When a Business Goes Out of Business

5x5BusinessI spoke with a relative who has been in business for himself for the past few decades. He’s seen companies come and go, and come back again. He’s seen companies that owed his company money go out of business, leaving him wondering how he would get paid for the services and products he provided.

As a person owed money by a company that goes out of business, sometimes we’re left in the dark, wondering the exact same thing: can I get the money owed to me, and if so, how do I get it?

My relative told me that getting paid isn’t automatic. Well, it is if you’re dealing with an honourable, honest company that values its reputation. When a reliable company goes out of business, all their debts are paid in full without hassle. They not only respect themselves and the laws, but their former service and product providers.

And then there are the other companies.

If a company goes out of business and leaves unpaid bills, it’s up to the person owed the money to pursue the business to get it. This could be simply making a phone call or sending a registered letter. Or it could mean small claims court if it’s less than $25,000.Crow Button

You can learn more about Small Claims Court in Nova Scotia from their website.

You can also research the decisions of past court cases from that website to see if the company you’re suing has already been taken to court. You’ll also have access to the outcomes. The online records go back to 2001.

Getting paid for outstanding bills is more difficult if a person declares bankruptcy. To see if the person who owns the company in which you are seeking money from has declared bankruptcy, visit The Courts of Nova Scotia website. The documents are not searchable; you’ll have to go through each one to see if a particular name is listed.

Knowing this basic information will not only help those who don’t know where to turn when they are left holding a bill, but it can be used to learn more about a company before becoming involved with them.

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