A demand letter, letter of demand,
(of payment), or letter before claim, is a letter stating a legal claim (usually drafted by a
lawyer
A lawyer is a person who practices law. The role of a lawyer varies greatly across different legal jurisdictions. A lawyer can be classified as an advocate, attorney, barrister, canon lawyer, civil law notary, counsel, counselor, solic ...
) which makes a demand for
restitution or performance of some obligation, owing to the recipients' alleged
breach of contract
Breach of contract is a legal cause of action and a type of civil wrong, in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party ...
, or for a
legal wrong. Although demand letters are not legally required they are frequently used, especially in
contract law,
tort law, and
commercial law cases. In some cases, evidence of attempts to settle are required before a court case will be accepted by the court, and demand letters are commonly used to fulfill this requirement. For example, if one anticipates a breach, it is advantageous to send a demand letter asserting that the other side appears to be in breach and requesting assurances of performances. Demand letters that are not responded to may constitute admissions by silence. Also, a demand letter will often generate a denial letter stating the basis for rejecting your side's claim (such as when the incorrect entity is sued), and is sometimes a good indication of what defenses will be raised if a suit is brought later.
Demand letters are sometimes used as a form of harassment and/or intimidation.
Insurance claims
In personal injury claims, the settlement negotiation process begins by the victim submitting a demand letter to the insurance companies. The purpose of the demand letter is to present facts about the accident in order to persuade the insurance companies to provide adequate compensation. A typical demand letter is structured in the following manner:
* Description of the Accident
* Discussion of Accident Liability
* Description of Personal injuries
* Description of Medical treatments
* List of Medical Bills/Lost Income Statements
* Injury Settlement Demand
The personal injury demand letter is then sent to the insurance companies with supplemental documents that are referenced in the letter. This may include copies of accident reports, photographs of the accident/injuries, medical bills, doctor's statements etc.
The insurance company will then analyze the arguments made in the demand letter and respond with a counter settlement offer.
Debt collection
In the
United States, demand letters from a
debt collector relating to a consumer debt must comply with the
Fair Debt Collection Practices Act.
In certain types of legal proceedings in
Quebec, a demand letter is mandatory; without it, a person could lose their case.
See also
*
Legal threat
*
Cease and desist
A cease and desist letter is a document sent to an individual or business to stop alleged illegal activity. The phrase "cease and desist" is a legal doublet, made up of two near-synonyms. The letter may warn that, if the recipient does not dis ...
References
{{DEFAULTSORT:Demand Letter
Legal documents
Letters (message)