The mob thing is tempting indeed, but it will get you in trouble instead. Not just legally, what if they get back at you the same way.
Badmouthing someone can also kick back at you. Warning other sound companies is a good thing though, they will eventually return the favor.
How is this sort of thing written into a contract?
Like someone else said, the contract can only help if the client HAS money at all.
Try to protect yourself from having to hunt them for money at all. (Following goes for dry rentals):
1. If it´s a rock show, take a deposit for the cost of replacing diaphragms in the HF drivers.
2. If it´s a Rave, take a deposit for the cost of reconing the LF-drivers.
3. Invest in some good limiters for all gear that goes out on dry rentals. Make sure the client can´t get to them. One pretty cheap unit with sense-return function (also x-over) we use for small rigs is the Master Audio VP-2 (www.master-audio.com).
Now for the most important thing, protect yourself against theft (I learned this the hard way):
1. When you get the booking, take name, address, social security number, landline phone number. Then check everything out. If some of the information doesn´t match, skip the gig, chances is he´s hiding something. Also try calling the number to see if you can reach the client at that number.
2. At pickup (if he passed the test). Take ID (if you want to be real sure, make a copy of it). If you are not sure if it´s the guy on the picture, get ID from one more person (they are almost always more than one guy picking the gear up). If there is only one and you´re not 100 percent sure, skip the gig.
3. Help them load, and write down the license number of the car. If they used a phony ID or skip for some other reason, this will help you track them down.
We had a client lose a wireless mic at a pretty high profile gig not long ago. The guy who introduced the artists never came back with it, probably just left it lying around and someone picked it up. This time I did not hustle the client for payment, because it was good pay for the gig and there will be more like it. It´s a judgment call when to claim payment and when not to. For dry rentals I charge for every cable and light bulb.
Some years ago I also had a guy disappear with some stuff (used a stolen ID and managed to fool me). What I did was get on the phone and warned other companies in town, and asked them to look for my gear. Three days later I got a call from a company not far away (that we work with from time to time). The guy called them and was coming to pick up gear in a couple of hours.
So I called the cops, they came down to the shop and waited for the guy to show the ID, and then THEY NAILED HIM. He got four months in jail and had to pay me for the gear he stole (it was never recovered), although I haven’t seen one cent yet.