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Old 30.10.2007, 18:51
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The complete guide to bills and what happens if you don't pay them.

Seeing as there is a thread about debt collection agencies and seeing as I have answered this before partially I will give a complete answer in this thread to the process of dealing with bills and those naughty agencies that sometimes send you nasty letters.

Here is the basic process:
Bill send with date by which to pay.
Optional Reminder sent to pay the bill
Optional 2nd and often final reminder send to pay the bill often with a
charge SFr. 5-20 for late payment.


Optional Sent to debt recovery agency and lots of letters and charges!
Betreibung or Poursuite - the formal legal process to recover the money.
Thanks to HeatherM for the French!
The important thing to note in the above process description is that many things that are assumed by many to be "their right" are actually not and legally as soon as the bill has not been paid and the date required for payment has passed you **could** have a Betreibung as the next step.

It is however entirely normal to receive a pleasantish reminder that you have not paid perhaps 2 weeks after the date of payment has passed. The second letter will probably not be so pleasant and include a request for an additional few francs for their trouble!

Thereafter if you are lucky comes a third reminder or passing directly to the fun part the inkasso bureaus. Apparently Intrum Justitia are the angels of this group and the way they work can best be described as blind. So in order to deal with this group you need to be aware of your rights and what you need to pay and what you definitely do not need to pay.

Legally there are two things you always need to pay.
1. The main amount owed
2. Interest on that amount at the rate of 5% - still I think but it might be more now unless this is otherwise set in the T&Cs of the company.

It is also possible and likely that to the original main amount you need to pay the amount billed for reminder charges in German Mahngebühr.

And that is more or less it.

However the debt recovery agency likes to make money so additional items appear on your "bill"...

Now what you definitely don't need to pay are the kosts of the debt recovery agency. This is covered in Art 27. Abs. 3 SchKG which states that the costs of representing the debtee or creditor are not allowed to be passed to the debtor. In other words if the company engages a third party to recover its debts then they need to pay the third party and not you.

So from the written law these costs are not allowed to appear as a debt however you will see references to Art. 106 OR appearing on any letter from a debt recovery agency with sentences such as Verzugsschaden or Forderung gemäss Art. 106 OR.

Another trick is div. Auslagen or Rechsberaterkosten or Rechstauskunft or...
These are all things that are not permitted to be charged to the debtor according to the SchKG - I mean to actually need to take legal advice for debt recovery for a company specialised in debt recovery is blatent robbery - thats all they do...

Then there is the nasty Teilzahlungszuschläge. This effectively means that it is possible to repay the debt in parts and or at a later date effectively postponing the inevitable. However, if this is to be permitted it falls under the Konsumkreditgesetz or the law of consumer credit. The first part of this is the requirement for a bonitätscheck ie your ability to repay the debt. Is this not why you are here in the first place because you cannot? And if you can repay the debt then you would, rather than face the substantial costs of Teilzahnlungszuschläge. The effective annual interest rate needs to be made clear and when this is ca 50% you would not sign up for such a thing so it is surpressed which of course is against the law. Further you are not given the chance for early repayment again something which is not legal. All in all this is a pretty nasty business...

So what do you actually do. Firstly everything must be via Fax and or registered mail and you must keep a copy of everything...
1. Request a copy of their power of attorney (right to represent the company in question). This is a legal requirement they must respond to. Inform them that until such document is provided you will enter into no correspondence with them and assume they have no legal right of representation.
2. Calculate how much you owe the company and in a separate post calculate the interest due. It is not legal to add the interest to the main amount otherwise later amounts would be charged interest twice.
3. Remove all positions that are irrelevant such as Div Auslagen, Rechstkosten, blabla gem OR 106.
4. When the power of attorney arrives pay the amount as calculated in 3 to the account the debt recovery agency provided.
5. Don't let additional mails with additional amounts frustrate or annoy you - simply save them and otherwise ignore them.
6. As soon as and assuming you receive a Betreibung you need to declare you will take the legal route as you owe nothing.
7. That will generally be it as they cannot take it any further - well they can but they lose and you can recover your costs if they take it further.

Questions?

Last edited by Richard; 01.11.2007 at 14:51. Reason: added French Betreibung
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Old 30.10.2007, 19:02
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Re: The complete guide to bills and what happens if you don't pay them.

Are there any protection for un-employed people ? Because usually thats when debt piles up
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Old 30.10.2007, 19:12
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Re: The complete guide to bills and what happens if you don't pay them.

Thank you , Richard, for the great info, I"m going to make this a sticky

Last edited by evilshell; 30.10.2007 at 19:16. Reason: decided to make this a sticky
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Old 30.10.2007, 19:19
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Re: The complete guide to bills and what happens if you don't pay them.

