[scottharveyco]

Mike Monteiro gave a recent talk discussing how he handles client payments and in particular dealing with contracts. It's not only an entertaining talk but has some good information as well.

http://vimeo.com/22053820

As for me, In the past when dealing with smaller clients I always get some money up front (usually 50%) to "cover costs" along the way. In your case it's difficult to justify too much time chasing down $400 so you might be better off thinking about that as money spent on learning to be a contractor and quickly move on to the next job.