount of compensation you can claim is:-

Invoice Amount


Up to £999.99 £40 per invoice that interest could be charged on each individual invoice, up to £40 per invoice.'


Seeing that I have issued 8 invoices that have not been paid to date, it would make much more sense to get 8x40=£320 instead. Does anyone know more about this?


Contractorcalculator.co.uk recommend using Creditsafe as debt collector. I have contacted them and awaiting reply. I have also contacted IPSE(association of Independent Professionals and the Self Employed) to ask for their help in the matter, also awaiting reply.

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£40 would be the maximum per invoice not the standard, but before any of that you will need to follow the correct protocol and send a LBA which in itself is a warning that if not remedied within the timescales (usually 14 days) then you will issue county court proceedings without further notice.

Notarise how much you are owed, plus interest at 8%.


I say 8% because you should be claiming interest on monies owed and its in line with S69 statutory interest so it keeps things simple.


One final note, if you are not prepared to go to court to fight for this then there is no point threatening it.





I am not legally trained or qualified, any advice i offer is gleaned from experience and general knowledge, if you are still unsure after receiving advice please seek legal advice.




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Dont even consider a debt recovery agency. Anyone with any ounce of sense knows they are completely useless and have absolutely NO authority to do anything.


get the LBA off, but only if you intend to see it right the way through to final judgement.

Any advice i give is my own and is based solely on personal experience. If in any doubt about a situation , please contact a certified legal representative or debt counsellor..



If my advice helps you, click the star icon at the bottom of my post and feel free to say thanks


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Hi martin and renegadeimp. Funny I got your replies in quick succession, just as I came off the phone with Safe Collections, a debt recovery agency that I contacted. Guess what the owner of the company, Sid House advised me to do? Not to bother with debt collection, but to go to Money Claim Online. Nice to see there are still upright people out there, despite working in an industry that has such a bad rep. The guy seemed a very nice man and spent 5 min on the phone with me for free, giving me good advice.


OK, I am definitely going to go to the end with this, I am not letting this scoundrel get away with my hard earned money. I am going to look for a lba template now and send it off to MCO just as soon as I borough some money to pay their fee. As it happens, I just got hit by the rent DD on the 10th and what's left in the account won't cover it. Oh well, at least I have learned a lot from this and in the future I know how to fight things like this a bit better. Thanks to you all again, I will keep you posted.

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There isn't a template as such for your situation but if you look at the template lba's and adapt one to suit you will be fine





I am not legally trained or qualified, any advice i offer is gleaned from experience and general knowledge, if you are still unsure after receiving advice please seek legal advice.




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you can claim any additional costs and interest but beware that should you do this you must have some evidence that this was made clear in your invoicing or other contractual condition or you wont get it. Better to keep it simple and win. You have the evidence you have tried to get this settled but adding interest from the date of when the notice of the lba runs out is a good idea so any MCOL claim will be £xxxx for monies owed under an agreement and interest at taxation (8% being the rate set by the courts) being the sum of £x.xx per day from the (say 30th april 2016) until the date of judgement.

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Hi again. The latest news: I have sent the ex-employer the latest figure that he needs to pay, after adding interest and compensation. The new figure is £2323.68. They replied that they will not give me more than the original £1433.77 that they decided to pay and issued me a 'take it or leave it' offer, with a 'if you don't accept that, you can talk to our lawyers, bla, bla'. I did not take the bite and also did not fall for their bullying tactics and wrote back a 9 point letter describing all the things that they have done wrong. I reiterated the fact that they have until the 26th to pay want they owe, when the LBA expires. After that, I will be taking the matter to MCO. It's also worth a mention that today I called an ex employee of theirs who used to work in the office. She left due to being paid a pittance and generally being messed about by the company director and the same man that doesn't want to pay me. They seem to have only one woman in the office now, instead of 3 like they used to. And this lady told me that I was never the only one that D. has had arguments with regarding money. Apparently, he owes another plumber that worked for them over £2000 that he refuses to pay. She said she will pass my number to him, so we can liaise about this. I will paste a copy of the final 2 letters, received and sent, for reference:


From Project1




Dear Mr. C


We sent your payment to you, in the sum agreed and with the cheque in the name that you use on your emails and

correspondence. It is not our fault that the bank account you use is in a different name and the bank would not

accept the cheque.


