There are various legal procedure for debt recovery in Cameroon. A debt exists where a certain amount of money is owed from one person (the creditor) to another (the debtor) due to certain agreements. Contracts are entered and executed between parties for various reasons and when there is a breach or failure for a party to perform his part of the contract, the aggrieved party can institute an action in court for recovering debts in Cameroon. Debt recovery can also arise in loan transactions “bank debt recovery in Cameroon”.
It is important to state that the limitation period in recovering debts in Cameroon that arose from a simple contract is six (6) years excluding the year the contract was entered and executed, as provided under Section 21 (1) (a) of the Limitation of Action law. Therefore, an action for debt recovery becomes statute-barred when the limitation period of 6 years has elapsed.
The procedure for debt recovery in Cameroon is contained in text like The Simplified Recovery Procedure under Law No 89/012 of 29/12/1989 and The Undefended List procedure under Order III Rules 9-14 of the Supreme Court Civil Procedure Rules Cap 211.
The first step in recovering debts in Cameroon is to write a demand letter to the debtor, warning her about the consequence if payment is not received within a stipulated time. The demand letter will also contain steps to be taken where payment is not received.
This second legal procedure for debt recovery is more suitable in bank debt recovery in Cameroon or where the parties in debt recovery disputes are corporate organizations. The proceedings can be done privately without resorting to court actions. In this procedure, parties submit voluntarily to it and the arbitrator(s) makes a binding decision on the debt recovery.
Another debt recovery method recognized under OHADA to a creditor is that such a creditor can apply to the courts for an injunction to pay against a debtor especially when the debt is unquestionable, liquidated and due. The application can be made in the Court of First Instance or High Court depending of the amount of money claimed.
Further , recovering debts through winding up of the company .This process entails serving a statutory letter of demand for winding up of the Company due to its inability to pay its debts and upon expiration of the statutory period, a winding-up proceeding is commenced against the Company to liquidate and sell its assets.
In conclusion, debt recovery in Cameroon involves making legal demand first by issuing a demand letter and when the debt remains unpaid, litigation can be explored for the purpose of recovering debts. It is common to see financial institutions or cooperative societies retain the services of legal practitioners to engage a debt recovery procedure
Article by Barr. Mafany Victor Ngando
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