What happens if you don't respond to a demand letter?
Asked by: Zoila Kutch | Last update: November 6, 2025Score: 5/5 (58 votes)
What happens when someone ignores a demand letter?
A demand letter is an attempt to reach a settlement out-of-court prior to the filing of a lawsuit, and there are no legal penalties for ignoring it, however, ignoring it could be legally considered an admission of guilt and may result in a summary judgement against you if the other party does file a lawsuit.
Do I have to reply to a demand letter?
Typically, demand letters require a written reply within a specified timeframe. Failure to respond may prompt the sender, often a law firm, to pursue legal action against you by filing in court.
Can a demand letter backfire?
Before you draft your own demand letter and fire it off thinking your actions will result in getting paid, getting the services you contracted for, demanding the satisfaction that you were expecting, consider that writing your own demand letter can backfire badly!
How powerful is a demand letter?
Demand letters show the owner that you're serious about getting paid. Sending a demand letter prior to litigation is a sign of good faith in the eyes of the law. In court, the language in your demand letter can support your case. Successful demand letters significantly reduce the cost of getting paid.
Why might a defendant employer not respond to a demand letter?
How long after a demand letter can I expect settlement?
In some cases, you may receive a response within a few weeks, while in others, it may take several months.
What are the risks of a demand letter?
Potential Legal Risks
Demand letters that include threats of litigation, accusations of infringement, recitations of the legal requirements for infringement, and/or a refusal for the marks to co-exist may increase the risk that the trademark holder will be subject to a declaratory judgment action.
What not to say in a demand letter?
Don't Be Threatening
While the dispute of payment may have become personal, a demand letter is meant to encourage a desirable resolution. The use of threatening or insulting language may embolden the owner into not paying when they otherwise would have. And remember, a judge may one day look at this letter in court.
What are the disadvantages of a letter of demand?
However, sending a letter of demand can have its disadvantages. Depending on the situation, the other party may feel threatened and respond negatively, or they may not respond at all. They might engage a lawyer, or they might even start legal action against you.
Can a lawyer lie in a demand letter?
[1] A lawyer is required to be truthful when dealing with others on a client's behalf, but generally has no affirmative duty to inform an opposing party of relevant facts. A misrepresentation can occur if the lawyer incorporates or affirms the truth of a statement of another person* that the lawyer knows* is false.
Can an employer ignore a demand letter?
Disregarding a litigation demand letter can have severe consequences for businesses, potentially escalating the claim. Ignoring a demand letter may signal to the sender that the recipient is unwilling to engage in good-faith settlement negotiations, prompting the sender to pursue more aggressive legal actions.
How much do lawyers charge for a demand letter?
Hiring a lawyer to draft a demand letter will incur fees because it requires the time of a licensed attorney to complete the task. ContractsCounsel's marketplace data shows the average demand letter costs to be $380.00 across all states and industries.
How long until I get my settlement check after I agree?
It depends. Usually within 2-3 weeks of signing the release, money should be in if settlement funds are coming from an insurance company. But if you have a government health insurer, work comp lien, or its a settlement against a government entity, it can take some time to finalize those.
Do you legally have to respond to a demand letter?
There is no legal requirement to respond to a demand letter, but don't brush it off – and don't make the decision to respond or not on your own. Just as drafting your own response can cause you legal trouble, so too can making the choice to respond or not without advice from legal counsel.
What to do if someone doesn't respond to your demand letter?
- Send a final demand letter.
- File a complaint with your state's Attorney General's Office.
- Sue in small claims court.
What happens if you sue a company and they don't respond?
What happens if you sue a company and they don't respond? If a sued company doesn't respond, you might get a default judgment. Use this judgment to pursue collecting the owed amount from the defendant through legal processes if applicable.
How can a demand letter backfire?
Demand letters are valuable tools for creating records, dispute resolution, and much more. But, they can backfire and lead to liability for the sender and even its attorney for threats or demands that are legally improper.
What are the consequences of ignoring a demand letter?
Consequences of Ignoring a Demand Letter
Increasing the likelihood of a lawsuit and potential financial losses: Not addressing the issue can lead to a small claims court case or other legal action, resulting in additional costs.
How successful are demand letters?
No, demand letters don't always work—and they're less effective now than they were ten years ago. However, they remain a valuable step in most cases. Here's why: the time spent preparing a demand letter is never wasted.
Is a demand letter a threat?
Demand letters are valuable tools for creating records, dispute resolution, and much more. But, they can backfire and lead to liability for the sender and even its attorney for threats or demands that are legally improper.
Is it worth going to small claims court for $500?
Conclusion: Going to small claims court may be worth it for $500, but it will determine how you weigh your costs versus benefits. At a minimum, it is worth it to send a demand letter.
What makes a strong demand letter?
A demand letter should clearly state the details of the dispute, describe the demand, and provide a deadline for the other party to take action. The letter should also include consequences if the demands aren't met.
Are demand letters harassment?
Remember that sending a demand letter is not actually a hostile act. What you're saying in the letter is that, even though you have a legal claim, you are willing to resolve it in a friendly fashion, rather than by going to court.
How long is a demand letter good for?
There's generally no set length of time to reach a settlement after a demand letter is sent, but the sender does give the recipient a deadline. This is the time by which they expect the recipient to respond.
How do I end a demand letter?
End the letter by stating you will promptly pursue legal remedies if the other party does not meet your demand. Make and keep copies. Make a copy of each letter before sending it. Send your letter by regular and certified mail with a return receipt requested.