You may consider writing off the debt – if, for example, the debtor’s response to your letter of demand is unsatisfactory the size of the debt is so small that you decide that it is not worth pursuing further or because the debtor has asked you to do this and you have agreed. You can seek the assistance of Arts Law regarding the form and terms of that agreement, including any release you are asked to provide the debtor in return for part payment.

If you agree to a compromise with the debtor, make sure that it is in writing, or is confirmed in writing if agreed verbally, to avoid later disputes.

ignore the letter or respond to it in a way that is unsatisfactory to the creditor.

negotiate a compromise, for example, payment by instalments or part payment or.

In response to a letter of demand, a debtor may: It is available at the ASIC website.įor assistance with drafting a letter of demand see Arts Law’s information sheet on Debt recovery Letter of Demand.

send a letter which is designed to look like a court document because this is illegal.Ī guideline on acceptable and unacceptable debt collection practices is published by the Australian Securities & Investment Commission (ASIC) as ASIC Regulatory Guide 96 – Debt collection guideline: for collectors and creditors.

harass the debtor – they have the right to complain about this behaviour to particular government agencies and the police or.

When sending a letter of demand, you should be careful not to:

When chasing payment for goods or services, the first step is generally to send a letter of demand to the other party telling them of the dispute and the money outstanding, and giving them a defined period within which to settle the matter or else face legal action. This information sheet assumes that the contracts under which money is owed are legally enforceable, and that the debts are not subject to the National Consumer Credit Protection Act 2009 ( Cth) or the National Credit Code If you are unsure, please contact Arts Law on (02) 9356 2566 or toll-free on 1800 221 457. In this information sheet: Introduction – letter of demand It provides clarification on the small claims procedure in each state or territory.

This information sheet provides an introduction into about how one can chase outstanding payment.

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