You have asked us to pursue a debt on your behalf.  The purpose of this guide is to let you know what procedure is involved at various stages of the process.  In many cases,  it will be possible to recover debts straight away after sending a 7 day letter.   Unfortunately, however, there can of course be no guarantee of this and the rest of this guide is intended to inform you, the client, about the procedure and options available if payment is not received quickly.   This Guide also gives details of current court fees but does not deal with costs.    Details of our costs are available upon request.

Court Proceedings

If a debtor does not, as demanded, pay the debt within 7 days, we will, if you instruct us,  issue Court proceedings on your behalf.  The court fee payable to the court on issue ranges between £30 and £1,700 depending on the level of the debt.   

When the Court proceedings are issued and served on the debtor, then the debtor has 14 days in which to file a Defence unless an acknowledgement of service is filed, in which case the debtor has 28 days in which to file a Defence.  If the debtor does not file a Defence within that period, then Judgment will be entered in your favour.

If court proceedings are commenced, contractual interest can also be claimed on the debt.  If there is no relevant contractual rate of interest then statutory interest will be claimed on the debt at the rate of 8% per annum from the date when the payment becomes due.  If the debt is a commercial debt you can recover interest under the Late Payment of Commercial Debts (Interest) Act 1998 at the rate of 8% above bank base rate as well as compensation for debt recovery expenses. Further details will be provided on request.

Judgment on Acceptance of an Offer

In some cases a debtor will admit the debt following the receipt of the Claim Form and they can offer to pay.  You are able to obtain a Judgment based on those proposals. 

Where a Defence is filed

If the debtor files a Defence then the Court proceedings become defended.  If your claim is for less than £5,000 then it will be referred by the Court to the small claims track for arbitration.  Costs are very rarely awarded in claims referred to the small claims court and if your claim succeeds you are unlikely to recover your costs from the debtor.  It is of course possible for clients to undertake litigation in the small claims court themselves and we would encourage this approach to make the procedure as cost effective as possible.

If your claim is for more than £5,000 then the case would normally proceed to trial in either the fast track (for cases where the sum claimed is between £5,000 and £15,000) or the multi-track (for cases where the amount claimed is more than £15,000).

If the value of your claim is more than £1,500, a further court fee of £100 is payable when a Defence has been filed.  This is known as the Allocation Questionnaire fee.

Instalment Payments

The debtor may offer to pay the debt to you by instalments either before or after the commence of Court proceedings.  If you are prepared to accept payment by instalments then it is more cost effective for you to collect the instalments yourself.  We can do this on your behalf if you wish however.
 
Enforcement Procedures

If your claim against the debtor succeeds after Court proceedings have been commenced and Judgment is entered in your favour, it may still be the case that the debtor will not pay.  If so, it may be necessary for you to take steps to recover the debt by one or more enforcement procedures.  You should also note that in some cases interest on the debt continues to accumulate after Judgment. 

The various methods of enforcing a Judgment are as follows:-

Warrant of Execution
 
This is the most common method of enforcement.   A Court Bailiff may attempt to seize the debtor’s goods (if any) if the debt is not paid.  The court fee to issue a Warrant of Execution is £35 for up to £125 being claimed and £55 for any sum over £125 being claimed.

Writ of Fieri Facias (Writ of Fi Fa)

This is a similar procedure to a Warrant of Execution but is for use in proceedings in the High Court.  Debts over £600 can be transferred to the High Court.  The High Court procedure is considered more effective than the County Court procedure.  The fee for this is £68.00 if the documents are sent via the Sheriff’s Lodgement Centre which, in our experience, is the most efficient way of doing it.   This procedure is operated by the Sheriff’s Office rather than the Court Bailiff.  The Sheriff’s Officer will also charge according to time spent, sum recovered and expenses incurred.   If, for some reason, they are unable to make a recovery, the Sheriff’s charge is limited to £60 plus VAT and the initial £68.00 fee.  

Attachment of Earnings

This is available where the debtor is employed.  The Court may order a sum to be deducted from the debtors wages each week/month.  The employer must pay that sum to the Court who then forward it to us.  The fee for this is £65.

Order to Obtain Information (Formerly known as Oral Examination)

This is a procedure to obtain more information about the debtor. The debtor has to come to Court and supply details about his financial circumstances.  This enables you to consider which enforcement procedure is appropriate.  The fee for this is £45.  A hearing date is listed and notice of the hearing  must be personally served upon the debtor.   There is no need for attendance by us or indeed yourself at this hearing.  If the debtor fails to attend the hearing a committal order may be made against the debtor.

 Third Party Debt Order (Formerly known as Garnishee Order)

This is available where another person or, for example, a Bank, holds money for the debtor.  An Order can be obtained requiring that person to pay the money held for the debtor to us.  The Court fee for this is £55.

Charging Order

Under this procedure the Court can be asked to place a Charging Order on the debtor’s property.  This gives you some security for your debt.  It may then be possible to recover the debt when the property is sold although this depends on what money is available after any mortgages on the property are repaid.  The Court fee for this is £55.   There are a number of disbursements payable.  These are usually fees to register the Charging Order on the debtor’s property and range between £10 and £100.

Bankruptcy/Winding Up

This is often a last resort.  It is possible to take steps to try and have the debtor made bankrupt or to wind up a limited company.  If you wished to consider taking this step then a full and detailed explanation of the work involved will be supplied to you at the appropriate time.