Demand letter or call: choosing the first move

The first factor is whether the relationship continues after the dispute. An employment matter where the employee is still employed, a vendor matter where the contract still has eighteen months to run, or a founder dispute where the parties remain on the cap table all benefit from the lower temperature of a call.

When the relationship has already ended, a written demand may be more useful because it creates a clear record of the position and requested response. That can apply to a former employee, a terminated counterparty, or a founder who has departed.

The second factor is the strength and cleanliness of the evidence. A matter with a clear written record, such as a signed contract, a documented breach, or a paper trail, tolerates a written demand letter early because the demand can reference the record.

A matter where the underlying facts are still partly verbal, contested, or developing benefits from a call. A demand letter sent before the evidence is settled creates a written position that may need to be walked back if the facts shift.

The third factor is what is known about the counterparty. A represented party with a business reason to resolve the issue may benefit from a precise written demand that counsel can assess and answer.

A demand can also escalate a matter when it arrives without context. In those cases, an opening call may set up a more useful written exchange. Communication should go through counsel whenever the counterparty is represented.

Some matters are not ready for either opening move. The facts may still be developing, the loss may not be clear, or a procedural deadline may not yet have been triggered. The immediate work is to gather the record, calendar the deadlines, and preserve the choice between a letter and a call.

Moving before the facts are settled can lock the client into a written position that later needs to change. The first move should follow the evidence, not outrun it.