Credit Contracts / Debt Collection
We have specialised in contract preparation and contract disputes for 5 years.
Our Proven Experience:
We have prepared loan agreements and security documentation and handled disputes for banks, companies and businesses of all sizes.
For 25 years Marcus has represented financial institutions including United Credit Union now Beyond Bank Australia, in debt recovery litigation in the Supreme Court, District Court and Magistrates Court involving debts of all sizes. He has also represented the Bank of Melbourne, the Bank of Queensland, National Australia Bank and large national mortgage insurer MGICA.
Because our offices are not located in the CBD our rates are substantially lower, often up to 20% lower, than most commercial law firms.
We provide legal advice on loan agreements and we can prepare loan agreements for individuals and businesses of all sizes as well as guarantees and caveats.
We include clauses which protect:
- Re-payment by including a caveat clause that allows you to lodge a caveat over property to secure re-payment.
- The right to recover legal costs incurred.
- Provide advice in relation to risk management and enforceability of loan documentation.
- Have you confirmed the identity of the debtor by requesting proof from an individual or have you considered conducting a company or business name search? (we can do these searches for you)
- Have you conducted a credit check on the debtor and, if applicable, its directors or proprietors or promoters?
- If you want to charge interest, have you specified precisely the rate to be charged, the method of calculation and the date from which interest will run?
- If you are selling goods, have you made clear precisely when title to the goods passes to the purchaser and have you included a Romalpa or retention of title clause? For those not familiar with Romalpa clause, it is a term in a contract that states that the title or ownership to the goods do not pass until payment is received.
- If the debtor is a company, or if you have some doubts about ability to pay, should you get personal guarantees from third parties?
- Do you have a well drafted form of guarantee?
You should have in your contract a cost recoverable clause that will allow you to claim most of your legal fees and other costs of recovery from the debtor. You should have the debtor's agreement to your terms before you perform your part of the transaction.
It may not be enough to rely on your terms of trading on the reverse of your invoice.
You must enforce your terms, otherwise you are sending an implicit message to the debtor that you do not care. How you enforce your terms is a matter for your commercial judgement. The best thing to do is immediately after the due date, an account rendered be sent, specifying a new due date. If the debt is still not paid, refer the matter to a lawyer for legal action.
The longer a debt is left unpaid, the harder it will be to recover. It must be made clear to the debtor that you will not let up until you have been paid. Remember that, if you have to sue to recover your debt, the court will require you to prove your case. Careful documentation of the transaction, and of your enforcement action, will play a very important part in that proof.
We can help you resolve any disputes regarding repayment of loan sums advanced or breaches of other terms of loan agreements.
We give legal advice on disputes over all types of contracts as well as debt recovery under loan agreements and we act for parties pursuing debts under loan agreements.