Debt collection guideline: for collectors and creditors

Relationship with court debt recovery processes

Broadly, debts may be recovered either through the courts, or by using creditor or collection agency personnel to negotiate repayments.

Debt recovery through the courts is largely regulated by state and territory law and the procedural rules of the courts. The recovery process may include the repossession of assets, securities or other legal enforcement of security interests.

This guide is mainly concerned with non-court debt recovery processes and informal collection activities before a court action is commenced or after a court judgment.

This guide does not limit any right you may have to:

  • take legal action to collect a debt
  • conduct legal repossession activities and other legal enforcement of legitimate security interests
  • seek and obtain pre-judgment remedies, for example, orders to prevent the removal or transfer of property from the jurisdiction
  • enforce judgment through a court process—including examination hearings, instalment orders, orders for the seizure and sale of property, garnishment or attachment orders
  • undertake all necessary procedures (for example, for serving documents) associated with these actions.

However, you must not threaten action (legal or otherwise) that you are not legally permitted to take, do not have instructions or authority to take, or you have no intention to take. How legal action is threatened or taken can, in certain circumstances, amount to misleading or deceptive conduct, unconscionable conduct or harassment. You also must not misrepresent your legal entitlement to seize goods.

See part 2, sections 19–21 for more information about representations about the consequences of non-payment and the legal status of a debt and about legal action and procedures.