x
!

Christmas Opening Times

Merry Christmas from all at Coles Miller. Please find our Christmas opening times here.

Eric Holt  Solicitor Coles Miller

More Hurdles for Recovering Debts19th Apr 2012

by on 19th Apr 2012

Contact

Eric HoltIn these difficult economic times, when maintaining your cash flow is likely to be a key to your business survival, probably the last thing that was needed was the introduction by the Government of a new Court Protocol or Debt Relief Orders that may slow down your ability to commence legal proceedings, increase the costs of doing so, or provide a debtor with yet another means to avoid payment.

Bad timing as it may seem, extensive protocols came into effect during the recent months which creditors are required to follow in order to try and recover debts. Furthermore, Debt Relief Orders (a lesser form of Bankruptcy) are now available to people on limited means who cannot afford to pay their Creditors the debts that they owe.

The new protocols are far reaching and place a much greater importance on Creditors (and Debtors) to provide the 'other side' with a reasonable amount of time to deal with matters, to identify issues and if possible to find (or at least attempt to find) alternative methods of resolving disputed matters before issuing a court claim.

Once a court claim has been issued and a judgment obtained, many Creditors quite often find that they then need to issue enforcement proceedings to try and force a debtor to pay. The methods of enforcement that are open to Creditors to try are often very limited, and quite often fail.

Eric Holt, a specialist in recovering debts at Coles Miller Solicitors says "There is always a risk for example that a warrant will fail. Some of the commonest reasons for failure are that a bailiff can not actually meet a Debtor or the Debtor simply has insufficient goods for the warrant to succeed. However, whereas before a Creditor could perhaps 'test the water' by issuing a part warrant for a court fee of £35.00, to try and determine whether a Debtor has any goods (and thereby limit both the Creditors and Debtors exposure on costs), Creditors will now be required to pay a court fee of £100.000, and the Debtor will be required to pay an additional £45.00 (or £65.00) to cover the increase in court costs".

All these changes make it more challenging to a business to recover money that is owed to them at a time when many businesses are struggling themselves, and it is therefore very important that Creditors understand and also use the changes to their best advantage. For help and advice on recovering debts or implementing credit control procedures contact Eric Holt on 01202 338844 or email eholt@coles-miller.co.uk





This document is not intended to constitute and should not be used as a substitute for legal advice on any specific matter. No liability for the accuracy of the content of this document, or the consequences of relying on it, is assumed by the author. If you seek further information, please contact Managing Partner Neil Andrews at Coles Miller Solicitors LLP.