Debt recovery may involve a range of procedures from a simple procedure such as the writing of a letter of demand to the debtor, to a much more difficult process. Where a dispute has arisen between the creditors and the debtor, a simple letter of demand or initial attempts to resolve the issue may meet with a negative response and a civil action may need to be commenced in the appropriate court.

The initiating court proceedings must be ‘served’ on the defendant or defendants and a defence is then required to be filed within a stipulated time frame which is usually 28 days. If a defence is not filed within the stipulated time frame, a judgement by default may be entered. If the defence is filed, then further steps are taken in the processing of the claim such as the step of disclosure by each party, or where documents or evidence may be held by a person who or an institution which is not a party to the proceedings, then a notice of non-party disclosure may be served.

Sometimes a defendant can be too slow in filing the defence and he or she or the defendant company (what ever the case may be) may really have a good defence which is worth proceeding with. In such cases it may be possible to apply to the court and have the judgment set aside, but there is always the risk that the court may reject such application and much depends on the time delay in making the application and the circumstances.

Many disputes are resolved in an alternative dispute resolution process such as negotiation or mediation. There are other such processes such as case appraisal or arbitration. The courts encourage parties to try and resolve their dispute by such processes. Costs escalate greatly if the matter must proceed to a court hearing to be resolved.

If a judgment is obtained against a party then it can be enforced by a number of methods including an appointment of a receiver, the giving of a bankruptcy notice and bankruptcy proceedings, examination at an enforcement hearing, enforcement warrant which can entail seizure and sale of property, an enforcement warrant for redirection of debts, an enforcement warrant for redirection of earnings or an order for payment of the debt by instalments.

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