Worthingtons Solicitors Belfast - Debt Recovery

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Debt Recovery Advice Leaflet by Worthingtons Solicitors Belfast. Worthingtons Solicitors is based in Belfast, Newtownards and Bangor. As one of the leading solicitors in Northern Ireland, Worthingtons provide a full range of legal services such as personal injury claims, corporate law, employment law, matrimonial advice, commercial litigation, wills and probate.

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<ul><li> 1. Debtrecovery</li></ul><p> 2. Debt RecoveryContentsPagesn Look Before you Leap 2n Preliminary Steps3-4n Small Claims - Debts up to 3000 5-6n County Court - Debts up to 15,000 7n High Court - Debts over 15,0008n The Enforcement of Judgments Office (EJO)9-11n Insolvency/Winding Up Proceedings12-13n Professional Fees and Outlay 14-16n Interest16n Contact Us17www.worthingtonslaw.co.uk1 3. There is often little point instigating debt actionif the debtor is a `man of straw i.e. has noincome or assets to discharge the debt.There are a number of important questions,which you must consider therefore beforecommencing legal proceedingsLook Before You Leap1. Are your own Credit Control measures sufficient? 9. here are a number of other issues which could be T considered depending on the status of the debtor2. o you have suitable Terms and Conditions? In theDevent of a dispute is there a condition reserving (a) If the debtor is a limited company;jurisdiction to Northern Ireland - what is its full title, registered office and other If not, - we can help? trading addresses? - does the company own or lease the premises?3. ow and when did the debt arise? You have 6 yearsH - What assets does it own?from the date of any Agreement/Contract/Invoice - do you have any knowledge of its general or breach thereof to instigate court proceedings to performance and/or credit history?recover a debt (b) If the debtor is a Partnership;4. as the debtor sufficient income or assets toHdischarge the debt? - what is the full trading title and business address?5. o you know whether the debtor owns propertyD - what are the names of the various partners?jointly or otherwise? - do you have any knowledge of the general 6. re there any previous Court Judgments against theA performance and/or credit history?debtor? Have they been paid? (c) If the debtor is an individual/sole-trader;Have Enforcement Proceedings been instituted7. - What is his/her full name and trading address? against the debtor by other creditors? - what is his/her home address?8. What evidence exists to prove the debt? - what assets are owned? For example... - do you have any knowledge of his/her credit history? - Invoice, - is the debtor in gainful employment? - terms and conditions,- correspondence,10. If the debt is in respect of rent arrears, is - retention of title clause, there a guarantor? - verbal evidence only?www.worthingtonslaw.co.uk 2 4. PreliminaryStepsThere are a number of Preliminary Steps which you may wish to consider beforeinstigating full court proceedings...Option 1: Letter Before ActionA relatively inexpensive measure is to send a Solicitors This letter may prompt payment!Letter Before Action (LBA). This letter demands paymentwithin seven days and puts the debtor on writtenHowever, If there is no satisfactory response withinnotice that failure to pay will lead to legal proceedings 3 days of the reminder letter, we will revert to you forbeing instigated without further notice or warning. Ityour instructions.is our practice to issue the LBA upon the day we areinstructed (assuming instructions are received in goodtime). We will send a threatening reminder letter to thedebtor after seven days, which we will follow up with atelephone call, if possible.www.worthingtonslaw.co.uk3 5. Option 2: Status Checking on the Debtor 1.JO and Bankruptcy Searches should help indicate E whether the debtor is already a bankrupt, or whetherStatus checking or credit checking on a Debtor beforethere are Enforcement Proceedings registeredinstigating court proceedings is highly recommended. against them.You may consider credit enquiries in addition to, or as an2. A Company Search may help in identify thealternative to an LBA. There are a number of preliminary Directors, registered office, when accounts were lastenquiries that may be undertaken and which may helpfiled etc.guide you in deciding whether to instigate proceedings.These costs are not recoverable from the debtor.3. f the property is Registry of Deeds then a RegistryIof Deeds Search may help to identify whetherproperty is actually owned by the debtor. ActionOutlayHowever, a computer search will only show negative EJO Search8.00actions, such as mortgages and other charges, against Bankruptcy Search 20.00 a particular property, and only after computer records Company Search10-351 began in 1990. It will not show any results if a propertyhas been bought outright, without a Mortgage. Registry of Deeds Search35.00 Land Registry Search6-18.004. f the property is Land Registry, a Land RegistryISearch may help to show any mortgages/charges Worth Suing Report2 150-200and any pending dealings on Folios. 1 Depending on the document charge per item. 2 The Worth Suing Report includes all of the above searches. 5. The Worth Suing Report includes all of the above searches and may assist in determining the likelihood NB, We will gladly advise of professional fees for each actionof obtaining payment if Court proceedings are on request. instigated. We would recommend that a Worth Suing Report is obtained where the debt exceeds 2,000.N.B If proceedings are issued and/or judgment is obtained,and/or Enforcement Proceedings commenced, andultimately the debtor proves to have insufficient income orassets, you still remain liable for our legal costs.www.worthingtonslaw.co.uk 4 6. Small ClaimsCourtProceedingsSmall Claims Debts Debts up to 3,000County Court Debts up to 15,000High Court Debts exceeding 15,000Your case will only be heard if the claimis disputed, a counterclaim issued, or anunacceptable repayment proposal is made bythe debtor. Most cases are undefended andyou will not need to attend court. Rememberno professional fees are awarded in the smallclaims court.We will