We have had a further call about poor workmanship at Mr. H’s property, with photographic evidence and

signed witness statement.


We are offering you this last chance to accept the originally accepted offer of £1433. 77 in full and final settlement

of your account, if you can give us the correct bank details.

Should you wish to decline this offer, then our solicitors Palmers, Hassett House, Hassett Street .

Bedford MK40 1HA will be instructed to vigourously pursue the matters of damaged caused due to poor workmanship

and/including all costs incurred.' End of email


My reply


'Without prejudice


1. The cheque you have sent is no longer relevant. I was not aware of my statutory rights at the time that I agreed to accept the lesser sum of £1433.77 instead of the rightful sum of £1733.77 that was owed me. I was never presented with evidence of the alleged damages, hence it was a decision based on hear say. I think we can put this matter to rest now.


2. My decision stands, I am entitled to interest and compensation as per Late Payment of Commercial Debts (Interest) Act 1998


3. If you want this matter settled outside the court, I advise you to pay the £2323.68 that I am owed


4. Should you decide to dispute this, I would like to see evidence of the alleged damage that was caused by my negligence. I will also require expert assessment of the implied negligence and if it is demonstrated that the damage was indeed caused due to my poor workmanship, I will accept it as such. I have worked as always, to a high standard and I have checked the installation done at Mr. Hern's place before leaving the premises. All was working fine. I never heard from your office about this until April this year. To be accused of poor workmanship 9 months after the job was done is not OK. I would like to see the evidence, who it was inspected by and when, together with an explanation as why it was attributed to me. I would like to see specific details: part that was broken, exact position in installation, etc, i order to asses whether it was something that was worked on by myself, or part of the old installation.


5. Supposing something did go wrong with a part of the installation, shouldn't the work be covered by your company's liability insurance, seeing that I was working as a Project1 employee at the time? Please correct me if I'm wrong. I was never informed that employees are expected to pay for any eventual damage, be it verbally or in writing. Hence, I did not consent to this.


6. I was initially told, when I asked for my money in various emails, that D. didn't agree to paying several invoices due to them amounting to too much. This then changed when I was told that actually D. does not want to pay £300 due to problems discovered on a couple of jobs I attended to. This then changed again, only one property remained, instead of the two. What am I supposed to understand from all this? The info I get is pretty contradictory and changes all the time.


7. I have had discussions with former employees of yours and they have confirmed that I am not the only one that is owed money and who has had to wait a long time begging for them. There seem to be a recurrent problem with paying invoices/salaries on time.


8. I am starting to realize that I have not taken everything into account when calculating the money owed me by Project1. No one should have to be subjected to this kind of treatment. I will seek legal advice in this matter, as it is getting beyond simple work-pay disputes. It has started to affect me and my family mentally, I am spending a lot of time seeking advice online and I can't concentrate on my work properly anymore. I cannot spend time with my family due to having to spend time writing to you, asking for money and researching my rights online.


9. I think the time for amiable negotiation has passed and all you are doing is trying to pressurize and bully me into accepting less money that I am entitled to. This is not OK. I think the best place to continue this conversation is in court, with a judge presiding. Only there reason will prevail. This has gone on for too long. I will no longer entertain any more correspondence coming from your office, if you keep offering me less than what I am owed, We seem to be running around in circles and getting nowhere. I do expect a deposit for the £2323.68 sum that is outstanding by the 26th of this month. Should you fail to pay by then, I will recalculate the sum and add interest to date, while forwarding this matter onto the HM Courts & Tribunals Service, Money Claim Online.' End of email.


As I said, I will be taking this matter as far as needed. I am not afraid of fighting for my money.


