As a collection attorney, I frequently see business, small and large, get into trouble when they ignore me and the documents that I serve on them.  I have nailed large car companies and retailers alike that have either ignored or "misplaced" legal documents that I had served upon them.  Don't you make these same mistakes because they are costly.  These mistakes are easily avoided.  The most common ones are:

1.                  Don’t Ignore that Garnishment served on your business.   If you have been served with a garnishment on your employee’s wages, DO NOT IGNORE IT.  You must respond to the garnishment within 14 days or a judgment will be entered against your business.  The garnishment is a lawsuit by the creditor against the business or business owner.  Take a moment and fill out the enclosed response form and follow the instructions.  If you have questions about what you are supposed to do, call your lawyer and she can help you.  Your failure to file a response will subject you to a judgment for the full amount that your employee owes the creditor. 

2.                  Don’t fire the employee that is being garnished.  Be aware that you may not fire your employee because his wages were garnished.  If he can prove that you terminated his employment because of the wage garnishment, he can sue you and collect damages and attorneys’ fees.  It’s a crazy world, right?  Don’t be a victim of the craziness.

3.                  Review your accounts receivable aging schedule frequently - A customer that begins to experience cash flow problems will usually take longer and longer to pay.  Your aging schedule is a perfect indicator of which customers are getting into trouble.  If your customer ultimately goes out of business, you do not want it going out of business with the money it owes you.  One of the best tools that you have to gage your clients’ financial liquidity is to review your accounts receivable aging schedule frequently. 

4.                  Call your customers that are not paying on time.  If after you have reviewed your accounts receivable aging schedule, you develop a concern about a customer’s financial stability, then call the customer.  That customer is holding your money.  You have a right to inquire as to how their business is doing.  If your customer is having a problem paying your bills on time, then consider putting that customer on a C.O.D. basis for new goods or services and making a payment arrangement on the balance. 

CONCLUSION          

        None of these issues is intuitive.  There are pitfalls for the unwary  business owner.  The price of ignorance can be high.  In my experience, the price of ignorance has been high.  Be aware of the principals that are discussed in this article and you won't be a victim.