Below is a practical menu of options you can consider if you receive a demand letter in the Philippines. It is general information, not legal advice; get individual counsel before you decide.
1 Read and Diagnose the Letter
- Calendar the deadline the sender gave you (often 5-30 days; 15 days is common). (RESPICIO & CO.)
- Identify the legal basis (e.g., unpaid loan, breach of contract, tort).
- Verify the sender’s standing—is it really the creditor or a collection agency?
- Collect your own records (contracts, receipts, e-mails, screenshots).
- Check prescription / statute of limitations (written contracts usually prescribe in 10 years, open accounts in 4 years). (RESPICIO & CO.)
2 Immediate Protective Steps
| What to do | Why it matters |
|---|---|
| Keep the envelope and proof of service | Shows when the deadline started |
| Stop public posts about the dispute | Avoid self-incrimination or libel |
| If you have liability insurance, notify the insurer | Many policies require prompt notice |
| If harassment occurs, record dates & screenshots | There are Anti-Harassment and Data-Privacy remedies |
3 Substantive Response Options
| Option | When to use it | Typical content of your reply |
|---|---|---|
| Full compliance / pay | Debt is correct and affordable | Enclose proof of payment and ask for a “full and final settlement” receipt |
| Partial compliance | Amount is partly correct | Explain computations; attach evidence; tender the uncontested sum |
| Payment-plan proposal | Debt is correct but lump-sum is impossible | Offer dates & amounts; ask that interest stop while you pay |
| Request for documents / clarification | You need proof (e.g., original promissory note) | Politely demand certified copies before you act |
| Formal dispute / denial | Debt is wrong, prescribed, or you have offsets | State facts, cite law, and expressly refuse the claim |
| Counter-demand / set-off | The sender also owes you | Assert your own claim and give a deadline |
| Offer to mediate or settle | You want to avoid court | Propose Barangay conciliation (if parties are in the same city/municipality), JDR, or court-annexed mediation under RA 9285 |
| Do nothing (not recommended) | Only if deadline is illegal/extortionate and you are ready for suit | Understand it can trigger litigation, interest, and costs |
4 Form & Tone of a Reply Letter
[Date]
[Name / Address of Sender]
RE: Response to Your Demand Dated [date]
1. Facts – short statement of background
2. Your Position – admit, contest, or seek proof
3. Action – payment enclosed / schedule offered / reasons for refusal
4. Next Steps – invitation to mediate, request documents, etc.
5. Deadline – e.g., “Kindly reply within seven (7) days of receipt.”
Very truly yours,
[Signature over Printed Name]Send it by a trackable means (registered mail, courier with POD, or e-mail with read-receipt) and keep copies.
5 Alternative Dispute Resolution Paths
- Barangay Justice System – Mandatory for many civil disputes ≤ PHP 400 k and parties in the same locality.
- Court-Annexed Mediation / Judicial Dispute Resolution – Strongly encouraged before trial.
- Small Claims Court – As of the 2023 Rules on Expedited Procedures in the First-Level Courts, you can sue (or be sued) for money claims up to ₱1 million with no lawyers’ appearance required, often within 30–60 days. (Manila Bulletin)
6 If the Letter Threatens Criminal Action
Check if the facts truly support a criminal case. For example, bouncing checks (BP 22) require proof of notice of dishonor; estafa needs deceit. A well-reasoned reply can sometimes head off a baseless complaint.
7 Where to Get Help (Low-Cost or Free)
- Public Attorney’s Office (PAO) – For indigent respondents in criminal or civil cases.
- Integrated Bar of the Philippines (IBP) Legal Aid Chapters.
- New Unified Legal Aid Service (ULAS) Rules (2024) – Lawyers must render at least 60 hours of pro-bono service; ask local IBP for the roster. (sc.judiciary.gov.ph)
8 Practical Tips & Cautions
- Respond within the period fixed in the letter or, if unreasonable, state why you need more time. (RESPICIO & CO.)
- Use calm, factual language—every reply can end up as court exhibit “A”.
- If you settle, insist on a quitclaim or “full and final settlement” to bar further claims.
- Document phone negotiations in writing (e-mail follow-ups).
- Beware of token payments that may restart prescription or be construed as admission.
- Keep all originals; only send photocopies unless the court later orders otherwise.
9 Bottom Line
A demand letter is a warning, not yet a lawsuit. Handled well—by verifying the claim, choosing an appropriate written response, and exploring settlement or mediation—you can often resolve the matter faster and cheaper than litigation. When in doubt, engage counsel or accredited mediators early.
Disclaimer: This overview is for information only and does not create a lawyer-client relationship. Laws and rules change; consult a qualified Philippine lawyer for advice on your specific facts.