What to Do After Sending a Letter of Demand in Australia | Claim Done
What to Do After Sending a Letter of Demand in Australia
You have sent your letter of demand. Now what? There are three possible outcomes — and a specific strategy for each.
Scenario 1: They pay
Most people who receive a professionally drafted letter of demand pay within the 14-day deadline. If payment arrives:
- Confirm receipt of the payment in writing (email is fine)
- If the amount is a partial payment or settlement, get written confirmation that it is accepted in full and final satisfaction of the debt
- Keep all records — the correspondence, the letter, the bank statement showing payment
No further action is needed. The matter is resolved.
Scenario 2: They respond or negotiate
The recipient may respond disputing the debt, offering a partial payment, or requesting more time. How to handle it:
- If they dispute the debt: review their response carefully. If you have strong evidence, reply in writing restating your position and giving a final deadline. If the dispute raises complex legal questions, consider legal advice before proceeding.
- If they offer a lower amount: you can accept or counter. Any settlement must be documented — get it in writing before you accept payment.
- If they request more time: you can agree to an extension, but confirm it in writing and be specific about the new deadline.
All responses should be in writing. Verbal agreements are difficult to enforce.
Scenario 3: They ignore the deadline
If the 14-day deadline passes with no payment and no response, you have several escalation options depending on who owes you money:
For individuals and sole traders
File a claim with the relevant state tribunal:
- NCAT (NSW) — claims up to $30,000
- VCAT (VIC) — claims up to $100,000
- QCAT (QLD) — claims up to $25,000
- SAT (WA), SACAT (SA), ACAT (ACT) — state-specific limits
Claim Done prepares a complete tribunal application for $79. Your letter of demand and their non-response become key evidence.
For companies (Pty Ltd, Ltd)
If the debt is $4,000 or more and not genuinely disputed, consider escalating to a statutory demand under s459E of the Corporations Act. This gives the company 21 days to pay or face wind-up proceedings. Claim Done prepares statutory demands for $197.
For larger claims
For claims above the tribunal limits, or for more complex matters, you may need to file in the Local Court or Magistrates Court (under $100,000 in most states) or the District Court (larger claims). Legal advice is recommended for court proceedings.
What evidence to gather
Whether you go to a tribunal or court, you will need:
- A copy of your letter of demand and proof it was sent (email sent folder, read receipt, registered post tracking)
- The contract, invoice, or agreement underlying the debt
- Any communications showing the debt was acknowledged
- Evidence of the loss (receipts, quotes for repairs, bank statements)
The bottom line
A letter of demand is not the end of the road — it is the beginning of the formal process. Most disputes resolve at this stage. For those that do not, Claim Done can prepare your tribunal application, statutory demand, or full case bundle. See all services.
Timeline: what to expect after sending a demand
| Day | What typically happens |
|---|---|
| Day 0 | Demand sent — other party receives email with PDF |
| Day 1–7 | Many respondents respond or pay in this window |
| Day 14 | Deadline expires — if unpaid, you can file a tribunal application |
| Day 14–21 | File your tribunal application if no response |
| Day 60–90 | Typical hearing date range after filing |
What if they acknowledge the debt but cannot pay immediately?
Consider accepting a payment plan — but only in writing. A signed letter confirming the agreed payment schedule creates a new enforceable contract. If they default on the plan, you can file immediately without sending a new demand.
What if they dispute the amount?
If they accept partial liability but dispute the full amount, consider whether the undisputed portion is worth settling for. If you believe the full amount is owed, proceed to tribunal — where a member will hear both sides and determine the correct amount.
Do I need a lawyer to go to tribunal?
No. Legal representation is either prohibited or requires leave of the tribunal in most Australian small claims divisions. Claim Done generates your complete tribunal application, witness statement and evidence bundle — everything you need to file and appear without a lawyer.