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Auckland Debt Recovery Lawyer – How To Get Money Owed To You

Many people find themselves owed money and need to call on the services of an Auckland debt recovery lawyer. If people or organisations owe you money, it can be very stressful. It can also harm your own circumstances.  If your own cashflow is already tight, knowing you should have more money at your disposal, but you cannot get it, adds to your stress and frustration.   They provide a wide range of services and are known to have a very high success rate when it comes to getting what they’re owed.

​Understanding the reasons behind why you have debtors is crucial. Debtors do not pay for one of two reasons; they can’t, or they won’t. Knowing or finding out which camp your debtor is in as soon as possible is essential.  That way your support services can take appropriate action.

How To Recover Debts Owed To You

If Customers Cannot Pay

Sometimes customer cannot pay their debts due to circumstances beyond their control. For example, they may not have sufficient cashflow to pay their debts. Their own customers may be delinquent in paying your customer. This is the more common reason that people do not pay their bills.

If their intention is to pay you but it is outside their control, to avoid souring the relationship between you, the best option is to arrange a repayment plan that they can adhere to. This option also minimises the recovery costs for both parties. Clearly, any additional costs such as lawyers, courts etc, will further reduce your customer’s ability to pay you.

If Customers Won’t Pay

Your actions depend on the size of the outstanding debt.

Bigger debts will need action from your Auckland debt recovery lawyer.  They can write to your customer asking for settlement by a certain date.   If that is not met, the lawyer will threaten the start of legal proceedings. For debts up to $200,000 this will go to the District Court. Over $200,000, the case will go before the High Court.

If the debt is below $30,000, you can make a claim through the Disputes Tribunal. This is a low-cost, and fairly simple process. However, if the case is found in your favour, enforcing the payment can sometimes be difficult, and relies on the honesty of the debtor to pay you as the Tribunal does not have any enforcement powers.

To Prevent Debts Owed To You

To avoid the problem of outstanding debts, it is best to have a robust, and rapid debt collection process.  A great start is to have a clear, and explicit Terms of Trade agreement that your customers sign before they begin trading with you.

This should state what is due, and by what payment date. It should also include:-

• Stating that the debtor will be responsible for any recovery costs.
• That a security will be taken over any products supplied until payment is made in full.
• That the debtor will pay interest on any outstanding monies.

If the invoice is going to be significant, have a Personal Guarantee from one or more of the Directors will be a useful weapon in your arsenal.

How An Auckland Debt Recovery Lawyer Can Help

Hopefully, you will have worked with a lawyer early in your trading history to have them write Terms of Trade, and contracts.  However, if you have not done this then, a good debt collection lawyer in Auckland will be able to give you good advice on your options.

They can write a letter to your customer requiring payment by a specific date. If this doesn’t work, then they can draft and file documents to the relevant court.

Subsequent to a successful court decision, your lawyer can then help enforce the settlement of the debt owed to you.

If you were able to get a Personal Guarantee from the customer directors, the debt recovery lawyer can help enforce that guarantee.

If you have a customer that owes you money, a good Auckland debt recovery lawyer, is McVeagh Fleming.  They have a team of lawyers who can help you at any stage in the debt collection process.