When Common Sense loses to Ego

A $31,000 Lesson That Cost Over $100,000

Let me tell you a true story from the business trenches. Something that still makes me shake my head when I think about it.

It’s a prime example of how emotion, ego, and bad advice can turn a manageable problem into a complete financial disaster.

We had a customer who owed us roughly $31,000.

The job had been done.

The work was completed to standard.

There was no legitimate dispute about the value of the labor or the materials.

Just an unpaid invoice sitting on the table.

Now, instead of demanding full payment all at once, we tried to be fair.

The customer explained that pulling the full amount from his IRA would trigger a hefty tax hit.

So we worked with him.

We offered to split the payments over two years to give him flexibility and avoid the immediate tax consequences.

It was a straightforward, respectful offer.

He agreed.

But then as soon as the first payment came due, he changed his mind.

Which forced us into taking the legal route.

What followed was a long, drawn-out, unnecessary legal battle.

He filed a lawsuit, presumably hoping to either get out of paying altogether or wear us down into settling for less.

But when all was said and done, he still had to pay us what he owed.

Only now, he wasn’t just out $31,000—he had racked up over $100,000 in legal fees, court costs, expert witnesses, and everything else that comes with going to war in court. 

He lost the case.

He lost the money.

And I suspect, he lost a lot of sleep and peace of mind along the way.

So what went wrong?

In my opinion, this wasn’t a financial decision. It was a pride problem.

Instead of accepting responsibility and working through the issue reasonably, he chose to fight, thinking he could win on technicalities or legal maneuvering.

But courts don’t work that way.

When the facts are solid and the paperwork is clean, judges aren’t usually swayed by drama. They look at the agreement, the work performed, and the payment owed.

The customer had every chance to resolve the issue peacefully. We gave him a way out that respected his financial situation.

But instead of common sense, he chose conflict. And it cost him dearly.

The real cost of a Lawsuit

This story ties back to something I talked about in a previous post: Legal Transparencies

They see legal action as a quick fix or a way to "get even," but don’t understand that once you’re in the system, the costs start stacking up fast—and many of them are non-refundable, win or lose.

• Attorney retainers and hourly fees

• Filing costs

• Expert witnesses

• Court reporters and transcripts

• Discovery and documentation

• Time lost from work or running your business

• And stress… lots and lots of stress

• 
  

If this customer had simply paid the debt under the two-year plan, he would have saved himself close to $70,000 or more.

Not to mention all the time, energy, and frustration he poured into fighting a losing battle.

Final thought: Don’t let pride empty your wallet

In business and in life, sometimes the best move is to settle the issue, move on, and live to fight another day. This was never a case of someone being taken advantage of—it was a case of someone making a simple situation painfully complicated out of spite or ego.

There’s no shame in working out a payment plan. There’s no shame in owning your debt and dealing with it like an adult. But there is a heavy price for letting pride take the wheel—sometimes over $100,000 worth.

Don’t be that guy.