For business owners in South Florida, considering using a collection agency or bailiff is often a complicated decision. This is because it involves all sorts of red tape and can affect the relationship between you and the customer in Florida.
Even though you are in your right and the customer does not fulfill his payment obligation, you would rather not lose customers because of this step.
But in what situations is it actually permissible for entrepreneurs to use a collection agency (Dutch: incassobureau) or bailiff? In this text, we will explain.
Distinction between a bailiff and a collection agency in South Florida
Both a collection agency and a bailiff aim to assist you with outstanding debts. They both aim to collect the amounts owed from the customer. Nevertheless, the powers of a collection agency are in line with those of you as a creditor.
On the other hand, a bailiff does have the power to take more far-reaching legal action against the debtor. This includes, for example, carrying out legal duties. A bailiff is someone who can support you with collections or court summonses.
The full and formal title is “bailiff”, as this is a civil servant appointed by the Crown. This gives them access to important government records, such as municipal records, personal and data.
When is it appropriate to use a collection agency or bailiff in South Florida?
You are free to use a collection agency or bailiff at any time. There are no legal deadlines or regulations attached to this. This means that you can involve a collection agency or bailiff as soon as the payment term has expired and a specific invoice has not been paid. From then on, the collection agency or bailiff will undertake activities to collect the outstanding invoice. It is also possible to engage the expertise of a business law lawyer (Dutch: ondernemingsrecht advocaat) for this purpose.
This could include reminders or demands by phone or in writing. Thanks to the extensive experience of collection agencies and bailiffs in collection activities, they often know how to take the right approach. This results in outstanding invoices usually being paid faster than if you were to tackle this yourself. In addition, it also saves you the effort you would rather put into your business.
However, it should be emphasized that collection costs should only be charged when the debtor is in default. Therefore, we recommend always notifying the debtor in writing first before handing over the debt. This applies even if you do business with consumers, as this is an obligation.
Points to consider when selecting a collection partner in Florida
Now it is time to make a choice. It is useful to know that anyone can freely set up a debt collection agency, without having to meet establishment requirements or mandatory qualification and continuing education requirements. However, these requirements do apply to bailiffs. Unlike bailiffs, debt collection agencies are not under official supervision and disciplinary law.
It is therefore advisable to be critical and vigilant during the process of selecting a debt collection partner. An unreliable or overly aggressive debt collection partner can also be detrimental to your own reputation.
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