Successful Cross-Border Debt Recovery for Israel-Based Exporter from Singapore Distributors

Case Summary

• Farallon Law acted for a fruit exporter based in Israel, who was owed a substantial sum by several fruit distributors in Singapore.
• After a detailed assessment of their contracts and communications with the distributors, we advised on the appropriate debt recovery strategy.
• We initially issued letters of demand to debtors highlighting the potential for commencement of legal proceedings if a settlement was not reached.
• The debtor reached out to inform us that sale proceeds are low and they would not possess the financial means to satisfy a potential judgement.
• We then proposed a settlement agreement acceptable to our client and all adverse parties.
• All parties involved agreed to the settlement and installments were eventually paid out to our client.
• Our client was satisfied as this negotiation averted the need for costly litigation proceedings while successfully recovering their debt.

Our Approach

Debt recovery and collection is a sensitive matter where emotions can run high. Farallon Law recognises the care and tact necessary when handling debt collection while, above all, prioritising the interests of our clients.

We offer tailored and customised client consultations to ensure we thoroughly understand the nature and strength of each debt claim. We review contracts, parties’ correspondence, and contractual documents to assess our clients’ legal position and subsequently recommend the most effective recovery strategy.

Solution, Strategy & Challenges

Farallon Law typically adopts a straightforward approach to initial legal strategy by issuing a letter of demand to the debtor(s). Ideally, we wish to pursue negotiation, mediation, and settlement to avoid further legal action.

If this initial approach feels ineffective, we assess the prospects of litigation based on the strength of the claim and the likelihood of recovery. As part of a holistic evaluation, we conduct due diligence to determine whether the debtor has the financial means to satisfy a potential judgment, which may include background checks on the debtor or target, searches on litigation and bankruptcy history, public records, prior company directorships and incorporations, or reviewing other relevant indicators of assets they may have or have had. We work with law firms and private investigators around the world to obtain such information.

Outcomes

Following a judgement or settlement, Farallon Law can assist our client with enforcement measures to ensure that they receive actual payment of the recovered amount. Depending on the debtor’s financial situation, we may assist with garnishee proceedings, or obtain a writ of seizure and sale to seize the debtor’s assets. Successful recoveries are often made through negotiated lump sum payments or structured instalment plans, especially where a debtor is willing but unable to pay in full immediately.

Where appropriate, Farallon Law can also advise and act on bankruptcy applications to compel settlement, facilitate enforcement against insolvent individuals, or pursue winding-up proceedings (in corporate cases) if the debtor is a company that has assets but refuses to pay. If the debtor is in financial distress, we will not suggest that winding up proceedings be considered.

Farallon Law always seeks an amicable resolution to all matters where possible, prioritising our client’s interests.

Key Takeaways:

• Early legal intervention can create a cooperative, open environment for the debt recovery and collection process to begin.
• A well-drafted letter of demand can sometimes be sufficient to prompt settlement.
• It is possible to negotiate settlements and successful outcomes without costly litigation.
• Complex cross-border debt recovery cases can be successfully resolved with strategic legal support.

About Farallon Law

Farallon Law is a boutique Singapore law firm known for delivering best-in-class legal solutions to leading businesses and individuals. With a focus on simplicity and clarity, the firm transforms complex legal challenges into practical, actionable outcomes.