A client contacted us because his company had leased expensive technical equipment from a major corporation.  When the equipment arrived, it did not perform according to the promises made by the sales personnel.  He attempted to negotiate with the sales and technical staff for several months on his own to get the equipment to perform.

Unfortunately, he had no success.  He finally gave up, boxed up the equipment, told the corporation to pick it up, and stopped making the lease payments.  The corporation sued him for breach of the lease.  Of course, our client’s position was that the equipment never performed as promised so it was the corporation, not him, who breached the lease.

We immediately contacted opposing counsel and learned that our client’s nonpayment had landed him in the corporation’s “deadbeat” category.  Therefore, they now viewed his complaint about the equipment not performing as a way to dodge paying.  However, we were able to get the case into mediation and settle the matter for a portion of the lease payments.

Unfortunately, our client’s problem is not uncommon.  About a year later, another client called us with the same problem with the same corporation.  This time, the client contacted us early.  Like our previous client, he wanted to box up the equipment, return it, and stop making payments.  We told him to keep paying on the lease while we negotiated a settlement agreement.  Because he made his monthly payment, the corporation did not view him as a deadbeat and never filed a lawsuit.  Meanwhile, we were able to get the corporation to pick up the equipment and settle the dispute for a nominal settlement payment of less than one month’s lease payment.

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