You wired the deposit six weeks ago. The delivery date has come and gone. Your customer is calling, your crew is sitting idle, and the vendor isn’t returning your calls. If you’re a central Indiana business owner stuck in this spot, you already know the cost of vendor non-performance isn’t just the money you paid out. It’s the project you can’t finish, the customer you might lose, and the time you’re burning chasing someone who should have done their job. This post walks through what to do when a vendor didn’t deliver in Indiana: how to document the breach, when to send a demand letter, what damages you can realistically recover, and when it makes sense to bring in a lawyer.
First, figure out what kind of agreement you actually have
Before you do anything else, pull the paperwork. Whether it’s a signed contract, a purchase order with terms on the back, an email chain, or a chain of texts and a handshake, the document trail controls almost everything that follows. Indiana law treats different kinds of agreements differently, and the first question is whether your deal is governed by the Uniform Commercial Code or by general contract law.
If your vendor was selling you goods, meaning movable, tangible items like materials, equipment, parts, or inventory, the deal is almost certainly governed by Article 2 of the UCC, which Indiana has adopted at Indiana Code section 26-1-2. The UCC has its own rules about delivery, acceptance, rejection, cure, and damages that differ from common-law contract rules. If your vendor was providing services (cleaning, consulting, marketing, software development, repair work), general Indiana contract law applies. If it’s a hybrid (a system installation that includes both equipment and labor), Indiana courts apply the “predominant thrust” test from the Indiana Supreme Court’s 1993 decision in Insul-Mark Midwest, Inc. v. Modern Materials, Inc. to decide which body of law controls. Under that test, the court looks at the contract language, the parties’ circumstances, the primary reason for the deal, the final product the buyer bargained for, and the pricing method (charging per gallon of coating versus per pound of screws coated, for example) to figure out whether the deal was predominantly for goods or for services.
This matters because the rules are different. Under the UCC, for example, you may have rights to “cover” by buying substitute goods elsewhere and charging the difference to your vendor. Under common law, you generally have to prove your damages with more traditional contract principles. None of this should stop you from acting fast, but it shapes the analysis your lawyer will run when evaluating your case. For a fuller walk-through of how Indiana courts approach these issues, our post on understanding breach of contract in Indiana is worth reading.
Document everything before you do anything else
This is the step most people skip, and it’s the one that decides whether you have a real case or a frustrating story. Right now, before you call the vendor again, before you send an angry email, sit down for thirty minutes and put together a clean file.
You want every version of the contract, purchase order, quote, or proposal. You want every email, text, and voicemail (transcribe the voicemails or save the audio). You want the proof of payment: wire confirmation, canceled check, credit card statement, ACH receipt. You want a timeline written in plain English: date of agreement, agreed delivery date, dates of partial performance, dates of missed deadlines, dates of your follow-up communications. If the vendor made promises after the original deadline passed (a new delivery date, a partial shipment, a refund offer), capture those in writing too. A reply like “We’ll have it there by the 15th” sent by text is a piece of evidence; a verbal promise made on a phone call is much harder to use.
Then write down what the missed delivery has actually cost your business. Money you paid out. Money you had to spend on a substitute. Lost revenue from a job you couldn’t complete. Penalties or chargebacks from your own customer. Storage costs, labor costs, expedited shipping you absorbed. Be specific and back it up with documents. Indiana courts (and vendors who are deciding whether to settle) take these numbers seriously when they’re documented, and they discount them sharply when they’re not.
Send a written demand before you sue
In most vendor non-delivery situations, a properly drafted demand letter does more practical work than any other single step. It puts the vendor on formal notice, creates a paper record that you tried to resolve the matter before suing, often triggers an insurance notice if the vendor has commercial coverage, and frequently produces a refund or a settlement offer within a few weeks.
A good demand letter is short and specific. It identifies the contract, states the breach, references the dollars at stake, sets a reasonable deadline to cure or respond (often ten to thirty days, depending on the situation), and explains what you intend to do if the vendor doesn’t respond. It does not threaten, posture, or read like it was written in anger. In Indiana, certain contracts and statutes also require specific pre-suit notice, and some contracts have their own notice-and-cure provisions buried in the fine print. Skipping those steps can hurt your case later. If your contract has a dispute resolution clause requiring mediation or arbitration, that controls too.
