I have a contract with a client where it was agreed that we would provide services for a fixed fee. The copy of the contract I have is faxed, but it still shows that it was signed by the client. Now the client claims they cannot come up with the money to proceed with the project. At this point no services have been performed by us. The amount of the project agreed upon was $xx,xxx range. What advice would you offer in terms of handling this matter? Would it be possible to pursue legal action for the amount agreed upon or should we just let this go?
what country are you in? In my country yes, there was a possibility of getting a compensation for expectations on the contract. Since no services haven't been performed yet, i believe that is the maximum you would get.
Depends on what assets your client has? If he has valuable assets, it may well be worth issuing a summons or court action - I am in UK - If he has no assets, it will not be worth your time or money, investigate this...
But even with a good lawyer, can he really get out of the contract he signed? It is my understanding that even a faxed copy with a signature is good enough to be legally enforceable in the US.
Lawyers are expensive. Some agreed upon termination fee that was paid immediately and before you signed a release would be in the best interest of both parties. Something that covered your losses or perception thereof. If you force them to take and pay for the service they will find fault with whatever you do. Just cut your loss and get what you can.
If they have no money/assets, then all you'll get is a paper judgement. Also, if it was done for a company, they could close up shop. Also, how long ago was the contract signed? No services have been performed you said. Perhaps the client's state (or yours) has "buyer's remorse" type of law. And that fact that no services have been rendered yet could strengthen the client's case. *Not a lawyer*
The agreement was between two corporations; ours and theirs, however I believe the client corporation is a small 1-3 person operation. We received the faxed contract back in May of this year, and up until now we've been waiting on the client to produce the payment which was due within 15 days of signing the agreement.
IMHO you'd better talk to a lawyer rather than ask opinions from here. If you really want to collect as much as you can, you'll need one to assess your risks by examining any and all available factors. (contract terms, party's state, etc.)
You have to put a little fire under his behind. Send him a later stating that he has untill July WHATEVER to issue payment to the terms of the contract. Put in the letter that if he does not, then you will seek legal advise; and per the agreement he may be responsible for attorney fees. What does your contract say about the default of the contract? Are you allowed to sue? Do you have to do arbitration?