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Methods Of Recovering A Debt Part I

Australian businesses are more and more being seen to engage a collection agency to recover a debt once a client has missed several payments. To put an expert in their field on the job is a beneficial way to save the creditor from wasting precious resources. Securing debts is a process that takes manpower, time and effort. Effective debt collection agencies will stay in constant communication with the debtors and allow the creditor to focus on their own business. In addition, a professional debt collection agency offers legal protection throughout the process and is qualified to use advanced tools and legal strategies to collect the receivables. The purpose of this blog series is to guide you through methods of recovering a debt and furthermore give an insight into debt collection and its complex insolvency law and practice.

Contract Law

To recover a debt, the essential document is a valid contract entered into with the business and its client. A contract is a legal binding between two or more parties and only enforceable by law if it contains several elements:

  • an agreement has been reached between the parties
  • consideration has been given by at least one of the parties
  • the parties have legal capacity and intend the contract to be legally binding and
  • ‘formalities’ (written or oral form of the contract) are complied with

Construction contracts will normally set out the main payment parameters of:

  • the amount to be paid
  • whether there are progress payments and if so, how they are to be calculated (valuation of work done, reaching a pre-agreed stage, etc.)
  • who will determine the amount of the payment
  • when the payment should be made
  • whether retention money or other offsets can be withheld and
  • how disputes will be managed

An agreement that lacks one or more of the elements listed above is not a valid contract.

Security of payment Clause

The security of payment refers to a clause designed to ensure there will be no significant delay in payment from the principal contractor. Thus the head contractor may insist that the contract includes for the principal to provide security for his payment obligations. This clause is particularly used in contracts where the principal is not a substantial company. Security may be provided by way of cash; alternatives are frequently bank guarantees or insurance bonds.

Our next blog in this series will discuss further methods of recovering debt after exhausting the contractual arrangements.

If you would like to learn more about the debt collection services we offer, contact us now. We have over 30 years of experience providing professional and discreet debt collection solutions for clients of all sizes and across all industries. With debt collection agencies in Sydney, Melbourne and Brisbane we have you covered.


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  • I have worked closely with Boston Commercial Services for over twenty years across four different companies and would not work with anyone else in regards to helping me with my outstanding accounts. Whenever I have started a new role, the first thing I am asked is, “How would you go about cleaning up our accounts receivable ledger?” My answer is always the same – “The first thing we need to do is call Boston Commercial Services”.

    Voytek Bradford

    Freedom Foods Group Limited (National Credit Manager)

  • I have known the principal of the BOSTON Group (Derryn HARRISON) as well as key staff members (including Ben GOWER) for well over 2 decades and have been using their professional services for myself as well as for Powerhouse Logistics Pty. Ltd. on a regular basis, not only in Sydney but on a national basis.

    At all times BOSTON have been extremely pro-active, attentive, courteous and professional with all matters we threw at them. Their advice has always been extremely sound and commercial and I find them to be a "breath of fresh air" within the legal fraternity and have no hesitation whatsoever to highly recommend them.

    Peter Brueckner

    Powerhouse Logistics Pty Ltd (CEO)

  • Expect A Star has worked with The Boston Group for 10 years. In this time we have appreciated the ongoing support of Boston for all of our collection and legal requirements. Like most businesses cashflow is critical to ongoing success and growth, with Boston we have found a partner who are an extension of our business and play a key part in our cashflow management. The Boston Group bring a level of expertise to our business which is valuable and coupled with their excellent customer service we look forward to continuing to work with them for many years to come.

    Ryan Meldrum

    Former CEO

  • I have been using the services of The Boston Group and their legal entity for over 11 years. During this time I have found their service to be impeccable, delivered with the utmost professionalism and integrity. The vast majority of cases that I have placed with Boston were far from straightforward, requiring legal acumen and delicate handling. Having used all methods available without success to procure payment, I confidently placed these matters into their safe hands. In all instances a successful outcome was achieved.

    Mark Parish

    Credit Manager

  • SNP Security has had the pleasure of working with Boston Commercial Services for the past 11 years. Boston has played an integral part in the continuing success of SNP Security’s low DSO’s, 90 Day % Debt & of course Bad Debts Written Off.

    Amanda Griffiths

    National Administration Manager

Boston Commercial Services prides itself in offering specialised, professional services, through a highly experienced team of debt collector, with personalised client attention.