Disclaimer: this is just what I've experienced using the WA system, good luck.
I do not know or care which company you are referring to here, but debt recovery is something I've been learning about for the past two or so years.
State to state things are a little different.
In short, I rented a house to some scumbags, they trashed my house and stopped paying rent, i.e. breached the contract.
Took them to court, they did not turn up, had my case heard, by presenting my evidence ( contract, photos and condition reports ), and the Magistrate ruled in my favour and awarded an amount.
A debt recovery agent basically tries to bully and scare you into coughing up cash, if you (the debtor) are stupid enough to pay up to their conditions, plus interest and their self imposed fee's, your mistake.
Nothing is set in stone until the Magistrate rules as such, i.e. MR Smith, you are hereby ordered to pay ABC $XXXXX.
If you have been making regular payments to the creditor ( or trying too ), the Magistrate is unlikely to be too harsh on you.
Often the Creditor will request a payment schedule, which is the Magistrate ordering you to pay under certain conditions, i.e. $xxx per week, this amount is decided at a "means enquiry", you will need to take pay slips etc etc.
If you default on the installment order, the creditor will then seek a "Garnish" or "Earnings Appropriation Order", which is effectively the court ordering your employer to pay the creditor.
One nasty curve ball that can be thrown in after defaulting on a installment order is the "Seizure and Sale" or "Seizure and Deliver", the bailiff will turn up on your door and take goods to the vales of the outstanding amount, this is not a good situation, a $1200 TV, when seized and sold is worth about $300, my previous tennants found that little gem out the hard way ( that is how the idiots spent their cash splash money, I mean stimulas package
).
With this order, there are items that are exempt from the bailiff taking, each state is different ( fridge, work clothes etc etc ). My advice is not to let it get this bad, you do not need your kids to see this.
From what I've seen. Debt recovery agents are used when there is a fair chance of recovering the cash, they are expensive and as others have said, you are under not obligation to pay them squat, unless the Magistrate orders you too.
If you are summonsed to Court, you will be served this notice by hand by either the creditor, debt recovery agent or the bailiff.
If you are summonsed to Court, be it the small claim or the Magistrates, and do not attend, perhaps not immediately, a bench warrant for your arrest will be issued.
The advice above by other posters is sound, get legal advice, if you are the debtor, just about every state has a free service to give you advice, if you are the creditor, you'll have to pay for advice.
Unions, they can offer very good advice and support.
Interest and fees can only be added by the Magistrate.
Everytime you go to court, the creditor has to pay application fees, the debtor will eventually have to pay all of these.
Mediation is often the first step in the process, the two parties enter a short attempt at negotiation:
The Creditor goes into this looking to gain as much of the money as quickly as possible, for example if the debtor owes the creditor $10,000.
The debtor can offer say $5,000 cash, the creditor may take that, so it is done and dusted on the spot. ( the creditor knows it will take atleast 12 months and 4-5 court visits to get the whole amount, and may cost them $6-7,000, [most of which is cost they can not pass on] to recovery the extra $5,000, so they often cut their losses and take the $5,000)
If an agreement is reached at mediation, the court registrar will issue an order detailing the term of the agreement.
To recover a debt entirely will take many visits to court and quite a lot in terms of time and money ( usually 12-18 months, and there is no certainty they will get the money ), application fees will be charged to the debtor, but the creditors time generally is not.