DO-IT-YOURSELF CREDIT REPAIR PRIMER

How to Collect Business Debts

This document tells you what debt-collection methods there are, how well they work, and how to choose which to use. You're in for some surprises. A lot of this material comes from behind the scenes: straight from lawyers, court officials, private investigators and debt collectors -- talking informally and bluntly.

What you'll gain from the book is increased profits and fewer worries. And if you're new to all this, it could actually save your business.

Introduction

1. What happens to the innocent

SEE IF the following story sounds familiar.

At the time, you were really happy to make the sale. He was a new customer, and his order was worth $6200. A promising new customer. And he was delighted with your product (or service).

But now thirty days have gone by, and you've had no cheque. So you phone him. No problem, really. "It's just that two directors need to sign the cheques, and one of them is out of town. He's expected back in two weeks."

Two weeks later, you phone again. The director got back, they tell you, but he's having a minor operation on his leg. He went straight to hospital and didn't get a chance to sign any cheques or go through his in-tray. Terribly sorry, but they swear you'll get a cheque next week.

Nearly two months have now gone by. The $6200 would be useful in your cash flow. You have bills to pay, like anyone else. You try phoning again -- but now have trouble keeping the irritation out of your voice. Has that cheque been signed yet? Yes, they say, but it's with the book-keeper, who has a whole pile of cheques that need to be "entered into the computer".

"When?" you ask.

"By Friday," they assure you.

Surely, things can't keep going wrong? (Or, more darkly: surely, they must run out of excuses soon?)

Not so. The problems can go on for a long time yet. That computer, for example: there could be a disk crash. Or your cheque could be sent to the wrong person, to someone who's in New Zealand. But never mind, they'll issue another one... when the computer is fixed. And the other director gets back from Canada. And the book-keeper recovers from his open-heart surgery. Provided they can find the chequebook, in the mess that was left after the sales tax people raided them. Always assuming that the person you want to speak to has returned from a meeting that seems to last as long as the polar night.

Even if you're pretty innocent, you'll realise you're being strung along. Time to put the pressure on! But how?

Usually what happens next in a story like this is that you make a few angry phone calls. In your last call, you threaten legal action. (A message that's carefully taken down by their 16-year-old receptionist, because everyone else is still in that polar meeting.)

Then you crack. You've had enough! You storm down to your lawyer (if you have one -- otherwise, you grab the yellow pages and pick one). There, in that comfortable chair, with that attentive face taking it all in, you feel like you're loading shells into a cannon. They did this, they did that! Great ammunition! Blast them, Mr Lawyer!

This takes an hour. In extreme cases, even two. Your story isn't that coherent. You haven't brought any papers -- or not enough. Anyway, you now feel better. It's now in the hands of your lawyer. Now they'll see! Boy, will they! No messing around with you.

Back at your office, you send copies of the papers your lawyer asked for. You get them out of the office within an hour, and send them to the lawyer by courier. (Why wait for the post? So slow. That might delay things a day!)

A week passes. Surely by now something dire must have happened to those guys who owe you the money? Agitated, you phone the lawyer. His tone jars you a little. Yes, he's looked at the papers. He suggests that he will write the debtor a letter, saying that legal action will be taken if no cheque is paid within seven days. A little casual and slow, you think -- considering those guys deserve, well, death, practically.

It takes another week before he actually sends the letter. How is this possible? Surely, there can be nothing more urgent than your $6200? A whole week, to get a letter out? But you don't dare resent your lawyer, your main weapon. But still, you don't feel exactly the way you did at the beginning. A thought -- hard to repress -- keeps coming up: maybe you didn't get a tough enough lawyer? But the idea of starting all over...

The letter goes out, and another week creaks by. Nothing. No $6200. No response. Zero.

You can't stand it! You'll hit them with a summons! Mind you, you haven't done this before, and you picture something like a lightning bolt. It will leave them stunned, and just alive enough to beg for mercy and write a cheque.

Actually, what you say to your lawyer is milder: "I believe that a summons would be the logical next step. Let's hope they respond in a more positive way, so the matter will be speedily concluded." So rational.

Several more weeks pass. Probably a month. Little by little, your lawyer informs you about the facts of legal life. You don't get out a summons just like that. (At least, he doesn't, not with his workload.) It's a little mysterious, anyway, this summons. You're not even exactly sure what it... er, does.

