The current unusual times and their harmful impact on the economy will undoubtedly bring reduction of debtors´ payment behaviour and unpaid invoices will cumulate. If informal reminders do not work, or the debtors do not pay their liabilities actively, the claim must be often brought to justice.
In this context, it must not be forgotten that before the action has been brought, the debtor must be called by a final demand for payment which must comply with both statutory and judicial requirements. You may find here an inspiration on how such demand should look like.
Dear Sirs, Madam,
I am referring to the Contract No. XXXX of DD.MM.YYYY, concluded between our company as the Seller and your company as the Buyer. Under the Contract, our company provided you with XYZ and your company committed to pay the purchase price amounting to CZK XXXX.
I must inform you that to date and after repeated calls, the amount of CZK XXXX, maturity date DD.MM.YYYY, invoice No. XXX of DD.MM.YYYY, has not been paid.
This is the final demand for the payment of the above mentioned Claim, without delay, and no later than seven (7) days from the day of dispatch of this demand, to the bank account of our company XXXXXXX, held at XXXX, a.s., using Reference No. XXXXXX.
Together with the Claim, please pay, under Section 1970 of the Civil Code, default interest at the required legal rate of 10% p.a. from the day following the maturity of the Claim, therefore from DD.MM.YYYY until the complete payment of the Claim.
In relation with the Claim recovery related to the final demand for payment of the debt within the meaning of Section 142a, Paragraph 1 of the Code of Civil Procedure, we also inform you that we are entitled to the payment of the lump-sum amounting to CZK 1,200 to reimburse the expenses connected with the enforcement of the Claim, in accordance with the Section 3 of the Decree-Law No. 351/2013 Coll., and we ask you to pay the sum within the above mentioned period, through the above mentioned payment data.
Finally, I would like to inform you that if the Claim is not fully settled, including the above specified extras, within the mentioned period, we may be forced to demand the Claim recovery before the court. As a result of the judicial recovery, the Claim shall be increased of the sum spent on the proceedings, which you will be obliged to pay to our company. The costs of the proceedings will be decided by the court.
Nevertheless, I do believe you will settle the situation by immediate and full payment of the Claim including extras; otherwise we will be forced to follow the above mentioned procedures.
Yours faithfully, XYZ
In case you decide to send the final demand, you are obliged to send it to the last known address of the debtor. In the case of natural persons not entrepreneurs, use the address from the contractual documentation with the debtor and contact address the debtor gave you. In the case of entrepreneurs (physical persons and companies) always check the Trade Register, resp. the Business Register, if there was no change of the debtor´s address in the meantime. If a change occurred, use the current registered address, unless you agreed otherwise with the debtor in the contract.
You will have to prove sending the final demand at the court so use the registered letter with the postal receipt. It is not necessary to demonstrate the delivery, you do not have to send the demand with the receipt of delivery, which is more expansive. You may reduce the costs of recovery especially in the case of larger amount of claims.
Do you use a data box? If your debtor has one too, find if he authorized to receive data messages from private persons. If so, do not hesitate to send him a final demand to his data box. It is cheaper than physical forms, you automatically receive a receipt and the debtor cannot make excuses about the wrong address.
If you forgot to send the final demand before bringing the proceedings, it does not mean the court will dismiss your proceedings, but the Court will not award you the costs before the court, not only costs of the lawyer, but also paid judicial fee. Since the fee is at least 4% from the defendant principal, it may be a significant loss in the case of high claims.
The courts repeatedly decided that in the final demand it is necessary to draw attention to possible judicial recovery of the claim, and also origin of the right to costs in the case of litigation. This means the final demand is qualified by the law, compared to a regular reminder, and it should inform the debtor about all main consequences which may happen if he does not settle the debt out of court. It may appear as a formality, but do not underestimate the necessity of such instructions put into the final demand. Otherwise, there is a risk that your final demand looks like a regular reminder, and in that case the costs will not be granted.
Even when the final demand may look like a template-like task, many things in the demand may be changed on a case-by-case basis. Sometimes the claim goes with the contractual fine or other fees which have to be quantified, or instead of interest for delay in payment at the statutory rate, it is necessary to use the interest for delay payment contractually agreed, which is often higher. There are other possibilities when recovering entrepreneurs’ debts, other when recovering consumer´s debts. It is necessary to remember when you sue the amounts which payment you did not ask for in the final demand sent to the debtor, there may be a problem when awarding recovery of the costs.
Thus, in case that your customer or other contracting party owes you money, we suggest using the professional services of a lawyer, as we regularly succeed in recovering the claims not only from the business relations.
The final demand from a lawyer is usually stronger than the demand sent directly by an entrepreneur.
