Home » What is a Letter of Demand?

Resolving Debts and Disputes

As a business owner, sometimes it is essential to establish and maintain strong relationships with other businesses to succeed. However, when faced with problems like unpaid invoices, contract breaches, or other disputes, it becomes necessary to take action to protect your interests. One effective way to do this is by sending a letter of demand.

This article will explain a letter of demand, how it is used, the benefits of sending one, and possible limitations.

What is a letter of demand?

A letter of demand is a crucial legal document that serves as a formal, written notice to a debtor or a party involved in a dispute. It outlines the nature of the debt or dispute and demands specific action from the recipient. It is a clear and decisive way to resolve issues outside of court and help avoid costly legal proceedings.

When drafting a letter of demand, it is essential to ensure that all the necessary information is included and that the tone is firm but professional. It should clearly state the facts and provide evidence to support the claim.


When does it make sense?

With a well-crafted letter of demand, it can address various situations.

Let’s explore the different scenarios where a letter of demand is typically used:


  • Unpaid invoices: Repeated attempts to collect have yet to yield results. A letter of demand puts the debtor on notice and sets a concrete timeline for payment.
  • Contract breaches: When a party fails to deliver on their agreed-upon obligations, a demand letter clearly outlines the breach and requests rectification.
  • Intellectual property infringement: Someone using your trademark or copyright? A demand letter can halt the infringement and potentially seek compensation.
  • Property damage: Tenants causing unexpected damage? A demand letter clarifies the necessary repairs and requests reimbursement.
  • Consumer fraud: Deceptive business practices impacting you? A demand letter requests compensation and potentially corrective action.


Why consider a letter of demand?

In case of a dispute, weighing the available options for resolution is crucial. At the same time, litigation may seem like the obvious choice, but sending a letter of demand could be more efficient and cost-effective as a first step.

Here are some of the advantages of using a letter of demand:

  • Cost-effective resolution: Legal fees and court costs can be substantial. A letter of demand offers a less expensive alternative to resolve the issue swiftly.
  • Stronger legal position: A well-drafted demand letter can strengthen your case if litigation becomes necessary, as it is evidence of an attempt to settle early without the need for court intervention.
  • Preserved relationships: Demonstrating your willingness to negotiate outside of court can potentially salvage the relationship with the other party.
  • Quicker resolution: Compared to the often lengthy court process, a demand letter can lead to a faster resolution, saving you time and stress.


Our Litigation Team

Our team of litigators have experience in Commercial Law, Employment Law and Criminal Law. This integrated understanding of legal transactions and the agreements in these areas provides well-rounded knowledge to advise you better.

Whether you are an individual or a company director, we have experience representing all parties in legal disputes. Our solicitors have appeared in several courts across Queensland, acquiring extensive experience in advocating for our clients.


Greenhalgh Pickard: Your Guiding Hand

Our commercial litigation solicitors are experienced in crafting impactful letters of demand, ensuring your message is clear, persuasive, and legally sound.


Contact Greenhalgh Pickard now for help with navigating turbulent times for your business.



The information contained in this article is for general informational purposes only and is not intended to provide legal advice or substitute for the advice of a professional. This information does not consider your personal circumstances and may not reflect the most current legal developments. Should you need advice, please contact our firm for targeted information relating to personal your situation.