At this stage, if I were the OP, I would send a "letter of demand" to the person who directly promised to pay (e.g.
Sample letters of demand - LawAssist : Lawlink NSW) (Adding the cost of
sending by "registered mail" to the total amount owing.)
If the time period expires without payment, it is a very simple procedure (in most states) to make an appointment to speak with the registrar at the small claims court/tribunal, at which time you would tender your evidence of claim & letter. If the registrar thinks that you have a valid case, you will be issued with a written summons to serve the "former friend" with a hearing date, your court costs will now be added to the amount owing, and interest chargeable from that date onwards.
(You do not need to involve lawyers.)
Then three things might happen -
- they pay up (or you reach an agreement to pay - personally I wouldn't accept an installment plan, as they will inevitably miss a payment and you have to go through this whole process again), and you advise the registrar that you have reached a settlement prior to the court date.
- they (and you) turn up at court, and your case will be heard
- they don't turn up at court (and you do), and the court orders the sheriff to seize property from their home to the value of the outstanding debt (which goes to auction, and you are paid what you are owed).
A letter of demand serves two purposes. First, it warns the debtor of your intention to commence legal proceedings unless payment is made and gives the debtor one more opportunity to pay. Secondly, the letter is a document which may be tendered in evidence during court proceedings as written proof of your claim of the debt owed and your attempt to settle the matter (which goes to auction, and you are paid the amounts outstanding).
http://www.artslaw.com.au/info-sheets/info-sheet/debt-recovery-letter-of-demand/