Someone Owes You Money

Suppose you loaned someone an amount of money. They promised to pay the debt within three months. But they did not pay the debt.

You want your money. What can you do?

This section looks at what you can do to collect on a debt.

How do I write a demand letter?

You can write a demand letter, which is a letter that says how much the person owes you and tells them they must pay you. For example, a demand letter about a loan can say something like this:

I am writing about a loan I made you of ______________(amount) on ______________(date of loan) for ______________(purpose of loan). Our agreement was that you would pay this loan in full by ______________(date of repayment). To date, you have not made any payments. It has now been ______________ (number of days) since the loan was due. The full amount of ______________(amount) is now due. If I do not receive payment in full by ______________(give a date), I will take legal action to recover the amount of the loan, as well as interest, filing fees, and any other costs. If you have any questions, please feel free to contact me at______________ (your phone number).

You can write a demand letter yourself or you can ask a lawyer to write it for you. A demand letter sent on the lawyer’s letterhead is often very effective. If a demand letter does not work, you may need to go to court.

When do I go to court?

You can go to Small Claims Court if the debt someone owes you is for $25,000 or less. If the debtor owes you more than the $25,000 limit, for example $28,000, you can make a claim for $25,000 plus some contribution for your expenses.

Small Claims Court is for people who do not have a lawyer. There are Small Claims Courts located throughout the province. To find out how to make a claim in Small Claims Court, go to Clicklaw, online at www.clicklaw.bc.ca. Type "Small Claims" in the search box. The site links you to a video about Small Claims Court, available in Chinese, Punjabi, Vietnamese, and English, among other resources.

To collect more than $25,000, you have to go to BC’s Supreme Court. This is much more complicated and expensive than Small Claims Court. To find out how to make a claim in Supreme Court, go to www.clicklaw.bc.ca and type "Supreme Court" in the search box. If you are in the Lower Mainland, you may wish to visit the Vancouver Justice Access Centre where staff can give you information about bringing a claim in Supreme Court.

Getting legal help from a lawyer

If you want to go to court, it would be a good idea to talk to a lawyer. Here are two places to contact for help:

• Lawyer Referral Service is a program where you can get advice and information from a lawyer for a fee of $25 plus taxes for the first 30 minutes.To contact Lawyer Referral, call 604-687-3221 in Greater Vancouver or toll-free at 1-800-663-1919 from anywhere else in the province. More detailed information about the service is available on the Clicklaw HelpMap.

• Access Pro Bono is a program for people who cannot afford a lawyer and who cannot get legal aid. Access Pro Bono offers clinics across BC where experienced lawyers volunteer to provide free legal advice. Call 604-878-7400 in Greater Vancouver or toll-free at 1-877-762-6664 from anywhere else in the province. More information is available on their website at www.accessprobono.ca or the Clicklaw HelpMap.

When should I speak to the lawyer?

Do not wait until the day before trial before you start asking a lawyer about what to do in court. There are limits on the time you have to collect the debt through the court.

How should I prepare for meeting with a lawyer?

Gather all the relevant facts and documents before you meet with the lawyer. You want to get the most out of your interview. Be ready to tell the lawyer the answers to these questions:

• How did the debt come about?
• What documents do you have that support your claim?
• How much are you owed?
• What is the repayment plan?
• What information do you have about the ability of the debtor to pay?

How do I collect my money if the judge decides in my favour?

If the judge rules in your favour, the debtor is expected to pay up. But sometimes the debtor just ignores the judge. In this case, you may have to go back to court and ask the judge to force the debtor to pay the debt. For example, the judge can:

• take money from the debtor’s wages,
• have a court official seize the debtor’s property, or
• make the debtor come to court to explain why he or she has not paid the debt.

Never try to take property or threaten a debtor. This is against the law.

Additional resources

To find out more about debt collection law, visit Consumer Protection BC's Debt website.

This information applies to British Columbia, Canada. Last reviewed for legal accuracy by People's Law School, 2013.

Consumer Law Wikibook © People's Law School is, except for the images, licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International Licence.

A sum of money or an obligation owed by one person to another. A "debtor" is a person responsible for paying a debt; a "creditor" is the person to whom the debt is owed.

A letter describing a legal claim sent to the person against whom the claim might be made, offering to settle the claim without the necessity of legal action on terms set out in the letter. Demand letters are usually issued before court proceedings are commenced to try to settle a potential claim without the need for litigation.

A court proceeding in which one party sues another for a specific remedy or relief, also called a "lawsuit" or a "case." An action for divorce, for example, is a court proceeding in which the claimant sues the respondent for the relief of a divorce order.

In law, a calculation of the allowable legal expenses of a party to a court proceeding, as determined by the Supreme Court Family Rules. The party who is most successful in a court proceeding is usually awarded their "costs" of the proceeding. See "account," "bill of costs," "Certificate of Costs or Expenses" and "lawyer's fees."

A person licensed to practice law in a particular jurisdiction by that jurisdiction's law society. See "barrister and solicitor."

(1) The assertion of a legal right to an order or to a thing; (2) the remedy or relief sought by a party to a court proceeding.

Normally referred to as the "Supreme Court of British Columbia," this court hears most of the trials in this province. The Supreme Court is a court of inherent jurisdiction and has no limits on the sorts of claims it can hear or on the sorts of orders it can make. Decisions of the Provincial Court are appealed to the Supreme Court; decisions of the Supreme Court are appealed to the Court of Appeal. See "Court of Appeal," "jurisdiction," "Provincial Court" and "Supreme Court of Canada."

The testing of the claims in a court proceeding at a formal hearing before a judge with the jurisdiction to hear the proceeding. The parties present their evidence and arguments to the judge, who then makes a decision resolving the parties' claims against one another that is final and binding on the parties unless successfully appealed. See "action," "appeal," "argument," "claim," "evidence" and "jurisdiction."

A person appointed by the federal or provincial government to manage and decide court proceedings in an impartial manner, independent of influence by the parties, the government, or agents of the government. The decisions of a judge are binding upon the parties to the proceeding, subject to appeal.

Something which can be owned. See "chattels" and "real property."