As a side note, while researching all this online, I realized a funny thing: I am not sure whether I am still an employee of this firm or not. How I came about working for them is thus: as I said in the beginning of this thread, I was initially subcontracting as a professional handyman for a few months. And then he offered me to work as part of the team. It was a verbal contract, but my research turned out that verbal contracts are just as binding as written ones. Just less clear, as there are no hard and fast rules that one has agreed to by signing. Nevertheless, I was their employee. Seeing that I left due to not receiving any pay and they didn't fire me, technically I should still be an employee of theirs. Although no contract was signed, one was in existence. Hence, they not dissolving my contract with any verbal or written notice, I think that I could walk in any day and start working again and they could not do anything about it. Theoretically. What do you guys think?


This presumption also opens the door for me to ask for recourse and compensation at an employment tribunal, seeing that I was employed at the time and no longer working as a self-employed person. I will be researching this further tomorrow, as it is kinda late and need to hit the sack. Best regards to you all and good night for now. Cheers, Mike

Edited by 1PeacefulWarrior
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Do you understand the term without prejudice or are you using it because someone else has? I'm afraid your letter the them is half waffle and probably wont get you the desired resolution

You will still need to send a shorter lba as this isnt one if you havent already but if you had sending a response to their garbage is lessening the impact of that lba.

I would now give them a week and file a claim at the county court without further notice or correspondence with them. They are basically calling your bluff and to a degree playing on your lack of knowledge on these things and it has worked.

If you were employed by them then you dont owe anyone for any failure of performance, that is their problem as they were contracted by their client, not you. However, expect a counterclaim when they acknowledge your claim. This will cost them money to file so they might well just admit to owing you £1400 and deny the rest and leave it to the day to argue about the £300 they want to grab back.

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I did look up the term 'without prejudice', but after I had sent the answer to their letter. After that, I sent the same letter, titled 'Clarification', explaining that I didn't know what it was at the time. I also told them that despite them using the term, the letter will still be read at court proceeding, as it involves 2 parties. I pointed out that I had nothing to hide, implying unlike them :wink:.


This was just one of the emails I was writing, in reply to their repeated offers to pay me a lot less than what they owed. £890 less, to be exact. The actual lbs was sent out on the 19 and it is this one:






TAKE NOTICE that according to our records the sum of £1733.77 was overdue for payment for invoices 39086(1), 39086(2), 46731, 47247, 47501, 47521, 47550, 47567, 47585 and PJ001402.


The Late Payment of Commercial Debts(Interest) Act 1998 entitles me to ask for compensation for late payment of debts. Due to the fact that invoices have not been paid on time, I hereby exercise my right to claim interest at 8% per annum over base, together with compensation at the rate of £40 per invoice and recovery cost.


To date, the sum of £2323.68 is due and was calculated thus:


Your Debt:






Recoverable Costs at Claim:


Recoverable Costs at Judgment (min):




Court Fee (recoverable):





This was calculated with the help of xxx solicitors and it is in accordance with The Late Payment of Commercial Debts(Interest) Act 1998.


Unless payment is made to the above address within seven days Legal Action to recover the debt will be taken against you without further notice.



Signed: M. '


After a lot of research, I now understand a bit better what my position is. I know that they owe me money and there is no way they can get out of paying them. Even if they dispute my workmanship and fail to see that if there were any problems, that should fall under their liability insurance, that matter is something entirely different anyway. They need to pay me what they owe me and THEN sue me for anything, if they desire. But they probably won't and like you have said earlier Eric, they were taking advantage of my lack of knowledge in the matter and hoped they can persuade me into accepting less. I am no longer even opening their emails and will not do so until the expiry date on the 26th. I will check then to see if they have agreed to pay the whole sum. If not, I will just file the claim with MCOL.


In your opinion, how would dealing with this issue through the Employment Tribunal differ, as opposed to using MCOL? The fees seem to be similar, but what are the differences in outcomes?

Edited by honeybee13
Lawyers' name removed.
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notice of intended court proceedings is again a meaningless phrase use the correct term of letter before action and say it is under civil procedure rules and look up the rules so you get it right or they will try and knock it back on this.