But you're beginning to learn not to press your lawyer too hard for details and petty information. He seems, well, unforthcoming. Sometimes you get the impression that your case isn't the supernova at the centre of his universe.

In the end, the summons is 'served'. A clear picture, that: an unpleasant-looking individual pounds on the door of your enemy (that's what he is now). You can visualise your enemy opening the door, turning pale, and receiving the summons with shaking hands. The same effect -- you think -- as a visit from Al Capone. You feel good all day.

After this event, the excitement never stops. Your lawyer lets you know that the debtor has 21 days to "file a defence" (that's what you think he said, worked up as you are). Otherwise, you'll win the case by default!

Plenty of scope for the imagination there. Many the pleasant hour you pass, downgrading your debtor's intelligence. His days pass dimly, you imagine, his mind consisting of some thin, grey, moronic vapour. So stupid! He'll be enraged when you snatch that $6200 away from him, just because he couldn't remember to file a defence! After all, you know the debtor spends all his time in meetings, he can never find anything, and his computer is always broken. How could someone like that ever file a defense?

Unfortunately, he does. Rather, his lawyer does. It's nothing more than a little note on an official form that says that they intend to defend the action.

Your mood turns grim. The debtor has passed through thunderbolts and a visit from Al Capone, and still hasn't coughed up the $6200.

Time for a conference with your lawyer. "What do we do now?" you ask. He most likely tells you the next move is to put the matter down for trial in the Magistrates' Court. (Depending on the background of the case, there are probably lots of other things he could do. But he is an old hand, and knows they'd run your bill up so high you'd have a fit.)

So the case goes down for trial, in six or eight months. And you receive a Statement of Account for Professional Services. $465, including mention of 'two attendances upon you' and 15 'telephone attendances'. (You begin to wonder if all those phone calls you made, asking all those questions, were a good idea.) You take comfort in recalling the lawyer said you'll get some of your legal costs back from the debtor, providing you win the case.

Now it's hard to maintain a heroic posture for six months. Probably you don't manage it. A week before the trial, your nerves get shaky. After all, you have no idea what you're in for. (And you don't feel like pounding the lawyer with questions and running up another bill for telephone attendance's.) You can't shake off vivid images of trial scenes from TV dramas. Terrible cross-examinations, everything checked and scrutinized to the dot. "How do we know that's really your signature, Mr. Bottomley?"

Probably you cave in. Your lawyer talks to the enemy lawyer, and they suggest a compromise: the debtor will pay you $4500 straight away, and it will all be over.

You'd be wise to take it. That way you'd end up with $4500, less the $465, less another smaller bill for the final work by your lawyer ($120). So you'll end up with a figure that begins with a plus sign. You don't end up owing money (an all-too-possible outcome, if you carry on, pig-headed for victory).

But say you aren't built like that. With you, it's the principle of the thing. You did excellent work for the guy, just what he wanted, spot on time. He doesn't deserve to get away with this! You'll show him what stuff you're made of.

You plunge into the trial. Amazingly, the enemy defends it, with witnesses and everything. And his lawyer actually makes you sound like you were lying about some things! At least, he made out that what you did or said could have been interpreted another way. All this takes two days in court.

Ah, but you win. Judgment and costs are awarded to you. At this point, the word 'costs' has an intriguing ring. You take it to mean the enemy will have to pay the $6200, plus all the money you'll now owe your own lawyer. (Two days in court. It doesn't bear thinking about.)

By and by, you get a bill from your lawyer for $4840. And find out you're entitled to recover $3220 from the loser. It's what the court scale allows. So you are down quite a bit. Your legal costs are $4840, minus the $3220 owed by the debtor, plus the old legal bill for $465... whoops, not to forget the smaller one for $120. Altogether, you've had to fork out $2205 to collect $6200!

Anyway, you've taught the enemy a lesson. No one can mess around with you! You'll even go into the red, and spend lots of time and worry, to punish anyone who tries to cheat you.

Except there's one problem. When do you get your check from the debtor? ($3220 legal costs, plus the $6200.) He lost, the court ruled in your favor. Surely, he now has to pay at once?

Your lawyer explains that you have a 'judgment'. This means there's no longer any argument: the debtor owes the $6200, as well as the legal costs the court has awarded you. But now you have to enforce the judgment. If the debtor doesn't just hand over the money, you have a couple of options, explains your calm lawyer. One, you can send in the sheriff and he'll seize furniture and other assets the debtor owns. Or you can put the company into liquidation -- but then any other creditors will join in and you'll have to share the spoils.

