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Disputed invoices

A customer arguing about the work is a different problem from a customer ignoring you — and the tools that solve one make the other worse.

There is a real difference between a customer who will not pay and a customer who says they should not have to. The first is a debt recovery problem. The second is a dispute, and treating it as the first is how a £9,000 invoice turns into a £30,000 argument.

The distinction matters because the tools change. A statutory demand on a genuinely disputed debt is an abuse of process. A claim on one is litigation, with evidence, disclosure and a real risk of paying the other side's costs.

Is the dispute genuine?

Courts distinguish between a genuine and substantial dispute and one raised for the first time as a response to being chased. Some honest indicators, in both directions:

  • When was it first raised? A complaint made at the time of delivery is credible. One that surfaces six months later, on the day a letter before action arrives, is not — and courts notice.
  • Is it in writing anywhere? Contemporaneous emails complaining about the work are powerful evidence. A recollection of a phone call is not.
  • Does it cover the whole invoice? Very often it does not. A complaint about one line item does not justify withholding the other eleven.
  • Did they keep using you? Continuing to place orders after the allegedly defective work is hard to reconcile with a serious complaint.

Splitting the debt

The most useful and least used move in a part-disputed matter is to separate it. If £2,000 of a £9,000 invoice is genuinely in issue, then £7,000 is not, and there is no good reason for the undisputed part to sit unpaid while the argument runs.

Putting that in writing — payment of the undisputed sum now, without prejudice to the balance — does two things. It gets most of the money in. And it exposes a tactical dispute, because a debtor whose complaint was really about cash flow will not pay the undisputed part either, and that tells you what you are dealing with.

What we do with a disputed debt

We read the file before we write anything: the contract or order, the specification, what was delivered, and the contemporaneous correspondence. Then you get an honest assessment of what the evidence supports, not an encouraging one.

From there the options are usually to narrow the dispute and settle it, to split the debt and recover the undisputed part, or — where the dispute is substantial and the sums justify it — to take proper legal advice on the merits before anything is issued. Where that is the right answer it goes to RHF Solicitors, because contested litigation is reserved work.

The honest bit

If the customer is right — if the work was defective, or the invoice does not match what was agreed — no letter is going to fix that, and sending one costs you money and credibility. We will tell you when the strongest commercial position is to negotiate rather than escalate.

Common questions

They raised a complaint only after I chased. Does that count as a dispute?

It has to be looked at rather than dismissed, but timing carries real weight. A complaint first made in response to a demand for payment, with nothing contemporaneous to support it, is treated very differently from one raised at the time. It does not automatically make the debt disputed.

Can I still charge statutory interest on a disputed invoice?

Interest runs on a qualifying debt that is late. If the debt is ultimately found to be due, the interest is due with it. If part of the invoice is successfully disputed, interest attaches to the part that was properly payable. It is not a reason to hold off claiming it.

Should I stop work while the dispute is running?

That depends entirely on your contract and it is a decision with real risk on both sides — suspending performance without a contractual right to do so can put you in breach. It is worth ten minutes of advice before you do it rather than after.

What if they counterclaim?

Then the matter is properly litigation and should be treated as such from the start. A counterclaim can exceed the debt, which turns a recovery exercise into a case you can lose money on. That is the point at which the honest advice is to get proper legal advice on the merits before spending anything further.

Get the debt recovery pack

The letter-before-action checklist, the interest and compensation rules, and the escalation ladder with what each step costs. One email, no sequence.

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