If you’ve received a demand letter, it means someone is expecting you to do something and they are giving you one last chance to do it, before taking you to court. Should you accept to do what they are asking, refuse to do it, or simply ignore the letter? What’s the best course of action?
A demand letter is also sometimes called a “lawyer’s letter” or “formal notice” or, in French, a “mise en demeure.” It means you’re making a formal demand for something.
A Final Warning Before Going to Court
If you’ve received a demand letter, it’s because someone thinks you’ve done something wrong and they’re giving you a final warning before taking legal action The demand letter is considered a “final” warning because, if you don’t do what is asked, there is usually nothing stopping the person who sent it from taking you to court.
On the other hand, receiving a demand letter doesn’t mean you’ll automatically be taken to court. You might end up coming to an agreement with the other person, or they might decide not to sue you. It’s also possible to settle your dispute in another way without going to court. In fact, you both have a duty to consider another way of settling your dispute.
What to Do If You Receive a Demand Letter
When someone sends you a demand letter, you have some options:
- agree to do what the person is asking and put an end to the dispute
- contact the person(or her lawyer) to explain why you don’t agree with her. You can even suggest trying to settle the dispute without going to court, for example, through negotiation or mediation.
- contact the person (or her lawyer) to let her know that you refuse to do what you’re being asked to do and to explain why
- do nothing and wait to see what happens which might mean you get taken to court
- in all cases, you can consult a lawyer to better understand your options
Important! If you have “liability” insurance, you should contact your insurer. You must notify the insurer quickly of any dispute that could lead to legal action being taken against you.
Things to Consider Before Answering a Demand Letter
- Whether the claim is well-founded: Does the person really have a right to demand anything from you?
You can refer to our articles on various legal topics to find out what legal rules apply to your situation. Otherwise, you can consult a lawyer.
- The amount of the claim: Does what you’re being asked to pay seem reasonable?
For example, if the person is claiming $800 from you to repair a window that’s worth $150, that doesn’t seem very reasonable.
- The fees to be paid: You should be aware that there are fees to be paid if you decide to go to court.
Is it worth paying those fees, on top of being off work for time spent in court, for a conflict that involves $150? It’s up to you to decide.
- No lawyer for claims of $15,000 or less: If someone is claiming $15,000 or less from you (not including interest), it’s very likely that the case will be in the Small Claims Division of the Court of Quebec.
In that court, no one can be represented by a lawyer. You can ask a lawyer to give you advice about the case, but they can’t represent you in court.
- You have a duty to consider settling your dispute: You can use various alternative dispute resolution methods, such as negotiation, mediation, or conciliation.
These methods allow you to come to an agreement with the person who wants to sue you without having to go to court.
If you don’t know how to respond to a demand letter, a lawyer can help you.