The sheriff sounds like the best idea. The debtor's computer, for example. Even if it really was broken, it still must be worth quite a bit. And there must be lots of other stuff in that office.

So your lawyer issues a warrant of execution, instructing the sheriff to seize assets to the value of $9420.

Many weeks pass, then your lawyer phones to say the sheriff has reported there are no goods to seize.

"What!" (And that's the beginning of wisdom.)

"Unfortunately," your lawyer explains, "Everything was encumbered. The computer and everything was leased. The company didn't really own anything. There was nothing the sheriff could seize. The company is just a shell, really. So it wouldn't do any good to put it into liquidation either."

Result: your $6200 'sale' has cost you $5425 in legal fees.

The following chapters tell you much better ways of coping with all this.

2. How to avoid problems - cheaply

First, check them out

IT IS ridiculous for anyone smart enough to be in business not to make routine credit checks. There is no point chasing a debtor with a summons if there's nothing there. You'll get plenty of 'legal action' -- but you'll pay for it all yourself. The debtor won't be touched. Look under 'Credit Reporting Services' in the Yellow Pages. Call a couple of these services. Get their literature. Then join one. You pay an annual subscription (in the very low hundreds) and a small fee each time you want to find out about someone (whether a person, or a business). And I do mean a small fee: less than $10, usually.

On an individual, you can get information like this:*

* At least in August, 1990, when I'm writing this. The Privacy Amendment Bill is still smoldering in Federal Parliament. If it ever passes in the form it's in, this might change the sort of credit information you can lay your hands on. But I don't believe a strong form of the Bill will last long. Businesses need information on people who apply for credit. They will get the information somehow. If businesses can't do credit checks through someone like CRAA, then no doubt they'll find another lawful way. Find out how other businesses do it, then do it too.

On a company, you can get information like this:

So if someone who asks you for credit is in financial trouble, you'll know it before you start doing business. You can tell him: sure, send us the $6200 and you can have the (whatever it is). If he huffs and storms and threatens to take his business elsewhere, let him. Let one of your competitors have the loss. Now I realize it's easy to say, "Keep your credit tight". I know the temptations. The sales staff are selling, selling. Maybe business isn't too good, and you really want this sale. But I repeat: the easy way to get difficult debtors to pay is never give them credit to start with. Money up front, or no sale.

But even if your credit checks are squeaky tight, you still won't avoid all problems. A debtor can 'go bad' for a hundred reasons. He can be a first-rate customer for years, then something slips. Instead of paying in 30 days, all of a sudden he drifts out to 45 or 60. Or maybe a check will bounce. Or something else that's not just quite normal. This should start to ring little bells. You should find out what the problem is. Use your credit reference agency. If that doesn't show any ominous signs, then phone the customer. You're entitled to find out what's happening -- you're providing the customer with credit.

The customer might say, "Accept things as they are, or we'll go somewhere else." That can put you in a quandary. Maybe he's spending $10,000 a month and it's an account you don't want to lose. But really, you might go for three months without getting paid. Maybe $30,000. And if he doesn't pay in the end, it means you might have to find $300,000 in new sales to make it up.

I urge you to get this credit checking right before you worry about the rest of the things in this book. You can stop reading right here, and do very well for yourself if you just do that. Better than many businesses, I can tell you.

Another suggestion: treat your sales and credit people as equals. Pay them the same, push them the same. Invite your credit manager to some of your sales meetings. If your credit manager has guts, he might say something like, "You bastards out there make the sales, but I can't get the money. Don't you eyeball them? Look, so and so is paying on 90 days now. Is he earning a quid? Or is he slow as hell out there, with no contracts? Is there lots of stock around? Let me know. You might try picking up a check too, next time you're there."

Then get it in writing.

THE MORE you get in writing, the stronger your hand will be if the debtor goes bad. If you have to go to court, your case will be tight. (But usually, with lots of signed documents in your hands, you probably won't need to: the debtor will realize his position is too weak.)

I know this isn't a popular topic. All that paperwork hassle -- for what? It feels like driving with the brake on. But I wouldn't be doing you a favor if I didn't at least mention 'credit management' (the right term for a system for checking out your customers, and keeping all the documentation straight).

