For professionals in the Philippines—whether they be architects, engineers, accountants, IT consultants, or freelancers—the non-payment of fees is not merely a financial inconvenience; it is a breach of a binding legal obligation. When a client refuses to settle their dues despite the completion of services, the professional has several layers of legal recourse under the Civil Code of the Philippines and various procedural rules.

I. The Legal Foundation: The Contract as Law

Under Article 1159 of the Civil Code, obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith.

A "Breach of Contract" occurs when a party fails, without legal reason, to comply with the terms of the agreement. In the context of professional services, this usually manifests in two ways:

Non-payment: The client fails to pay the agreed sum.
Mora Accipiendi: The client unjustifiably refuses to accept the completed work to avoid the trigger for payment.

II. Preliminary Step: The Formal Demand Letter

Before rushing to court, the law generally requires the creditor to put the debtor in "delay." Under Article 1169, those obliged to deliver or to do something incur in delay from the time the obligee judicially or extrajudicially demands from them the fulfillment of their obligation.

A formal Demand Letter served via registered mail or personal service is crucial. It must:

State the exact amount owed.
Cite the specific contract or service agreement.
Provide a definitive deadline for payment (e.g., 5 to 7 days).
Expressly state that failure to pay will result in legal action.

Proof of receipt of this letter is a prerequisite for most collection suits.

III. Judicial Remedies for Collection

1. Small Claims Cases

If the principal amount owed (excluding interests and costs) does not exceed PHP 1,000,000.00 (as per the 2022 Revised Rules), the professional can file a Statement of Claim in the Metropolitan Trial Court (MeTC) or Municipal Trial Court (MTC).

Key Advantage: You do not need a lawyer. In fact, lawyers are generally prohibited from appearing as counsel in these hearings.
Process: It is inexpensive and fast. The court usually decides the case on the first hearing day.
Finality: The decision in small claims is final, executory, and unappealable.

2. Sum of Money (Ordinary Civil Action)

If the claim exceeds PHP 1,000,000.00, the case is filed as a regular "Collection for Sum of Money."

Venue: Filed in either the Regional Trial Court (RTC) or the MeTC/MTC depending on the jurisdictional threshold of the location.
Legal Representation: A lawyer is required to draft the complaint and represent the professional in court.

3. Specific Performance vs. Rescission

Under Article 1191, the injured party in a reciprocal obligation (like a service contract) can choose between:

Specific Performance: Asking the court to compel the client to pay the fees plus damages.
Rescission: Canceling the contract and returning the parties to their original state, often paired with a claim for damages for the work already performed (Quantum Meruit).

IV. The Principle of Quantum Meruit

In cases where there is no written contract, or the contract is found to be void, the professional is not automatically barred from collecting fees. The Philippine Supreme Court often applies the principle of Quantum Meruit ("as much as he has deserved").

This prevents "unjust enrichment" at the expense of the professional. The court will determine the reasonable value of the services rendered based on:

The nature of the work.
The professional’s standing/expertise.
The time spent and the benefits conferred upon the client.

V. Damages and Interests

In a breach of contract suit, the professional can pray for the following:

Actual/Compensatory Damages: The unpaid principal amount.
Legal Interest: Since 2013 (BSP Circular No. 799), the default legal interest for the forbearance of money is 6% per annum, calculated from the time of judicial or extrajudicial demand.
Moral Damages: Only if the client acted in bad faith, fraudulently, or in a wanton manner.
Exemplary Damages: Imposed as a deterrent against public wrongs.
Attorney’s Fees: The court may order the client to pay for your lawyer’s fees if you were forced to litigate to protect your rights.

VI. The Burden of Proof

In civil cases, the burden of proof lies with the professional to establish their claim by a preponderance of evidence. This means you must show that it is "more likely than not" that the services were rendered and the payment was not made.

Essential Evidence to Retain:

Signed Contracts or Service Agreements.
Notarized Affidavits.
Official Receipts (ORs) or Billing Statements.
Email threads, Viber messages, or SMS confirming the acceptance of the work.
Project milestones and delivery receipts.

VII. Statute of Limitations (Prescription)

Professionals must be mindful of time. Under Article 1144, an action upon a written contract must be brought within 10 years from the time the right of action accrues. For oral contracts, the period is only 6 years (Article 1145). Delaying beyond these periods can lead to the "prescription" of the right to sue, effectively barring recovery.