If someone owes me money – what steps can I take before court action?

If someone owes you money, there are several steps you can take to recover the monies  before you commence legal action. These actions include: 

  • Discussing the debt with the debtor  
  • Sending a letter of demand  
  • Applying to QCAT  

Legal action should not be the first option as other alternative recourse may prove cheaper and quicker for you.  

This article will provide an overview of the steps you can take in seeking money owed to you prior to any legal action.  

Pre-Court & Pre-Tribunal Options  

Option 1: Attempt to settle the dispute with the Debtor  

Discussing the outstanding amount with the debtor is a starting point in trying to obtain money owed to you. The debtor may not be able to pay the full outstanding payment and if you are able to organize a payment plan, this is a good alternative.   

This discussion can occur either via written correspondence or a face-to-face meeting.  

According to the Queensland guidelines on dealing with a debtor, if you are a business, reasonable contact includes:  

  • Up to 3 phone calls or written correspondence per week  
  • Face to face contact between 9:00AM-9:00PM on weekdays and weekends  
  • No contact on national public holidays  

Option 2: Send a letter of demand  

If discussions with the debtor have failed, the next option to consider is sending a letter of demand.  

In the letter, you can include:  

  • The amount initially loaned and the outstanding amount owed; 
  • The steps you’ve taken to recover the money;  
  • Details of when you would like the debt paid  
  • Future action you may have no option to take, should the outstanding amount .not be paid  

Option 3: Alternative Dispute Resolution  

If you have been unable to obtain the outstanding amount following discussions with the debtor, you may seek support through alternative dispute resolution.  

Through Dispute Resolution Centres, free mediation services are available. By inviting the debtor to attend mediation you may be able to settle the dispute without any legal proceedings.  

This method is encouraged by the courts and for more information, visit the Queensland Courts Website regarding Alternative Dispute Resolution.  

If the debt is $25,000 or less – Go to Queensland Civil and Administrative Tribunals  

If you have a minor debt disagreement or dispute and you are owed less than $25,000, your dispute can be heard by the Queensland Civil and Administrative Tribunal (QCAT).  

What is QCAT?  

QCAT is an independent tribunal that focuses on the efficient resolution of disputes on a range of matters.  

What happens at QCAT?  

QCAT proceedings normally involve the parties representing themselves to keep costs at a minimum. This process is similar to formal Court proceedings, however it is considerably cheaper and less than formal compared to court proceedings.  

What happens after lodgment at QCAT?  

Once you’ve lodged the application, you will need to serve it upon the debtor. Once the debtor has received your application, they will have 28 days to respond. 

If the debtor fails to respond within 28 days, you may be able to apply for a default decision. This type of decision is based  on the information you have provided to the tribunal.  

Alternatively, if payment is made within the 28 days, you will need to notify the tribunal of withdrawing your matter.   

Who can’t access QCAT to resolve a minor debt dispute? (1)  

There are instances where you won’t be able to access QCAT, this will include if:  

  • The outstanding debt owed is more than $25,000 
  • There was no previous agreement for the outstanding payment  
  • If no agreement about the amount was made beforehand relating to a trader or consumer, a contract for the supply of services and/or goods   

Additionally, other circumstances where a minor debt dispute cannot be heard include if the debt relates to:  

  • A motor vehicle defect repair  
  • Unpaid Wages that are included under the Fair Work Act  
  • Property damage caused by a motor vehicle  
  • Property damage from motor vehicle use  

Who can access QCAT?  

For a minor debt dispute the applicant can include:  

  • Individuals 
  • Entities (including businesses or corporations) 

What if the amount is below $1,500? 

If the amount is below $1,500 your case will be listed for hearing and bypass any mediation process. (Rule 77 QCAT Rules). 

What if the amount is below $3,000?  

If the monetary amount is more than $1,500, QCAT will firstly direct both parties to a mediation prior to any hearing. The intention of this conference, which is overseen by a QCAT Member, registrar or adjudicator (s 70 QCAT Act) is to ensure there is clarity around the issues of the dispute. There is also encouragement that at this compulsory conference, the claim can be settled .  

Legal Action – Queensland Courts 

If your payment is more than $25,000 you may seek to lodge an application at:  

  • Magistrates Court of Queensland – up to $150,000 
  • District Court of Queensland – up to $750,000 
  • Supreme Court of Queensland – more than $750,000 

Need Legal Assistance, we can help 

Here at Corney & Lind Lawyers, we are committed to care, attention and integrity. If you are owed money or need legal advice about being owed money, we can help.  

Contact our client engagement team today on (07) 3252 0011 or email enquiry@corneyandlind.com.au  


  1. Start an application for a minor debt dispute  

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