In Cyprus while invoicing is an important accounting practice for many businesses, invoices do not serve as a legally binding agreement between the business and its client. An unpaid invoice is not actionable per se but its existence may well constitute important evidence for the support of a relevant claim before the Court, provided that certain requirements are met.
Under Cyprus Case Law the unilateral issue of an invoice without any proof that its content was accepted by the other party is usually of no evidential importance.
However if a claimant brings a claim in Court for unpaid provided services or delivered goods and submits evidence that the relevant invoice had been accepted by the defendant/client then he would have little difficulty to win his claim provided that the defendant does not prove that the non payment of the invoice was justified for some reason.
One good way for the claimant to prove the acceptance of the invoice by his client is to provide evidence that the invoice bears the signature of the client and/or by any person authorised by him. However usually in Cyprus a significant number of suppliers or service providers do not ensure that the invoices for supplied goods or services to their clients are being signed by the latter.
The Cyprus Supreme Court recently observed (see Civil Appeal 7/2013 dated 19.02.2020) that the charging of an interest in an invoice not signed by the client does not amount, by itself, to an agreement. The Supreme Court’s decision is in line with its older decisions on similar topics such as the charging of VAT in an invoice.
The recent Supreme Court’s decision reminds that the evidential value of a client’s signature on his invoice is very important.
Consequently businesses must never forget that on a legal perspective, the signing of the invoices by their clients constitutes a sine qua non requirement of the general invoicing procedure.
For further information on this topic please contact us by phone (+357 25875151) or email (info@hhlaw.com.cy).