Clauses for dealing with the chiseling customer

January 17, 2024

If your client is in the business of providing value in exchange for payment, whether the consideration offered is goods, services, licenses to IP, data, expertise, or anything else, there are certain must-have clauses that your client’s agreement should carry in order to maximize payment leverage and enforceability.

In many cases, customers fail to pay, not because of a legitimate good faith dispute with the vendor or the value exchanged, but because they are insolvent, or suffering poor cash flow, or are prioritizing some vendors over others, or have simply regretted the deal made (ie classic buyer’s remorse) — or worse yet, are in the habit of routinely chiseling or slow-paying vendors.

The lawyers of Redline have put together checklists of clauses aimed squarely at such customers–provisions that will serve your client well in the scenario in which your client is not getting paid for no good reason.