How much documentation you use -- and what sort -- depends on the size of your business, how much bad experience you've had with debtors, how much you know about credit management, how tolerant your customers are about signing papers (including directors guarantees), and a hundred other things. But whether you know it or not, you already have a credit management system: it might be good, or less good, or downright lousy -- but it's there.

You may be relieved to know that I'm not going to mention anything else about this topic. (As I said, I've found that people really don't like to hear about it.) But that doesn't let you off. If you get your credit management wrong, it will come back and thump you. If you get it right, you'll get your money almost every time. But to get it right, you may need help: if you feel shaky on all this, you can join the Australian Institute of Credit Management and let them help you.

Simple Ways To Collect A Debt Yourself

LET'S SAY you've got a bad one. The money is way overdue, you've called a few times -- now you're convinced it isn't going to be easy. What should you do?

I wish I could list nine easy steps. It's not that simple. First, it depends on the size of the debt -- $31 calls for a different strategy than $1200, or $34,000. It's different chasing an individual than chasing a company. If it's a company, it depends on the size of the company. It can also depend on how important you are to them.

Let's look at the main categories, then list things that often work. But caution: don't follow any of this slavishly. Use common sense and a bit of psychology. We're dealing with quirky, obstinate, vain and wonderful humanity -- even if they are debtors. You know the history of the debt, and you know what the debtor is like. Use everything you know. Use it skillfully to turn up the pressure.

Little Debts Owed By Individuals

WARNING: You'll probably be all right visiting the debtor personally, if you're just offering to pick up the check and you don't start making big waves. But if you handle things wrong, there's always some danger of being prosecuted for 'harassment'. A legally minded (or bloody-minded) debtor might try calling the police. True, the police might have better things to do than follow up. But don't ask me to guarantee it.

Big Debts Owed By Individuals

Little Debts Owed By Companies

Big Debts Owed By Companies

TIP: if a big debtor is in financial trouble, and you push him hard, he might find something 'wrong' with your product and offer part payment. Your product was faulty, or your service wasn't up to scratch -- or whatever. This is face-saving. But it offers an easy chance to get most of your money.

Consider his offer very seriously. Believe me, it can be the best thing you can do. You'll probably still end up with a profit on the deal. (And he'll be happy, because he's got a reduction.) You'll have saved yourself a lot of time. And you'll probably get more money from the debtor than you'd get in any other way. Also you'll come away feeling like a good guy. You're reasonable, you can compromise. Do it! Do it! Don't get involved with law courts and endless hassles if you can avoid it. Pride can be very expensive.

Psychological Section: Know Thyself

DEBT-COLLECTION professionals estimate that at least 80% of people have terrible problems asking for money. Even if there's no squabble. They just hate asking. They can't stand the idea of walking up to someone and saying, "You owe me such and such, could I have a check please?"

Are you like that? Worse yet: is your credit manager like that? (Many are.)

Here's a simple test: you're in a queue and someone pushes in. Do you grumble under your breath and let him in? Or do you pipe up and say, "Hey! There's a queue here. Go to the back." Eighty percent or more would let the person push in. The same 80% are the ones that have trouble asking for money (from anyone -- even their own brother).

If you're honest and think you aren't a natural debt collector, take account of the fact. Hire someone who finds it easy. This is precisely what many debt-collection agencies try to do themselves: pick people who are psychologically right for the job. There's no point in them hiring someone to collect debts if it takes the person half an hour to calm down each time he phones someone.

And back to you: think of your health. If debt collection rattles you, you won't be able to sleep at night. Is it worth it? Can you run a business that way?

You have to know how much debt-collection you can stand, then hand over the job when you reach your threshold. That's what I do. I press debtors to a certain extent -- then just throw up my hands and let the professionals go after them. The peace is wonderful.

4. Getting Rougher: The Counsel Of Experience

SO MUCH for preaching. You probably didn't buy this book to hear you should tighten up your credit system, or to find out a few new tricks to collect debts yourself. Let's say you've done all that and it didn't work. Someone owes you money, and it's turning into a hard case. What next?

I'll take you through the possibilities. I'd better say that I've used the methods I'll tell you about. This isn't theory. It's experience.

My business is writing things for people. (Brochures, speeches, articles, reports, ads, marketing letters, and sometimes books.) Believe me, all kinds of people phone and ask me to do jobs. . My clients range from individuals, to some of the largest international companies. The big companies aren't always prompt payers. And the individuals -- wayward as they sometimes appear -- are often OK. Very hard to predict. And I had plenty to learn.