You can send a demand letter yourself, and for smaller disputes that’s often fine. For anything substantial, having a lawyer send it on firm letterhead changes how seriously the other side takes it. Our post on contract disputes between Indiana businesses goes into more depth on the pre-litigation stage.
Know what you can realistically recover
The damages question is where business owners often get either too optimistic or too discouraged. Indiana law lets you recover what’s needed to put you in the position you would have been in if the vendor had performed. In practical terms, that usually means a refund of what you paid, the reasonable extra cost of covering the work or goods elsewhere, and consequential damages that were foreseeable at the time of contracting. It does not, in most cases, mean punitive damages, attorney fees (unless your contract or a specific statute provides for them), or speculative lost profits you can’t prove with reasonable certainty.
A few examples of how this plays out. If you paid a vendor $40,000 for materials they never delivered and you spent $48,000 buying the same materials from another supplier on rush order, your cover damages are typically the $8,000 difference plus your $40,000 refund. If your project was delayed and your customer charged you $5,000 in liquidated damages because of the vendor’s failure, those may be recoverable as consequential damages if the vendor knew or should have known you had downstream obligations. If your business “would have made another $200,000 in profit” but you don’t have any documentation to support that figure, an Indiana court is unlikely to award it.
You also have an obligation to mitigate. That means you can’t just sit on your hands and let damages pile up; you have to take reasonable steps to limit the harm. Buying substitute goods, finding another contractor, or notifying your customer that delivery will be delayed are all part of mitigation. Failing to mitigate can reduce or eliminate damages even when the vendor’s breach is clear. Our post on what kind of damages your business can recover in a breach of contract lawsuit breaks the categories down in more detail.
Don’t sleep on the statute of limitations
Indiana imposes deadlines, and missing them ends the case before it starts. The applicable deadline depends on what kind of contract you have and what the dispute is about.
If your vendor was selling you goods governed by Indiana’s UCC, the limitations period is four years after the cause of action has accrued, under Indiana Code section 26-1-2-725. If your deal is a written services contract or a written commercial agreement outside the UCC, Indiana Code section 34-11-2-11 sets a ten-year limitations period for written contracts other than those for the payment of money. Indiana Code section 34-11-2-9 sets a six-year period for written contracts for the payment of money, which Indiana courts apply to instruments like promissory notes and bills of exchange. In a 2025 decision, the Indiana Court of Appeals applied the ten-year written contract statute to a claim against a title company that agreed to prepare a deed in exchange for a fee, treating the substance of the agreement as a written services contract rather than a contract for the payment of money. For oral agreements, Indiana Code section 34-11-2-7 sets a six-year limitations period for actions on accounts and contracts not in writing.
When the clock starts running matters as much as which statute applies. Indiana follows what’s known as the discovery rule, meaning a cause of action accrues when the claimant knows or, in the exercise of ordinary diligence, should have known of the injury. For most vendor non-delivery cases the breach is obvious the day the goods don’t arrive, but for hidden defects, misrepresented progress, or vendors who string buyers along with false reassurances, the discovery rule can matter.
The practical takeaway: don’t try to time this on your own. Dragging out informal negotiations for a year before talking to a lawyer can be costly. If you’re not sure where you stand, get an evaluation now rather than later.
Where you sue (and whether to sue at all)
If a lawsuit becomes necessary, venue and forum matter. For most Indiana business disputes, the right venue is the county where the contract was performed, where the defendant resides or has its principal office, or where the relevant events occurred. For central Indiana businesses, that often means Marion County, Hamilton County, Hendricks County, Boone County, Hancock County, or Johnson County, depending on the facts. Many contracts also have forum selection clauses that override the default rules and require suit in a specific county or state. Read the fine print before you file.
