How To Send A Legal Notice To A Company?

A legal notice is a formal legal document addressed to a company, primarily as a pre-step towards a lawsuit, to inform such companies about the grievance and seek redressal. This is the primary step to resolve the dispute, which has not yet reached the courts. A well-drafted, well-delivered legal notice often works wonders to achieve speedy resolutions, thus saving time and money. Given the complexities of the law involved, it is important to consult a lawyer while drafting a legal notice. Important Acts governing legal notices are the Indian Contract Act, 1872, the Consumer Protection Act, 2019, and the Code of Civil Procedure, 1908.

When Should You Send A Legal Notice To A Company?

Sending a legal notice to a company is a formal way to communicate your grievances and intentions, often as a precursor to legal action.

Breach Of Contract

A legal notice is not obligatory when a company fails to pay for goods delivered or services rendered in its contractual obligations. These acts constitute a legal precondition for demanding that the company rectify the violation within an allotted time, stating the specific terms violated and what the sender requires. This is a preceding to litigation and describes the sender's intention to go to court if the complaint is not resolved. A documented attempt to resolve the problem will aid the sender if he has to bring the matter to court.

Also Read : Remedies For Breach Of Contract

Consumer Complaints

Where a company sells defective products or provides poor services that inflict harm or losses on the consumer, a legal notice is warranted. It enumerates the particular defaults or deficiencies, demands redress (like repair, replacement, or refund), and serves as formal documentation of the grievance. It puts the company under an obligation to deal with the customer's grievance in a bid to avoid taking the matter further. If the company fails to respond satisfactorily, it becomes proof of an attempt to settle matters amicably before heading towards the legal route.

Employment Disputes

Legal notices are vital in employment disputes such as wrongful terminations, failure to pay the salary or dues, or violation of employment laws by a company. The notice would contain specific details of the grievances to be settled, ask for damages or re-employment, and give the company a response time. It is an official channel through which an employee may communicate his or her rights and intent on going ahead with legal action in case the issues do not resolve. This documented notice is important for a case built in labor courts or other relevant tribunals.

Intellectual Property Disputes

A legal notice is important when one company commits infringement against an intellectual property right of another party, such as a trademark or copyright. It will inform the other company of the act of infringement, cease the infringing action, and prosecute for damages. It serves as a warning and an ultimatum for immediate compliance with the rights of the intellectual property owner. The neglect of this kind of notice may lead the person to legal action very quickly through injunctions and huge amounts of money.

Steps To Draft A Legal Notice

The following are the steps to draft a legal notice to send to a company:

Step 1: Contact A Lawyer To Draft The Notice

You can draft a legal notice yourself. However, it is advisable to consult an experienced lawyer. A lawyer will ensure accuracy, laws relevant to compliance, and legal terms. They may also advise best strategy and legal implications.
They would verify the facts and cite relevant law precedents and draft the notice in a professional tone.

Step 2: Include Sender And Recipient Details

Accurate identification of both parties is important. For companies, use their official registered name and address. Verify the details of official sources such as the website of the company or the government registry.
Full legal names, addresses, and contacts should be included. For corporations, use the address of the registered office. This ensures proper service upon the correct legal entity.

Step 3: Clearly State the Grievance and Supporting Evidence

The notice has to be short and to the point, describing what happened, with timelines and actions taken on the damage incurred, along with proper evidence. Give an objective, factual account of the grievance. Include copies of contracts, invoices, emails, or any other documents to substantiate your allegations. Be precise and not emotional.

Step 4: Reference Relevant Laws and Contractual Clauses

Citing specific laws and clauses of the contract would give weight to the argument, thus indicating that some legal basis exists for the claim. Identify laws, regulations, and contractual provisions in detail and have those checked with your lawyer for accuracy. Consider citing relevant past court cases if applicable.

Step 5: Mention The Legal Demand And Deadline For Compliance

Describe clearly your desired outcome, whether it's payment, action, or compensation. Then set a reasonable deadline for compliance from the recipient. State the action to be taken, the amount due, or the relief sought. Use language like "within [number] days from the date of this notice."

Step 6: Properly Format The Legal Notice

A professional format enhances the credibility and creates clarity in the notice.
Use clear and concise sentences. Organize the notice into numbered paragraphs. Include subject matter, date, and sign. Print the notice on the official letterhead, if any. Send the notice via registered mail or courier with an acknowledgment of receipt and keep a copy for record purposes.

