• Partnership Disputes

    Partnership Disputes

    We have resolved hundreds of disputes between business partners and understand they are not easy.

    That’s why you need to engage a specialist in resolving these types of disputes.

  • Trade Disputes

    Trade Disputes

    When it comes to business disputes, we have seen them all.

    We are experts at enforcing agreements and intellectual property rights to protect your business.

  • Employee Disputes

    Employee Disputes

    We are all too aware of the damage an employee can do if they defect to a competitor with confidential information.

    We specialise in resolving disputes of this nature.

  • Debt Recovery

    Debt Recovery

    Getting paid on time and in full is so important for every business.

    Our track record proves we know what we are doing.

  • Business Transactions

    Business Transactions

    We are first and foremost business lawyers for business owners.

    We will give you the tools you need to take advantage of commercial opportunities whilst ensuring minimal risk.


If I Receive A Letter of Demand, Do I Have To Pay?

Usually, a creditor will send a letter of demand if there is an outstanding debt. However, not all letters of demand are created equal.

Depending on the circumstances of the letter and the facts of your individual case, it might be hard to know whether the amount of the debt is correct, whether the debt is disputed, what the basis of the debt is, and indeed, whether you owe it at all. You may not even have to pay it.

Accepting the Debt

If you accept responsibility for the debt, you should pay it.

If you accept the debt but you do not have the means to pay the debt, you can negotiate with the other side. You may be able to reach agreement on paying a lesser sum of money or the full amount over time. This is only an option if the other side agrees as there is no legal requirement that they negotiate with you.

Additional Fees

Sometimes, letters of demand will also request additional fees or costs over and above the unpaid debt.  As a general rule, legal costs or fees can only be claimed under a contract or once legal proceedings are issued.

Be sure to go back through the contract and check if legal fees or charges are included. If not, you can dispute these charges.

Disputing the Debt

If you dispute the debt, you can either not respond to the demand or put the other side on notice of your position. Selecting an option will depend on your circumstances.

As a guide, it is preferable to respond to the demand where you believe that the other side will take the next step of issuing legal proceedings. Your response may deter them from issuing legal proceedings or encourage them to negotiate instead. These will potentially save you some legal costs.


Our top tips for dealing with a demand is –

  1. To remember that you are usually not required to pay a debt that has been in default for more than 6 years;
  2. There are debt recovery rules which lawyers and agents must follow. You may be able to make a complaint if you are being persistently contacted;
  3. There is no time limit on putting forward an offer of settlement;
  4. Consider whether it is worth paying the debt promptly where you will have an ongoing relationship with the other side.

If you receive a letter of demand, we recommend you contact a member of our experienced dispute resolution team at Taurus Legal Management for advice on (03) 9481 2000 or info@tauruslawyers.com.au.

Posted by Taurus Legal Management