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What legal recourse do I have if my customer refuses to pay?

What legal recourse do I have if my customer refuses to pay?

Q: Who should receive a copy of PO?

Typically, a copy of the purchase order should be sent to the purchasing department, the accounts payable department, and the receiving department. Additionally, the vendor or supplier should receive a copy to confirm the order details. This ensures all relevant parties are informed and can track the order effectively.

Q: Who receives a copy of the purchase order?

A copy of the purchase order is typically sent to the vendor or supplier to confirm the order. Internally, copies are distributed to the purchasing department, accounts payable, and the receiving department to ensure all relevant parties are aware of the order details and can manage it appropriately.

Full question:

I received a purchase order from a customer to produce a product. I produced the product and shipped to my customer. I invoiced product the day it was delivered. My customer then sold product to his/her customer. My customer has received a few minor complaints about my product. However, no one has asked for a refund and no refund has been provided. My customer has now informed me that this is not what they ordered and will not pay the invoice. What legal recourse do I have.

Category: Warranties
Date: 04/07/2025
State: Georgia

Answer:

Your claim regarding the sale is likely governed by contract law. A court will determine if there was a breach of contract or warranty that would excuse your customer from payment. Review your contract terms and any warranty language to understand your rights and obligations, as well as those of your customer.

A contract is a legally enforceable agreement that establishes the rights and duties of the parties involved. Breach of contract occurs when one party fails to perform their contractual duties, causing the other party to suffer measurable harm. Legal actions for breach of contract are civil matters, and remedies aim to restore the injured party to their position before the breach.

The five basic remedies for breach of contract include:

Money damages: Compensation for financial losses due to the breach.
Restitution: Restores the injured party to their pre-contract position.
Rescission: Terminates the contractual duties of both parties.
Reformation: Changes the contract to correct inequities.
Specific performance: Compels a party to fulfill their contractual obligations when monetary damages are inadequate.

Under the Uniform Commercial Code (UCC), there are implied warranties in sales transactions, including the implied warranty of merchantability, which ensures that goods are fit for ordinary use and conform to promises made. There is also an implied warranty of fitness for a particular purpose when the seller knows the buyer's intended use and the buyer relies on the seller's judgment.

Implied warranties are included in every UCC contract unless explicitly disclaimed by the seller. Disclaimers must be clear and conspicuous. While express warranties cannot be disclaimed, implied warranties can be.

If you consider pursuing legal action, it may be beneficial to consult with a legal professional to discuss your specific situation and options.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

What are the rules for a purchase order?

A purchase order (PO) is a formal document issued by a buyer to a seller, indicating the items, quantities, and agreed prices for products or services. The rules for a PO typically include clear terms regarding delivery, payment, and any conditions for acceptance. Once accepted by the seller, the PO becomes a binding contract. It is essential that both parties understand and agree to the terms outlined in the PO to avoid disputes.

Who should receive a copy of PO?

Which staff members should receive copies of purchase orders?

Copies of purchase orders should be distributed to key staff members involved in the procurement process. This usually includes the purchasing agent, accounts payable personnel, and warehouse or receiving staff. Ensuring that these individuals have access to the PO helps maintain clarity and accountability throughout the procurement cycle.

Who receives a copy of the purchase order?

Does the purchase order go before or after the invoice?

The purchase order is issued before the invoice. It serves as a formal request to the seller to provide goods or services. Once the goods are delivered, the seller issues an invoice based on the terms outlined in the purchase order. This sequence helps ensure that both parties agree on the order details before payment is requested.

What to do after receiving a purchase order?

After receiving a purchase order, review it carefully to ensure all details are correct, including item descriptions, quantities, and prices. Confirm your ability to fulfill the order as specified. Once confirmed, proceed with processing the order, preparing the goods for shipment, and keeping records for invoicing and tracking purposes.