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To sue or not to sue?

When it comes to debt, your automatic response might be to go full speed ahead, who wouldn’t? But with the level of commercial debt rising and court recovery reducing, the decision to sue is more critical than ever.

Litigation is a vital tool in the debt recovery armoury, if used properly. By getting court proceedings under way, it will send a clear message that you will not accept late payment.

The apprehension usually comes down to how much it will cost. Most clients’ biggest concern is will I be throwing away good money after bad? If the claim is for less than £10,000 we offer fixed fees to our clients, which means that legal costs are kept to a minimum and can be budgeted.

You have to keep in mind that sometimes spending a little in order to recover much more is still a return. Not issuing a claim definitely won’t recover the debt, but taking proceedings may well just do the trick.

Another concern is what happens once Judgment has been obtained? Well there are a few different routes you can take, depending on your claim:

  • Charging order – apply to secure the debt over the debtor’s property. However, charging orders aren’t particularly popular anymore as the courts are viewing them as too aggressive.
  • Attachment of earnings – apply to have the individual debtor’s employer transfer a specified amount of their salary to you per month until the debt is paid. This is viewed as a safe and easy to use way of achieving payment.
  • Third party debt order – apply to obtain an order against the debtor’s bank account so the bank pays the Judgment. Although, they aren’t considered straightforward or speedy to obtain.
  • Order to obtain information – apply to send the debtor to court to be questioned about their financial circumstances. This option is used when you don’t have any details about the debtor or are unsure of which method of enforcement to use.
  • Warrant of control – instruct a bailiff. If I’m honest, I wouldn’t bother. The fee is in no way proportionate to the level of service delivered.
  • Writ of control – instruct the sheriff, or High Court Enforcement Officer to give them their correct title. In my opinion, they remain one of the most efficient means of collecting a Judgment, particularly against a company.

So why not take the plunge? Sometimes you will have little to lose. We will always advise you whether we think you have a good case or not.

Francesca Damario