How To Send A Legal Notice?

Sending a legal notice correctly is crucial for its validity and effectiveness.

Modes Of Sending A Legal Notice

The following are the modes of sending a legal notice:

Registered Post With Acknowledgment Due (RPAD)

This is the most conventional and widely accepted means. RPAD ensures proof of delivery and receipt as it records the signature of the recipient on acceptance. It can also be deemed legally valid since it offers a systematically proven and documented manner of proving that the item was delivered. Keep the receipt of RPAD plus the acknowledgment slip as evidence.

Courier Services

Similar to RPAD, trustworthy courier services usually provide tracking and a delivery confirmation feature. Ask the courier for the delivery receipt with the recipient's signature. Retain that delivery confirmation and tracking information from the courier as proof.

Email Communication

While email may prove to be a convenient formality, the same cannot be said about legal validity. Sending the legal notice to a party primarily through email is considered inadequate; it may be used as a supplementary method. Alongside sending via email, demand a return receipt along with a delivery confirmation. Best is to send a physical copy in addition to the email. Keep a copy of the sent email with all the headings.

Serving Through A Notary Public

To serve a legal notice, a Notary Public may do so personally or through their agent. This adds extra formality and credibility to the notice itself. The affidavit of service provided by the Notary Public is strong evidence of service delivery.

Importance Of Stamp Paper And Notarization

• Normally, a legal notice does not require a stamp paper. Its affidavit or declaration may be required to be on a stamp paper in accordance with local laws.
• This being said, notarization lends credibility to those specific documents, such as affidavits, that accompany legal notices.
• Notarization essentially serves to verify who signed the document and that he/she did so voluntarily.
• Do consult with a lawyer to assess whether stamp papers are applicable to your case or if notarization is required.

Acknowledgment of Receipt - Why It’s Crucial?

• Gaining an acknowledgment of receipt is extremely important because it shows that a legal notice was received by the recipient.
• If not, one may then be deemed to be incapable of proving that the legal notice was sent to the addressee; thus weakening your legal position.
• RPAD and courier services provide legally acknowledged proof for the same.
• An acknowledgment of receipt establishes the conditions under which the recipient either could or could not receive the notice and respond to it, particularly when the ordinary course of events leads to a court proceeding.

What Happens After Sending A Legal Notice?

The scenarios after sending a legal notice are as follows:

Scenario 1: Company Responds, And Dispute Is Resolved

• The company acknowledges the notice and enters into negotiations or takes remedial action.
• A settlement might be reached, setting out the terms of the resolution, which may involve payment, repairs, or fulfillment of the contract.
• This scenario avoids any further legal action, thereby saving time and resources for both parties.
• For clarity and enforceability, it is important that any such agreement is in writing and signed.

Scenario 2: Company Ignores The Notice

• Failure to heed the legal notice on the part of the company shows a lack of eagerness in resolving the matter through mutual means.
• The sender can then file a case in the proper court with such legal notice on record as an attempt at resolution.
• This could constitute the filing of a case before a Small Claims Tribunal for small disputes, a Commercial Court for business-related matters, or the National Company Law Tribunal (NCLT) for issues relating to companies, like insolvency.
• The sender will now be required to source all relevant evidence as well as make preparations for possible court hearings and trials.
• Disregarding the legal notice indicates the company's unwillingness to resolve the dispute in an amicable way.
• The sender may now file a case in the proper court using the legal notice as evidence of attempted resolution.
• This may be filing a case before a Small Claims Tribunal for minor disputes, a Commercial Court for matters business-related, or the National Company Law Tribunal (NCLT) for company-specific issues such as insolvency.
• The sender will need to gather all the relevant evidence and prepare for the possibility of hearings and trials in court.

Scenario 3: Company Denies Allegations – Possible Counteractions

• As soon as the company responds and refutes the allegations made in the legal notice, putting forth its own series of counterarguments and/or evidence, negotiations or mediation are usually attempted to settle.
• If negotiations fail, then the aggrieved party will initiate litigation, whereby the court will decide based on evidence adduced by both parties.
• It is then imperative to involve a lawyer to evaluate the counterarguments and formulate a response.

