Letters of Demand (Civil Litigation Practice Series)
Published on 26th April, 2018 by Mark Lee
Letters of Demand
What is a Letter of Demand?
Formal claim against an opposing party
Prior to commencing a Court action, one should consider first issuing a Letter of Demand (“LOD”) against the relevant opposing party.
A LOD is essentially an expression of the claimant’s intention to commence Court proceedings should the claimant’s claim(s) / demand(s) continue to go unanswered.
Simply, a LOD, amongst other functions, serves as a final “warning shot” to the opposing party to take the dispute seriously. This is particularly the case when the LOD is formally issued by a law firm on its letterhead.
Why bother issuing a Letter of Demand?
A LOD does not have the force of a Judgment / Court Order and the opposing party may simply choose to ignore the same. So why bother issuing a LOD at all?
For starters, it is not uncommon for the opposing party to comply with the claimant’s demand(s) after receiving a LOD. Even if the opposing party is not prepared to comply immediately, a LOD at least opens the possibility for negotiations to take place.
Ultimately, parties will benefit from greater costs savings if they can resolve their dispute without resorting to Court proceedings.
In any event, a LOD is important as a matter of record. If anything, it allows one to put forth his/her position in writing and expressly reserve their rights to make known that he/she is not waiving his/her rights by keeping silent.
Letters of Demand – Contents
A LOD is not a formal Court document and therefore has no prescribed / fixed form. The contents of a LOD depends largely on the dispute in question and the claimant’s claim(s) / demand(s).
These are but some of the typical features to note in a LOD (including but not limited to):-
(a) Cause(s) of action;
A LOD should contain sufficient details to explain the basis of the claimant’s claim (e.g. a breach of contract, negligence, debt owing, etc). Though, a LOD need not contain all of the claimant’s evidence.
(b) Demands clearly stated;
To state the obvious, a claimant should indicate clearly the relief/remedy that he/she is seeking. Where possible, it would be beneficial to seek legal advice as what remedies are permissible under the law. For instance, for a tenant’s breach of a tenancy agreement, a landlord has a variety of remedies to choose from but may not enforce certain remedies conjunctively.
(c) A clear deadline;
A LOD should not be open-ended. A clear deadline should be stipulated for the opposing party to comply with the claimant’s claim(s) / demand(s) (e.g. to comply within seven (7) days from the date of the LOD). Failing which, the claimant will consider commencing Court proceedings.
(d) Settlement negotiations;
Where there are settlement negotiations, such correspondence between parties should be marked “Without Prejudice”. Correspondence marked as such cannot eventually be disclosed in Court should settlement talks ultimately fall through.
What should I do when I receive a Letter of Demand?
Once in receipt of a LOD, it is always advisable to consult a lawyer on the contents therein and what would be an appropriate response.
Should there be a delay to your receiving the LOD, you may reply to the same to seek an extension of time to consider the contents of the letter and provide a fuller response at a later date.
In any event, a LOD should not be ignored and left unaddressed. Should you disagree with the allegations made against you, you should state your disagreement in writing for the record.
Any silence / inaction on your part may be construed adversely against you when (and if) formal Court proceedings are commenced.
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