Disputes · 7 min read · 23 October 2026

How to write a letter before action that a court will respect

A letter before action, also called a letter before claim, is the step a court expects before you issue proceedings, and which rules govern it depends on who owes you. A business owed money by an individual or sole trader must follow the Pre-Action Protocol for Debt Claims and give 30 days to reply. Every other debt, and most other claims, fall under the Practice Direction on Pre-Action Conduct, where 14 days is the benchmark in a straightforward case. Get the regime, the contents or the tone wrong and the costs penalty can land on you, even if you win.

First decide which rules apply

The Practice Direction on Pre-Action Conduct and Protocols applies, by paragraph 2, to every dispute where no specific pre action protocol does. The protocol that catches most unpaid bills is the Pre-Action Protocol for Debt Claims. Paragraph 1.1 of that protocol says it applies to any business, including sole traders and public bodies, claiming payment of a debt from an individual, including a sole trader, and that it does not apply to business to business debts unless the debtor is a sole trader.

• Your company is owed money by another company: the Practice Direction.
• Your business is owed money by a sole trader or a private individual: the Debt Protocol.
• You are an individual owed money: the Practice Direction, because the Debt Protocol applies only where the claimant is a business (Plekhanov v Yanchenko [2020] EWHC 1201 (Comm)).
• Construction, professional negligence, dilapidations and media claims: their own protocols, listed at paragraph 18 of the Practice Direction.

Getting this wrong is the commonest mistake in a letter before action, because the two regimes ask for different contents and different deadlines.

What a letter before claim must contain

Under the Practice Direction, paragraph 6(a) expects the claimant to write to the defendant "with concise details of the claim". The letter should give the basis on which the claim is made, a summary of the facts, what the claimant wants from the defendant and, if money, how the amount is calculated. Paragraph 6(c) expects the parties to disclose the key documents, so the contract or terms, the invoices and the chasers go with the letter rather than being promised later. Paragraph 8 expects both sides to consider negotiation or another form of ADR, so a well drafted letter proposes it.

The Debt Protocol is more prescriptive. Paragraph 3.1 requires the amount of the debt, whether interest or other charges are continuing, the details of the agreement the debt arises from, how the debt can be paid and how to discuss payment options, and the address for the reply. It also requires a statement of account, or the interest and charges added since the last one, together with the Information Sheet, the Reply Form and a Financial Statement form from the annexes to the protocol. Paragraph 3.2 says the letter should be dated near the top of the first page and posted that day or the next, and paragraph 3.3 says it should be sent by post, and by email as well where the creditor has an email address.

How long to give the other side

Under the Practice Direction, paragraph 6(b) says the defendant should respond within a reasonable time: 14 days in a straightforward case and no more than three months in a very complex one. Under the Debt Protocol, paragraph 3.4 allows the creditor to start proceedings if there is no reply within 30 days of the date at the top of the letter. Where a reply comes in, paragraph 4.2 says proceedings should not start less than 30 days from receipt of the completed Reply Form, or 30 days from the creditor providing any documents the debtor asked for, whichever is later, and that a debtor seeking debt advice must be allowed a reasonable period to get it.

A letter demanding payment within seven days on pain of immediate proceedings shortens neither period. It only shows the court that the claimant did not follow them.

Interest and recovery costs belong in the first letter

Where the purchaser and the supplier are each acting in the course of a business, the Late Payment of Commercial Debts (Interest) Act 1998 applies (section 2(1)) and implies a term that a qualifying debt carries simple interest (section 1(1)). The rate is 8 per cent a year over the Bank of England official dealing rate in force on the 30 June or 31 December before interest starts to run (article 4 of the Late Payment of Commercial Debts (Rate of Interest) (No. 3) Order 2002). Once statutory interest runs, section 5A adds a fixed sum of £40 for a debt under £1,000, £70 for a debt of £1,000 or more but under £10,000, and £100 for a debt of £10,000 or more, plus the difference if the reasonable costs of recovery are higher.

Claim them in the letter and show the working, because paragraph 6(a) asks how the amount is calculated and a debtor who pays the principal on day 13 has not paid what the Act gives you. The detail is in our guide to late payment interest and recovery costs.

The sanctions, and why they reach claimants too

Paragraph 13 of the Practice Direction says the court will take non compliance into account when giving case management directions and when making costs orders. Paragraph 14(a) treats a letter that does not give enough information to meet the objectives in paragraph 3 as a failure to comply, and paragraph 14(c) covers unreasonably refusing ADR. Paragraph 16 lists the sanctions: an order that the party at fault pays the other side's costs or part of them, costs on the indemnity basis, and for a claimant at fault who is awarded money, an order depriving it of interest for a period or awarding interest at a lower rate. A defendant at fault can be ordered to pay interest at up to 10 per cent above base rate. Paragraph 2 adds that a person who knowingly makes a false statement in a pre action protocol letter may face proceedings for contempt of court.

In short, a claimant who sends a thin or misdirected letter can win the debt and still lose interest and part of its costs.

Why a letter before action template goes wrong

• Wrong regime. A business to business template sent to a sole trader leaves out the Information Sheet, Reply Form and Financial Statement form the Debt Protocol requires, and gives 14 days instead of 30.
• Wrong party. A letter addressed to a trading name, or to a director for a company's debt, is addressed to someone other than the party that contracted with you.
• No calculation. A round figure "plus costs" does not show how the amount is calculated.
• Threats you cannot make. Section 40 of the Administration of Justice Act 1970 makes it an offence, when coercing payment of a contract debt, to falsely represent that criminal proceedings lie for failure to pay, or to use a document falsely presented as having an official character. A letter dressed up to look like a court form is exactly that.
• No ADR. The court has power to order the parties to engage in alternative dispute resolution (CPR 3.1(2)(o)), following Churchill v Merthyr Tydfil County Borough Council [2023] EWCA Civ 1416. A letter that refuses to discuss anything invites the argument that you refused ADR unreasonably.

The final demand, and what comes after it

If the deadline passes without payment or a reasoned reply, a short final demand restating the sum, the interest still running and the date proceedings will be issued removes any argument that the debtor was taken by surprise. Paragraph 12 of the Practice Direction expects both sides to review their positions before a claim is issued. Letters do not stop the limitation clock: an action founded on simple contract cannot be brought more than six years after the cause of action accrued (section 5 of the Limitation Act 1980), and paragraph 17 of the Practice Direction says that where a claim has to be issued first to protect the time limit, the parties should ask the court to stay it while they complete the pre action steps.

If you are on the receiving end of a letter rather than sending one, read our guide on how to reply to a letter before action.

What we do

We identify which regime applies, read the contract, invoices and chasers, calculate the statutory interest and fixed compensation, and send a letter that meets paragraph 6(a) of the Practice Direction or the Debt Protocol, with the key documents and an ADR proposal. From £595, fixed in writing before any work begins. If the letter is ignored, the follow up and final demand is £195. Issuing a claim is conduct of litigation and is referred to instructed litigation solicitors or counsel at that point, with the file prepared.