Whether to sue is a separate question from whether you can. A lawsuit costs money and takes time, and not every breach is worth litigating. Sometimes the right move is a demand letter and a negotiated refund. Sometimes it’s a small claims action; Indiana small claims courts now have a $10,000 jurisdictional limit statewide, raised from the prior $8,000 Marion County and $6,000 elsewhere limits when the law changed in 2021. Sometimes it’s a full breach of contract suit in the appropriate trial court. Sometimes the vendor is judgment-proof and even a winning case won’t translate into a paid judgment. A good lawyer will tell you that part honestly before you spend money on a complaint.
At Fugate Gangstad Lowe, our attorneys each bring more than a decade of experience handling Indiana business and contract disputes, and our approach is practical. We figure out the most efficient path to the best result the facts allow, whether that’s a sharp demand letter, a negotiated resolution, or litigation when litigation is the right tool. We use modern technology and disciplined case management so that we’re not running up fees on motions and busywork that don’t move your case forward. For situations where the original deal was informal or based largely on a verbal understanding, our post on handshake deals and business contract disputes in Indiana is also a helpful read.
Frequently asked questions about vendor non-delivery in Indiana
What can I do if a vendor doesn’t deliver what I paid for?
Start by gathering every document related to the deal, then send a written demand identifying the breach and a deadline to cure or refund. If that doesn’t resolve it, you can pursue a breach of contract claim in Indiana court for refund of your payment, cover damages, and reasonably foreseeable consequential damages.
How long do I have to sue a vendor in Indiana?
It depends on the type of contract. For a sale of goods governed by Indiana’s UCC, the general limitations period is four years from the date of breach under Indiana Code section 26-1-2-725. For a written services contract, Indiana courts have applied the ten-year limitations period under Indiana Code section 34-11-2-11. For oral contracts, the period is generally six years under Indiana Code section 34-11-2-7. Talk to a lawyer to confirm which deadline applies to your situation.
Can I get my deposit back from a vendor who didn’t deliver?
In most cases, yes. If the vendor materially breached the contract by failing to deliver, you can usually recover your deposit along with any additional damages caused by the breach. The strength of your claim depends on what the contract says, what you can prove you paid, and whether the breach was material.
Is a verbal agreement with a vendor enforceable in Indiana?
Often, yes. Indiana enforces oral contracts in many situations, though some agreements (including contracts for the sale of goods of $500 or more under Indiana’s UCC statute of frauds at Indiana Code section 26-1-2-201) must be in writing to be enforceable. Verbal deals are harder to prove and harder to litigate, but they aren’t automatically void.
What counts as a material breach by a vendor?
A material breach is one that goes to the heart of the bargain, like total failure to deliver, delivery of nonconforming goods, or failure to perform by a deadline that was clearly important. A minor or technical breach (delivering one day late on a non-time-sensitive order) usually doesn’t justify the same remedies as a material breach.
Do I have to send a demand letter before suing my vendor?
Indiana law doesn’t require a demand letter in most breach of contract cases unless your contract or a specific statute requires one. Practically, though, sending a demand letter first is almost always the right move. It often produces a resolution and strengthens your position if you do end up in court.
Can I recover lost profits if my vendor failed to deliver?
Sometimes. Indiana courts allow recovery of lost profits when they were reasonably foreseeable to the vendor at the time of contracting and can be proven with reasonable certainty. Speculative or undocumented lost profits are typically not recoverable.
Where do I file a lawsuit against a vendor in central Indiana?
Venue depends on where the contract was performed, where the vendor is located, and what your contract says. For central Indiana businesses, suits are commonly filed in Marion, Hamilton, Hendricks, Boone, Hancock, or Johnson County, depending on the facts. If the claim is for $10,000 or less, small claims court is an option. Some contracts contain forum selection clauses that control venue.
When to call a lawyer about a vendor non-delivery dispute
If a vendor didn’t deliver in Indiana and you’ve already lost a meaningful amount of money, missed a customer deadline, or hit a wall trying to get a refund, the next move is a real conversation with a business litigation attorney. We can review the contract, evaluate the strength of a breach of contract claim, draft a demand letter that gets attention, and tell you straight whether litigation is worth pursuing. Call Fugate Gangstad Lowe at 317-829-6797 or reach us through our contact page to set up a consultation. The earlier you bring us in, the more options you have.
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.