In the Philippines, it is common for aggrieved parties to send a demand letter to another party prior to filing a formal legal complaint before the courts.
This plays a significant role in resolving disputes regarding breach of contract, debt collection, property disputes, and other issues. Below are the advantages and disadvantages of sending a demand letter:
ADVANTAGES
Demands compliance from the letter recipient
Essentially, a demand letter formally informs the recipient or the other party of the claims and demands of the letter sender, whether it is the payment of debt or loan obligations, breach of an agreement, or any other contractual obligation. Through sending the letter, the sender demands compliance from the recipient and informs the latter that in case of non-fulfillment of demands, the sender will pursue legal action to protect its rights and interests.
Avoid litigation and associated costs
Sending a demand letter actually encourages amicable settlement and resolution of disputes outside courts. As a result, both parties can avoid the costs and risks associated with legal proceedings.
Pre-requisite in certain legal actions
In some instances such as filing an ejectment case, sending a demand letter is a pre-requisite before initiating court proceedings.
DISADVANTAGES
Does not guarantee compliance
Sending a demand letter does not assure compliance from the recipient. There is still a likelihood that the recipient ignores the demands of the sender or fails to respond, thereby resorting to further legal action.
Possible escalation of disputes
Demand letters may also aggravate or increase the tension between the parties, leading to further conflict or complications.
Disclaimer: This article is for informational purposes only and should not be considered legal advice. For specific guidance on drafting and sending a demand letter, consult with a legal professional or business advisor.