A customer owes you $50,000, the work was delivered or the goods were shipped, and the payment simply is not coming. You have sent statements, made calls, and probably issued a formal demand, and the account is still open. At that amount the situation has moved past a routine collections nuisance and into a decision about whether and how to pursue the money through the courts. What Indiana business owners need to understand is that the path from an unpaid invoice to money actually recovered involves several steps, each with its own cost and its own risk, and the size of the debt does not by itself guarantee that you will collect it.
What should you do before filing a lawsuit?
Before a lawsuit makes sense, the foundation of the claim has to be in order. Gather the contract, the invoices, the delivery records, the email exchanges, and any written acknowledgment of the debt, because the strength of your documentation will determine both whether you can prove the obligation and how much you can ultimately recover. A clear written demand that states the amount due, references the agreement, and sets a deadline often prompts payment, or at least a response that tells you whether the customer disputes the debt or simply cannot pay. If the nonpayment stems from a genuine dispute over the work rather than an inability to pay, recognizing that early matters, because a contested claim is a different undertaking than a straightforward collection. Understanding what actually constitutes breach of contract in Indiana business deals helps you judge whether you are facing a defensible position or an excuse.
How much of the $50,000 can you actually recover?
The amount you are owed and the amount a court will award are not necessarily the same. In Indiana you can recover the loss you actually suffered, which for an unpaid account is generally the contract balance, and you may be able to recover interest and, where your contract provides for it, attorney fees. What you cannot assume is that the full claimed figure will survive, because every element of damages has to be supported by evidence rather than assertion. A warranty dispute litigated in Hamilton County illustrates the risk, because the property owner sought more than $300,000 covering repairs, lost use, employee time, and a replacement roof, and the trial court awarded $9,500, a figure that was then appealed and sent back for further proceedings. Reviewing the damages your business can actually recover before you file gives you a more realistic sense of the likely outcome than the number on the invoice alone.
Some business owners ask whether they can pursue additional or multiplied damages when a customer refuses to pay. In a Marion County case, a finance company that won a judgment exceeding $320,000 against an automobile dealer saw it reduced on appeal to roughly $123,000 after the court found the trial court had counted the same sum twice, and the company’s separate attempt to treat the unpaid debt as criminal conversion in order to triple its recovery under Indiana’s Crime Victim’s Relief Act was rejected, because a failure to pay a debt does not, by itself, constitute conversion. Enhanced damages of that kind are available in narrow circumstances rather than as a routine remedy for nonpayment, so a recovery plan that depends on them rests on shaky ground.
Is there a deadline to act in Indiana?
There is, and how long it runs depends on what kind of transaction produced the debt. When the unpaid amount is for goods that were sold and delivered, the claim generally falls under a four-year deadline, and that shorter period controls even though the open account might otherwise look like it carries a longer one. When the debt comes from services, an oral agreement, a running account kept open for ongoing business, or a written promise to pay money, the period is generally six years. Where a single deal involves both goods and services, Indiana courts decide which deadline applies by asking what the contract was predominantly for, so the same $50,000 balance can be governed by different deadlines depending on how the arrangement was structured and documented. The practical risk is assuming you have six years when a goods-based claim actually had four, because once the deadline passes the claim is generally barred regardless of its merits, so pinning down the deadline for your specific account is a step worth taking early. The fundamentals of breach of contract in Indiana set the framework, but the filing deadline is a separate question that deserves its own attention.
What happens after you win?
A judgment is not the same as a payment. Winning establishes that the customer owes you, but collecting on that judgment is a separate process, and a judgment against a customer who has no assets or who is heading toward insolvency can be difficult to satisfy. Indiana provides post-judgment tools, including proceedings supplemental to identify a debtor’s assets along with mechanisms such as garnishment and judgment liens, but each of those takes additional time and effort and presumes there is something to collect. An honest assessment of the customer’s ability to pay therefore belongs at the front of the decision rather than the end, because pursuing a $50,000 judgment against a business with nothing behind it can cost more than it returns. The overall length of a breach of contract lawsuit in Indiana compounds that concern, since the longer the process runs the more a thin recovery is eroded by the cost of obtaining it.
When should you bring in a lawyer?
At $50,000, the dispute is already beyond the reach of Indiana’s small claims court, which is limited to $10,000, so a claim for the full amount belongs in the regular civil courts where the process is more formal and counsel is the norm. It is sensible to involve a lawyer when the customer disputes the debt or has retained counsel, when a filing deadline may be approaching, when the customer’s financial condition is uncertain, or when the contract terms are open to more than one interpretation. An early consultation can tell you whether the claim is worth pursuing, what it is realistically worth, and whether collection is likely, which is far less expensive than learning those things after the cost has been incurred. If the unpaid amount arose from a construction or improvement project, the considerations involved in resolving a construction contract dispute may apply on top of the general collection analysis.
Frequently asked questions about a customer who won’t pay $50,000
What can I do if a customer won’t pay a $50,000 invoice in Indiana?
Start by assembling your contract, invoices, and records and sending a written demand for the amount due. If that does not resolve it, a breach of contract action in the regular civil courts is the usual route, because the amount exceeds the small claims limit.
Can I sue a customer in small claims court for $50,000 in Indiana?
You cannot pursue the full amount in small claims, because Indiana caps those cases at $10,000, so a $50,000 claim belongs in Circuit or Superior Court unless you are willing to waive everything above that cap.
How long do I have to sue a customer for nonpayment in Indiana?
It depends on what the debt is for. A claim for goods that were sold and delivered generally carries a four-year deadline, while debts for services, oral agreements, open accounts, and written promises to pay money generally run six years, so a goods claim can expire sooner than owners expect. Confirm the deadline for your specific account early, because once it passes the claim is generally barred.
Will I get interest and attorney fees if I win?
You may be able to recover interest, and attorney fees are available when your contract provides for them or a statute allows them. Without such a provision, each side ordinarily pays its own fees in Indiana.
Can I get triple damages from a customer who won’t pay?
Triple damages are usually not available for a simple unpaid debt. Indiana’s Crime Victim’s Relief Act allows them for criminal conversion, but courts have held that failing to pay what you owe, without more, is not conversion.
What if the customer has no money to pay a judgment?
A judgment is only as valuable as your ability to collect it. If the customer is insolvent or without reachable assets, even a successful lawsuit may not produce payment, which is why assessing the ability to pay early matters.
Is it worth suing a customer for $50,000?
It depends on the strength of your documentation, whether your contract shifts fees, and whether the customer can actually pay. When those factors line up, a claim of that size is often worth pursuing, but each should be weighed before filing.
Talk through your situation before you decide
A customer refusing to pay $50,000 is a serious matter, and the right response depends on facts specific to your contract, your records, and the customer’s ability to pay. Fugate Gangstad Lowe handles breach of contract and business collection matters for companies in Indianapolis, Fishers, Carmel, Noblesville, and the surrounding central Indiana communities, and we can help you evaluate what you are owed, what it will take to recover it, and whether pursuing it makes sense. Call 317-829-6797 or contact us through our contact form to discuss your options.
The information provided in this article is for general informational purposes only and does not constitute legal advice. Reading this article does not create an attorney-client relationship. For legal advice tailored to your situation, please contact our firm directly.