If, as a business, you find yourself in a position where one of your customers is disputing a debt owed to you, there are a few steps you can take to try and recover the debt.
The evidence needed to pursue a claim
Before attempting to recover a business debt from a customer, you must first gather all of the evidence you have which shows that the debt is due and owing.
The easiest way to recover a debt is if you have a written and signed contract with your customer, which clearly shows both parties' obligations.
For example, that you would supply goods or services to the debtor and what the debtor would pay for those goods or services.
However, you may have other documentary evidence, such as purchase orders, invoices or written correspondence which is evidence of how the debt has arisen.
Keeping copies of all correspondence and documents and your attempts to collect the debt or negotiate a settlement is important.
These will be required if your customer continues to dispute the debt and you instruct a solicitor to try and recover it for you.
Discuss the debt with your customer
Once you have gathered all of your evidence, the first step should be to try and resolve the dispute with the customer directly, whether through correspondence or at a meeting.
By discussing the situation with your customer, you can try and resolve any issues and reach an agreement with them.
Trying to resolve the dispute yourself before instructing solicitors to try and recover the outstanding debt will likely save you time and costs in the long run.
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
