Debt Recovery Kit - Qld

Does someone owe you money and won't pay up?

It took you a long time to earn that money or provide that service. Now is the time to prepare yourself to recover your money.

This Debt Recovery Kit includes:

1. A Debt Collection Manual. The Debt Collection Manual explains:
   1. Debt recovery techniques;
   2. The forms required to commence a Claim in the Magistrates Court or the Queensland Civil and Administrative Tribunal (“QCAT”);
   3. Details on the process you could expect in the Magistrates Court and QCAT; and
   4. Details and forms required to enforce Claims in the Magistrates Court (i.e. after you have received the initial judgment/decision); and
2. A Letter of Demand

The Letter of Demand is unpleasant and makes most Debtors stand up and take notice of your demand for payment.

If the Debtor doesn’t pay after receiving your Letter of Demand, you can consult the Debt Collection Manual to discover your options, including:

1. Applying to have the matter formally mediated; and/or
2. Commencing a Claim in either the Magistrates Court or the QCAT.

Checklist is not available for this document.

Sample is not available for this document.

Creditor Details
• More than three Creditors?
• Who is the Creditor and who is the Debtor?
• There are three Creditors. Must I name them all?
• Is the Creditor a company or a human?
• Suing someone in another state
• What do I receive in this Debt Recovery Kit?
Debtor Details
• More than three Debtors?
• Who is the Debtor and who is the Creditor?
• How many Debtors?
Debt Details
• Description of Debt
• Claim Amount: Only use numbers (not words)
Remedy Sought
• Can I sue for more than $25,000 in the QCAT?
• How much can I sue for in the Magistrates Court?
• My Claim is under $25,000. Which Court do I choose?
• Letter of Demand: Choosing a Remedy
• What is Mediation?
Enclosures
• How to describe enclosures in your Letter of Demand
Enclosure Details
• How to describe enclosures in your Letter of Demand
Date of Letter
• What jurisdiction does the Letter of Demand work in?

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Creditor Details

• More than three Creditors?

  Unfortunately this document cannot be used where there are more than three Creditors.

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• Who is the Creditor and who is the Debtor?

  The Creditor is the person that lent the money (or provided the goods or service). The Debtor is the person who borrowed the money (or received the goods or service) and hasn't yet paid.
  
  If John Smith and Jenny Smith lent the money then both these people should be mentioned separately as Creditors.
  

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• There are three Creditors. Must I name them all?

  The Letter of Demand should be as correct as possible. If there are three Creditors, then all three Creditors should be named.

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• Is the Creditor a company or a human?

  COMPANY
  Let's say the Creditor is a company. If you don't have your company’s correct name or ACN then you should do a free search for the correct details at www.asic.gov.au. If you don't name the Creditor correctly, you won't be able to recover the money as only the Creditor can sue for money owed to them. For example, if Jenny and John sue for money, but the money is really owed to their company then they won't win. In this scenario the wrong person is suing. They should have sued in the company’s name.
  
  Look at your loan agreement, contract or the invoice that you gave the Debtor. Make sure the right person or persons are sending the letter of demand to the debtor.
  
  HUMAN
  Each human needs to be inserted separately. Use each Creditor’s full legal name. Be as correct as possible.

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• Suing someone in another state

  QUESTION: I have a debt I need to recover. The debtor is in WA. We live in Qld and trade out of Qld. Which document should I use?
  
  ANSWER: There are 2 issues. You want to sue in your jurisdiction because it is easier. You live there and you can go to the court close to you. Less travelling is required. To commence an action in Queensland, all that is required is that the debt has a connection to Queensland.
  
  However, this may not always be fair to the Debtor. If all parties agreed to sue in WA if something went wrong, then it would be unfair to sue in Queensland.
  

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• What do I receive in this Debt Recovery Kit?

  This Debt Recovery Kit contains a Debt Collection Manual and a Letter of Demand to send to the Debtor. The Debt Collection Manual explains:

  • Debt recovery techniques;
  • The forms required to commence a Claim in the Magistrates Court or in the QCAT;
  • Details on the process you could expect in the Magistrates Court or in the QCAT; and
  • Details and forms required to enforce Claims in the Magistrates Court (i.e. after you have received the initial judgment or QCAT decision). 

  This hint is provided by Law Central Legal.

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Debtor Details

• More than three Debtors?

  Unfortunately this document cannot be used where there are more than three Debtors.

  This hint is provided by Law Central Legal.

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• Who is the Debtor and who is the Creditor?

  The Debtor is the person that won't pay the Creditor their money. The Creditor lent the money or provided the services to the Debtor.
  
  Each Debtor must be included.
  

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• How many Debtors?

  If John Smith only owes you the money, then John Smith is the only Debtor.
  
  If John Smith and his business partner Jill Smith owe you the money for the goods you supplied, then you have two Debtors.
  
  If however, John Smith and Jill Smith guaranteed the debt for their company Smith Pty Ltd, then you have three Debtors.
  
