Debt Recovery

Being owed money can be frustrating and stressful. If someone owes you money or has your property, but can't or won’t pay you or return the property, there are legal avenues to help you pursue the debt.

It is important to seek legal advice early, as the longer you let the debt go on, the harder it will be to recover. There are time limits for lodging a debt recovery claim in court, generally within 6 years of the debt being incurred.

Sometimes a simple letter of demand is enough to prompt a debtor to pay what they owe, rather than risk court action. A letter of demand will typically state the dispute, what is owed, and give a date by which payment must be received, or otherwise risk legal action.

Negotiation may follow a letter of demand, such as a debtor requesting to pay off the debt in installments rather than all at once. Or they may disregard the letter.

Before deciding to take someone to court you need to consider whether it is worth pursuing in Court. For example, can the person who owes you money afford to pay you? (They may be bankrupt). If the facts are being disputed, can you back up your claim with evidence? Are you within the time limit to claim?

For debts under $10,000 you can go through the Small Claims division of the Local Court, which is fairly straight forward and doesn’t require a lawyer. For debts between $10,000 and $60,000 you need to go through the Civil Claims division of the Local Court. Amounts above this are handled in the District Court. The process requires you to lodge a Statement of Claim form at the relevant Court.

The debtor (defendant) then has 28 days to respond. If they don’t, or if the matter goes to Court and the Magistrate rules against them, you can take action to recover the debt. This might involve seizing and selling their property, deducting money from their salary, or making them bankrupt.

Our lawyers can help you understand your options, including whether you have a case that is worth pursuing in court. We can assist you to resolve your dispute through mediation, and handle negotiations on your behalf. We are experienced in methods for recovering debt, and can represent you in court.

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