In today’s Freedom Friday blog and email newsletter, I want to answer a question that relates to one of the many practice areas here at Liberty Legal Solutions, LLC, and that is commercial claims. You may be asking, “What is a commercial claim?” So, in today’s Freedom Friday blog and email newsletter, I’m answering the question, “What is a commercial claim in 2026.”
The American Lawyers Quarterly (ALQ) defines claims for monies owed into two categories: “retail” claims (which are often consumer debts) and commercial claims. A commercial claim is an obligation to owe money which is incurred during the course of conducting a business which arises from goods sold or leased, services rendered, or monies loaned for use in conducting a business. Not all commercial claims are based on open account balances as they also can be based on lease agreements, security agreements, consignments, guarantees, or any other similar business transaction.
At Liberty Legal Solutions, LLC, we prosecute and defend all types of commercial claims on behalf of our clients. Here is our simple five (5) step process for prosecuting commercial claims on behalf of our clients:
1. Review the File
The first step to prosecuting a commercial claim is to review the file or whatever documentation our client provides to us. Most clients who are owed money will either have invoices, a contract (or sometimes both), or other written documentation that demonstrates the obligation and the amount owed. This documentation then allows us to identify the amount owed and the legal basis for why that amount is owed (e.g., breach of contract, open account, promissory note, lease, etc.). Once this review is completed, which doesn’t take long, we can proceed to the second step.
2. Demand Letter
The second step to prosecuting a commercial claim is to send a demand letter (unless the client wishes to skip this step and sometimes it is not appropriate). Most often we will charge a flat fee to prepare a demand letter and send to the borrower (or obligor) demanding payment of the monies which are owed to your business. If the borrower (or obligor) responds to the letter, then we can work out a payment arrangement with them (either lump sum or a payment plan), and if they do not respond, then we can proceed to the third step.
3. File Suit
The third step to prosecuting a commercial claim is to prepare and file a lawsuit and then have that served on the debtor (or obligor). After the lawsuit is filed, we will watch and wait to see if the debtor (or obligor) responds to the lawsuit (usually by filing a written response which is called an Answer). If no response or Answer is filed, we will begin the process of obtaining a default judgment on the client’s behalf. If not, we will proceed with the litigation process, which often includes written discovery requests and filing a motion for summary judgment. Most cases are resolved either through a default judgment, summary judgment, or in some instances, mediation, but if a trial becomes necessary, we will prosecute the commercial claim to the fullest extent of the law.
4. Judgment
The fourth step to prosecuting a commercial claim is obtaining judgment against the debtor (or obligor). If the debtor (or obligor) fails to respond to the lawsuit, we can usually obtain a default judgment. If the debtor (or obligor) responds to the lawsuit, then we will typically issue written discovery requests to the debtor (or obligor) to better understand their defenses, and eventually we will file a motion for summary judgment. Some cases are also resolved via negotiation or mediation, but if a case is still disputed, and summary judgment did not resolve the case and it is disputed following mediation, then we will prosecute the case to trial before the court.
5. Enforcement
The fifth step to prosecuting a commercial claim is enforcement of the judgment. This step includes filing liens and garnishments, but if we do not know where the debtor (or obligor) is employed or has bank accounts, we can obtain a post-judgment Court Order requiring the debtor (or obligor) to appear in Court for an asset hearing to testify under oath concerning the debtor’s income, bank accounts, finances, and other assets. If the debtor refuses to appear at the asset hearing, we can ask the Court for additional orders, including contempt of court and a bench warrant for the debtor’s arrest. In many cases, if the debtor is a business itself, the same remedies may apply to the registered agent for the business who was served with the above-referenced Court Orders.
Thinking about starting a small business? Or maybe your small business is having issues with contracts, leases, business partners, collection issues, or experiencing other barriers to growth? Please contact me at Jonathan@libertylegalok.com to schedule a FREE strategy session.
For more information about Liberty Legal Solutions, LLC, please visit our website at https://www.libertylegalok.com/