 If rates are still unpaid after 6 months from the date when they were deemed to be in default, a further surcharge of 10% on the total amount outstanding may be added.Before taking any legal action to recover arrears of rates, a warning letter will be issued to the defaulter to demand immediate payment.Legal action for recovery of rates is taken in the Small Claims Tribunal if the amount of rates arrears does not exceed $50,000 or in the District Court if the arrears exceed $50,000.