Cash flow is a concern for every business, and unpaid debts can have a huge impact on the bottom line.
If you’re in this situation, it’s worth knowing that a letter of demand on legal letterhead is often very effective:
In the last three months, 85 per cent of outstanding debts have been recovered for clients after NODCO issued a letter of demand for the client.
But sometimes, a letter isn’t enough.
If a debt is not paid within seven days of the letter of demand being sent, proceedings can be issued in the form of a Magistrates’ court complaint for recovery of the outstanding debt plus legal costs.
If, after the complaint has been served, the debtor does not defend the claim, application for default judgment can be filed with the court.
This default judgment is recorded on the debtor’s credit history and creditors may enforce the default judgement by a Warrant or Summons.
If the claim is defended by the debtor, the matter proceeds to mediation, at which 90 per cent of matters are resolved.
If you have outstanding debtors on your books and need advice on your options for recovery, please contact our Litigation Department, for assistance.