GAME OF DEBTS – How do I recover money owed to me?
In our modern age debt recovery is not only a common occurrence where disputes arise between parties, but as some Game of Thrones zealots may argue, brings shame and flagrant disrespect to the Lannister household and its family mantra that Tyrion Lannister is well known for:
‘A Lannister always pays his debts’.
Unfortunately, not everyone in today’s society shares or honours the Lannister’s sentiments and disputes can arise from seemingly small amounts to an incredibly large sum of monies.
What is Debt Recovery and what is the First Course of Action?
Before we explore what happens in Debt Recovery, it is prudent to provide a basic definition of what Debt Recovery is. In essence, Debt Recovery can simply be defined as the recovery of a sum of money from another party.
Prior to engaging the services of a third-party, it is always best practice to attempt to resolve the matter between the parties by contacting the other party directly and make reasonable attempts at resolving the dispute. You should ensure that you have completely exhausted this avenue before exploring other options.
Okay, I’ve tried that but what’s next?
If communications fail between yourself and the other party then the next step is to issue a Letter of Demand. You may decide to issue this Letter of Demand yourself, however we urge you to proceed with caution and carefully consider your circumstance before doing so. If you have completely exhausted your avenues then any further attempts at contacting the other party may be futile and an improperly drafted Letter of Demand may only further aggravate your situation and/or the party. The decision then becomes who do you engage to draft and issue a Letter of Demand on your behalf. In making this decision, it is important to remember two (2) things that a competent lawyer can provide you with:
- Legal advice that is tailored to your circumstance in addition to drafting a properly drafted Letter of Demand to increase the likelihood of recovering your debt ;
- Assistance with further stages of recovering your debt if a Letter of Demand is unsuccessful.
What’s if a Letter of Demand is unsuccessful?
If there is no response from the other party, or if there is still a refusal to pay the debt owed, you may wish to consider issuing a statutory demand or instituting court proceedings. Issuing a statutory demand is only effective if there is no dispute by the other party that the debt is owed. The benefit of resolving the matter in court is certainty of outcome – if you have sufficient evidence of the debt owed to you then it is likely that your court proceeding will be successful. However, in making this decision, it is important to consider that court proceedings are generally not cheap, but it may be necessary to recover your debt in your circumstance.
The court that the proceedings are heard in will depend upon the amount claimed:
- The Queensland Civil and Administrative Tribunal (‘QCAT’) has a monetary limit of up to and including $25,000;
- The Magistrates Court has a monetary limit of up to and including $150,000;
- The District Court has a monetary limit of up to and including $750,000; and
- The Supreme Court has a monetary limit of over $750,000.
Please note that the amount claimed may or may not include any applicable interest claimed by you. If you believe that interest applies to your debt claim then we strongly suggest you seek legal advice before proceeding further.
QCAT Generally
In most cases, the parties will participate in a mediation in person or by phone to resolve the matter prior to a hearing, however if the application concerns an amount up to $1,500 then the dispute will be listed for a hearing without the need for mediation.
If mediation is unsuccessful then you must attend the hearing in person. At the hearing, you may present evidence and provide written submissions to QCAT. This is an opportunity to present your case to the tribunal, and if you have not engaged a competent lawyer then you may wish to carefully consider your prospects of success as it could be the difference between succeeding on the day of your hearing. At Potts Lawyers we offer a free twenty (20) minute consultation to discuss your matter, and we invite you to contact our office prior to any court proceeding.
Other Courts Generally
To commence the proceeding in the Magistrate, District or Supreme Courts the general process is relatively the same in these courts. The general process is more complex than matters in QCAT as there are further stages involved in these Courts. Various documents must be drafted and filed in accordance with the rules in the Uniform Civil Procedure Rules 1999.
Settlement Conference in the Magistrates Court
There is a compulsory settlement conference between the parties prior to a hearing in the Court itself. This is similar to that of the mediation process in QCAT as the purpose of the settlement conference is to reduce the costs associated with the proceedings and attempt to resolve the dispute out of court. If the settlement conference fails, the matter will proceed to a hearing in the relevant court.
Disclosure Obligations
Importantly, there are strict time periods and requirements by which you and the other party must comply with in order to satisfy the court proceedings in the Magistrates, District and Supreme Court. If these requirements are not satisfied there is a possibility that you or the other party may apply for default judgement against the other simply due to failing to comply with these requirements. A competent lawyer can advise you of the disclosure requirements and draft the required documents to be filed in the relevant court.
The Hearing
As Jon Snow would vacuously and vehemently state:
‘Winter is coming’
Chances are is that you’ve been patiently waiting and sitting through seven seasons of the show to find meaning in this unsophisticated and vague phrase. In the realm of court proceedings, meaning could be derived and it can unequivocally be said that, in fact, Winter is coming when parties to a matter attend a hearing. The hearing provides an opportunity for the parties to present their case and for the matter to be adjudicated. It is important to not only be well prepared for the hearing, but to realise that everything that is done prior to a hearing is equally as important as the hearing itself. The adjudicator for the matter will make a judgement which is binding on the parties and the matter is concluded unless the unsuccessful party appeals the decision.
Appealing the Decision
Grounds for appeal may be a viable option in certain circumstances, however there is no guarantee of a successful appeal and it may only incur further unnecessary legal costs and is reason alone to seek a successful outcome at the hearing. In some cases, an appeal may not be possible as it could amount to a vexatious or frivolous proceeding that will only waste the court’s time and resources. Nevertheless, a competent lawyer can advise you on whether or not your matter is vexatious or frivolous.
Enforcing the Judgement
If and when a judgement of any kind is received, the court may issue enforcement proceedings in your favour to recover the debt owed. The type of enforcement proceeding is generally specific to the capacity and circumstance of the other party which commonly include:
- Orders to sell the property and garnish wages;
- Bankruptcy;
- Statutory Demand; and
- Winding-up.
Is a Competent Lawyer Really Necessary?
Whether your matter is in QCAT or another court, we cannot stress enough how important it is to engage a competent lawyer prior to the hearing in order to assist you with preparing the relevant evidence and to draft written submissions on your behalf. These tasks may seem simplistic or mundane, however they require technical skill and intimate knowledge of the law to properly construct these documents in accordance with the respective court.
Our team at Potts Lawyers understands that it can be an extremely stressful experience and emotionally draining. We alleviate your concerns relating to your matter by planning and providing an expert strategy to obtain your debt.
As aforementioned, we offer a free twenty (20) minute consultation to discuss your matter with one of our competent lawyers who are happy to assist with your enquiry despite the stage of the debt recovery process you may be at. Please do not hesitate to contact our office at your earliest convenience should you have any questions on how we may be able to assist you.
Please note that this article is not legal advice and is general in nature. It is not intended to be and should not to be relied upon as legal advice. Please contact a lawyer to discuss your matter with them.