What to do if someone isn’t paying your bills?

If you have a customer/client that is not paying their invoices on time or is refusing to pay for works and/or services provided, then you may have to start your debt recovery process.

In order to deal with your “debtors”, you should ensure you have an effective process in place, as if you do not act quickly, it may be more difficult to recover the debt, especially if the customer is not solvent and becomes bankrupt/goes into liquidation.

Therefore, your debt recovery process should look something like this:

1. Ensure your terms of payment are clearly stated on your tax invoices/statements and/or your terms and conditions have been provided to the customer/client;

2. Attempt to contact your client/customer and send reminder letters (prior to engaging a debt collection agency/law firm). This should generally be as follows:

  • Two (2) weeks overdue notice – this should be a polite reminder, in the event that the invoice has been missed and they may be having short term cash flow problems and you do not want to ruin the business relationship;
  • Two (2) to four (4) weeks overdue notice – you can make personal contact by phone or a further email/letter requesting a fixed time and date in which the tax invoice will need to be paid;
  • Four (4) to six (6) weeks overdue – you can provide a final notice, strictly adhering to the time and date previously agreed to, and stating that it will now be referred to your lawyers/debt collection agency.

3. If payment is still not made, you can request a letter of demand from your lawyers/debt collection agency, which outlines the amount owing and what for, and requests that payment is made within seven (7) days, otherwise legal proceedings will be issued and further costs incurred;

4. If payment is still not received, then it is time to commence legal proceedings in the relevant state, in order to recover payment from the outstanding invoice;

  • You can use debt recovery solicitors to maximise your chances of successfully obtaining your desired outcome;
  • You are able to claim the costs incurred and interest applicable (either pursuant to the terms of conditions or the Reserve Bank of Australia rate).

5. Enforce your money order or judgment.

  • Once you have a judgment or an enforceable money order, there are a number of different enforcement options.

Should you require any assistance in regards to unpaid debt, contact our debt recovery lawyers now to discuss your options in a no-obligation consultation with the experts. We will guide you, step by step and ensure the best possible outcome for your circumstances.  Call our Brisbane lawyers on (07) 3009 8444 or our Sydney lawyers on (02) 9307 8900. Alternatively, click here to get started.

The blog published by Rostron Carlyle Rojas is intended as general information only and is not legal advice on any subject matter. By viewing the blog posts, the reader understands there is no solicitor-client relationship between the reader and the blog publisher. The blog should not be used as a substitute for legal advice from a legal practitioner, and readers are urged to consult RCR on any legal queries concerning a specific situation.


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