Can you collect what is owed to you

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Can you collect what is owed to you

Can you collect what is owed to you?

There have been a couple of changes recently that affect the recovery of money through the courts.

First, there has been a price increase. This affects only the fees paid to the county court for enforcing judgments. When the court system was reviewed in 1998, one of the objectives of the reforms was to make the court service self-financing. This is not yet happening – hence the fee increase.

There is no increase in the fees for issuing the original claim – just the cost of enforcement after judgment.

Second, you may have heard from other alarmist solicitors that the whole basis of making a claim has been changed beyond recognition and that you may face serious consequences if you do not use those solicitors who claim to have the answers to this huge problem.

The reality is that the notice period that you must give to a debtor has simply been set down by the courts as a minimum of 14 days (and up to 30 days in complex cases). This is no change to anything that has gone before – just a judicial clarification of what is considered to be a “reasonable” notice period. In the past, there has always been a requirement that formal warning is given before court proceedings are issued. Traditionally, that has tended to be a 7 day warning, but there has never been any authority for this. In certain cases, shorter notice or longer notice might be considered reasonable.

The court has written a number of protocols over the past 10 years which set down best practice standards for handling different sorts of claims, from construction claims to medical negligence claims. The most recent such protocol concerns debt recovery and it came into force in July. It simply says that you should give a minimum of 14 days notice to allow the debtor to carry out investigations and respond. In complex cases, a longer period might be necessary – up to 30 days.

Obviously we would recommend adherence to the protocol but there is no absolute requirement to do so. It would not invalidate your claim. At worst, it may mean that you are deprived of the costs of the proceedings, even if you win. Our view is that this is unlikely to be of much consequence in most cases as the majority of claims do not get as far as a trial.

What this underlines though is the need to chase late payment of debts at an earlier stage than has been necessary in the past. Debtors are taking longer to pay and genuine disputes need to be flushed out and resolved quickly, whilst positive action needs to be taken to collect those debts that are not disputed.