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A DEBT COLLECTION AGENCY VERSUS A DEBT COLLECTION LAWYER

By Anica Cunanan, Solicitor at Matthews Folbigg in the Insolvency, Restructuring and Debt Recovery Group

The debt collection process is one which causes a lot of hesitation and frustration which can lead to a misunderstanding of what the key differences are between a debt collection agency and a debt collection lawyer.

Some creditors choose to handle such matters on their own whilst others choose to engage with a debt collection agency at first instance. That being said, engaging with a debt collection lawyer is a step which many avoid due to some misconceptions of how lawyers deal with the debt recovery process and by the same token, engaging a lawyer can seem daunting. [...]  READ MORE →

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Debt Restructuring legislation proposed for SMEs

By Andrew Hack, Solicitor, and Stephen Mullette, Principal, of Matthews Folbigg Lawyers, in our Insolvency, Restructuring and Debt Recovery Group.

The Treasury has today announced its Draft Bill designed to create a new, affordable restructuring mechanism for distressed small to medium businesses. The legislation seeks to resolve problems SMEs face in affording the costs of expensive Voluntary Administration processes. The Australian Government’s “Debt Restructuring” solution is a new process similar to a Part IX debt agreement available to insolvent individuals under bankruptcy legislation, as well as Chapter 11 arrangements available to companies in the US. [...]  READ MORE →

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The handcuffs are on debt recovery, but for how long? What you can do in the meantime…

By Jeffrey Brown, Principal at Matthews Folbigg in the Insolvency, Restructuring and Debt Recovery Group

As part of the Federal Government’s response to the COVD-19 crisis, a handbrake has effectively been applied to court proceedings aimed at bankrupting individuals and placing companies into liquidation. This has been achieved by lengthening the time for debtors to respond to formal demands, from 21 days to 6 months, for both bankruptcy notices (in the case of individuals) and statutory demands (for payment of debts incurred by companies). As part of the same reforms, the minimum debt amount that can be the subject of bankruptcy or winding up proceedings has been increased to $20,000.00. [...]  READ MORE →

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Debt Collection – Who Signed the Document?

By Darrin Mitchell, Senior Associate at Matthews Folbigg in the Insolvency, Restructuring and Debt Recovery Group

In the current age of technology, with capabilities to do just about anything, it seems redundant and “old fashioned” to be asked to execute a document by hand writing your signature on a sheet of paper! Because of this, debt collection can be a distinct (and difficult) exercise.

When opening a credit account, a supplier of goods and/or services will generally forward a Credit Application and a Deed of Guarantee to the customer. These documents are helpful in debt collection as they include information from the customer as to the customer’s financial viability, and security for the repayment of amounts owing should debt collection become necessary. In days gone by, these documents were to be completed by the customer physically writing on the forms as required, then posting these back to the credit provider, or perhaps giving the documents to a sales representative for the supplier. [...]  READ MORE →

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Debt Collection – Liquidated or Unliquidated Debt?

By Darrin Mitchell, Senior Associate at Matthews Folbigg in the Insolvency, Restructuring and Debt Recovery Group

Is your debt collection for a liquidated or an unliquidated amount? What is the difference?

In a debt collection action, the debt is often defined by the amount specified in tax invoices issued for the supply of goods or services. Debt collection for these types of debts involves a “liquidated” debt. This is because the debt which is the subject of the debt collection is ‘liquid’, in the sense of having a specific monetary value. There may be an ability to claim interest in debt collection proceedings for a liquidated debt, but again this will be a defined amount and calculated in accordance with the terms and conditions of the agreement between the parties. [...]  READ MORE →

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Collecting Money? Avoid Going It Alone!

By Ellen Ferris, a Solicitor in Matthews Folbigg’s Insolvency, Restructuring and Debt Recovery Group.

Collecting money, especially from people you know, is always a delicate business.

