Have you ever encountered the situation whereby your company has issued invoices to your clients and your clients did not want to make the payment. Though numerous reminders are given, the clients still refused to make payment as if they have deaf ears.

What you should do?

First, go to law firm and ask the law firm to issue notice of demand whereby in the said notice itself, mentioning that the debtor should make payment and failing to comply with instruction in the said letter, the creditor is free to take any legal action.

Second, file a suit in Court. This is very crucial as a lot of client came to us they want to claim back the money and at the same time they do not want to sue as they worry that they might lose the said client in future. Bear in mind that, in business, cash flow is very important if keep possessing that kind of mindset, the creditor company most properly will be wound up soon than the debtor. Once file in the suit in Court, automatically, the said debtor CTOS/RAMCI system will be alerted and they said debtor company will have problems in taking loan from banks. Investors who want to cooperate with the said debtor might also will think twice before doing the same. Normally, come this stage, the debtor will try to settle the case with the creditor and therefore creditor can claim back their debts.

In the event, creditor successfully sue the debtor and manage to get the judgment from the Court and the said debtor refused to comply with court judgment, the creditor has plenty ways to execute the said judgment inclusive but not limited to garnishee proceeding, judgment debtor summon (put the debtor to jail in the event the debtor cannot make payment), bankruptcy (in case of individual), winding up (in case of company) and so on.

BY Lawyer Khoo

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