Hi there. It sounds like you are having a stressful time. If you had a loan agreement between you and your friend, it sounds as though your friend is breaching the terms of that agreement by not paying on the agreed date. When you make a loan agreement with your friend (written or oral) ordinary contract law governs the contract. This means that if terms are not fulfilled correctly you will have the right seek fulfillment of these terms (repayment of the debt) in court.

Going to Court is usually the final option when it comes to debt recovery. This is because court is expensive and time consuming, and usually disputes can be resolved with negotiation. You might begin by sending your friend what is known as a “letter of demand”. A letter of demand sets out the obligations of both parties, and explains that proceedings will be launched in court if the amount is not paid. Templates for a letter of demand can be found online from the Australian Government website www.business.gov.au. Depending on the amount of money you loaned your friend, and whether they respond to your letter, you may then consider seeking the repayment of the amount by starting a debt recovery proceeding in the Magistrates Court of WA. There is a division in the Magistrates Court which is specifically designed for general claims up to $75,000, and also caters specifically for small claims up to $10,000.

However, if a loan has been agreed to because you as the lender were put under duress the contract will be void. Duress is when abuse and intimidation cause a person to agree to something they otherwise wouldn’t. You will have to be able to show that you agreed to lend the money because of the intimidation by showing evidence that it occurred (i.e. emails, voicemail recordings or witnesses). You will have to do this in court. If the contract is found to be void, your friend may be compelled by a court to pay the money back to you. If on the other hand there was no formal contract or any kind of arrangement for the loan and the abuse and intimidation put you in fear of your safety (and your friend refuses to return the money) this may be considered to be theft. Police take threats of violence very seriously and if you were in fear of your safety because of the abuse and intimidation you should consider reporting this to police.