For this book, I also interviewed all sorts of people: debt collection agencies, private investigators, a magistrate, sheriffs, and lawyers. They were happy to help. They told me it was about time someone did a realistic book about debt collection! And they gave me an earful -- valuable information, worth a lot to me in running my own business. I'm now sharing it all with you.

In the next chapters, I talk about how to collect the difficult debts. Wild waters.

5. Using A Lawyer

YOU CAN TRY asking your lawyer to send the debtor a letter. The idea is to startle the debtor into paying. This sometimes works.

Sometimes a lawyer is willing to write a letter that begins like this: "We act on behalf of Minimax Circuits Pty Ltd. We are instructed that you are indebted to our client to the amount of $1200."

And it ends something like this:

"We advise that if the sum of $1200 is not received by our office within fourteen days of the date hereof, our client will issue proceedings against you for that sum without further notice to you."

Your lawyer hasn't insisted on knowing what the matter is about. He (or she) just sends out a letter. Even so, a letter like this isn't free. Make sure you know how much it's going to cost. And weigh that against the size of the debt. And think about the psychology of the debtor: is he used to getting letters like this? Will he just shrug?

If you want to use this technique regularly, you may be able to work out a deal with a lawyer. A bulk rate. But usually you'll get the same kind of reaction you'd get from a doctor if you phoned up and asked for a prescription for double-strength penicillin, without saying what your symptoms were. He'd want you to come in and be examined first. Similarly, lawyers didn't spend all those years in law school to be asked to write letters without getting any background.

From the evidence I have, the success rate for a straight lawyer's letter isn't too high. (But as one lawyer told me: "It depends on the nature of the debt and to whom it is owed. Obviously, if the debtor thinks he has a good defense the letter will draw no instructive response...")

But if you continue to the next step, and get your lawyer to send a summons, that often does the trick -- especially for a debt that's only a couple of thousand dollars. Your expenses have gone up, though: there are some court costs, more lawyer's time, and the cost of getting the summons served. Worse yet, if your lawyer insists on getting stuck into the case and finding out what it's about, you could be up for hundreds of dollars just to get a summons served.

Remember, we're talking about trying to startle the debtor into paying. You realize it's not economic to carry the legal process any further: the sum you're chasing is too small, or you suspect the debtor hasn't got much money anyway. You're hoping to jolt the debtor into issuing you a check (and probably put off paying someone else). Shock tactics.

If the debtor doesn't pay when he gets a summons, then -- if you wish to -- you can normally just let the matter die. You don't have to list the action for trial.

If the debtor wants to be difficult -- or stand on some high principles -- he can list the matter for trial himself. (But as you might imagine, this doesn't often happen.) A slight danger is that the debtor will later apply to the court to have your action formally dismissed (for 'want of prosecution'). This makes it extremely hard, or expensive, to sue him for the debt later, if you discover he actually has some money. Also, the court may 'award costs' in the debtor's favour -- so you'll get a bill for some part of the debtor's costs in getting the action dismissed. And you have to pay it.

In short, matters are not always 100% under control, even when you only threaten legal action. But as you'll see in the next section, if you decide to drive the legal process all the way to the court, your steering wheel can snap off completely.

When You Expect To Go To Court

TWO important points, right away:

How To Save Some Money On Lawyers' Fees

IF YOU LEARN to behave like a lawyer's ideal client, your bills will be lower.

Don't present your lawyer with a half-crazed story, full of sound and fury but with no legal value in it. First write out what happened, in full detail. Get it typed. Make sure it's very clear.

When you get to a point in the story that you can substantiate with a document, refer to the document in the text. ("See the Contract, document A.") Put all these documents in order, with the story on top, send them to your lawyer and ask him to read them.

After he's done that, then make an appointment to see him. You'll be amazed at the difference this makes. The meeting will go fast and smoothly. The lawyer will ask you about any points that aren't quite clear from the papers you gave him.

From then on, keep in mind that your object is to get the debtor to pay you. Don't get so wrapped up in the proceedings that it becomes a mission to punish the debtor.

Anywhere in the proceedings, the debtor's lawyer may suggest a compromise. Think very carefully before you turn it down. Your legal costs will never be any less.

