SBR NZ Case Study: Debtor Not Following Tribunal Payment Plan

A company contacted Slater Byrne to collect a debt from a chainsaws and mowers company. Our client initially filed the claim with the Disputes Tribunal, which issued an order in her favour. The Tribunal also directed the other party to pay $400 per month. The problem, in this case, was, the debtor did not follow the Disputes Tribunal order and never paid up.

What happens when a debtor does not follow the payment plan in a Disputes Tribunal order

The Disputes Tribunal is an informal solution for small claims. Small claims are claims of up to $30,000. Our client’s debt was for less than $5,000. This is to enable the claimants to recover the small amounts easily without incurring too much cost. Both the claimant and the respondent will speak for themselves without the presence of lawyers.

In the Disputes Tribunal, there is no judge. However, there will be a legally qualified referee who decides whether it is appropriate for the parties to settle. Parties who avail of the Disputes Tribunal route prefer a settlement outcome. But there will be instances when the parties cannot come to an agreement. In this situation, the Disputes Tribunal will make its own decision. It is up to the parties to follow the order.

The deadline in the decision has passed and the debtor has not paid even one cent. What happens now? Our client can go to court to enforce the order. Or, our client can hire a lawyer to draft a formal letter to have the decision followed. Either way, our client will be spending more time and money than what she was owed. Good thing, our client chose to contact Slater Byrne’s Auckland debt collection office. The client then tapped us to pursue the debt for her.

There are many reasons why debts go unpaid even when the payment is mandated by a legally binding order. So, we approached the creditor through numerous discussions, which oftentimes erupted to invalid disputes. In the end, after a little push from our accounts manager, the debtor paid up in full. Our client was happy to have recovered what was indicated in the Disputes Tribunal order.

The main lesson here is that – there are many ways to recover a debt. But there needs to be a more forceful, not to mention, experienced, follow through. This applies even when there is already a legally binding order. Slater Byrne does the follow through for our clients. Because there is no assurance that the other party will do his part of the bargain.

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