What to Do When a Client Doesn’t Pay: Enforcing Contracts in NY & NJ

Waiting for a client to “get around” to paying your invoice or commission? Don’t. In New York and New Jersey, time is not on your side. If a customer stops responding or delays payment beyond agreed terms, you need a plan to enforce your contract — fast.

1. Review the Written Agreement

Start by reviewing the contract or invoice terms. Key things to confirm:

• Payment deadlines and grace periods
• Late fee or interest provisions
• Whether commissions are tied to performance or receipt of funds
• Jurisdiction and venue clauses
• Attorney’s fees or collection cost provisions

Even without a formal contract, you may still have a case based on emails, texts, or past performance.

2. Send a Formal Legal Demand

A strongly worded demand letter from a law firm shows you’re serious and creates leverage. In many cases, it results in prompt payment — or at least opens the door to settlement.

3. Act Quickly — Especially with Commissions

In New York, unpaid commission claims can be subject to a six-year statute of limitations — but waiting too long to sue could result in a judgment-proof debtor. In some cases, unpaid commissions also trigger penalties under the NY Labor Law.

4. Consider a Breach of Contract Lawsuit

When informal efforts fail, a breach of contract lawsuit may be the most effective way to recover. You can seek:

• Full payment of amounts due
• Interest and penalties
• Reasonable attorney’s fees (if provided for in the contract)
• In some cases, consequential damages

5. File a Lien — If Eligible

Real estate brokers and certain contractors may be able to file a lien on real property to secure payment. This must be done quickly and properly — and enforcement typically requires litigation.

6. Don’t Ignore Settlement Opportunities

Even when suing, keep an eye open for a workable settlement. A structured payout, confession of judgment, or secured agreement might be better than chasing a bankrupt defendant.

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Need to Enforce an Unpaid Contract?

At JDE Law Firm, PLLC, we represent businesses and professionals in recovering unpaid invoices, commissions, and service fees across New York and New Jersey.

Call us today: NY – 718-966-0877 | NJ – 732-490-7120
Or visit www.jdelaw.nyc

My Business is to Protect Your Business.