The more you can bury your pride and anger, and see the whole business as a procedure, the more likely you'll come out ahead. It also means less time spent talking to your lawyer about what amounts to your emotional reactions to the whole business. He'll listen to your problems, and guide you away from irrational decisions -- but it will cost you.

Keep your cool. Treat it like a game of chess.

The statistics are good: less than 10% of the Magistrates' Court summonses for debts ever go to trial or to arbitration at the court. The rest are settled before they get that far.

What The Lawyer Is Thinking

YOUR LAWYER doesn't want you to hit the roof when you get his bill. So if you're just chasing a few thousand dollars, he probably hopes that the debtor will make some acceptable offer before the trial. He knows this would be to your advantage. Your legal costs would probably then be reasonable, measured against the amount you'll collect.

The debtor's lawyer is thinking the same thing. Sure, the debtor has some kind of defense, but his lawyer doesn't know if it will stand up until he looks at all the details. These things are always more complicated than the client can imagine. In law, practically everything is arguable. There's no way the debtor's lawyer wants to spend huge amounts of time on this either, and run up a colossal bill, if there's some hope it won't be needed.

Upshot: the lawyers on both sides tend to do the minimum, just shadow-box for a while. To both of them, it's a fight about a small sum (a few thousand dollars). They can't afford to sink a lot of their client's money into the sort of pre-trial preparations you see in Rumpole dramas.

Usually, very little happens until about a week before the trial is due to begin. Even if the trial looks like going ahead, the lawyers still won't do as much technical preparation as they could. For a debt of say $6000, their clients just couldn't afford it. So your lawyer isn't going to look into every possible 'cause of action' and the debtor's lawyer isn't going to spend his evenings pondering subtle and sophisticated defenses.

Getting to the bottom of it: why Magistrates' Court actions need to be 'cheap'

IT ALL goes back to the scale of fees in the Magistrates' Court. The court puts limits on how much the winning side can stick the losing side for, in legal costs. There are good reasons for this. There'd be little point in having a hierarchy of courts (Magistrates', County, and Supreme) if all the courts handled cases of any size, and allowed similar costs.

The Magistrates' Court handles cases less than $25,000 and has a correspondingly modest scale of allowable fees. This means that if your lawyer's bill runs over the Court scale by say $250, you can't claim the $250 from the debtor if you win the case. You're $250 out of pocket, no matter what.

And there's something else: if you're suing for a debt of $500 or less, you aren't allowed to claim any of your legal fees from the loser. (Except in rare circumstances, not worth hoping for.) The only good news is that if you lose the case, the debtor can't hit you with a bill for part of his lawyer's fees.

To repeat: if you sue someone for $500 or less, you pay all your own lawyer's fees.

If you aren't aware of all this, your lawyer certainly is. And this is what curbs him.

Mind you, there are complicated trials in the Magistrates' Court. Sometimes it can't be helped. There might be 10 witnesses, the trial might go on for a week -- all over a debt of just $3500. Such a thing might happen, for example, if the debtor was getting legal aid. "Why worry?" he might think. "My costs are all covered. What can I lose?" (Actually, if he did lose, he'd have to pay the Court's scale costs to you. Legal aid wouldn't cover that.)

In the higher courts, the costs themselves can become a driving force. For example, a 'small' dispute for $9000 could eventually get appealed to the Supreme Court, with costs that might soar to twenty times that on each side. Both sides are now in so deep, it's mostly the legal costs they're worried about. They want to win and collect the costs back from the loser. Stuff the $9000! Just save me from my lawyer's bills!

If you win, how much do you pocket?

MOST OF the people who buy this book will be chasing sums that would put their cases in Magistrates' Court. County Court cases normally begin at $25,000, and Supreme Court cases at $100,000. (But complex cases for smaller amounts can sometimes be started in the higher courts.)

So-o-o, let's say you win your Magistrates' Court case. You know the debtor has the money, because you checked before you started all this. Say he owes you $6000. And you have a bill from your lawyer for $3000. Question: how much of your $3000 lawyer's bill can you recover from the debtor? The hedged answer is: it depends how complex the proceedings were. If they were a lot more complex than the court scale allows for, then you'll have to pay a big whack of your lawyer's bill yourself.

Averaging over a lot of cases, the winner will recover about two-thirds of his lawyer's bill. So if you are facing a lawyer's bill of $3000, the loser will have to pay perhaps $2000 of this.

