When an out-of-state client does not pay invoices, there are a few ways a law firm can enforce the client’s payment. One of the most effective ones is, of course, suing the client. However, it can be difficult for a creditor to sue someone in another state.
When a client signs an engagement letter, seeks legal representation in a specific state and participates in a lawsuit, they must pay their invoices. While the vast majority of clients pay without delays, some clients refuse to pay. Clients can cut contact with their lawyers and move on with their lives as if nothing had ever happened.
When this happens, what can the lawyer do? Usually, the best strategy is to sue the client for non-payment. In Florida, creditors have up to 5 years after the non-payment to file a lawsuit. So, the lawyer must sue within that timeframe. However, as mentioned above, when an out-of-state client does not pay invoices, it can be a bit difficult to sue them.
The Florida lawyer can sue the out-of-state client if the client has had “minimum contacts” with Florida. Additionally, the Florida lawyer will need to ensure that suing the client does not violate fair play and substantial justice standards or imposes an undue burden.
Usually, when someone hires an attorney from a law firm located in Florida, the “minimum contacts” requirement is met because the client signs a contract in Florida. Or, the client hired a Florida-licensed lawyer and obtained a judgment in the State of Florida. Most importantly, because the client hired the lawyer to sue in Florida, they benefited from Florida laws.
For a Florida lawyer to sue an out-of-state defendant, the sue must meet five major requirements:
- The plaintiff’s interest in having the claim adjudicated,
- The burden on the defendant,
- The forum State’s interests,
- The interest of the interstate judicial system in resolving the dispute, and
- The shared interest of the several states in furthering fundamental social policies.
It is reasonable for an out-of-state client, who has previously sued in Florida, to expect to be sued in that State if:
- The client’s lawyer practices in Florida, the previous lawsuit occurred in Florida, and the out-of-state client signed the contract with the lawyer in Florida. Thus, the plaintiff has a strong interest in having the claim adjudicated in Florida.
- The burden on the defendant seems minimal as they have sued in the State of Florida in the past.
- Florida has an interest in handling the lawsuit, given that a Florida lawyer is seeking payment of invoices.
- The witnesses and the evidence are in Florida; therefore, it would be far more efficient to sue in Florida.
- There is no evidence that the substantive policies of the out-of-state client’s home state would be undermined by permitting the case to go forward in the State of Florida.
When an Out-of-State Client Does Not Pay Invoices, Suing Can Be Tricky
To protect themselves from this type of problem, Florida lawyers should always include a choice of law and jurisdiction clause in their engagement letters. When an out-of-state client does not pay invoices, it can be a bit tricky to sue; however, with the right legal team by your side, it can be a walk in the park.
If one of your clients has not paid their invoices and you want to file a lawsuit, contract Attorney Romy B. Jurado Esq. today for assistance. Call (305) 921-0976 or send an email to Romy@juradolawfirm.com to schedule an initial consultation.