While the law can be complex, it can be an effective tool to ensure your business is rightfully paid what it is owed.
Long-term debtors or debtors who again and again will not pay on time are a universal theme of day-to-day budgeting and cash-flow. How can we help? We can take legal action on behalf of you to recover money that is owed to you, if the customer:
- Continuously ignores your written requests for payment,
- Refuses to pay the invoiced amount,
- Only pays part of the debt owed to your business and refuses to pay the complete invoiced amount.
How does the debt recovery process work? Here are the initial steps that are necessary to commence recovery of the debt.
- Collect Information
- In order to respond accurately and efficiently, we'll need some of the debts details. This may include the unpaid tax invoices, engagement agreements or other contracts, any correspondence (emails, letters, reminders, notices) between you and the debtor, and any other relevant information.
- Send a Letter of Demand.
- The Letter of Demand is a final request for payment of outstanding debt, and often includes a warning or notice that should the debt remain unpaid, then legal proceedings will be brought against the debtor. From our experience, a debtor is likely to pay the debt upon receiving a Letter of Demand from us.
- Take Further Action (if the debt remains unpaid)
- If the Letter of Demand is not complied with, we can file either a Statement of Claim or a statutory demand with the Court. This means that legal proceedings to recover the money, often with interest, have now commenced.
- Depending on the amount claimed, it will go to one of the following Courts:
- Local Court Small Claims Division: claims of up to $10,000. Please note that no interest can be claimed if the money owed is less than $1,000.
- Local Court General Division: claims of $10,000 to $100,000 (and in limited circumstances $120,000).
- District Court: claims of $100,000 to $750,000
- Supreme Court: claims of over $750,000.
Our experienced lawyers at Frank Legal can help ensure that your debt is promptly recovered. This will save you the stress and worry of having to continually chase up these debts from difficult customers. Additionally, our fees are very competitive, and substantially less than many debt collecting agencies.
We note that at any stage in the process, the debtor may decide to pay the debt in full. If so, then the matter is complete. This is advantageous in cost and time for both the debtor and the creditor.
If you have further questions, please contact us at frank@franklaw.com.au.
This is not legal advice.