How to avoid debt disputes

One way is to document the arrangement properly from the outset.

Businesses providing goods on credit should ensure they obtain details of the customer by implementing an application for credit with the suppliers terms and conditions of supply. This could also include a directors or personal guarantee to secure the customer’s obligations.

We routinely receive debt recovery enquiries where it is unclear who the contracting parties were. If steps were taken early to collect the customer’s details and document it, this could prevent big headaches down the track.

You could go one step further as a supplier and obtain a credit report of the company to ensure its credit score is satisfactory and it’s not a high risk customer and doesn’t have any negative listings on its credit report.

Implementing sensible trading terms and an internal accounts collection policy will also reduce the likelihood of recalcitrant debtors.

If you need some advice about setting up reliable collection policies, please give us a call.

Kollrepp Law is here to help