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Are there any protection for un-employed people ? Because usually thats when debt piles up
Not as far as I'm aware. however from my experience (I used to be crap with money), if ever in trouble paying an invoice, give them a call. Tell them you're a bit short of funds and suggest a reasonable time by when you want to pay the bill in full, or suggest Ratenzahlung (first the first one slightly bigger than the others, they love that too). Don't wait until the reminders or even the Betreibung arrives.
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Old 30.10.2007, 19:26
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Re: The complete guide to bills and what happens if you don't pay them.

Richard, the french word you're looking for is "poursuite".
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Old 30.10.2007, 22:28
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Re: The complete guide to bills and what happens if you don't pay them.

This is a fabulous post and the reason why I keep coming back to this forum.
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Old 30.10.2007, 22:37
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Re: The complete guide to bills and what happens if you don't pay them.

OK,
I have a problem. In August received a bill for charges saying that I had not paid my health insurance premium for June.

I thought that was odd, as I paid it by ebanking. I wrote them an annoyed letter and they said that the reference number was wrong and they were unable to process it. The money clearly went into their account according to my bank, and the premium was not returned to my bank account.

Since then they have brought forward the charges and added more to them because I refused to pay them as they clearly had the money when it was due. I suggested they review their internal procedures if the were unable to find it in their bank account.

I have now written to them twice explaining the situation and I am starting to get really angry as today I received yet another yet larger bill.

The insurance company seems to be ignoring my correspondence and are clearly try to bully me into submission. Any advice whom to approach ?

dave
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Old 30.10.2007, 22:44
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Re: The complete guide to bills and what happens if you don't pay them.

Dave,

Did you send your complaints by registered letter?
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Old 30.10.2007, 22:46
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Re: The complete guide to bills and what happens if you don't pay them.

One of the three, plus the one that gave notice to end the insurance
The whole dossier is going registered tomorrow.

dave


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Dave,

Did you send your complaints by registered letter?
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Old 30.10.2007, 22:52
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Re: The complete guide to bills and what happens if you don't pay them.

Name that company! (the feckers )

In a similar situation (not health insurance though) my bank at the time (Bern Kantonal Bank) did the business for me and demonstrated to the receiving company where and when the payment was made - so I suggest you go to your bank, explain the situation, and ask them to send the insurance company the facts. I think that's why we pay the extortionate bank charges.
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Old 30.10.2007, 22:55
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Re: The complete guide to bills and what happens if you don't pay them.

I feel you would make little progress, even if they were french.

dave


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Name that company! (the feckers )

In a similar situation (not health insurance though) my bank at the time (Bern Kantonal Bank) did the business for me and demonstrated to the receiving company where and when the payment was made - so I suggest you go to your bank, explain the situation, and ask them to send the insurance company the facts. I think that's why we pay the extortionate bank charges.
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Old 30.10.2007, 23:15
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Re: The complete guide to bills and what happens if you don't pay them.

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Name that company! (the feckers )

In a similar situation (not health insurance though) my bank at the time (Bern Kantonal Bank) did the business for me and demonstrated to the receiving company where and when the payment was made - so I suggest you go to your bank, explain the situation, and ask them to send the insurance company the facts. I think that's why we pay the extortionate bank charges.
That was what i did a couple of months back for a completelly different matter... after several discussions on " i did send in the money" - " you did not" - "did too" - "cannot find it, to what account you send it?" - "the one you gave me" my bank called their bank and shortly after everything was solved. My understanding is that if you can prove they have recieved the money, they cannot claim again, even if they cannot find in their own financial mess....
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Old 30.10.2007, 23:36
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Re: The complete guide to bills and what happens if you don't pay them.

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Name that company! (the feckers )

In a similar situation (not health insurance though) my bank at the time (Bern Kantonal Bank) did the business for me and demonstrated to the receiving company where and when the payment was made - so I suggest you go to your bank, explain the situation, and ask them to send the insurance company the facts. I think that's why we pay the extortionate bank charges.
I once tried that when someone I paid via bank transfer claimed not to have received the money. The UBS guy told me with a very straight face "We cannot give you the account number of the receiving party" (the one I provided them to begin with) "since that would violate bank secrecy".
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Old 30.10.2007, 23:37
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Re: The complete guide to bills and what happens if you don't pay them.

Richard, an interesting point that comes to mind. If the betreibung is carried out, are the associated fees other than moratory interest legally enforceable?
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Old 30.10.2007, 23:44
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Re: The complete guide to bills and what happens if you don't pay them.

Add to the list.....What happens if you ignore the demands of the Betreibung/Poursuite and don't consider legal option because you know you're in the wrong?
You receive a letter from the police to visit them, no subject mentioned. On visiting them they politely advise to 'Pay the Betreibung/Poursuite office immediately'. Not wanting any problem with the law you have no option.
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Old 31.10.2007, 00:10
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Re: The complete guide to bills and what happens if you don't pay them.

