HMH COLLECTION PROCESS
Legal as adopted and maintained a collection practice equal to that
followed by most well-known collection agencies and law firms in the US.
Consequently, your placement of an account for collection will follow international
standards and common best practices for your comfort, security, and ease.
involvement with your company for the rendering of legal and collection
services will also be subject to
terms & conditions that are generally followed in the collection
industry. Our Firm follows in strict manner the guidelines set forth in
the "Operative Guides for Forwarders and Receivers" adopted by the CLLA (Commercial
Law League of America) on July 6, 1994.
collection process is very unique though. Although best practices around
the globe do give us a higher consistency in our collection efforts and
results, HMH Legal creates its own “best practices” according to our own
legal environment and legal system, Mexican commercial practices, and
other social, economic, and political situations that prevail and need to
be taken into consideration in Mexico.
entire process for collection includes the following
steps and strategies.
Operative Procedure: Placing
an Account for Collection
Accounts can be placed for collection easily through our
claim placement form on our website, or by sending by fax, email, or
currier service a
forwarding letter which specifies the particular claim turned over for
collection with your proposed terms and conditions (commission fees
proposed), along with copies of all supporting documents for the
later case we will request for you to fill out as much information as
possible for each debtor. This will help us enormously during our
collection efforts. It is our policy to work hand in hand with our clients
to get the best results possible in each collection.
Operative Procedure: Acknowledgement of Claim
A formal acknowledgment letter is sent to our clients
within two days of receipt of any claim for collection. This letter will
confirm the receipt of the claim as well as terms and conditions for
handling such claim out-of-Court, including our fee arrangement which will
always be on a contingency basis, that is, we will charge a commission fee
until a recovery is made and only if we collect. If there is no collection
there is no fee to pay.
Within the third day of
receipt of any claim HMH Legal will have already opened a file to your
claim and will update its database giving a formal identity in our system. Every progress and collection effort from now on will be
updated to our database and then posted on our website for continuous
information to our clients.
Our collection is done by Mexican attorneys and
fully-trained pre-legal collectors who are knowledgeable about Mexican
law, best known local collection strategies, and the HMH Legal unique collection
process. Our business is credit & collections, and all of our staff is
singularly selected for their demonstrated skills in this field.
skip tracing procedure
In an effort to better prepare ourselves on each collection attempt, we do
an initial skip tracing procedure to make sure that our debtor information
accurate, and up to date, regardless of the information provided by our
clients. We have to make sure that we are contacting the appropriate
person within the debtor company (the decision maker), and that we know
his full story financially, economically, and legally (full assets,
locations, related companies, lawsuits, etc.)
Whenever possible and where the debtor's jurisdiction will throw no
additional cost for us, we will conduct a full search and investigation on
special Mexican electronic databases (private and public), chambers of
commerce, public registry, debtor's address and vendors, Internet, etc.
When there is additional cost involved we will inform our clients and let
them decide the extent of our investigation.
strategy and process
Our collection process is always first pursued out of court.
We do an immediate personal visit when this is possible (either when
debtor is in our city or a city where we have a correspondent local
attorney), and we try to collect in full in amicably fashion, or at least
get a written payment plan, a formal acknowledgment of debt, or a
After that visit and a conversation with the debtor we will be able to determine if
suit will be necessary and worthwhile, as well as the promptness that is
required for any legal action.
ourselves for litigation during this initial visit, we will make our best
effort to resolve all disputes amicably, persuading the debtor to pay
voluntarily in full or to make a settlement offer with a serious payment
plan. These attempts will be supported by a series of demand letters (3).
After the third one we will know it is time to move on. Our objective is
to try to get our clients the most affordable solution within a reasonable
time period. That is definitely out of court.
This process comprehends the first stage of
collection. (This stage is sometime skipped at our client’s request, when
he wants to immediately proceed with legal action)
no recovery or formal settlement is reached during the first stage of collection, we will asses the possibility of collecting through
litigation (based on the debtor's conditions observed during our general
investigation and personal visit: assets available, current
company name and address, related lawsuits, etc.), and we will make our
recommendations for suit or not (It is not our intention to have our
clients investing in any legal action only to secure a worthless judgment).
The strategy followed in litigation and all related costs are assessed on a case by case basis,
depending on the nature of the transaction and the available supporting documents for each claim. (Please see the
FAQ’s on collection and the litigation process).
Generally, we give our first stage of collection from one to three weeks
to reach any kind of settlement agreement, depending on the response we get from the
debtor and depending on his situation. This timing will also depend on the
promptness of each response from our clients. Any and all proposals from
debtors are informed to our clients and it is our clients, not us, who
make any decision for a settlement agreement.
In litigation, timing will depend on several factors including our
current debtor situation (if debtor is operating under the same corporate
under a different company, has changed address during litigation, etc.),
debtors’ defenses (problems within your transaction, weak counsel, weak
It is recognized by most lawyers in Mexico that most of these proceedings
for recovery of debt (called
mercantiles) will last around one year, without adding any
appeal process. Nonetheless, many collections are done
immediately following suit when a debtor notices that the
creditor IS keeping his word in pursuing legal action and applying all
means necessary to collect, or when an attachment or garnishment order is issued
against him for the seizure of his company’s assets.
HMH Legal team
encompasses exceptional lawyers with expertise in the field of
international & commercial law, and vast experience in cross-border
commercial disputes. Ninety percent of our client base involves foreign
companies with collection problems in
so the majority of our cases involve international commercial disputes.
(Please refer to the services section on our website for more information
on specialized services provided by our Firm)
This has placed the need
in our Firm to seek and reunite experts in such field, something we have
successfully done so far to our clients' advantage. Thus, we are allowed to
pursue legal action throughout the country with an approach like no other
law firm or collection agency in Mexico.
Our litigation strategies and formal complaints are always designed and
prepared by expert in-house attorneys and of-counsels in our main office
in the City of Tijuana, with the approving opinion of our correspondent
local attorneys to accommodate to local rules and customs.
When a complaint or formal petition is ready for filing we turn it over to
any of our local correspondent attorneys who will help us with this
initial task as well as the remaining process of litigation. It is our
local attorney the one that personally oversees the proceedings at the
Courtroom and attends hearings under our Firm’s in-house attorneys daily
supervision, with full involvement in the case and control overall.
This reduces the overall cost of litigation to our clients, and allows
them the use of experts on their side for optimum results.
fees and cost
In-court collection [legal action] is subject to different terms depending
on the nature of each claim. After assessing a particular claim and
situation we will provide our opinion and a specific proposal for
initiating legal action (suit requirements). Once we have recommended suit
and provided suit requirements, we will require a deposit of funds to
cover court costs and expenses throughout judicial proceedings. Costs vary
for each claim depending on the type of proceedings that we are filing
for and the particular jurisdiction of the debtor.
We provide each client with a monthly statement for all of his accounts,
reflecting each cost incurred during the month, and reimbursing at the end
any and all funds not used during the proceedings.