You need something to change: an unpaid amount settled, work completed, or another business obligation met. You may want to preserve the relationship, or bring it to an agreed end.
Before you send a commercial letter of demand, get clear on the outcome you want and the basis for asking for it. The letter can put your position and requested action in writing. It cannot guarantee payment, compliance or a response.
Decide what a useful outcome looks like for you.
What do you want the other business to do? Identify the payment, outstanding work or other action you are seeking, and explain whether the relationship should continue.
You do not need to draft the legal letter before seeking advice. A short outline of what happened, what you want and any deadline gives the discussion a starting point.
For unpaid invoices, the Australian Government’s letter-of-demand guidance recommends checking the facts and considering the consequences before escalating. A different commercial obligation needs its own assessment.
Understand what supports your position.
Identify who entered the arrangement and who owes the obligation. A brand, contact person and contracting company may be different.
Gather the agreement, variations and relevant correspondence. Ask how any notice or dispute-resolution provisions affect your next step. Sending a demand should not be assumed to terminate the agreement or satisfy every contractual notice requirement.
If the other party disagrees, explain their position as well as yours. Complaints about quality, delay, missing work or a competing claim can affect whether a demand is appropriate and how it should be expressed.
Decide what you are prepared to do next.
You may receive payment, a refusal, a request for more information, a proposal to negotiate, or no response. Legal Aid NSW describes possible responses to a payment demand.
Choose a response period that suits the matter, taking existing deadlines into account. Ask what basis supports any interest or legal costs you want to claim. Neither a copied deadline nor an added amount becomes appropriate simply because it appears in a template.
Avoid threatening action just to sound stronger. Decide what you would actually consider if the demand is not met. Keep the final letter and delivery records; Legal Aid NSW explains why legal correspondence and its wording can matter later.
Payment and an agreed end to the relationship.
In a matter we handled, a disputed commercial claim was paid and the underlying supply relationship brought to an agreed end.
Choose the help you need for this step.
You can enquire about commercial letter preparation and advice before deciding to engage us. Your quote identifies the records to be reviewed, letter work, whether dispatch is included and any follow-up advice.
Ongoing collection, court proceedings, statutory demands, insolvency action and enforcement are outside this service. Disputed matters need assessment before an engagement is agreed.
Start with what happened, what you want the other party to do, whether they dispute your position and any deadline. Leave confidential documents and sensitive details out of the initial form.