The Acknowledgement of Claim Letter is a crucial legal document used in Australian business and legal practice when one party needs to formally recognize a debt or obligation to another. This document is particularly important as it can restart the limitation period under Australian law, during which a creditor can take legal action to recover a debt. The letter serves multiple purposes: it provides clear evidence of the debt's existence, confirms the debtor's acceptance of the obligation, and can include specific terms of repayment if applicable. It's commonly used in debt recovery processes, commercial disputes, and financial arrangements. The document must be carefully drafted to ensure compliance with relevant Australian legislation, including the Limitation Act and Evidence Act applicable in the relevant state or territory. An Acknowledgement of Claim Letter typically includes specific details about the debt, parties involved, and any conditions or terms associated with the acknowledgment.

1. Letter Header: Date, recipient's name and address, reference numbers

2. Subject Line: Clear identification of the matter (e.g., 'Acknowledgement of Debt - Reference Number [X]')

3. Formal Opening: Formal salutation and introduction identifying the parties involved

4. Debt Details: Specific details of the debt being acknowledged, including amount, origin, and date incurred

5. Explicit Acknowledgment: Clear and unambiguous statement acknowledging the debt and its validity

6. Interest Statement: Declaration regarding any applicable interest rates and accrued interest

7. Closing Statement: Formal closing confirming the binding nature of the acknowledgment

8. Signature Block: Space for signature, name, date, and witness details if required