It's worth trying to get the money you are owed for a debt or as a result of a car accident paid back without the trouble and expense of a court case.
Before you decide if you want to start a court case, you should consider the strength of your claim by getting legal advice. If you lose the court case and the defendant has a solicitor or barrister appearing for them, you may have to pay some of their legal costs. For more information, see Legal costs.
You should consider:
A letter of demand is a letter you send to the person or business that owes you money, also known as the 'debtor'. The letter should tell the debtor:
Don't forget to put the date on the letter and to include your full name or the name of your business. You should also put your postal address, email address and phone numbers in the letter.
Make sure you keep a copy of the letter of demand and a record of where and when you posted the letter to the debtor. For more information, see Sample letters of demand.
If your claim is about a car accident, see Sample letters of demand - car accidents.If the debt is more than six years old, or if the car accident happened more than six years ago, you can still send a letter of demand. However, you may not be able to win a court a case to get the money back as by law there are time limits for making claims. These are called a statutory time limits. For more information, see Time limits. You should get legal advice if you are chasing a debt that is more than six years old.
You may receive a request for further and better particulars (more information) from the debtor about your letter of demand. For more information on how you may respond, see Sample response to letter asking for further and better particulars.
You can try to talk to the debtor about the debt and how it can be repaid. You could consider accepting payment of a lesser amount in a lump sum or payment of the whole debt by instalments (part payments).
If you are able to reach an agreement with the debtor about repaying the debt, you should write down what has been agreed and both of you should sign the agreement.
For more information, see Settling the case, Sample agreement to pay by instalments and Sample Release - car accidents.
Sometimes there might be a disagreement about whether the money is owed, how much money is owed, how and when the money should be repaid or who was at fault in the car accident. In these situations, mediation could be useful.
An independent person, called the mediator, helps the parties try to settle their dispute through discussion and negotiation. All discussions in mediation are confidential and 'Without Prejudice'. This means that if the case ends up going to a court hearing, nothing the parties have said during the mediation may be used against a party in the court.
Most mediation is voluntary - you cannot force the debtor to attend. For this reason, mediation is only an option if the debtor will agree to do it. Community Justice Centres provide free mediation services in NSW. All you need to do is contact them. The staff can tell you if your situation is suitable for mediation. The staff will then contact the debtor and encourage them to participate in a mediation session.
For more information, go to the Community Justice Centres website.
If a letter of demand, negotiation or mediation does not work, you could make a claim in the Local Court. For more information, see Starting a Case.
For answers to some commonly asked questions, see Do I have to go to court? - Questions to consider and Do I have to go to court? - Frequently Asked Questions.
Community Justice Centres