What to do if we have a contract with a large company and they are over 250 days late which is beyond contract stipulation?

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What to do if we have a contract with a large company and they are over 250 days late which is beyond contract stipulation?

We do audits for energy efficient programs offered by the Utility companies. We are paid based on the kilowatt hours saved to the end user. In our contract we are to be paid by the company we are contracted to 12 days after they are paid by the utility company. That should have been in July of last year. What kind of damages or penalties can be applied for this type of breach?

Asked on April 12, 2012 under Business Law, California

Answers:

Glenn M. Lyon, Esq. / MacGregor Lyon, LLC.

Answered 9 years ago | Contributor

Look to the terms of the contract regarding interest, late fees, penalties, liquidated damages, etc.  If it is not addressed, you would have the right to the principal payment plus legal interest at the rate set by state law.  Have your attorney send them a demand letter and allow them a chance to pay.  If not, consider filing a lawsuit for all damages and costs, including attorneys' fees if the contract so states.

Hong Shen / Roberts Law Group

Answered 9 years ago | Contributor

It should be governed by your contract. If there is liquidated damage clause and is reasonable, then it should be the damage you recover. If not, you may claim your actual damage, incidental damage, maybe consequential damage such as losts opportunities. There is no penalty for contract breach.


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