A Demand Letter from an attorney is an official notice issued by an Attorney on behalf of their clients, to have something returned, paid, or for a request of action. Demand letters are often the antecedent of filing a lawsuit. However, they can also be a useful tool in resolving disputes out of court.
What’s the Purpose of a Demand Letter?
The sole purpose of a demand letter is to give the recipient formal notice that you are considering legal actions against them if they do not comply with your request. Some of the reasons why you should have a demand letter sent including but not limited to:
- Expressing an intent to sue
- Negotiating, bargaining or forcing compliance
- When you want the other Party to Desist from doing something
- When the other Party is in breach of an agreement
- Landlord/Tenant issues
- When having a Personal Injury case
- Wrongful termination
- Medical malpractice
- Client defamation
- Collection efforts
What Makes a Demand Letter Effective?
An effective demand letter comprises the facts, demands, and consequences. It must also be signed and sealed by a licensed attorney. Consequently, a demand letter must elicit emotions and must be professionally drafted. It must also inform the recipient that you are willing to act should they fail to comply with your request.
What is Contained in a Demand Letter?
A demand letter consists of the following:
- A brief review of the history of the relationship
- Explanation of the problem and alleged damaged
- Discussion of prior attempts for restitution
- An official demand for restitution and the timing of that restitution
- What your next steps are should they fail to respond to your letter
The demand letter from an accident or injury might have some different components like:
- Description of the incident or accident
- Discussion of any personal injuries
- Discussion of the accident liability
- Description of medical treatments
- List of medical bills and any lost income
- Your injury settlement demand
- The next step you shall take if the recipient fails to heed to your demand.
What if the Attorney is Not in My Area?
It does not matter if the Attorney is not in your area. As long as the letter is drafted and sealed correctly, the recipient, upon receiving the letter, they shall be bound to respond to the claims to avoid any legal battles. The location of the Attorney makes no difference in the outcome of your case since the client, in most cases, will act to avoid escalation of the matter, as indicated in the letter.
Does it Matter if I Send it to the Recipient or their Attorney?
Does it matter? Absolutely. When sending the letter to an individual, the letter may eventually make it to their Attorney; on the other hand, when you send the letter to an attorney, you are guaranteed that they will read it.
Why You Should Write a Demand Letter With Your Attorney
Even though you can write a demand letter on your own, there are benefits of having an Attorney write for you. A demand letter serves as evidence in a court of law if the recipient fails to heed to your request. Therefore having an attorney draft, the letter will most definitely give you some advantage over the case. The benefits include:
- The legal Letterhead: No one likes legal battles. Neither you nor your debtor would want to engage in one. By having your letter on the law firm’s letterhead, you are making clear your connection with an attorney from the very beginning. Your debtor will most certainly take this seriously, as this shows a clear intent to sue if the notice is ignored. This will, in most instances, inspire or frighten them into having the debt settled to avoid entering a courtroom.
- Can Result in Payment: The ultimate goal of sending a demand letter is to get the situation resolved as soon as possible. A demand letter written by an attorney shows your debtor that you are serious about getting compensated. Your Attorney adds a reference to some laws and contractual obligations that were not upheld, thereby increasing your chances of getting paid.
- Saves Time and Costs: If you have tried to reach out in person or over the phone to your debtor, the situation can escalate, and you may find yourself in an argument that may have otherwise been avoided by simply writing a demand letter. Having your attorney draft letter shows that you are taking the matter seriously and that you are prepared to engage in a legal battle. Your Attorney will use courtesy and professionalism, which comes in handy when presenting your letter.
- Precise and Intentional Wording: Most disputes are usually resolved at the demand letter stage without any further necessary action. By writing a demand letter, you are officially informing your debtor of your grievance, legitimate claim to payment, and intention to be paid through legal actions if necessary.
- A sign of good faith: Writing a demand letter shows your willingness to have the issue resolved. The court will, in most instances, though not mandatory, require that you first send a demand letter to your debtor before opening a case against them. Sending a letter by a certified mail and or any other means available at your disposal proves that you made an effort to have the issue resolved before taking legal action.
What Should You Do If You Receive a Demand Letter?
After receiving a demand letter, you have the following options:
- Agree to resolve the matter and put an end to the dispute.
- Present them with a counter offer.
- Contact the person or their lawyer to let them know that you refuse to do what they are asking for and explain your reasons.
- The most effective way is to contact your attorney to advise you accordingly.
Consider the Following Before Answering a Demand Letter
- You should check to see if the claim is well-founded: Does the person have the right to make the demands they are making?
- You can seek legal advice or refer to legal articles to find out legal rules that apply to your situation.
- Amount of the claim: if you are sure of debt you owe the other Party, make sure to check at the amount of demand to make sure it is what you owe them
Reasons Why You Should Never Ignore a Demand Letter From an Attorney?
- It will be used against you in court
If you fail to comply with the demands stipulated in the letter, the dispute is more likely to be taken to the court where the demand letter will end up being used as an exhibit to the court and jury in subsequent litigation. Before responding to a demand letter, it is advisable to consult with your attorney to carefully analyze whether the demand has merit and provide a carefully considered response to the letter.
- An attorney may be able to negotiate a settlement lower than the claimed amount
Having an attorney send your demand letter can be quite beneficial. The attorney, having vast knowledge in the rule of law, can negotiate a settlement of the Party’s demand, by either obtaining some valuable concessions or by settling the debt for a reduced amount.
- You could end up paying more than the claimed amount
Failing to reply to a demand letter from an attorney may result in additional remedies such as foreclosure or eviction in situations involving a mortgage or lease. Consequently, it may also lead to individual liability for any potential guarantors of the debt.