A demand letter, or a letter before action or a pre-action letter as it is called in the UK, is a formal notice demanding that the recipient perform a legal obligation. It is typically used to persuade the recipient to take or cease some action, rectify a problem, pay a sum of money or honor a contract, on specific terms and within a specified time, or to revoke a waiver of rights, or simply to provoke a reaction that the writer can use to his/her client’s advantage.
A demand letter gives the recipient a chance to perform the obligation without being taken to court. Indeed, in many instances, it encourages the recipient to settle the matter. Overall, demand letters should be a firm statement of a client’s position and intentions, and while demand letters are often written to intimidate, they should not bully the recipient.
- Use plain English whenever possible to ensure that the letter is understood
- Be polite and avoid personally attacking your adversary
- Avoid common errors such asusing inflammatory language and misstating the facts and/or the law
- Adapt the content, including the depth of analysis, to the recipient
- Collect good examples
Introduction: Identify your representative capacity and clearly state the purpose of the letter.
Body: State the legal and factual bases for your demands and then state your demands followed by an implicit or explicit threat to take legal action if the demands are not met. Also include:
- The phrase without prejudice to protect the sender with regard to the contents of the letter (either as a heading or contained within the body of the letter, i.e. this letter is written without waiver of or prejudice to my client’s rights or remedies, all of which are expressly reserved.)
- Demand for specific relief or payment. For example, a specific amount of money to be paid by a set date, or for the recipient to do something specific
- An acknowledgment that the demand letter constitutes notice
- Deadline by which the matter must be settled