Consequences Of Not Replying To A Legal Notice And Potential Escalation To Court (Small Claims Tribunal, Commercial Court, NCLT)

• It may entail a major setback if the company chooses not to respond to this issuance of notice when its position in subsequent proceedings is challenged by the other side.
• The court may choose to interpret this as an admission of guilt or the company having no defense to the claims being made against it.
• In such a case, the sender may either approach the Small Claims Tribunal for smaller monetary claims or the Commercial Court for business-related disputes, or go to the National Company Law Tribunal for cases of company insolvency or restructuring matters.
• Any judgment by the court in favor of the claim by the company will lead to a financial liability in terms of an order for an action to be done or will attract other legal consequences.
• Non-compliance with this order would therefore lead to action, such as seizure of assets.

Also Read : How To Check A Legal Notice Online? - Quick Guide & Best Practices

Legal Remedies If The Company Ignores The Notice

When a company ignores a legal notice, the sender has several legal remedies available, depending on the nature of the dispute and the applicable laws.

Filing A Case In NCLT, Consumer Forum, or Civil Court Based On The Nature Of The Dispute

In this process, the following courts are involved:

NCLT (National Company Law Tribunal)

This tribunal has jurisdiction over company matters such as insolvency, merger, and oppression or mismanagement of shareholders. If the legal notice concerns company law matters, the proper forum for instituting a case will be the NCLT.

Consumer Forum (District, State, National)

Consumers can approach consumer forums for complaints that arise due to defective products or inadequate services. These relatively inexpensive and easy consumer forums provide a solution to the problem of grievance redress.

Civil Court

Contractual disputes in general and property disputes, and any other legal matter that does not fall under the jurisdiction of the specialized tribunals can be tried in the civil courts. This is the most commonly used court for disputes that arise between businesses.

Seeking Compensation, Damages, Or Specific Performance

Depending on the nature of the breach, the sender can seek various remedies.

• Remedies involve claims for monetary damages that offset tangible losses attributable to the company.
• Damages may include concern for compensation for emotional distress, damage to reputation, or any other intangibles.
• This will mean that the claimant requests that the court compel the company to execute under the contract.

The legal notice is crucial evidence when requesting these remedies.

Alternative Dispute Resolution

• Disputes are resolved faster and are treated more confidentially through arbitration than litigation trials.
• If there is an arbitration clause in the agreement between the parties, the dispute may be referred to an arbitrator.
• The Arbitration and Conciliation Act, 1996 governs arbitration proceedings in India.
• Arbitration is sought by businesses for expeditious and confidential resolution.

Legal Timelines And Cost Considerations

• Depending on the court or tribunal concerned, the nature of the case, and the workload of the judiciary, legal timelines vary widely.
• Litigation can be a long, drawn-out affair, requiring a potential duration of many months or even years to come to rest.
• Some common cost factors in any case are court fees, lawyer fees, and other expenses that may be incurred through the course of legal proceedings.
• Arbitration is quicker, and the cost does entail other associated costs like arbitrator fees.
• It is important to discuss with a lawyer and understand an estimate of the related costs and timelines before embarking on any legal action.

Conclusion

Sending a legal notice to the company bears an important task regarding the settlements of disputable matters before litigation can be applied. It is hence advisable that a lawyer prepares and sends this notice, guaranteeing total compliance with the law and factual accuracy. Furthermore, a wise attorney will prepare an understanding of what happens next once a legal notice is dispatched in order to evaluate future steps."

FAQs

A few FAQs are:

Q1: Is a legal notice mandatory before filing a lawsuit against a company?

No, but it is a highly recommended pre-litigation step.

Q2: Can I send a legal notice to a company without a lawyer?

Yes, but it is highly recommended to have a lawyer draft and send the notice.

Q3: How long does it take for a legal notice to be effective?

The effectiveness depends on the company's response and the nature of the dispute.

Q4: What if the company ignores the legal notice?

You can proceed with legal action by filing a lawsuit.  

Q5: Can a legal notice be sent via email?

Yes, but ensure you have a read receipt.

Disclaimer: The information provided here is for general informational purposes only and should not be construed as legal advice. For personalized legal guidance, please consult with a qualified Civil lawyer.