Distributors & Wholesalers

Collection of Debts in Vermont
Our firm has over 30 years of extensive experience in helping distributors and wholesalers recover delinquent obligations, from debtors anywhere in Vermont. During the past several years, a substantial part of our collection practice has been assisting food distribution companies recover debts owed to them by restaurants and other customers.

Key to Success
The key to success in legal debt collection is securing assets or income of the debtor, out of which our client’s obligation can be paid. This can be done via lien, seizure, or other methods. In order to be able to do this, we first examine all of our client’s documentation on the account in question, to determine who the potential debtors are. (Is it just the corporation or LLC that operates the business? Or, have one or more of the principals signed a personal guaranty, or exposed themselves to personal liability in some other way?)

Once we identify the potential debtors on an account, we conduct an investigation of each of them (using a proprietary online database and other methods) to determine their assets and sources of income. Based on this information, we advise our client as to whether there appears to be a reasonable chance of recovery. If so, we start legal proceedings to obtain a judgment against the debtor(s). If the debtor does not resolve the obligation after being served with suit papers and a copy of the judgment; we then take legal steps to secure the debtor’s assets and income, in a way that would make them available to pay what is owed to our client.

Fees and Costs
Obviously, doing the work mentioned above, and taking legal action, involves attorney’s fees, investigation costs, Court filing fees, and Sheriff’s fees. However, our clients usually have a credit application or some other document signed by the debtor, which provides for recovery of these fees and expenses if the debtor defaults on payment of its account. Therefore, the judgment we obtain from the Court will include not only the principal amount of the obligation, but also interest, and the fees and costs involved in pursuing the debtor. Then, assuming the debtor has sufficient assets or income which we can secure, these costs plus principal and interest are ultimately reimbursed to our client.

Client’s Documentation Because of the importance of having the right documentation signed by each customer, the first thing we do in working with a new client is to review the client’s existing documents, and suggest any changes which may be necessary to enable them to achieve full recovery against a customer who defaults on his obligation.

Difference Between Collection Agency and Attorney
Some businesses use collection agencies to recover obligations. However, a collection agency is limited to contacting the debtor by mail and phone, to try to persuade him to pay voluntarily. An attorney is not limited to that approach, and can take legal action to obtain payment directly from assets or income of the debtor.