Legal Question in Business Law in California

Demand Letter For Unpaid Services

I operate a marketing call center and have provided complete services for a company who is refusing timely payment and is now severely delinquent on roughly $40,000. The contract calls for mediation, followed up by arbitration on contract disputes. I feel we have an open and shut victory if it comes to that. I am considering having an attorney send a demand letter and had a few questions.

how long do they typically have to respond to a demand letter and make full payment? how likely is a demand letter to yield a positive result that completely resolves a matter such as this? If they refuse to pay in accordance witv the demand letter and we go to mediation and arbitration, and are victorious, how long do they have to pay?

I truly appreciate any advice in this matter.

Asked on 2/22/09, 2:51 pm

5 Answers from Attorneys

Adam Telanoff Telanoff & Telanoff

Re: Demand Letter For Unpaid Services

In my practice, I do a lot of collections work. There is no hard and fast rule about demand letters. Their effectiveness is generally a function of the debtor and the debtor's reason(s) for non-payment.

Typically, I allow ten days for a response from a demand letter. (In your case, the demand letter would be coupled with a demand for mediation).

Arbitration depends largely on the arbitration provisions in your contract. Figure 3-5 months from start to finish. (In Court figure a year).

Payment on the arbitration award depends entirely on the debtor. Some debtors, generally those with a real dispute as to the charges, will pay upon the arbitrator's decision. Others will not.

The arbitration award will need to be presented to a court and turned into a judgment (a straightforward process). The judgment can then be enforced against the debtor's assets.

Please contact me via email to discuss this in more detail.

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Answered on 2/23/09, 10:07 am


Re: Demand Letter For Unpaid Services

It is best to start the process immediately. Demand payment and/or mediation, then move forward toward arbitration. Contact me directly.

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Answered on 2/23/09, 11:51 am
Michael Stone Law Offices of Michael B. Stone Toll Free 1-855-USE-MIKE

Re: Demand Letter For Unpaid Services

Demand letters from attorneys are often very effective as one arrow in your quiver of collection tools. The terms you instruct your attorney to put in the demand letter are up to you. Since I don't know what's in the contract -- where did you get this contract? -- as far as arbitration and mediation is concerned, I don't know what it will cost you in time or money or attorney fees to mediate/arbitrate.

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Answered on 2/22/09, 3:15 pm
Daniel Bakondi The Law Office of Daniel Bakondi

Re: Demand Letter For Unpaid Services

Demand letter success rates vary. There is no way to know - it depends on their situation, but does not make sense to spend more on a lawsuit before having tried the right pressure from a letter. The reason for using a lawyer is that lawyers have experience in looking at the case and threatening the right avenues of enforcement, like personal liability, and attorneys fees, if available. Time of payment would be whatever is agreed to, until you get a judgment which you can enforce yourself. The sooner you act, the better chance you have of getting money. I write lots of such letters - please let me know if you want me to write one for you.


Daniel Bakondi, Esq.


No attorney-client nor confidential relationship is created through this communication. You may not rely in any way on this communication, and nothing herein constitutes legal advice nor legal opinion. Your issue may be time sensitive and may result in loss of rights if you do not obtain an attorney immediately.

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Answered on 2/22/09, 4:13 pm
George Moschopoulos The Law Office of George Moschopoulos

Re: Demand Letter For Unpaid Services

Results for demand letters vary. Depending on the circumstances of your case, you may opt to hire an attorney to proceed with filing a demand for mediation which is similar to filing a lawsuit. You can always hire an attorney for a few hours to review your documents and write the letter. Then you can make your mind up later if you want to mediate shortly thereafter.

Feel free to contact us.

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Answered on 2/22/09, 8:14 pm

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