When it comes to collecting unpaid bills for food products in Canada-US trade, having an effective recovery system in place is crucial. This article focuses on the Recovery System for Unpaid Bills, outlining the Initial Recovery Phase, Legal Action Recommendation, and Collection Rates and Fees. Here are the key takeaways from the recovery process:
Key Takeaways
- Thorough investigation is essential before recommending closure of a case.
- Decision to proceed with legal action involves upfront legal costs.
- Competitive collection rates are tailored based on the number and age of claims submitted.
- Phase One includes sending letters, skip-tracing, and daily contact attempts with debtors.
- Phase Two involves drafting demand letters and contacting debtors via phone calls.
Recovery System for Unpaid Bills
Initial Recovery Phase
The Initial Recovery Phase is a critical step in the pursuit of unpaid bills for food products in the Canada-US trade. Within 24 hours of account placement, a multi-faceted approach is initiated:
- A series of four letters dispatched via US Mail to the debtor.
- Comprehensive skip-tracing and investigation to secure optimal financial and contact data.
- Persistent contact attempts by our collectors through phone, email, text, and fax.
Daily contact attempts continue for the first 30 to 60 days, aiming to secure a resolution. Failure to reconcile the account propels the process into the subsequent phase, involving legal representation within the debtor’s jurisdiction.
The effectiveness of this phase hinges on the diligence and precision of the recovery team’s actions. It sets the tone for the entire recovery process, ensuring that all avenues are explored before escalating to more stringent measures.
Legal Action Recommendation
When the initial recovery efforts fail to yield results, a pivot to legal action may be necessary. Careful assessment of the debtor’s assets and the case facts is crucial before proceeding. If the likelihood of recovery is low, case closure is advised, incurring no cost to you. Conversely, choosing litigation requires upfront payment for legal expenses, typically between $600 to $700.
Litigation is a decisive step, and upon your commitment, our affiliated attorney will initiate a lawsuit for the full amount owed, including filing costs. Should the legal route not lead to recovery, the case will be closed without further charges.
The decision to litigate is significant and should be weighed against the potential costs and benefits.
Our fee structure is transparent and competitive, with rates varying based on the age of the account, the amount owed, and the number of claims. Here’s a quick overview:
- For 1-9 claims, rates range from 30% to 50% of the amount collected.
- For 10 or more claims, rates decrease slightly, with a minimum of 27% for newer accounts.
The decision to proceed with legal action or to continue with standard collection activities rests entirely with you, providing flexibility in your approach to debt recovery.
Collection Rates and Fees
Understanding the financial implications of debt collection is crucial. Collection rates vary depending on the age and size of the account, as well as the number of claims. For instance, accounts under one year are charged at a lower rate compared to those over a year old. The fees for accounts under $1000 or those requiring legal action are notably higher.
The decision to proceed with legal action involves upfront costs, including court and filing fees, typically ranging from $600 to $700. These are necessary to initiate a lawsuit and attempt to recover the full amount owed.
Here’s a breakdown of the standard collection rates:
| Claims Submitted | Accounts < 1 Year | Accounts > 1 Year | Accounts < $1000 | Attorney Involvement |
|---|---|---|---|---|
| 1-9 | 30% | 40% | 50% | 50% |
| 10+ | 27% | 35% | 40% | 50% |
It’s important to note that if collection efforts, including litigation, do not result in payment, clients owe nothing to the firm or affiliated attorney. This no recovery, no fee policy ensures that clients are not further burdened financially without successful collection outcomes.
Frequently Asked Questions
What is the Recovery System for Unpaid Bills in Canada-US Trade?
The Recovery System consists of three phases: Initial Recovery Phase, Legal Action Recommendation, and Collection Rates and Fees.
What happens in the Initial Recovery Phase?
During the Initial Recovery Phase, letters are sent to debtors, skip-tracing and investigation are conducted, and attempts are made to contact debtors for resolution.
What is the Legal Action Recommendation in the Recovery System?
The Legal Action Recommendation involves either closure of the case if recovery is unlikely or proceeding with litigation, where upfront legal costs are required.
What are the Collection Rates for unpaid bills in Canada-US Trade?
Collection rates depend on the number of claims submitted and the age and amount of the accounts, ranging from 27% to 50% of the amount collected.
What are the costs associated with proceeding with legal action in the Recovery System?
If legal action is recommended, upfront legal costs such as court fees are required, typically ranging from $600.00 to $700.00.
What happens if attempts to collect via litigation fail in the Recovery System?
If attempts to collect via litigation fail, the case will be closed, and there will be no further obligations to the firm or affiliated attorney.