  Ensure that you include all the Debtors.

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Debt Details

• Description of Debt

  The description of debt is included in the heading of your Letter of Demand. Keep it to a few words only. For example:

  • Goods sold and not yet paid for; or
  • Services rendered and not yet paid for. 

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• Claim Amount: Only use numbers (not words)

  Please enter the Claim amount in numbers only (not in words) and include a dollar sign ($). For example: $5000

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Remedy Sought

• Can I sue for more than $25,000 in the QCAT?

  The jurisdiction of the Queensland Civil and Administrative Tribunal ("QCAT") is $25,000. If the Debtor owes you $30,000, then you will need to sue in the Magistrates Court of Queensland.

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• How much can I sue for in the Magistrates Court?

  The Magistrates Court's jurisdiction is for claims up to and including $150,000.

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• My Claim is under $25,000. Which Court do I choose?

  For Claims of amounts up to and including $25,000, you have the choice whether to commence the Claim in the Magistrates Court or in the QCAT.
  
  Given the choice, many people prefer to commence proceedings in the QCAT, as it is a less formal jurisdiction that is designed to be more straight-forward to self-represented litigants. QCAT fees are often far lower, and outcomes can usually be reached quicker than in the Magistrates Court. Generally, parties cannot be represented by a lawyer unless the QCAT gives parties leave to do so. Leave can be granted on various grounds, including if all parties consent to legal representation.
  
  The Magistrates Court is more formal than the QCAT. In the Magistrates Court, any party can elect to have a lawyer represent them (without leave of the Court). Often, fees are higher due to the presence of lawyers and additional Court procedural requirements. It generally takes longer to resolve a matter in the Magistrates Court compared with the QCAT.

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• Letter of Demand: Choosing a Remedy

  In your Letter of Demand, you can choose which remedy you wish to seek from the Creditor. For example:

  • If they don’t pay, you intend to sue them in the Magistrates Court (for claims up to and including $150,000);
  • If they don’t pay, you intend to sue them in the QCAT (Claims under $25,000);
  • If they don’t pay, you will apply to have the matter mediated;
  • If they don’t pay, you will do nothing.
  It is ok if you send the Letter of Demand which says that you will sue them if they don’t pay you, as long as at the time of sending the Letter of Demand you have the intention to do so. It is ok if you later change your mind later and choose not to sue them.

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• What is Mediation?

  Mediation is a form of Alternative Dispute Resolution. At a mediation, all parties come together to discuss issues in front of an impartial facilitator (the Mediator). Mediation can only occur if all parties consent to it (so if your Debtor refuses to attend mediation, you may have to go straight to lodging your Claim at the Court/QCAT).
  
  Mediation is said to offer benefits such as:

  • Assisting parties in identifying and narrowing issues;
  • Reducing the stress on parties;
  • Reducing costs;
  • Offering more tailored solutions to issues;
  • Offering an early chance to solve issues, saving parties time; and
  • Encouraging parties to communicate issues to reach settlement.
  Ultimately, mediation puts the parties in control of agreeing on a mutually suitable outcome, which is then binding on the parties.
  
  If parties cannot reach an outcome, the matter can then be referred to the QCAT or to the Court.
  
  The QCAT offers free mediation services.

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Enclosures

• How to describe enclosures in your Letter of Demand

  It is a good idea to send the Debtor copies of any relevant documents that evidence the debt owing. Relevant documents could include:

  • Loan agreements;
  • Tax invoices; and
  • Quotes for goods/services.
  Ensure that you include sufficient information about the document you are enclosing. For example:
  • Loan Agreement between Bill Smith and Bay Pty Ltd ACN 123 456 789, signed on 14 January 2012;
  • Tax Invoice number I.1109 dated 5 August 2014; and
  • Quote number Q.22201 dated 20 July 2014.
  Click “Add” for each document that you will enclose with the Letter of Demand. Law Central will automatically number these enclosures for you.

  This hint is provided by Law Central Legal.

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Enclosure Details

• How to describe enclosures in your Letter of Demand

  It is a good idea to send the Debtor copies of any relevant documents that evidence the debt owing. Relevant documents could include:

  • Loan agreements;
  • Tax invoices; and
  • Quotes for goods/services.
  Ensure that you include sufficient information about the document you are enclosing. For example:
  • Loan Agreement between Bill Smith and Bay Pty Ltd ACN 123 456 789, signed on 14 January 2012;
  • Tax Invoice number I.1109 dated 5 August 2014; and
  • Quote number Q.22201 dated 20 July 2014.
  Click “Add” for each document that you will enclose with the Letter of Demand. Law Central will automatically number these enclosures for you.

  This hint is provided by Law Central Legal.

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Date of Letter

• What jurisdiction does the Letter of Demand work in?

  This letter of demand works Australia wide. However, the instructions for lodging the Claim in the QCAT or Magistrates Court only work in Queensland.

  This hint is provided by Law Central Legal.

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This document has been prepared by the law practice Law Central Legal