Hello. This is Bradley Bailyn, and this is episode number nine of the Surprise! Legal podcast.
I’m a business attorney in New York City and we try to cover various topics that are relevant to the real world.
Today. I would like to ask you an ethical question. How frequently do you sue your customers or clients when they sign a legally valid contract with you and then back out of it without any real good reason?
From a from a legal perspective, you have the right to the benefit of the bargain.
Meaning that if someone signs a contract with you and after expenses you would make, say, eight thousand dollars on the job, then you have the right to sue them for $8000, which would be you suing for the amount of the contract, less expected expenses associated with what they hired you to do. You’re entitled to receive from them your benefit of the bargain. However, judges don’t really like to see lawsuits where the vendor didn’t actually lose any money, where they’re purely suing for benefit of the bargain. And a lot of times people just decide not to file lawsuits against their customers or clients just because they don’t want bad press or they don’t want the public record or just plain inconvenience.
They may think that it is going to hurt their reputation in the local community, that it’s not worth it for them to deal with it. But I do have a lot of other clients who come to me and they’re like, absolutely not.
I negotiated with this person.
I invested my time and energy and creative process on this whole thing.
You know, basically in plain English, I was counting on the money and I’m not about to let it go. Possibly they even spent it already.
And they’re like, no, I don’t care. Sue them. Let them know you’re going to sue them. Do whatever you need to do. I’ve got a contract here and I want to get paid.
So from a legal viewpoint, you are legally right to do it.
But you’re not going to be necessarily so popular with the judge.
What do you think from an ethical viewpoint?
When should you sue your customers for more money than you’ve actually spent on the job? And when should you not do that?
So anyway, I think that’s going to be the end of our podcast for today.
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Thank you, and I look forward to seeing your responses in the comments section.