Collecting money requires you to be persistent, and all too often becomes something that we let slip to the back of our mind to avoid the hassle, inconvenience, and sometimes even embarrassment of chasing valued customers for unpaid debts. Certain debts, even large ones, can be placed in the “too hard basket”, and never followed up on. Certain timelines for recovering debts can then expire, or more simply, debts can be forgotten or ignored. [...]  READ MORE →

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Debt Collection Sydney – Statutory Demands and the Expiration of the Coronavirus Economic Response Package Omnibus Act 2020 amendments

As a result of the COVID-19 pandemic, the Coronavirus Economic Response Package Omnibus Act 2020 (Cth) was introduced, which resulted in various temporary changes to the Corporations Act 2001 (Cth) and Corporations Regulations 2001 (Cth) in respect of statutory demands.

These temporary changes include extending the time period for a company to respond to a statutory demand from 21 days to six months, and increasing the monetary threshold for a creditor to issue a statutory demand from $2,000 to $20,000. [...]  READ MORE →

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Recovering costs for debt collection services

Recovering costs for debt collection services

Fees and costs, including legal costs and costs for third party debt collection services can only be collected from a debtor if there is an agreement between the creditor and debtor providing for those costs to be payable to the creditor. Attempting to recover costs in the absence of a clause in the relevant agreement can be misleading deceptive and conduct in contravention of section 18 of the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)), section 154 of the National Credit Code (Schedule 1 of the National Consumer Credit Protection Act 2009 (Cth)) as well as Section 12DA of the Australian Securities and Investments Commission Act 2001 (Cth) (“the ASIC Act”). [...]  READ MORE →

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Clearing your debtor ledger – Get in touch with your not too friendly Debt Collection Lawyer!

By Hayley Hitch, an Associate of Matthews Folbigg Lawyers in our Insolvency, Restructuring and Debt Recovery Group

Do you hate debt collection? Do you have a list of debt collection tasks that is getting longer every day? Have you been unable to accomplish the critical debt collection part of debt collection? If only debt collection were easier, and there was some way of moving those pesky debtors off the debt collection ledger! And don’t forget the cashflow side of debt collection – wouldn’t you like to have a bit extra cashflow back in your budget? [...]  READ MORE →

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OPPOSING PREFERENCE PAYMENT CLAIMS AFTER COLLECTING MONEY

Claims by a liquidator for monies to be repaid to a company now in liquidation are unfortunately for most businesses a common event.  The good deeds done in collecting money can come undone and hurt your bottom line.

As a successful credit management team, you will have recovered monies that may have been received shortly before the debtor company was placed into liquidation, or the individual declared bankrupt.  This can then bring a new raft of issues should the liquidator or trustee be savvy enough to want the money back. [...]  READ MORE →

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SHOULD I INSTRUCT A LAWYER FOR DEBT COLLECTION?

At Matthews Folbigg Lawyers, we have a team of lawyers and clerks ready, wiling and able to cater for your debt collection requirements.  Aside from being lawyers, members of our team have been involved in debt recovery for over 30 years, helping companies and individuals recover monies due and owing to them working with finance companies and mercantile agents seeing first hand the nuts and bolts of dealing with debtors.

This experience has given us a boost in assisting our clients to recover monies in-house up to the management of a full blown hearing where the debtor defends everything from non-supply of goods to alleging that the goods supplied were defective.  It also allows us to give you advice on the implications of debt collection, so you can make practical, commercial decisions. [...]  READ MORE →

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When is it too late to collect a debt?

By Ellen Ferris, a Solicitor in Matthews Folbigg’s Insolvency, Restructuring and Debt Recovery Group.

When life gets busy, sometimes we put off important jobs to deal with more pressing matters. But when it comes to debt collection, this can only be put off for so long before debts become ‘statute barred‘. At this point the debts the subject of debt collection are no longer capable of being collected.

Most States and all Territories have time limits within which debt collection must be completed. In New South Wales, if too much time passes and the limitation period expires, section 63 of the Limitation Act 1969 (NSW) extinguishes the debt, meaning recovery of the debt is no longer possible.. [...]  READ MORE →