Letter Before Action: What to Send Before You Sue

There is no rule that says a claim form is invalid without a letter before action. What there is instead is a Practice Direction — the Practice Direction on Pre-Action Conduct and Protocols — that sets out what the court expects of both sides before proceedings start, and a set of sanctions for parties who do not comply.

Its purpose is to let each side understand the other's position, try to settle without proceedings, consider alternative dispute resolution, and keep costs down. Litigation is meant to be the step of last resort.

Two different regimes can apply, and you need to know which one you are in:

• A specific pre-action protocol. There are protocols for debt claims, personal injury, professional negligence, housing disrepair, construction disputes and several other areas. If one covers your dispute, you follow it and not the general Practice Direction.
• The general Practice Direction. If no specific protocol applies, the Practice Direction's own requirements in paragraph 6 apply instead.

For most consumer and small-business disputes — a faulty product, unpaid invoice, poor workmanship, a withheld deposit — there is no specific protocol and the general Practice Direction governs. The one very common exception is a business chasing a debt from an individual, which falls under the Pre-Action Protocol for Debt Claims and carries considerably heavier obligations.

Paragraph 6(a) of the Practice Direction requires the claimant to write to the defendant with "concise details of the claim", including "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".

In practice a letter that does the job contains all of the following:

• Your full name and address, and the correct full legal name and address of the other party. For a limited company, use the registered name and registered office from the Companies House register — suing a trading name that is not a legal person wastes the issue fee.
• A clear heading — "Letter before action" — and the date, prominently. Every deadline runs from it.
• A chronological summary of the facts — what was agreed, when, what went wrong, and what you have already done about it.
• The legal basis in ordinary language: breach of a contract term, failure to pay an invoice, goods not of satisfactory quality under the Consumer Rights Act 2015.
• The amount claimed and how it is calculated. Break it into principal, each item of consequential loss, and interest, and show the arithmetic.
• Interest, if you are claiming it. Say which basis you rely on and at what rate.
• What you want the defendant to do, and by when — a specific calendar date, not "within 14 days".
• Copies of the key documents you rely on, and a request for the documents you want from them.
• An offer to consider alternative dispute resolution. The Practice Direction expects it.
• A statement that you will issue proceedings without further notice if the deadline passes, and that you will draw the letter to the court's attention on the question of costs and interest.

Paragraph 6(b) of the Practice Direction says the defendant should respond "within a reasonable time — 14 days in a straight forward case and no more than 3 months in a very complex one". The response should confirm whether the claim is accepted and, if it is disputed, give reasons and explain which facts and parts of the claim are contested.

Translating that into a date:

• Fourteen days is the standard allowance for a straightforward claim against an individual — a simple unpaid debt, a refund refused, a deposit withheld. This is the figure the Practice Direction itself names.
• Thirty days is the customary allowance where the defendant is a business or organisation that will need to pull records, take internal advice, or refer the matter to insurers. It is not a rule, but a court is far more likely to regard 30 days as reasonable for a corporate defendant than 14, and giving it costs you very little.
• Longer where the claim is genuinely complex, involves multiple parties, or requires expert input. Three months is the outer limit the Practice Direction contemplates.

Whatever period you choose, state an actual date and allow for postal transit. If the defendant asks for a short, reasoned extension, granting it is almost always the right call.

The Pre-Action Protocol for Debt Claims applies where a business — including a sole trader or a public body — claims payment of a debt from an individual, including a sole trader. It does not apply to business-to-business debts unless the debtor is a sole trader. Its requirements go well beyond the general Practice Direction.

The Letter of Claim must state the amount of the debt, whether interest or other charges are continuing, and details of the agreement — if oral, who made it, what was agreed and when; if written, the date, the parties and how a copy can be obtained. If the debt has been assigned, it must name the original creditor and give the date of assignment. If the debtor is already paying by instalments, it must explain why the creditor still intends to go to court.

Three documents must be enclosed with the letter: the Information Sheet, the Reply Form, and a Financial Statement form, all of which appear in the annexes to the protocol.

The timescales are strict:

• The debtor has 30 days from the date at the top of the Letter of Claim to return the Reply Form. If they do not reply within 30 days, the creditor may issue.
• If the debtor asks for documents or information, the creditor must supply it, or explain why it is unavailable, within 30 days.
• If the debtor replies, the creditor must not issue proceedings for at least 30 days from receipt of the completed Reply Form, or 30 days from providing any requested documents, whichever is later.
• If the debtor says they are seeking debt advice, the creditor should allow a reasonable further period for that advice to be obtained.
• Where the debtor has responded but no agreement has been reached, the creditor must give a further 14 days' notice of the intention to start proceedings.

The letter is worth nothing at the costs stage if you cannot prove it was sent. A few practical points:

• Send by post. The Debt Claims Protocol expressly says the Letter of Claim should be sent by post, and may additionally be sent by email or other channels where the creditor has those details. For general Practice Direction cases, post plus email is the safest combination.
• Keep proof of posting from the Post Office. A free certificate of posting is usually better evidence than a signed-for service that goes unclaimed — an unsigned recorded delivery item proves only that the recipient did not sign for it.
• Date the letter and post it the same day, or as soon as reasonably possible afterwards. Under the Debt Claims Protocol the debtor's 30 days run from the date at the top of the letter, so a letter dated a week before it is posted quietly eats the debtor's response time — and a court will notice.
• Keep the whole file: a copy of the letter, the enclosures, the certificate of posting, and any reply.

If the letter produces a payment proposal you can live with, record the agreement in writing before accepting any money, and say whether it is in full and final settlement or on account.

The court will not usually strike out a claim just because no letter before action was sent. What it will do is make the non-compliant party pay for it. Paragraph 15 of the Practice Direction tells the court to consider whether all parties have complied when giving directions, and paragraph 16 sets out the sanctions available where they have not:

• An order that the party at fault pays the costs of the proceedings, or part of them — even if that party won.
• An order that those costs be paid on the indemnity basis, which is materially more expensive for the paying party than the standard basis.
• If the party at fault is the claimant, an order depriving them of interest on any sum awarded, or awarding interest at a lower rate.
• If the party at fault is the defendant, an order that they pay interest at a higher rate, up to 10 percentage points above base rate.

The court weighs the seriousness of the non-compliance and whether it caused avoidable costs. Minor or technical non-compliance is generally overlooked; issuing with no warning at all, or giving a plainly inadequate deadline, is not.

There is a practical cost too. A properly drafted letter settles a large share of disputes before any fee is paid, because it is the first moment the other side sees a dated, evidenced demand with a deadline attached.