Keep contracts, invoices, delivery records, bank statements and complete message histories. WeChat conversations may help explain the transaction, but retain original files and context, rather than selected screenshots alone. Record who controlled the relevant account and obtain reliable translations where needed. A transfer to a relative or business associate may be disputed as a gift, investment or payment on someone else's behalf.
Section 5(1)(a) of the Limitation of Actions Act 1958 (Vic) generally sets six years from accrual for simple contract claims. The accrual date depends on the obligation; a demand loan can create particular issues. Other causes of action and circumstances may have different rules. Sending a demand or negotiating does not itself stop time running. The amount, parties and cause of action affect the appropriate court or tribunal.
In Equuscorp Pty Ltd v Haxton (2012) 246 CLR 498; [2012] HCA 7, loan agreements connected with unlawful investment schemes were unenforceable and restitution did not provide the recovery sought. It was not an ordinary family loan case. Its practical lesson is that proof money changed hands does not bypass defects in the legal basis for repayment.
A demand should explain the debt, calculation and payment deadline accurately. Section 24 of the Civil Procedure Act 2010 (Vic) requires reasonable endeavours to resolve disputes, subject to the Act's qualifications. Consider a documented repayment arrangement or mediation alongside proceedings. Check solvency, assets and enforcement options before incurring substantial costs. Do not use insolvency procedures as a shortcut for a genuinely disputed debt.
Author: Yi Liang
Last updated: October 2026
Jurisdiction: Victoria, Australia
Disclaimer: This article provides general information only and does not constitute legal, financial or tax advice. The law may change and its application depends on individual circumstances. You should obtain professional advice before acting on the information contained in this article.