Most dealers only very occasionally will be forced to seek a lawyer’s aid to collect money due for goods they have already sold and delivered. Often however, that lawyer’s job is made unnecessarily difficult because the dealer failed to properly protect himself at the outset of that job.

In this column we will look at some of the things a dealer should do before there is a problem so that he may have a better chance of getting paid should one later arise.

As I have noted to retailers in the past, one of the most important protections a dealer can have against customer abuses is a proper sales order form. But even the best form imaginable is of little use if it is not properly filled out. After you have put so much time and money into preparing a proper sales order form you and your staff should at least take the time to fill in the blanks.

Probably the most important of these blanks is the place for the signature of the customer. A good form should have two—yes, two—places for this signature.

The first of these should indicate that he or she agrees to the contract of sale as it is finally calculated. Everything that is, or is not, included in that particular job should be stated in the contract. This includes all extra labor, steps, rip-up molding, base, etc. You are probably familiar with these problem areas because most likely they have come up before at one time or another.

The second signature spot should be signed by the customer when the job is completed. There is nothing wrong in having your mechanic present the customer with a copy of the form and asking her to sign off on “The job has been completed to my satisfaction.” Legally speaking, a signature such as this constitutes “acceptance” of the job making it very difficult for that customer to later claim something was incomplete, defective or otherwise not to her liking.

Another extremely important portion of the sales order form is the space at the very top where you fill in the name and address of the customer. While it may seem to be very basic that you would know whom you are dealing with, the lack of this complete information is often the biggest obstacle we face in a later attempt to collect money due. It is very difficult to sue “John the Oilman” or “Bill from Butcher Shop,” as we are often asked to do.


Dealing with a Business

Ascertaining the correct name of your customer is even more important when your customer is a business entity rather than an individual. To do this, you must know some basic law concerning the various types of business names.

The first of these is the individual doing business under a trade name: John Jones doing business as (d/b/a) John’s Stationary Store. In a situation such as this, it is best to have the sales order form just filled in and signed just that way by John Jones.

The same is true if your customer is a partnership, although in that case it will usually suffice to have just the trade name of the partnership and the signature of only one of the partners signing in his capacity as “partner.”

If your customer is a corporation you must be very careful to get the corporate name just right, i.e., “John’s Stationary Store Inc.” The person signing must then sign in his corporate capacity such as “John’s Stationary Store by John Jones, President.”

If your customer is a large corporation and you are not dealing directly with the president make sure the person you do deal with has the authority of that company to make that purchase and to obligate them to pay for it. If the job is large enough it may be wise to insist that an officer of his company countersign your agreement.

How do you find out the proper name of your commercial customer? One way is to ask him. Business cards are often misleading. For instance, a card may merely say “John’s Stationary Store” when in fact the true name of the company may be “John’s Stationary Store Inc.” or even “John’s Stationary Store Corp. doing business as John’s Stationary Store.”

If you are dealing with a corporation you must make sure that you have the proper corporate name and that it is indicated as such by the use of one of the terms, Inc., Corp., or Ltd.

Often a company check will be left as a deposit. This check will, in most cases, have the proper corporate identity of the purchaser imprinted on it. Sometimes however, this check is given from the account of a company other than the one where the flooring is being installed. You then may have two companies to go after. The one who signed the contract and the other one who paid the deposit.

The Internet has become an important tool for us in our search for the exact corporate name of a business entity. It’s amazing how much information on most companies is readily available through this medium. If that doesn’t work, each state has some sort of an official search site for business entities filed in that state.

Making the extra effort to get the sales order right in the beginning, may, that one time that you really need it, save you, or your attorney, a lot of time and money.


Martin Silver is more than just a practicing attorney in New York. He is a lawyer who knows the flooring industry inside and out. He worked as a floor covering installer, and then moved on to sales, including time spent at the retail, distributor and manufacturer levels, all the while working his way through law school. For over 30 years he has been helping flooring retailers on legal matters, including being the legal counsel for the Long Island Floor Covering Association. He can be reached at:

(631) 435-0700