Debt recovery litigation is a critical area of law that helps creditors reclaim owed money. However, one aspect that often surprises clients is the complexity surrounding legal costs and disbursements, particularly regarding their recoverability. This article aims to clarify why not all legal costs and disbursements are recoverable in debt recovery actions, with a detailed focus on the costs associated with engaging process servers.   Legal Costs in Debt Recovery Litigation   When initiating debt recovery proceedings, clients typically incur various legal costs, including solicitor’s professional fees, court fees, and disbursements. Legal costs refer to the fees charged by solicitors for their services, which

Why is it Harder to Obtain Credit in Australia?   Have you struggled to obtain credit in Australia recently and are unsure why? What have been the recent developments in Australian Credit Law? What should small to medium (SM) business owners and credit providers consider when providing credit in the current climate? Obtaining credit in Australia can be more challenging due to economic conditions, regulatory frameworks, and individual creditworthiness. Still, in recent years, there have been developments in Australian Credit Law (ACL) which require lenders to be more responsible when providing credit:   Regulatory Environment: Australia has strict lending regulations

Understanding Credit Provision for Businesses in Australia   In the competitive landscape of small to medium (SM) businesses in Australia, offering credit to clients can be an effective strategy to boost sales and foster customer loyalty. However, it comes with its own set of challenges and considerations. Here are some key factors that SM businesses should keep in mind when providing credit to clients.   Assessing Customer Creditworthiness Before extending credit, businesses need to evaluate potential clients' creditworthiness. This can be done through credit checks. SM businesses should analyse financial statements and consider the client's payment history. Tools and services are available to help

In the civil registry within the New South Wales (NSW) Local Court, a statement of claim for a liquidated debt is a common legal tool used to recover a specific sum of money that is owed. The defendant in any proceedings has the opportunity to respond by filing a defence.   In our experience, in most cases a defence is not filed. It may happen once in every 20 or 25 cases. Even less cases proceed to a final hearing, with most settled during case management. However, the process can become intricate when the defendant decides to defend the claim.   This article outlines

Introduction   In Australia, creditors have various enforcement procedures at their disposal to recover debts from judgment debtors who fail to pay judgment debts. A judgment occurs when a court rules in favour of the creditor because the debtor has failed to respond to legal proceedings, or a matter has been heard by the court and the court has found in favour of the creditor.   Judgment is a court order that the debtor owes the judgment debt amount, plus interest and legal costs, and is legally obligated to pay the creditor. However, obtaining a judgment does not automatically result in payment; creditors often

Ombudsman report finds Revenue NSW engaged in ‘maladministration’ by taking money directly out of millions of bank accounts. The New South Wales government’s debt collection agency broke the law when it used an automated system to withdraw money from millions of bank accounts to claw back unpaid fines, a scathing report has found. The NSW ombudsman Paul Miller’s report, released on Tuesday, found Revenue NSW’s use of AI to generate garnishee orders broke the law from its introduction in 2016 until 2019, and that it was “wrong” until March 2022. A garnishee order is when Revenue NSW takes money directly out of people’s

Enforcing a judgment debt in New South Wales refers to the legal processes that a creditor can undertake to compel a debtor to pay what they owe pursuant to the orders contained within a court judgment.   When a creditor has obtained a judgment against a debtor and the debtor fails to pay the judgment debt amount voluntarily after being issued with post judgment demands for payment, there are several enforcement measures available under NSW law. Laws in other states have similar enforcement methods but for the purposes of this article we will concentrate on NSW enforcement procedures.   The three methods for enforcing

Further to our recent article regarding issuing a Statement of Claim, you may recall that there are several ways that defendants usually respond: Pay the Statement of Claim amount, which is the debt amount plus the legal costs and interest, within 28 days of being served. Apply to the court to acknowledge the debt and make an application to pay by instalments. Contact the solicitor acting for the Plaintiff creditor to negotiate settlement. File a defence to the Statement of Claim with the court. If this happens then the court will list a hearing date for a pre-trial review or

If a debtor is unresponsive to pre-legal demands and negotiations to settle a debt, then the matter usually proceeds to court to commence legal debt recovery proceedings.   When a client instructs us to collect a debt on their behalf, they usually do not want to take any further interest in the matter other than to provide instructions along the way and to receive updates about the progression of the matter.   However, it is prudent for clients to have a basic understanding of the legal debt recovery procedures. Over the next few weeks, we will be publishing articles that cover all aspects of

In 2024 NSW Credit Law will continue to provide the services that you know it well for.   A link to our list of services is provided below:   https://nswcreditlaw.com.au/our-services/   However, we will be expanding our list of document review and document drafting services to include personal legal documents as well as commercial legal documents. A non-exhaustive list of documents we will be providing services to review, and draft is provided below, however, the total list extends to over 300 documents, so if you have any queries with regards to any of our services please do not hesitate to get in touch:   Business   Sale Agreements Confidentiality Agreements Amendment Deeds Deeds of