Question :

What happens if you don't agree with the invoice. How can you contest or refuse to pay it without falling into this mahnung/rappel-Betreibung/poursuite trap.

Example.

I got a package sent to me from Germany, total value of the goods CHF 75.-

It happens that the sender chose the fast shipping and this goes via "Swiss Post GLS", so they charge me for the TVA CHF 10, for the customs office at Basel fees CHF 8 and CHF 53 for their administrative handling fo the package ( CHF 33 handling +10 administrative costs + 10 TVA over the total invoice, so TVA over the TVA+charges )

Total CHF 71 as taxes and fees for a CHF 75 value ???

This is unacceptable as any other shipping company as Fedex, DPD, UPS and even Swiss Post Express charge much less ( as an example the Last Package I received via Fedex 1 month ago was for a total of CHF 300 goods and the TVA+charges were a mere CHF 38.- )

So Swiss Post GLS just invoiced me that, and now I am forced to pay, if I don't they will start the procedure... what to do then ?

Sure it is not a lot of money, but it is excessive and it illustrates an example of what could happen. what to do then ?
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Old 31.10.2007, 00:25
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Re: The complete guide to bills and what happens if you don't pay them.

My understanding is if you want to fight it you have to contest the bill before the 30 days are up. However, since that is often not possible, I wonder what the options then are. I would think pay first and send a registered letter at the same time saying you disagree, but what I fear is that by paying you agree with the amount.

Perhaps Richard knows if this is the case?
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Old 31.10.2007, 08:26
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Re: The complete guide to bills and what happens if you don't pay them.

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One of the three, plus the one that gave notice to end the insurance
The whole dossier is going registered tomorrow.
Make sure you have adequate photocopies, because if they call you at work to resolve the matter and your paperwork is at home, you are at a disadvantage.

EDIT:

I have a similar problem with my health insurance, in that I couldn't find February's bill, so paid with an old reminder. They claimed I didn't pay for February, so I coughed up for it again. Apparently it will be settled at the end of the year when they reconcile their accounts. The fact that you mention them talking of an invalid reference number makes me think that this could be your problem.

Meanwhile, I've gone back to good old fashioned paperwork. Pay at the Post office, get a stamped receipt (and write in the date paid if the stamp isn't legible), and file it.

Last edited by JVC; 31.10.2007 at 14:03.
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Old 01.11.2007, 15:23
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Re: The complete guide to bills and what happens if you don't pay them.

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Are there any protection for un-employed people ? Because usually thats when debt piles up
Me and my big mouth. Why did I add Questions?...

There is no debt protection for unemployed people although the administrative court will require that you pay less if you are unemployed. Often the company selling the goods or service does have protection if there is any form of credit. Sometimes this is an optional extra which during your employed times seems irrelevant. If you are made unemployed and the item was high value having taken this protection can help a lot - but of course if you did not after the event it is a much use as a hole in the head!
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Old 01.11.2007, 15:32
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Re: The complete guide to bills and what happens if you don't pay them.

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OK,
I have a problem. In August received a bill for charges saying that I had not paid my health insurance premium for June.

I thought that was odd, as I paid it by ebanking. I wrote them an annoyed letter and they said that the reference number was wrong and they were unable to process it. The money clearly went into their account according to my bank, and the premium was not returned to my bank account.

Since then they have brought forward the charges and added more to them because I refused to pay them as they clearly had the money when it was due. I suggested they review their internal procedures if the were unable to find it in their bank account.

I have now written to them twice explaining the situation and I am starting to get really angry as today I received yet another yet larger bill.

The insurance company seems to be ignoring my correspondence and are clearly try to bully me into submission. Any advice whom to approach ?

dave
This often occurs with companies that receive thousands of payments per month. They simply allocate all the unknowns to the year end and sort them out then. What is sometimes difficult to understand is that they cannot book an amount to the same reference number. This is very dependent on the software they are using. Some companies can do this others cannot - effectively the position closes when the outstanding debt is paid.

There is however still an open position for the amount you paid with the "wrong" reference number and the money you paid is in the general pot of unknowns. Your bank should be able to sort this out quite quickly and trying to deal with the insurance company is not going to produce results as they have no visibility of the values in the general unknown pots just the big hole of your missed payment.

Now the question here is did you carry on making the payments normally and just miss that one month. If you did and you can prove that you did make the payment then you can ignore the letters they send you even if they have late payment costs/interest etc as you can prove to a court that there is nothing to pay. In your letter tomorrow I would suggest telling them that you will be doing exactly that.
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