Debt Recovery - The Essential Guide to Debt Recovery - Part 4
Date: April 18, 2011
Authors: Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
Welcome to our series on the essentials of debt recovery, we hope you find these articles interesting and informative. Should you wish LAC Lawyers to help with your debt recovery issue please contact us today.
Legal Options
Where all other methods have been tried to collect an outstanding debt and they have proved to be unsuccessful the only avenue open to a creditor is to commence legal proceedings provided the debtor is not insolvent and the amount involved is large enough to justify the cost of issuing proceedings. Unfortunately where serial debtors feel they can get away without paying you they will so this step is important if you are to obtain reparation. Normally the debt recovery process is started by way of letter of demand followed up by statement of claim and where a corporation is involved a statutory demand in the appropriate situation.
Recovery and Enforcement
When judgment is obtained this opens up the way for enforcement and recovery, the garnishee of wages or repossession of property. In addition it may involve the sheriff where the judgment debt is not satisfied by money and he may be called in to take possession of property sufficient to satisfy the amount of the judgment debt when sold. Where a person or a company is insolvent it will lead to bankruptcy proceedings or the winding up of the company. It may not stop there if insolvent trading is involved and with a company can expose the directors to personal liability.
Reasonable Non Payment
Of course there are situations where the debtor may have just cause to refuse to pay the amount claimed. They may have done everything possible to compromise the matter but the so-called creditor has refused to listen to reason and is plunged head first into the litigation process. Litigation in these circumstances is no guarantee of success and it may very well turn out that the plaintiff loses the matter and will be up for substantial legal costs including those of the notional debtor. Irrespective these situations often play out and the debtor is well within their rights to resist a claim which lacks legal justification. As in all of these cases documentation is paramount because the better your documentation the greater your reasonable prospects of success.
Early Settlement
Often once litigation has commenced the parties may see the benefits of an early settlement with which both can live. There may be merit on both sides and this is a sensible way of proceeding allowing the matter to be settled without either party having to bear the full cost of legal proceedings. Litigation is all about achieving a result but both parties need to be sensible and if the distance between them is so great that a compromise cannot be effected then the only way forward is to leave it to the courts to adjudicate on the merits of their respective positions.
Debts
Although there is a great variation as to what constitutes a small or a medium or a large debt our view is that a medium-sized debt starts at $60,000 leading to a large debt which we quantify as being $150,000. Debts under $60,000 are dealt with in the Local Court whereas debts in excess of this figure are dealt with in the District Court. Lump sum settlements and payments are best but if this is not always possible then installments should be accepted where appropriate otherwise bankruptcy proceedings should be commenced or efforts made to wind up the company.
Service
Over the years we have conducted thousands of matters in all courts including numerous bankruptcy and company liquidation matters. We have been engaged on everything from civil debt recovery matters all the way through to complex money claims irrespective of all types including matters involving proceeds of crime and out-of-jurisdictional assets. We have recovered millions of dollars on behalf of hundreds of satisfied clients including individuals, SMEs and large corporations both in Australia and overseas. We are available to assist you with all aspects of any debt recovery matter in excess of $60,000 ranging from negotiations and drafting of court documents to obtaining judgment, recovery and enforcement.
Documentation
As we have indicated previously, debt recovery is all about managing your debtors a large part of which is to ensure that where you are entering into the provision of goods or services to a customer or client then you need to have the proper documentation in place. Where credit is granted you need to ensure that the terms and conditions of any agreement that you provided sets out your terms of trade including interest and cost recovery supporting your ability to recover these sums should you be forced to initiate litigation.
We are regularly instructed by our clients to either draft or redraft these documents to ensure they are kept up to date as a well-drafted agreement can save you big dollars in future litigation. Many of these cases are all about the documents. They are essential, should never be forgotten and must be properly executed and filled out by the recipient of the goods or services at the relevant time. COD should also never be forgotten as a risk management technique.
Tax Law - Debt Recovery - False or misleading statements(Part 2 of 4)
Date: January 17, 2012
Author(s): Jonathan Lim B.A., LL.B. (Hons)
This article deals with the ATO’s power to impose and increase administrative penalties upon unpaid tax debts, in situations where the taxpayer has made a false or misleading statement.
Tax Law - Debt Recovery - False or misleading statements(Part 3 of 4)
Date: January 17, 2012
Author(s): Jonathan Lim B.A., LL.B. (Hons)
This article deals with the ATO’s power to impose and increase administrative penalties upon unpaid tax debts, in situations where the taxpayer has made a false or misleading statement. This part of the article deals with “recklessness.”
Tax Law - Debt Recovery - False or misleading statements(part 4 of 4)
Date: January 17, 2012
Author(s): Jonathan Lim B.A., LL.B. (Hons)
This article deals with the ATO’s power to impose and increase administrative penalties upon unpaid tax debts, in situations where the taxpayer has made a false or misleading statement. This part of the article deals with “intentional disregard”.
Tax Law - Debt recovery - False or misleading statements
Date: January 12, 2012
Author(s): Jonathan Lim B.A., LL.B. (Hons)
This article deals with the ATO’s power to impose and increase administrative penalties upon unpaid tax debts, in situations where the taxpayer has made a false or misleading statement.
Tax Law - Widely based tax disputes(Part 1)
Date: January 12, 2012
Author(s): Jonathan Lim B.A., LL.B. (Hons)
Taxation is a complex and ever-evolving field where, inevitably, oddities and contradictions arise every so often. The ATO is aware of this likelihood. Typically, a dispute over the application of tax law is between the ATO and a taxpayer over a specific tax matter. However, there are times when disputes between taxpayers and the ATO, over the same matter, happen on a larger scale. These instances are what the ATO calls as widely-based tax disputes.
Tax Law - Widely based tax disputes(Part 3)
Date: January 12, 2012
Author(s): Jonathan Lim B.A., LL.B. (Hons)
This part of this article looks at the principles that the ATO uses when assessing a settlement proposal relating to a widely-based tax dispute.
Debt Recovery - The Essential Guide to Debt Recovery - Part 1
Date: April 18, 2011
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
We have all heard about Australia having a two-speed economy since the GFC and according to the pundits apparently the separation between the two areas of business and commercial activity has widened. The resources sector is booming whilst general business including retail is struggling, interest rates are on hold and the current government is struggling to manage the economy.
Debt Recovery - The Essential Guide to Debt Recovery - Part 2
Date: April 18, 2011
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
As we have stated earlier we have put up our Cost Agreement and Disclosure Document on our website to ensure the maximum degree of transparency with respect to the terms and conditions of our retainer. It provides clients with the opportunity to acquaint themselves with all the necessary things that they need to know about engagement of a lawyer including privacy, confidentiality and storage of records. You should do the same.
Debt Recovery - The Essential Guide to Debt Recovery - Part 3
Date: April 18, 2011
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
Early intervention is the best means possible to ensure that you get paid before somebody else does whilst educating the debtor that if they wish to continue doing business with you then unless they abide by your terms and conditions they will need to go elsewhere. Although many people are honest debt loads increase substantially during periods of muted economic activity and therefore it needs to be watched closely. No one who is owed money should feel shy about approaching anyone who has gone beyond your normal credit terms. After all you are not a bank or a finance provider and shouldn’t be treated as one.