You need to show how interest is calculated, usually 8% as per interest at taxation but you have to stae the period that the interest relates to or there is room for argument

dont use the word compensation, use the phrase about the Act that allows it

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I see. So that rules out the ET. Thanks Eric.


Coming back to the matter on hand, does me sending them a letter entitled 'Notice of intended court proceedings' does not equate an LBA? My understanding was based on the following info, gleaned

from justice.gov.uk:


Objectives of pre-action conduct and protocols

3. Before commencing proceedings, the court will expect the parties to have exchanged sufficient information to—


(a) understand each other’s position;

(b) make decisions about how to proceed;

© try to settle the issues without proceedings;

(d) consider a form of Alternative Dispute Resolution (ADR) to assist with settlement;

(e) support the efficient management of those proceedings; and

(f) reduce the costs of resolving the dispute.


Steps before issuing a claim at court

6. Where there is a relevant pre-action protocol, the parties should comply with that protocol before commencing proceedings. Where there is no relevant pre-action protocol, the parties should exchange correspondence and information to comply with the objectives in paragraph 3, bearing in mind that compliance should be proportionate. The steps will usually include—

(a) the claimant writing to the defendant with concise details of the claim. The letter should include the basis on which the claim is made, a summary of the facts, what the claimant wants from the defendant, and if money, how the amount is calculated;

(b) the defendant responding within a reasonable time - 14 days in a straight forward case and no more than 3 months in a very complex one. The reply should include confirmation as to whether the claim is accepted and, if it is not accepted, the reasons why, together with an explanation as to which facts and parts of the claim are disputed and whether the defendant is making a counterclaim as well as providing details of any counterclaim; and

© the parties disclosing key documents relevant to the issues in dispute.


Compliance with this Practice Direction and the Protocols

13. If a dispute proceeds to litigation, the court will expect the parties to have complied with a relevant pre-action protocol or this Practice Direction. The court will take into account non-compliance when giving directions for the management of proceedings (see CPR 3.1(4) to (6)) and when making orders for costs (see CPR 44.3(5)(a)). The court will consider whether all parties have complied in substance with the terms of the relevant pre-action protocol or this Practice Direction and is not likely to be concerned with minor or technical infringements, especially when the matter is urgent (for example an application for an injunction).

14. The court may decide that there has been a failure of compliance when a party has—

(a) not provided sufficient information to enable the objectives in paragraph 3 to be met;

(b) not acted within a time limit set out in a relevant protocol, or within a reasonable period; or

© unreasonably refused to use a form of ADR, or failed to respond at all to an invitation to do so.


It does not state that the letter should be called LBA specifically, that's why I went with the title 'Notice of intended court proceedings' ans suggested somewhere. I don't mind sending them an LBA, if that means it will stop them from using technicalities to slow me down. According to this paragraph 'The court will consider whether all parties have complied in substance with the terms of the relevant pre-action protocol or this Practice Direction and is not likely to be concerned with minor or technical infringements', they shouldn't be able to, but they have tried every trick in the book so far, so nothing would surprise me.


I will get reading on the Civil Procedures rules as you have advised, while waiting for a reply. Thanks for the help.

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Ok, so para 13 really tells you what you need to do first and you have done most of that.

Lba and letter before claim are standard phrases as per the CPR, followed by a warning of what will happen if the other party ignores. You are basically in a business to business conpact so the small bits do matter more than an individual suing a shop for example. It may seem cruel but businesses are expected to know everything about everything so get things slightly wrong and it can make a difference if the judge is forced into a determination on "he said she said" type evidence and balance of probability. You seem to have a strong claim but that doesnt mean they wont counterclaim just to try and get you to settle for a lower figure or try and get a partial concession to avoid paying costs.

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Yes, you are right :-). I just checked the email I have sent them and I could see that the email subject was LBA, while the body said 'Please find the LBA attached., containing the latest details. A hard copy will be sent to your office for your reference.' I think that should be enough to cover it, despite the heading of the attachment itself being 'Notice of intended court proceedings'. The judge will see I did what I was supposed to. OK, I will wait until tomorrow when the deadline expires and then read their latest reply. Then file the claim if they did not agree to pay the sum in full.

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