Debt recovery is getting back the sum of money owed by a debtor. This can be enforceable by law depending on the situation. In the construction industry, this usually happens between a contractor or builder and the owner of the building (whether it’s residential or commercial). Debt recovery can be enforced under the Building and Construction Industry Security of Payment Act 1999 NSW.
It is advisable for anyone in a debt recovery situation to ask help from a construction lawyer. Before deciding to commence legal action, you must first consult with a lawyer to assess the situation if it qualifies as a debt recovery case or not. This can also avoid making the situation bigger and can properly guide the client in taking the proper steps to settle his/her case.
As mentioned earlier, before deciding to take any legal action against the debtor, it would be more helpful to get advice from a legal expert. Discussing your situation with a lawyer will give you a clearer assessment on where you stand legally and whether or not it is qualified as a debt recovery case. Getting legal advice can also minimise the chances of making unwise decisions along the way.
If the situation is indeed a debt recovery case, your lawyer would advise and assist you to write a letter of demand to the debtor. This is usually done in the early stages of the debt recovery process. In this letter, details of the payment must be included as well as the due date to when the debtor must comply to your demand. If the due date comes and the debtor still doesn’t serve the money owed, the next letter of demand you send would serve as a warning that you will commence legal proceedings if the other party still doesn’t comply.
In addition, your construction lawyer is allowed to write and send a letter of demand to serve as further warning for the debtor.
If the letters of demand you’ve sent were all ignored, you must proceed with the debt enforcement process as guided by your building lawyer. This means that you will now proceed with the legal steps to take your money back. With the help of your building lawyer, you are guided throughout the debt recovery process and can definitely move forward towards getting your monies.
It is important to identify where the debt recovery case has happened. Each state in Australia has a different legal procedure when dealing with these cases. How construction laws deal with debt recovery in New South Wales is different from how it is dealt in Victoria, Queensland, and other states of Australia. Again, this is why it is important to consult with a building and construction lawyer to properly assess your situation.
There are disputes that get resolved in the early stages of cases such as debt recovery and this is done through negotiation. If you got yourself a good construction lawyer, he/she wouldn’t advise you to take your case to litigation immediately. He/she would probably tell you to try negotiating first to save you a lot of cash and effort. A court process, after all, is much more exhausting. So perhaps it’s better that you get to try alternative means of resolving your dispute before proceeding to litigation.
There can be cases that your claim for debt recovery is not really ‘debt recovery’. If the liability to pay is in question, this may not be considered as debt recovery. That’s why it’s better to have your contract reviewed by a building lawyer to go back to any specified terms regarding payment. Through this, the situation would be evaluated as to whether it is suitable for a debt recovery proceeding or not.
Contracts Specialist is a Sydney-based construction law firm dealing with Building Disputes, Construction Contracts, Security of Payments, and Debt Recovery. Our principal lawyer, John Dela Cruz, can surely get you out of your situation. With his extensive knowledge and over 10 years of experience, you can be confident that you are in good hands.
So if you think there’s debt owed to you, get paid and get the right legal advice now.
Contracts Specialist is a Sydney-based construction law firm that deals with Building Disputes, Construction Contracts, Debt Recovery, and Security of Payment. With Contracts Specialist, you are ensured that you are in good hands.