Detailed legal overview
Commercial debt recovery is more than drafting a claim. The contract, performance evidence, acknowledgement, limitation issues and the debtor’s assets should be assessed together before proceedings begin.
1. Confirm the legal basis of the debt
Identify the parties, obligation, due date and actual performance. Any conflict between the contract, invoice, acceptance record, bank document and correspondence should be resolved before filing.
- Signed contract and appendices
- Orders, invoices, delivery and acceptance records
- Bank statements and reconciliation documents
- Acknowledgements in email or messages
- The debtor’s correct registered identity
2. Check timing and jurisdiction
Review limitation, dispute-resolution, governing-law and jurisdiction clauses at the outset. A foreign element, arbitration clause or security arrangement may materially change the strategy.
- Payment due date and start of default
- Court or arbitration clause
- Security, guarantee, pledge and penalty provisions
- Part-payment or later acknowledgement
3. Send a reasoned demand
A formal demand should explain the amount, calculation, legal basis, payment details and response period. It both creates a genuine opportunity for voluntary payment and records the creditor’s position.
- Separate principal from additional claims
- Calculate interest and penalties under the contract and law
- Keep proof of dispatch and receipt
- Record any payment schedule in a signed settlement
4. Plan enforcement after judgment
A judgment does not itself produce payment. The writ, lawful information about bank accounts and other property, interim measures and written communication with the enforcement officer require active management.
- Check that the enforcement document is correct
- Organise available lawful asset information
- Log enforcement actions and responses by date
- Allocate incoming payments correctly
Next step
An early evidence audit and realistic assessment of recoverability reduce cost and timing risk. Limitation, security and enforcement prospects must be checked against the documents in each matter.
Official sources
This article provides general information and does not replace advice based on the facts of a specific matter. Legislation may change; verify current rules before acting.
