Corporate Debt Collection Litigation in Bogotá

When to move from collections to court

Receivables collect themselves for the first few weeks. After that, every month reduces the chance of recovery and increases the risk that the debtor runs out of assets or enters insolvency, where a creditor stops negotiating and starts queuing. The moment to move to court is not defined by how old the invoice is, but by two signals: the debtor has stopped answering, or it is paying other suppliers and not you.

Before filing we run two checks that are often skipped: that the document can actually support a claim, and that the debtor has something to pay with. If either fails, suing means spending money to obtain an unenforceable judgment.

First question: is the document enforceable

Enforcement proceedings are faster than other routes because they do not debate whether the debt exists: they assume it does and go straight to collection. That requires an enforceable instrument, meaning a document producing a clear, express and due obligation on the debtor. We review what the company holds and say what works:

• Electronic sales invoices as negotiable instruments, where the issuing, delivery and acceptance conditions were met.
• Promissory notes, bills of exchange and cheques, checking formal requirements, endorsements, maturity and limitation of the action.
• Contracts with defined payment obligations, together with the records, purchase orders or delivery notes proving performance.
• Settlement records, payment agreements and conciliation records signed by the debtor.
• Security: mortgages, pledges, registered security interests over movable assets, guarantees and joint debtors.

Where what exists is not enforceable, we say so before charging fees to draft a claim. In those cases the route is different: document the debt through a signed acknowledgement, or bring a declaratory claim, which takes longer and has to be weighed against the size of the receivable.

How the work runs

1. Review of the collection file. Documents, balances, applicable interest, correspondence and the state of the commercial relationship.
2. Asset tracing. A search for assets of the debtor and its joint debtors in publicly available registries, so we know what to seek attachment over.
3. Formal payment demand. A demand with a firm deadline resolves part of the cases without proceedings and, where it does not, leaves a useful record.
4. Claim plus interim relief. The claim is filed together with the attachment application, so the measure is granted with the payment order.
5. Service and defences. If the debtor raises defences, we answer them and take evidence; if not, the case moves towards auction.
6. Calculation and payment. Calculation of the debt and costs, valuation and auction of the attached assets, or release of the funds withheld.

Attachment is what decides the outcome

In collection matters, the moment that determines recovery is the attachment. A debtor whose bank account is frozen, or whose property carries a registered measure, negotiates; one that has only been served often does not. That is why the measures are prepared before filing rather than after: bank accounts, real property, vehicles, going concerns, shares and quotas in companies, and debts that third parties owe the debtor.

Preparing the measure includes the part most often neglected: making it effective. An attachment granted but not perfected, with orders never issued or never registered, withholds nothing. We follow through until the withholding or the registration actually exists.

What the client receives

• A written viability opinion on the collection, setting out the instrument available, the assets identified and a clear recommendation: sue, negotiate or write off.
• The claim filed, with the application for interim relief and the bond process where applicable.
• Representation throughout the proceedings, including hearings, defences, appeals and interlocutory matters.
• Status reports stating what happened and what it means for the case, without the language of the file.
• Support through to payment, auction or settlement, not through to judgment.

Portfolios with several debtors

Where there are many debtors, the work is not done case by case from scratch. We sort the portfolio by recoverability and by quality of the instrument, and decide what to sue on, what to negotiate and what is not worth pursuing. That exercise usually saves more than the litigation itself, because it stops the budget being spread across cases that were never going to recover anything.

If the debtor is already in reorganisation or liquidation, individual collection changes forum: the claim has to be lodged in that process, its ranking and classification argued, and every step taken under the insolvency rules. We check this before filing, because suing outside that process is wasted time.