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The Payment Demand Letter Breach of Contract is a crucial document in German business practice, used when a party fails to fulfill their payment obligations under a contract. It serves as a formal notification under German law, particularly relevant under §286 of the German Civil Code (BGB), and is often a prerequisite for initiating legal proceedings for payment recovery. The document should be used when informal attempts to secure payment have failed and the creditor needs to establish a formal default (Verzug). It typically includes details of the original contract, specific amount owed, payment history, applicable interest calculations, and a final deadline for payment. This formal demand letter must comply with German legal requirements regarding form and content, making it admissible in court if further legal action becomes necessary. The document is particularly important as it triggers legal consequences such as default interest and can serve as evidence in subsequent enforcement proceedings.

1. Sender Details: Full legal name and address of the creditor/demanding party

2. Recipient Details: Full legal name and address of the debtor, including any reference numbers

3. Date and Reference: Current date and any relevant reference numbers for the original contract or invoice

4. Subject Line: Clear identification as a Payment Demand Letter (Zahlungsaufforderung/Mahnung)

5. Contract Reference: Specific details of the underlying contract including date and nature of agreement

6. Outstanding Payment Details: Precise amount owed, original due date, and breakdown of the claim

7. Legal Basis: Reference to relevant contract terms and legal provisions (e.g., BGB § 286)

8. Payment Deadline: Clear specification of the final payment deadline (typically 7-14 days)

9. Payment Instructions: Bank account details and payment reference information

10. Legal Consequences: Statement of consequences if payment is not received by the deadline