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Our aim is to keep actions simple such that debt problems do not become expensive problems. Hence we cap legal cost such that you know what the cost will be before taking action to recover your debt.

Your initial action should be to make your own initial demands, with a view to keeping your client or customer relationship friendly. However if this fails then we can help.

As a first step we will send a "Final Demand Letter" which will signal the debtor that this debt is becoming a very serious matter, and that they should make an arrangement to pay your debt.

This will cost: $49.50 inc GST.

As a next step, if that does not work then you can instruct EDR to “Take Immediate Legal Action”.

 

 

Again, our aim is to keep actions simple such that debt problems do not become expensive problems. Hence we cap legal cost such that you what the cost will be before taking action to recover your debt.

If sending a "Final Demand Letter" does not produce an acceptable result then your next option is to "Start Immediate Legal" to recover your debt.

If you elect to take Immediate Legal Action, you will be charged an administration fee of $110.00 inclusive of GST per claim plus a fixed filing, service and scale solicitor's costs (“Fixed Fee”). The amount of the Fixed Fee will depend on the value of your claim. Please refer to the How It works link to see a sample claim. You may also be charged for disbursements.

This is assuming that the debt is not contested. If the debt is contested then we will charge you $1,750.00 plus GST for small claims ($0 - $20,000), please see Fees for Contested Local Court NSW Claims link.

We have simplified the process so that you have to do minimal effort to recover your debt. Hence to reduce the time you spend collecting your debts, you can use our services to maximise the the effectiveness and reduce the time wasted in going through this process.

EDR is a legal practice with qualified and experienced lawyers. EDR does not charge commissions on top of legal fees for litigated claims.

EDR can cap its legal fees for claims under $20,000. By using EDR you can be sure that you will not be paying excessive legal fees and in most cases, you may recover all scale solicitor’s costs and fees from the debtor.

 

EDR recommends that prior to registering for this service, you are aware of the whereabouts of the debtor. If you have a mobile number, a current residential or business address, this information should be provided at the time of your registration with EDR. By having current and accurate information on the debtor will significantly increase your chance of getting paid by the debtor, subject of course to any reasonable dispute to your claim and other matters identified in this website.

In NSW, most debts expire after six years from the date that the cause of action arose. This means six years from the date the payment was due or from the last date on which the debtor did some act to confirm the debt. An expired debt cannot be claimed unless you obtain leave from a Court to extend the operation of the limitations period. This is very difficult to obtain and in most cases, it not commercially viable due to the substantial cost involved in doing so.

EDR recommends that a Final Demand be issued to the debtor. The Final Demand will make a demand of payment of your debt plus the cost of the letter directly to you. The time to pay is usually 7 business days from the date of the letter. The letter will also encourage the debtor to discuss the debt with you directly if there is any dispute, hence maximise the chance of coming to a reasonable resolution without the intervention of lawyers.

It is important to ascertain the basis of any dispute from the debtor from the outset. Hence, why EDR recommends sending the Final Demand to the debtor.

A debtor may already have notified you of the basis of disputing the debt. If so, it is important to provide this information to EDR at the time of registration.

EDR will assess the prospects of success if the nature and basis of the dispute is known. EDR cannot guarantee that your debt will get paid, even if you win a contested hearing. There are many reasons for this: the debtor cannot be found; the debtor has no assets or has no means to repay the debt or is declared bankrupt are a few examples.

Not all claims are defended in court. If the debtor files a defence, EDR will advise you of the prospects of their defence. EDR may advise you to reach a commercial settlement depending on the strength of the defence. If you reach a commercial settlement, you may not recover the solicitor’s costs and filing and service fee or any interest on the outstanding debt. Similarly, if the debtor contests the claim and you win, you are only entitled to claim scale solicitor's costs. The maximum scale solicitors costs allowable in the small claims division of the Local Court is: (i) 40% of $912.00 for claims not exceeding $1,000; (ii) 60% of $912.00 for claims exceeding $1,000 but not $5,000 and (iii) 80% of $912.00 for claims exceeding $5,000 but not $20,000. This means that you may be out of pocket if the interest component is not enough to cover the fixed legal fees paid to use the services offered by EDR.

If you elect to proceed to a hearing and you win, EDR will ask that the debtor pays your scale solicitor’s costs, interest, fixed filing and service fee. In some circumstances, you may be able to recover some external expenses incurred on your behalf such as witness expenses and so on.

If you proceed to a hearing and you lose your case, you may be liable to pay the debtor’s costs, if they are legally represented. The maximum scale solicitors costs allowable in the small claims division of the Local Court is: (i) 40% of $912.00 for claims not exceeding $1,000; (ii) 60% of $912.00 for claims exceeding $1,000 but not $5,000 and (iii) 80% of $912.00 for claims exceeding $5,000 but not $20,000.


The Local Court aims to have all claims filed resolved within 12 months from the date of filing. Sometimes, it can take longer for your matter to be finalised, up to 2 years or more, at a final hearing due to matters beyond the control of EDR.

EDR can only initiate legal proceedings for debts where the debtor resides or operates in, or where the debt was incurred in NSW.

EDR may be able to recover debts outside NSW however, the cost of doing may be greater than the value of the debt.

The types of debts EDR accept are: all debts arising from contractual arrangements, claims for damages to property (example car accidents, rental property claims and so on).

EDR does not accept claims under workers compensation or personal injury, public liability claims.

Some debt claims must be filed in specific tribunals such as NCAT. For example, NCAT deals with all matters concerning residential tenancies in NSW and residential home building disputes. An applicant requires leave to be legally represented. NCAT and other tribunals have limited power to award costs in a debt claim. If a claim is filed in such tribunal(s), you may not recover your legal costs.

EDR reserves the right to decline to accept any claim where the claim is so complex or time consuming that they demand special attention. Such claims are uncommercial to pursue and put too much pressure on providing an efficient debt recovery service at a low cost.

 

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© 2019 CAV Law Pty Ltd trading as Effective Debt Recovery, ABN 63 616 409 244
T: (02) 8935 3898 | sales@effectivedebtrecovery.com.au | NEXUS LAW GROUP, LEVEL 11, 66 CLARENCE STREET, SYDNEY NSW 2000

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