Let’s say your Maine-based small business provides a service that involves servicing products that your customers own. Maybe you fix broken construction equipment, make alterations to clothing, frame customers’ art or a repair computers. You provide the service, but a customer does not respond to phone calls and e-mail messages after you notify him that his product is ready for pick up. Since payment is due at the time of pickup, you are not paid for your service and the customer’s property remains on your premises. What should you do? There are certain steps you need to take before you can resell the property to another customer.

It’s always a good idea to have a written contract. You would be protected if there was language like this in a contract or on a receipt:

If a customer fails to accept delivery or pick up a product within 60 days of the shipping date, Company A will consider the property abandoned and has the right to sell, dispose of, or use any such products in any way it chooses.

Language such as this would protect you from a customer coming back six months or a year later to say that the property is theirs and they want it back. It is best to provide notice of your intent and provide the customer a reasonable time for pick up. You would therefore have evidence that you acted in good faith.

Reasonable Notice

Reasonable notice could involve taking steps such as using registered mail, return receipt requested, informing the customer to pick up the property. The letter should state that as previously stated in the written contract, if the customer fails to accept delivery or pick up a product within 60 days from shipping date, your company has the right to sell, dispose of, or use any such products in any way the company chooses. You may have already given notice in the form of an earlier phone call or e-mail, so it could be reasonable to say that with this new registered mail notice, the time to pick might be less than 60 days. But to play it safe, keep it close to the amount of days first cited to the customer.

Payment for the Service

What if you do not want to sell the property to another customer and want your payment? You would have to seek judicial or other intervention to obtain payment. It would be in you and your business’ best interest to provide a demand letter for the payment of the services, and include the storage cost and any other costs you have. This sometimes gets the customers attention to pay and pick up their property. Also, for significant amounts, you may be able to sell the product and bring a lawsuit for the difference in cost.

If you have questions about these or similar situations in your business, consult with Filler & Associates.