What happens if payment is still not received, despite sending the Letter of Final Notice?
After the Letter of Demand has been issued, and no satisfactory response is received, you can either:
- Invite the other party to attend mediation which is a way of settling a dispute without legal action. The Department of Justice and Attorney General provides a free mediation service through its Dispute Resolution Branch; or
- Make an Application directly to the Queensland Civil & Administrative Tribunal (known as QCAT) – a Minor Debt Claim.
QCAT can deal with debts of up to $25,000.00. If you require, Law Essentials can prepare the QCAT Minor Debt Form on your behalf for a fee of $350.00 plus GST.
- There are also filing fees to be paid with any application as set out below:
- For the relevant filing fee, visit the QCAT website at www.qcat.qld.gov.au
- To make an application in relation to a debt dispute complete and lodge Form 3 – Application for minor civil dispute – minor debt.
What happens next?
Once your application and forms have been received, QCAT will review the information you provided. QCAT will return to you copies of your application and forms which have been stamped with the QCAT seal.
You must then deliver (serve) a copy of the stamped documents to the other party. You may use the services of a Magistrates Court bailiff, commercial agent or process server to serve the documents on your behalf. You can find their contact details in the phone book.
Responding to the Application
On being served the stamped documents, the other party may file a response to the original application. In a response, the other party outlines facts which try to disprove the original claims. For example, you stated that “the contract is a written document dated 1 July 2008”, the other party may say “I deny that the contract was a written document dated 1 July 2008 because the copy of the contract is signed and dated 1 July 2007”.
The other party has 28 clear days in which to file a response from the time they are served. It is up to the other party to send you a copy of the sealed response after it is lodged at QCAT.
All parties will then receive a notice to attend mediation including the date, time and location of mediation. The aim of mediation is to get all parties to reach an agreement. If no agreement is reached at mediation, generally the matter will proceed to a hearing and a final decision will be made.
When no Response is Received
If the other party fails to lodge a response within 28 days of being served with the application, or they do not resolve the dispute to your satisfaction, QCAT can proceed with the application. You can apply to QCAT to make a decision by default by lodging Form 6 – Request for decision by default – minor civil dispute – minor debt.
A decision about your case will be made from the paperwork received and you will not be required to attend mediation.
Interest on a Debt
As part of its final decision QCAT may order a party to pay the other party interest on the debt. If interest is ordered, it will be:
- At the interest rate agreed upon in the original contract; or
- At a rate the tribunal considers appropriate. Practice Direction 5 – Interest on decision by default for certain minor civil disputes has set this rate as 10%
Any claim for interest must be included in the application to QCAT.
PLEASE NOTE – all QCAT forms and other procedural requirements can be located on the QCAT website at www.qcat.qld.gov.au