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How we recover debt

By using proven methods, skilled procedures and a bespoke case management system tailored for effective debt recovery, we offer clients a debt recovery service that is as quick, simple and effective as possible.

Letters before action

Upon receipt of instructions we send a letter to your debtor detailing the monies owed, and demanding payment within 7 days. The letter makes it clear that if payment is not received then court proceedings may commence.

Where appropriate this letter will include a demand for any interest and compensation payable under the Late Payment of Commercial Debts (Interest) Act, unless we are otherwise instructed. Late payment interest can be claimed at 8% over the Bank of England Base Rate if:

  • The contract relates to the supply of goods and services which were purchased by your customer for business purposes.
  • The contract was formed after 6 August 2002.
  • The contract does not contain a provision for interest or other substantial remedy for late payment.

In many cases, even where you have made attempts to chase the debt yourself, a letter from a third party with the threat of further action can result in payment being made.

Pre Legal Collection

Where no response has been received from your debtor you may instruct us to proceed with chasing the debt via means of further letters, emails and telephone calls for a short time. Many clients chose this option as it provides an opportunity to try and establish communication with the debtor and secure payment, or to negotiate a repayment proposal in accordance with their instructions.

In cases where the debt remains unpaid, the information gathered during the collection process can prove useful when making decisions relating to legal proceedings and enforcement.

Court Claims

It is not always possible to recover monies through means of a letter before action and/or pre legal collection. In such cases we will, on your instruction, issue a claim.

When preparing the claim, solicitors fixed costs and the Court fee is included within the debt and is therefore recoverable from the debtor if successful. Statutory, contractual or late payment interest and compensation is also added to the debt for you by us to ensure that you are recovering the maximum amount possible.

When a claim form is issued, your debtor is forced to comply with a set timetable for response. Within 14 days they must either admit the debt and offer payment in full or by instalments, file a part admission, or contest the debt as a whole. If a claim form is ignored completely then we will apply for judgment in default on your behalf.

The minority of claims will become defended but in such circumstances we are able to offer cost effective advice from a highly experienced team. You may instruct us to review the defence and offer commercial and tactical advice on the best way to proceed.

Judgment & Enforcement

Once we have requested the entry of a County Court Judgment (CCJ) the debtor will have 28 days to pay in full. If the debtor fails to pay within this time the CCJ will be registered against them. This will remain on the debtors credit file for a period of 6 years and may have a negative impact on their ability to obtain credit.

The consequences for a debtor of having a CCJ registered against them are serious, and as such the threat is often enough to secure payment within the 28 day time frame. Should however your debtor still not pay, then we can advise on the best means of enforcement of the Judgment, and commence the enforcement proceedings for you.

There are a number of enforcement options available and these include:

  • Writ/Warrant of Execution - the use of Bailiffs of High Court Enforcement Officers to seize and sell the debtors property.
  • Charging Order - taking a legal charge over the debtors home or office.
  • Attachment of Earnings Order - having the debt paid out of the debtor's earnings.
  • Third Party Debt Order - having a debt due to the debtor paid to you.
  • Insolvency - Issuing proceedings to make you debtor bankrupt or to wind up the company.

You might also consider applying to the Court for an Order to Obtain Information. Whilst this is not an enforcement process as such, it will require the debtor to attend Court and be subject to an examination about their financial affairs. This will give you more information about your debtor if required and provide a better understanding of the best enforcement actions to take.

Insolvency Proceedings

If the amount of your claim is over £750 you may consider commencing insolvency proceedings as an alternative to issuing a claim. This would be bankruptcy for an individual, and winding up for a company.

Generally we would only advise pursuing insolvency proceedings in cases where the debt is of a high value due to the increased costs compared to issuing a claim. However, the mere threat of insolvency, made by serving a statutory demand, may be useful in other cases where the debt is over £750 and is undisputed.

Serving a statutory demand is the first step in proceedings of this nature, although this is not always necessary in the case of winding up petitions, and it may be used tactically to prompt payment. Once the demand has been served the debtor will have 21 days in which to make payment. Failure to do so will be taken as evidence that the debtor does not have the necessary funds to enable them to do so, i.e. is insolvent. At this stage the petition can be presented and a hearing will be listed.

We will of course advise you on the suitability of insolvency in each matter as there are a number of very important considerations before proceeding down this route.

Additional Services

In order to offer our clients a complete debt recovery solution we also offer a number of additional services including:

  • tracing services
  • commercial credit reporting
  • instalment monitoring
  • reviews of terms and conditions 

Further information

We have also put together the following information resources:

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