Solve your debt in 5 days or less!

you ask. He most likely tells you the next move is to put 
the matter down for trial in the Magistrates' Court. 
(Depending on the background of the case, there are probably 
lots of other things he could do. But he is an old hand, and 
knows they'd run your bill up so high you'd have a fit.) 
So the case goes down for trial, in six or eight months. And 
you receive a Statement of Account for Professional 
Services. $465, including mention of 'two attendance’s upon 
you' and 15 'telephone attendance’s'. (You begin to wonder 
if all those phone calls you made, asking all those 
questions, were a good idea.) You take comfort in recalling 
the lawyer said you'll get some of your legal costs back 
from the debtor, providing you win the case. 
Now it's hard to maintain a heroic posture for six months. 
Probably you don't manage it. A week before the trial, your 
nerves get shaky. After all, you have no idea what you're in 
for. (And you don't feel like pounding the lawyer with 
questions and running up another bill for telephone 
attendance's.) You can't shake off vivid images of trial 
scenes from TV dramas. Terrible cross-examinations, 
everything checked and scrutinized to the dot. "How do we 
know that's really your signature, Mr. Bottomley?" 
Probably you cave in. Your lawyer talks to the enemy lawyer, 
and they suggest a compromise: the debtor will pay you $4500 
straight away, and it will all be over. 
You'd be wise to take it. That way you'd end up with $4500, 
less the $465, less another smaller bill for the final work 
by your lawyer ($120). So you'll end up with a figure that 
begins with a plus sign. You don't end up owing money (an 
all-too-possible outcome, if you carry on, pig-headed for 
victory). 
But say you aren't built like that. With you, it's the 
principle of the thing. You did excellent work for the guy, 
just what he wanted, spot on time. He doesn't deserve to get 
away with this! You'll show him what stuff you're made of. 
You plunge into the trial. Amazingly, the enemy defends it, 
with witnesses and everything. And his lawyer actually makes 
you sound like you were lying about some things! At least, 
he made out that what you did or said could have been 
interpreted another way. All this takes two days in court. 
Ah, but you win. Judgment and costs are awarded to you. At 
this point, the word 'costs' has an intriguing ring. You 
take it to mean the enemy will have to pay the $6200, plus 
all the money you'll now owe your own lawyer. (Two days in 
court. It doesn't bear thinking about.) 
By and by, you get a bill from your lawyer for $4840. And 
find out you're entitled to recover $3220 from the loser. 
It's what the court scale allows. So you are down quite a 
bit. Your legal costs are $4840, minus the $3220 owed by the 
debtor, plus the old legal bill for $465... whoops, not to 
forget the smaller one for $120. Altogether, you've had to 
fork out $2205 to collect $6200! 
Anyway, you've taught the enemy a lesson. No one can mess 
around with you! You'll even go into the red, and spend lots 
of time and worry, to punish anyone who tries to cheat you. 
Except there's one problem. When do you get your check from 
the debtor? ($3220 legal costs, plus the $6200.) He lost, 
the court ruled in your favor. Surely, he now has to pay at 
once? 
Your lawyer explains that you have a 'judgment'. This means 
there's no longer any argument: the debtor owes the $6200, 
as well as the legal costs the court has awarded you. But 
now you have to enforce the judgment. If the debtor doesn't 
just hand over the money, you have a couple of options, 
explains your calm lawyer. One, you can send in the sheriff 
and he'll seize furniture and other assets the debtor owns. 
Or you can put the company into liquidation -- but then any 
other creditors will join in and you'll have to share the 
spoils. 
The sheriff sounds like the best idea. The debtor's 
computer, for example. Even if it really was broken, it 
still must be worth quite a bit. And there must be lots of 
other stuff in that office. 
So your lawyer issues a warrant of execution, instructing 
the sheriff to seize assets to the value of $9420. 
Many weeks pass, then your lawyer phones to say the sheriff 
has reported there are no goods to seize. 
"What!" (And that's the beginning of wisdom.)
"Unfortunately," your lawyer explains, "Everything was 
encumbered. The computer and everything was leased. The 
company didn't really own anything. There was nothing the 
sheriff could seize. The company is just a shell, really. So 
it wouldn't do any good to put it into liquidation either." 
Result: your $6200 'sale' has cost you $5425 in legal fees.
The following chapters tell you much better ways of coping 
with all this. 
2. How to avoid problems - cheaply
First, check them out
IT IS ridiculous for anyone smart enough to be in business 
not  to make routine credit checks. There is no point 
chasing a debtor with a summons if there's nothing there. 
You'll get plenty of 'legal action' -- but you'll pay for it 
all yourself. The debtor won't be touched. Look under 
'Credit Reporting Services' in the Yellow Pages. Call a 
couple of these services. Get their literature. Then join  
one. You pay an annual subscription (in the very low 
hundreds) and a small fee each time you want to find out 
about someone (whether a person, or a business). And I do 
mean a small  fee: less than $10, usually. 
On an individual, you can get information like this:*
(a) Driving license number and date of birth.
(b) Name of employer, and previous employer.
(c) His address, address before that, and before that.
(d) Companies he is a director of, and former companies.
(e) Credit services, banks etc. that have been inquiring 
about him, and when. 
(f) Any writs and summonses served, and whether he has had 
any court judgments against him. 
(g) Default information, including written-off accounts and 
accounts referred to a collection agency. 
(h) Which mercantile agents have made inquiries about the 
person. 
* At least in August, 1990, when I'm writing this. The 
Privacy Amendment Bill is still smoldering in Federal 
Parliament. If it ever passes in the form it's in, this 
might change the sort of credit information you can lay your 
hands on. But I don't believe a strong form of the Bill will