If you want to make a claim against someone, sending a letter before action is a legal requirement. A letter before action is a formal letter sent to someone before you sue them, explaining what has happened, what the claim is, and what you want from the other party. Read on to find out what has to be included in a letter before action, when you should send a letter before action, and how to write a letter before action.
For more guidance on the small claims process, see our recent blogs on what a small claim is and how much it costs to bring a small claim.
Is a letter before action a legal requirement?
Yes, sending a letter before action or letters of claim is a legal requirement before you initiate court proceedings against someone. If you don’t send a letter before action before starting legal proceedings against someone, the court may penalise you later on (for example, by awarding you less money than you would have otherwise received).
Besides avoiding the risk of penalties, sending a letter before action can also help settle the matter with the other party without going to court at all. This would save time and money.
What has to be included in a letter before action
A letter before action explains what has happened, what your claim is, and what you want from the other party. Your letter could include a summary of the relevant facts, what you want from the other side (including how you calculated the financial award that you want), and the length of time you will give them to reply before you proceed with your claim. You should also include copies of any key documents the other party will need to address your claims, such as invoices, letters, terms and conditions.
See our templates for specific letters before action depending on the type of claim you want to pursue.
- Letter before action, debt claims (B2C) for small debt claims where the person you want to sue is an individual (including a sole trader);
- Letter before action, debt claims (B2B) for small debt claims against another business (not including sole traders); and
- Letter before action, non-debt claims for small claims where you are asking for something other than money owed.
When should I send a letter before action
You should always send your letter before action before commencing court proceedings. You must behave sensibly and try to cooperate with the other side wherever possible to resolve the matter efficiently. However, you don’t have to try all possible options of reconciliation or settlement before sending your letter before action.
When sending your letter before action, you must attach a standard information sheet and a blank copy of a reply form to your letter (if you use our templates, these are annexed to the letter already); and respond appropriately depending on whether the other side returns the reply form to you, and if so, what they say. We discuss this further below.
How long to wait after sending a letter before action before suing someone
Before starting your claim, you should give the other side enough time to respond before proceeding to sue them. Normally, 14 calendar days is the minimum if the case is uncomplicated and no longer than three months in a very complex case.
However, there are special rules for how long you must wait after your letter of claim in some specific cases, the most common being where you are suing a sole trader or individual for money they owe you.
If an individual or sole trader owes you money, you must wait at least 30 days from the date of your letter of claim before starting your small claim or other legal action. Additionally:
- if a small debt claims reply form is returned to you saying that the other side is seeking debt advice, you must give at least 30 days from the date you receive the reply form (longer if they ask for it and it is reasonable to do so);
- if the other side have asked you to send them any documents about your claims, you must give them 30 days from the date you provide those documents, or 30 days from the date you receive their reply form if they wish to get debt advice, whichever is later.
Do I have to agree to an instalment plan with someone who owes my business money?
No, but you should try to reach an agreement if you can, based on the individual’s income and outgoings. If they have made a proposal for repayment of a debt in their reply form and you do not agree with it, you should give your reasons in writing.
The content in this article is up to date at the date of publishing. The information provided is intended only for information purposes, and is not for the purpose of providing legal advice. Sparqa Legal’s Terms of Use apply.
Marion joined Sparqa Legal as a Senior Legal Editor in 2018. She previously worked as a corporate/commercial lawyer for five years at one of New Zealand’s leading law firms, Kensington Swan (now Dentons Kensington Swan), and as an in-house legal consultant for a UK tech company. Marion regularly writes for Sparqa’s blog, contributing across its commercial, IP and health and safety law content.