2024-02-09 19:00:00
The costs of collecting
The breach of contract or the absence thereof is already a cause for the creditor to have difficulties in collection, to which is added the cost of carrying out a judicial process, among others.
”To the costs of fees for legal advisors, of the conciliation center that will have to be resorted to before filing a legal claim, as well as the costs of time, especially relevant in a country that has an excessively slow administration of justice and with little predictability, are added those of a personal nature, that is, the emotional exhaustion that entering into litigation entails for any citizen,” comments Ricardo Mego, partner at MOAR Abogados, specialist in Civil Property Law.
Along the same lines, Carla Montes, civil and commercial lawyer at Estudio Linares, adds that the invoices issued “do not establish the conditions that benefit the creditor.”
Added to this is that the debtor is untraceable, that there is no possibility of communicating with him, or that they are reported to the National Superintendence of Tax Administration (Sunat) as missing; There are even those who are in the process of investigation.
Difficulties present in debt collection. Photo: Freepick
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Legal solutions to the difficulty of collecting a debt
Whether or not to take legal action once morest the debtor can be a difficult decision. Experts recommend that, if you choose to do so, you should identify if the debt is bad.
Carla Montes mentions what are the possible solutions if cases of bad debts arise:
- It is necessary to carry out an extrajudicial conciliation prior to the start of a judicial process. This will depend on the document that is collected and if there is a contract with the agreed conditions.
- If there is a contract involved, it can be seen that it establishes the dispute resolution clause, which mentions that any type of disagreement between the parties can be resolved before the Judiciary, but if it is established that the mechanism is through a arbitration will have to be resorted to.
- If they are invoices for collection, an extrajudicial stage would have to be exhausted by submitting a conciliation request.
Both parties should try to reconcile before starting a legal process. Photo: Freepick
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Recommendations to prevent bad debts
For his part, Ricardo Mego mentions what measures must be taken, prior to loaning money, to ensure that the other party can pay the amount in full.
- Reasonable efforts must be made to know the profile of the clients to whom credits will be granted to pay for the services. With this information, you will be in better conditions to decide the feasibility of executing services on credit and, if applicable, the conditions for granting credit.
- There must be contracts that clearly establish the rights and obligations of the parties, deadlines, form and method of payment, among other important provisions. An alternative for suppliers who work through service orders or quotes is to accompany a section of general terms and conditions, with essential legal terms, which must be accepted by their clients at the time of contracting the service.
- In the case of credit services for significant amounts, it is recommended that clients represent outstanding installments in securities such as bills or promissory notes. In the event of non-compliance, these may be executed in judicial processes that are more expeditious than the long knowledge processes that must be initiated, if there are no executive titles involved.
Mariela CCencho, corporate lawyer at TPC Group, recommends that, regarding commercial issues of a company or an individual, both parties should “sign guarantees, bills of exchange. It is not enough that the person as a legal entity is obliged to pay the debt, but it is recommended that there be a guarantee. If the company cannot meet the debt, this person will assume it.”
A contract must be made with clauses to ensure payment of the loan. Photo: Freepick
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Negative impact on the debtor
Ricardo Mego reports that “a defaulting debtor might face precautionary measures such as preventive seizure of assets, bank accounts, seizure in the form of registration, among others, which seek to ensure the effectiveness of a future judgment. These measures can have serious effects on the already scarce liquidity.”
With this, the debtor company would already have a bad work reputation and a bad credit history because, generally, the companies that are owed immediately make the risk report and the debtor company already has a red history in the risk centers. .
“Other companies will not want to contract with debtor companies and if they have a lot of debt, they will go bankrupt and disappear from the market. Precisely, due to a bad decision, these situations are reached,” adds CCencho.
In this framework, a creditor who meets the requirements required by law can request Indecopi to declare the debtor insolvent or initiate bankruptcy proceedings.
In this case, the debtor will lose control of the company, which will pass into the hands of a meeting of creditors, which will finally decide what to do with the assets of the insolvent debtor in order to request the collection of outstanding debts, concludes Ricardo Mego. .
The debtor’s property might be seized if he does not repay the loan he requested. Photo: Freepick
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