In a business of any kind, recovering debt can be problematic and time-consuming.
The question is how to get what you’re owed without becoming embroiled in an ugly dispute – or worse yet, a lengthy legal battle.
Whether someone refuses to pay for services rendered or completed work, we fully understand the nuances of the debt recovery process and provide the guidance and representation you need from start to finish.
Negotiations and demand letter
In Queensland, the debt recovery process usually begins with negotiations between the parties. As part of this process, you should advise the person who owes you money (the debtor) about your concerns in writing. This formal correspondence is known as a demand letter and should include the following details:
- How much you think they owe
- How they incurred the debt
- Preferred method of payment
- Ramifications of failure to comply with a written request for repayment
Although it is important to convey your thoughts in a formal, professional tone, the demand letter is not an official court document and should not be presented as such. It is also important to refrain from using any intimidating or threatening language.
The recipient is not required to respond at this time. However, if he or she opts not to, or you aren’t satisfied with the response you do get, you can pursue legal recourse.
Where will the matter be heard?
The venue in which debt recovery is pursued depends on how much the debtor owes. The Queensland Civil Administrative Tribunal (QCAT) hears matters involving debts of $25,000 or less, but only if the debt originates in Queensland. The Magistrates Court hears debt recovery cases with amounts ranging from $25,000 to $150,000 and the District Court hears cases with amounts ranging from $150,000 and $750,000. The Supreme Court hears matters where the debtor owes more than $750,000.
What to expect during QCAT proceedings
Pursuing legal recourse through QCAT begins by filing an application and serving it on the person who allegedly owes you money (the respondent) within 28 days. He or she may respond at this point. If he or she does so, you will be served with the response. However, if he or she doesn’t do so within 28 days, you can ask QCAT to make a “default finding” in your favour.
If a case involving an amount of $3,000 or more goes forward, QCAT will schedule the matter for mediation. If that fails, the matter will be decided at a hearing.
If QCAT renders a decision in your favour, the debtor must pay what they owe you. If they don’t, it may be necessary to seek an enforcement warrant. A magistrate can order this type of warrant as soon as QCAT’s decision is registered in the Magistrates Court. The warrant authorizes the seizure and/or sale of the debtor’s property to ensure the loan is repaid.
Pursuing legal recourse through the Queensland courts
As we have already noted, the court where your case will be heard depends upon the amount owed. Once the appropriate venue has been determined, you can start the legal process by filing a claim with related documents, which must then be presented to the debtor.
Once the debtor has been served, he or she can offer a defence by filing their documents with the court and having them served on you. At this point, you can respond or ask the court to set a trial date.
In a last-ditch effort to avoid litigation, these matters are often sent to mediation or some other type of alternative dispute resolution. If mediation is unsuccessful the case will go forward and a Judge will ultimately decide whether or not you can recover the money owed.
Because court proceedings are more complicated and costlier than tribunal proceedings, it is crucial that you consult OMB Solicitors rather than taking any action on your own. Contact us to schedule an appointment with a lawyer to discuss your case today.