“The recovery of debt procedure can be a challenging task when transactions are not backed by evidence. However, the OHADA Law has provided several mechanisms for debt recovery in Cameroon”
Debt recovery practice in Cameroon is governed by the OHADA Law on Simplified Recovery Procedures and enforcement measures of 1998.
The OHADA Law on Simplified Recovery Procedures and enforcement measures of 1998 has put in place practical mechanisms through which debt recovery practice in Cameroon can be exercised before the competent court in view to enable a creditor is paid what he is due.
Debt recovery in Cameroon is the systematic process of collecting unpaid money owed by individuals or businesses to a creditor. The process typically moves from informal communication (Simple Letter of Demand) to formal legal action, with strict legal regulations (In conformity with the OHADA Law on Simplified Recovery Procedures in Cameroon) protecting debtors from unfair practices.
The Debt Recovery Process for a Creditor in Cameroon
This process usually follows a series of steps as follows:
Internal Assessment and Communication: The creditor first sends a series of polite reminders through letters, emails, or phone calls. The goal is to reach an amicable solution, such as a full payment or a structured repayment plan. Documents at this stage are always couched as a Letter of Demand.
Pre-Action Notice: If initial attempts fail, a formal "Pre-Action Notice" (or "letter before action") is issued. This official notice outlines the debt details, a deadline for payment, and the potential consequences of non-payment, such as legal action.
Third-Party Involvement: If the formal notice is ignored, the creditor may hire a debt collection agency or a lawyer in Cameroon to handle the process. These specialists use various strategies and their expertise to encourage payment, operating within legal guidelines.
Legal Action: As a last resort, the creditor may initiate legal proceedings by filing a lawsuit before the competent court in Cameroon. This can result in a court judgment that legally obligates the debtor to pay the amount owed, plus potential interest and legal costs.
Enforcement of Judgment: If the debtor still refuses to pay after a court judgment, the creditor can pursue enforcement measures. These might include wage garnishment, placing a lien on property, or seizing assets through enforcement officers or bailiffs in conformity with the Simplified Recovery Procedure under the OHADA Law.
Debtor's Rights and Options in Cameroon
Debtors have specific rights and options when facing debt recovery process in Cameroon:
Dispute the debt: The debtor can contest the debt in total or partially.
Negotiate: The debtor can try to negotiate a settlement or a manageable repayment plan with the creditor or collection agency in Cameroon.
Seek advice: The debtor can opt for independent advice on how to manage the situation.
Protection from Harassment: The debtor is protected from harassment under certain laws in Cameroon like the Penal Code.
Statute of Limitations: Debts have time limits for legal action (e.g., six years in many places for simple contract debts), after which they become "statute-barred," and court action may no longer be possible.
This Practical Mechanism for Debt Collection in Cameroon
These mechanisms are as follows;
- Mandatory Injunction to pay procedures
- Procedure for the Delivery or Restitution of Specific Personal Property
- Sequestration of Tangible Movable Property, Debts, Shareholdings and Other Transferable Securities
- Attachment and Sale Procedures
- Garnishee Proceedings
- Assignment of Earnings
- Simplified Procedure for Claims of Maintenance Allowance
- Attachment and Apprehension under a prior claim of Tangible Movable Property etc.
When petitions are filed before the competent court in Cameroon for debt recovery, the debtor has either the choice to contest the petition in what is referred to as an opposition or not to contest in what is referred to as a non-opposition or an undefended list procedure.