Debt Recovery Procedure

Once you have reached the decision that polite reminders and statements from your credit control department are not producing results, just send us a copy of the relevant invoices and statements and leave the rest to us.  Don’t leave it too long!

We will then log the debtor’s details together with the invoices outstanding and the amounts involved and will send out a Letter Before Action requesting payment and warning that Court proceedings will be issued if payment is not received within seven days together with a warning that in those proceedings we will be claiming costs and interest on your behalf (you are also entitled to claim enhanced interest and statutory penalties on commercial debts).

If that does not elicit a response in the form of a payment, proceedings will be prepared on the eighth day, or on a later day if you prefer.  We will then draft the Claim Form and Particulars of Claim, as appropriate, claiming the amount of your invoices plus interest (and penalties on commercial debts only) and both reimbursement of the Court fee payable and a contribution towards your legal fees.  This is then sent to the Court for issue and service.  Once the proceedings are served by the Court on the debtor, they then have fourteen days in which either to pay, or submit an Acknowledgement of Service, which will then give them a further 14 days by which to submit their Defence.  If they fail to do either we will request that the Court enters judgment against the debtor.  If no payments are received from the debtor then you will need to consider taking enforcement action against them, depending on the debtor’s individual circumstances.

Any debt up to the sum of £5,000 is treated as a small claim and therefore if the debtor defends any claim issued against them only fixed costs are recoverable.  Any debt over £5,000 that is defended (and where you are successful) reasonable legal costs can be recovered against the debtor.

We also have available to us Money Claim Online (MCOL) through the Court’s website which is an efficient and cost effective way of issuing proceedings.  One of the benefits of using this service is that the issue fees are slightly lower than detailed in the table overleaf.  However, once you give us your authority to proceed with issuing a claim we will advise you whether or not it is appropriate to use the online service available.

Please bear in mind, however, that issuing a claim through the County Courts is not the only option available to you when trying to recover a debt.  You may, for example, prefer to issue a Statutory Demand or alternatively Bankruptcy/Insolvency Proceedings against the debtor.  We will, of course, be happy to discuss with you all of the options available to you together with the relevant cost implications so that you are in a position to make an informed decision prior to proceeding down a particular route.