Before the Disputes Tribunal will hear your case, it wants to see that you gave the other party a genuine, written chance to put things right. A Letter of Demand does exactly that: a clear, factual statement of what's owed, why, and by when, sent before things escalate to a Tribunal application.

Step 1: Understand why you need one

Before the Disputes Tribunal will accept your application, it expects you to have made a genuine attempt to resolve the dispute directly with the other party first. A Letter of Demand is the clearest way to show that: a formal, written record that you asked for what you're owed, explained why, and gave a fair chance to sort it out before involving the Tribunal. Turning up without one weakens your application, even if the underlying claim is solid.

Step 2: Set out the facts clearly and chronologically

State who you are, what was agreed, what was supplied or promised, and where things went wrong: unpaid trade work, a faulty product never refunded, a loan that was never repaid. Include dates, amounts, and any reference numbers. Keep it factual rather than emotional, since this letter may later form part of the evidence you rely on if the dispute does end up in front of a Referee.

Step 3: State exactly what you're claiming

Set out the amount owed and how you arrived at it: the original price, cost of repair, refund due, or damages, whichever applies to your situation. If you're also claiming interest or additional costs (such as a mechanic's report obtained under the Consumer Guarantees Act), itemise those separately rather than folding everything into one round number. A demand that's easy to verify is harder to dismiss.

Step 4: Give a clear deadline and explain the consequences

Give the other party a reasonable window to respond, commonly 10 to 14 days, and state it explicitly. Explain that if the amount isn't paid or a satisfactory response isn't received by that date, you intend to apply to the Disputes Tribunal. Keep the tone firm and factual; you're recording a fair process, not making a threat.

Step 5: Send it properly and keep proof

Send the letter by a method you can later prove: email with a delivery or read receipt, or post using a tracked service. Keep a copy of exactly what you sent and when. If the matter proceeds to a Tribunal hearing, being able to show you sent a clear demand and gave the other party a genuine opportunity to respond is often part of what a Referee will want to see.

Step 6: What happens after you send it

The other party may pay, offer a partial settlement or payment plan, dispute the claim, or not respond at all. If they engage, it's usually worth trying to reach a sensible agreement; a dispute settled directly is faster and cheaper than one that goes to a hearing. If the deadline passes with no resolution, you can move on to filing your application with the Disputes Tribunal, referencing the Letter of Demand as evidence that you tried to resolve things directly first.

A worked example

Say you paid a tradesperson $2,500 upfront for work that was never completed and they've stopped responding. Your Letter of Demand would state the agreement date, the amount paid, what was promised, what was actually delivered (or not), and a 14-day deadline to either finish the work or refund the $2,500. It would note that if neither happens by that date, you intend to apply to the Disputes Tribunal, referencing this letter as proof you tried to resolve it directly first.

This guide is general information, not legal advice, and procedures and expectations can vary depending on the type of dispute. LawClaims is a document preparation tool, not a law firm, and no solicitor-client relationship is formed by using it or reading this page. For anything beyond a straightforward claim, consider free advice services such as Community Law.

How to Write a Letter of Demand in New Zealand