Business Debt Recovery Free Letter Before Action Template

LBA TEMPLATE

A Customer

100 Specimen Road

Town

County Postcode                                                                                  by email & post

Date

Dear Sirs,

Re: Outstanding Monies due to Creditor: Amount - £5,000

Our Ref: Insert here Date of Invoice

Customer Ref: Any PO or Order Number PO 11111  

We are writing to you concerning the monies outstanding on Invoice number 999999 dated 01/01/2000 for the amount of £0,000.00 for the agreed contracted works. We have previously provided you with the relevant invoices and statements. Any request for a further copy invoices, or other documents relating to these outstanding monies, should be made by return.

We refer you to the Practice Direction (Pre-Action Protocols) in particular paragraph 15 and the sanctions for non compliance. You can find these on the Ministry of Justice website at: http://www.justice.gov.uk/courts/procedure-rules/civil/rules/pd_pre-action_conduct

Unless payment of this sum is received within 7 days of the date of this letter, further action may be taken that includes referring this matter to a debt recovery agency and/or court proceedings, which will be enacted against you without further notice.

Any further action will include all applicable fees due under the law on late payments as well as  claim for interest from the due date of the invoices, court fees and recovery costs. Where appropriate, interest, compensation and further costs under the Late Payment of Commercial Debts (Interest) Act 1998 will be claimed. Any further invoices which become due will be included in the claim.

If a Judgment is subsequently registered against you it is likely to affect your credit rating.

We look forward to your prompt response.

Yours faithfully

Company Name

NOTES

Under the new CPR you must give 30 days to a sole trader, partnership or legal entity that is not a Limited Company. Please call us for further information.

1. The telephone is your best source. Always use it to check the address you put on  a letter
2. Always ensure you have the correct address so the customer cannot argue they did not receive the letter.
3. Send the letter by both email and post and put that on the letter. Follow up with the telephone to ensure they have received the letter.
4. Letter sent to registered offices often do not get to accounts payable.
5. Always send LBA letter and email to a named person using FAO named person.
6. Make sure the reference provided is correct as a clerical error at the customers end (or your end) may be the issue.
7. If there is a specific reference the customer uses or purchase or order number that would identify the debt within their system, ensure you quote this at all times. (this should be set out in the contractual agreement between you and the company, but often is not).
8. Ensure you are aligned on payment terms and that you are not working to 14 days and them to 60 days.
9. Always specify the amount outstanding against your invoice number.
10. Make the customer aware of the relevant procedure you have in place in the event there is a dispute to the debt. (disputes often arise only when monies are being chased).
11. Always specify the date you require payment by and the consequences of failing to pay.
12. Set out the daily interest charges under the Late Payment of Commercial Debts (Interest) Act 1998 (currently 8% above BOE base rate; for £5,000 it is £1.13p per day).
13. The Late Payment of Commercial Debts (Interest) Act 1998 will not apply to an individual, but does to sole traders and all other types of companies.
14. . If you are not sure, please feel free to check with AVC Debt Recovery.

NEXT STEPS

If you do not receive any response to the LBA or you do not agree with the response you receive, court proceedings can be issued or alternative steps can be taken to collect the debt.

If the free LBA fails 

Call AVC Debt Recovery on 0333 121 0161  or use our

contact form