Phone: (02) 9633 1826
Office: Level 7, 9 George Street,

Are you or your business owed money?

What is the quickest and cheapest way of recovering a bad debt? What are the best techniques for recovering a bad debt? How do you maximise your chances of recovering a bad debt?

If communication has broken down with a person or business who owes you money, it is important to act fast to have the debt paid. Generally the more time that goes on, the harder it becomes to recover the bad debt.

Working out the asset position of the debtor is an important piece of information. Obviously if a debtor owns real estate or has a business or employment the prospects of recovery are improved.

Searches can be done to find out what assets a debtor has. It is amazing how debtors have ways of finding money when enough legal pressure is placed upon them.

A formal letter of demand is often appropriate with clear notice to the debtor as to what will happen if the debt is not paid. If no satisfactory response is received, legal proceedings can be commenced in the Local Court of NSW for claims up to $100,000, in the District Court of NSW for claims up to $750,000 and in the Supreme Court of NSW for claims exceeding $750,000. Interest and costs can be included and added to the claimed amount.

If the debt is owed by a company, it may be possible to bypass legal proceedings and simply issue a statutory demand, and then apply to have the company wound up and have a liquidator appointed.

Assuming a judgment is obtained against the debtor, immediate action is normally taken to enforce the judgment. Bankruptcy notices, garnishee orders, examination notices, statutory demands and writs are some of the options open to extract money fast.

Of course at any stage of enforcement it is possible to negotiate with the debtor and agree on a settlement. It is good to keep lines of communication open, but with the clear awareness that further action will be taken if the debt is not paid.

Care must be taken to ensure good money is not thrown after bad! Smart people do write off some debts, but only after careful consideration of all available options.

One of the obvious risks is that a debtor does not have the money to pay. A creditor cannot get blood out of a stone. Having the debtor declared bankrupt or placed in liquidation may provide some satisfaction, however commercial realities must be paramount.

Knowing as much as possible about the debtor’s financial circumstances is one of the key considerations in a successful recovery of a debt.

It is important to immediately seek legal advice regarding your rights. For a free, no-obligation appointment, please ring Steve McAuley of McAuley Hawach Lawyers on either (02) 9633 1826, mobile 0413 853 331 or email

Steve McAuley, Principal Solicitor

McAuley Hawach Lawyers

Level 7, 9 George Street, Parramatta NSW 2124

Telephone: (02) 9633 1826



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