Result: of the original $6000 owed to you by the debtor, you actually pocket $5000 ( $6000 he pays you because he lost, plus $2000 of your lawyer's costs he pays you, less $3000 you have to pay your lawyer).

In a more complex case, you might only be able to recover $1500 towards your lawyer's bill from the debtor, or even only $1000. Down go your final takings.

No matter what, you'll end up a bit out of pocket. (Not to mention the time it's taken you.) You may win by default, before trial. But even if it doesn't go to trial, you still have to pay your lawyer. At different stages, the court may award you costs for this or that. But add them all up, and it won't cover what you owe your lawyer.

With arithmetic like this, you can see why your lawyer always has THE LAZY PERSON'S SECRETS TO OVERNIGHT WEALTH

There are so many simple, yet really sure-fire ways of acquiring wealth, it's a wonder everybody with even the least bit of ambition isn't already rich. When you come right down to it, the only things needed for anyone to make bundles of money are the long-range vision and the energy to put a money-making plan into force.

One of the easiest methods of building wealth, and the one most often used by the "smart" people, is to furnish the expertise, equipment or growth capital to promising beginning businesses. Basically, you buy in as either a part owner or limited partner; then, as the business grows and prospers with your help, you reap your share of the rewards.

The beautiful part about this whole concept is that you can repeat this procedure over and over again. You can start out with, say marketing and sales leadership for a small, garage-type business; then with your holdings and earnings from that business, invest in another, and keep doing this until you own a part of twenty-five to an unlimited number of businesses. Looking at the idea from a dollar return point of view, if you were getting $200 per month from 25 different businesses, your monthly income would amount to no less than $5,000 and that's not too bad for a fledgling millionaire.

Look around your own area. With just a little bit of business sense and perception, you're sure to find hundreds of small businesses that could do better - perhaps even become giants in their field - with your help.

Most small businesses need, and would welcome marketing, promotional, advertising, and sales help. If a quick survey of a business turns you on with enthusiasm about the potential profits to be made with just a few changes that you can suggest, then you are on your way.

Basically, you set up an appointment to see and talk with the business owner about some ideas and help that could double or triple his profits. When you approach him in that manner, he's almost certain to want to see you and hear what you have to say.

In preparation for your meeting, set your ideas down on paper. Put them together in an impressive marketing or profit-potential folio. Out-line your ideas, the costs involved and the ultimate profit to be gained.

Then, when you arrive for the meeting, be sure to look and act the part of a successful business person. A few pleasantries to break the ice, and then begin with your presentation.

Through your proposal, you must instill confidence that you can do all you claim for him. Guide him through the presentation to the ultimate profits - all for a 10 or 20 percent limited partnership in the business, which really won't cost him anything. Of course, if he's reluctant to give up any part of his ownership, you come back with the idea of being hired as a consultant.

Almost all small businesses need help of some kind. The owners get bogged down in a myriad of everyday problems and things to do. They find there just aren't enough hours in the day to handle everything that should be taken care of, and end up neglecting or putting off some of the things they should be doing to keep the business prosperous. As a result, the long struggle for business survival begins, with more than 60% of them selling out at a loss or just closing up shop.

The other way to "cut yourself in" on a piece of someone else's business is to supply needed money. If you can come up with 10 or 15 thousand dollars, you can easily "buy into" some small businesses. Be sure to look the business (and its market potential) over; but once you spot one that can really be a winner with just a little bit of operating cash or money for expansion, then start figuring!

You can reach a never ending supply of such businesses to choose from, simply by running a small advertisement in your daily newspaper in the classified section under the heading of Business Opportunities Wanted. Such an ad might read:

SUCCESSFUL BUSINESS EXECUTIVE LOOKING FOR NEW BUSINESS VENTURES. WILL CONSIDER BUY-OUT OR PARTNERSHIP. PO BOX 123, CITY.

By the same token, make it a habit to look through the Business Opportunities Avail able on a regular basis. Mark a few each day and follow up. Check them out, and see what kind of a deal is being offered. Remember, proper management and planning are basically the ingredients to success in business; and most small businesses just don't have these ingredients in the proportions needed to attain their greatest profit potential.

Other people have done it, and more are starting up every day. There's no reason why you can't do it. In most cases little or no cash is needed. But with just a little bit of action on your part, you could quickly become a multi-business owner, and very wealthy as well.