In our latest Real Deal scenario, Wrightway Signs, a third-generation company with 38 employees, is tapped for a blockbuster project by Quatrefoil Gaming, an expanding casino concern headed by billionaire Densmore Quatrefoil.
Anticipating a huge payday, Wrightway Signs arranged leases on new equipment. The shop completed the project on time and received Quatrefoil’s final payment in the form of a check for $375,000 shortly thereafter.
However, the check bounced after Quatrefoil placed a stop payment on the transaction. Wrightway Signs has learned the casino magnate is unhappy with the work, and now Quatrefoil is taking legal action to worm his way out of making the full agreed-upon payment.
With the signshop scrambling for a solution, we asked you:
How can Wrightway Signs save itself from imminent collapse? Do they dare sue the billionaire? Or do they try to settle — as long as the loss won’t bankrupt them?
Andrew J. of Plano, TX offered his counsel:
On any project of magnitude, pre-liens are a must, as is a good contract. While you cannot prevent ending up in court, you certainly can have an impact with their bank/insurers. The payee will make you sign a lien release upon payment, but you have legal options with the fraud that the cancelled check initiated. No bank or insurer wants to see liens on the job. … With very few exceptions, casinos complete expansion/new construction with bank financing and pay down the loans. Thirty years of building casino/hotels for the largest gaming companies in the US gives me the experience to protect both the casino and the sign company.
How would you handle the sticky situation that Wrightway Signs finds itself in? Feel free to comment below!
EDITOR’S NOTE
Real Deal is a fictional scenario designed to read like real-life business events. The businesses and people mentioned in this story should not be confused with actual businesses and people.