WHN’s, debt recovery expert Sara Beaumont explores how debts are recovered through the courts system and shares her top tips for a smooth process.
With business trading inevitably comes payment problems, so most business owners are aware of the headache of recovering outstanding funds from customers.
The way in which you pursue debt recovery depends on the size of the debt as well as your ability to prove the funds owed. A solicitor’s letter can yield quick results but if you are unable to claim an outstanding debt this way, issuing court proceedings could be your only option.
Issuing a claim to the court can be a lengthy and time consuming process, but with the help of a specialist debt recovery solicitor, your firm can begin proceedings to reinstate money which is rightly owed to you.
Initially, a form itemising details of your claim will need to be completed and sent to the court along with a fee, which will be determined by the value of the claim. The court will then allocate a claim number and date of issue to the case before serving the claim form to the defendant.
Once the claim form is served, the defendant has 14 days to respond from the date of service – the day which they should have received the form. The defendant has the option to either file a defence or an acknowledgement of service, meaning that responsibility for the debt is recognised.
In difficult cases, such as where the defendant is outside of the jurisdiction, your solicitor can serve the claim form directly. For these cases, the defendant has 21 days to respond.
If the defendant fails to respond within the appropriate timescale, your solicitor can request judgment from the court, meaning that the defendant automatically loses the case and is liable to pay the funds owed. It usually takes approximately two weeks to receive the judgment, which will also be required if the defendant admits that the money is owed.
In cases where a defence is filed and the money owed is disputed, then you will need to complete a directions questionnaire detailing issues surrounding the case before attending a final hearing.
It is important to note that there is no quick-fix to recovering debt and the approach taken will be determined by how the debtor reacts to the claim. While chasing debts through the courts can be a lengthy process, it is often the only way to pursue payment, particularly where a debtor is ignoring your chasers.
For more information on recovering outstanding debt please call Sara Beaumont on 0161 761 4611 or email sara.beaumont@whnsolicitors.co.uk
