26/05/2014

When you run your own business, managing debtors can be quite a task. In most cases, a chat or phone call can usually work out the issue. But when a debtor looks like they are not going to pay, how do you proceed without throwing good money after bad?

A solicitor's letter of demand provides a clear and final request for a debtor to pay any outstanding money owed before any legal action is taken. The fact that it comes from a solicitor sends a message that the creditor is deadly serious about recovering the debt. So, you need to ensure that you are prepared to back up the threat in the letter one way or another – either because you intend to commence proceedings yourself or use the services of a law firm or a debt collection firm.

For any business, time is money and running a business is already a time-consuming process without the additional headache of constantly chasing up problem debtors. Pursuing debtors through numerous phone calls can quickly end up costing you significant time.  Many businesses delay the payment of debts as long as possible and effectively use their creditors as a source of free finance for their business.

But of course the issue is that if the debtor has not paid by now, are they ever going to be able to, or are the legal fees you may need to spend on claiming the debt just a further waste of money?

No-one can know for sure in any given circumstance but here at Townsends we've developed a fixed-fee online service that will allow you to quickly instruct us to issue a letter of demand at a price that may make it a little easier for you to go the next step in enforcing your rights.  

It is important when wording a letter of demand that the actions required by the debtor are clearly outlined and that any claims of potential penalties or legal action are not overstated. Having a letter of demand prepared by a solicitor helps take the guess-work out of how to get the right message across to your problem debtor.   

Our fixed-fee online letter of demand service assists you in minimising the time and cost of chasing your problem debtors.

For further information, go to our website Fixed-Price Letters of Demand or contact Townsends Business & Corporate Lawyers on (02) 8296 6222.