prepare an Application for Arbitration, submit 2. Should the debtor fail to respond:online, together with the appropriate court outlay will obtain a Judgment in Default, which willwe(please see table on page 6). This outlay is added tothen be served on the debtor by first class post. Thethe debt if your application is successful and judgmentJudgment will include the amount awarded by theawarded.court together with the Court Outlay, applicableThe Application will be endorsed by the Court officeinterest. It will not include our fees. The Judgmentwith a return date, and sent to the debtor. We will may affect the debtors ability to obtain credit in thereceive a copy along with an Applicants Informationfuture. If the debtor does not make payment, youPack. The debtor must lodge a dispute, counterclaim ormay wish to consider Enforcement Proceedings (seemake payment prior to the return date. The progress ofEnforcement Section).the Application can be followed online. 3. Should the debtor lodge a dispute or a1. hould the debtor pay:S counterclaim: are liable to pay total amount claimed, and theyyour case will be given a date for hearing before applicable interest, together with the court outlay the District Judge. It is imperative that you or your incurred. The debtor will not be liable for our fees or representative attend this hearing and bring all any search outlay.paperwork to prove the debt. These proceedings are relatively informal and you can represent yourself at the Small Claims Court but you may also have legal representation. Should you request legal representation, win or lose, you will be responsible for paying our costs.www.worthingtonslaw.co.uk 5 7. 4. Should the debtor lodge an Acceptance of Remember Liability: (1) court does not pay the amount that is The awarded, it only decides who is liable. means that the debtor has admitted that they this owe the debt but are unable to make full immediate (2) legal fees are awarded by the Small No payment to settle this matter, and may seek timeClaims Court. to payWe will gladly provide a fee proposal in each case.- Should you not accept this offer, the matter will be Please contact our Debt Department and/or email listed before the District Judge for directions. info@worthingtonslaw.co.uk- hould you agree to the offer, a Stay of Execution S will be attached to the Order. Please note that enforcement is not possible until this has been removed.- Should the debtor then default in any weekly/ monthly payments, the Stay of Execution can be removed by way of signed Affidavit, a full Judgment obtained and served on the debtor.- the debtor does not make payment, you may If wish to consider Enforcement Proceedings (see Enforcement Section) Small Claims Court Outlay: Debt Amount:Court Outlay Up to 30030.00 Up to 50050.00 Up to 1000 70.00 Up to 3000 100www.worthingtonslaw.co.uk 6 8. County CourtProceedings not normally require your attendance at court. Once a CountyCourt Judgment has been obtained the debtor is liable to pay the principal sum, applicable interest and a higher scale of recoverable costs.3. a Notice of Intention to Defend If is received, then the issue of costs is one to consider very carefully, as our fees for a contested matter are marked in accordance with the County Court Scale Fees, which are significant. If you were to lose a contested case, you would be liable for not only our costs but also the debtors legal costs. Should a Notice of Intention to Defend be served, we will discuss the costs implications of proceeding furtherIn a contested case, if you are successful, additionalprofessional fees, as appear in the County Court RulesDebts up to 15,000will be added to the Debt and may be recoverable fromUnless your claim is disputed, you will not havethe Debtor, if recovery is secured ultimately.to attend Court and Judgment may be obtainedby completion of the relevant documentation.County Court Outlay:We will prepare the Civil Bill, and submit to the courtsCivil Bill up to 5,000 165.00together with a cheque for the court outlay.Civil Bill up to 15,000185.00It will then be stamped by the court and served on theMark Judgment 75.00debtor. The Debtor has 21 working days after service tolodge a Notice of Intention to Defend.Affidavit 7.00Certificate of Readiness250.001. hould the debtor payS within 21 days of receiving the Civil Bill, they will be liable to repay the original debt, applicable interest We will gladly provide a fee proposal in each case. and recoverable fees awarded by the court (these are Please contact our Debt Department and/or email known as 21 day costs, which are fixed by statuteinfo@worthingtonslaw.co.uk and are detailed on page 14).2. the matter is undefended, i.e. If the debtor fails to respond within 21 days, we will send an Affidavit of Debt to you, which must be sworn in the presence of a solicitor. We will then submit all the relevant paperwork together with a cheque for the court fee of 75.00 and a County Court Judgment (CCJ) obtained. This option doeswww.worthingtonslaw.co.uk 7 9. We will prepare the Writ of Summons, and send to the court together with a cheque for 200.00, in respect of the court outlay; It will then be stamped by the court and a copy served on the debtor. The Debtor has 14 working days after service in which to lodge a Memorandum of Appearance. 1. hould the debtor pay within 14 days of Sreceiving the Writ, the Debtor will be liable for theprincipal sum, applicable interest and recoverablecosts.High Court 2. the matter is undefended, i.e., the debtorIffails to respond, we will submit the relevant papersProceedingstogether with payment of 75.00 to the court anda High Court Judgment will be obtained. Once aJudgment has been obtained, the debtor is liableto pay the principal sum, applicable interest and ahigher scale of recoverable costs.Debts Exceeding 15,0003. a Memorandum of Appearance isIfreceived, then the Debtor has effectively signalledA Writ of Summons may be issued in thetheir intention to dispute the debt. In this event, theHigh Court for any debt above 600, but may issue of costs is one to consider carefully as if youwere unsuccessful, you would be liable for not onlybe transferred to the County Court, shouldour costs but also the debtors legal costs, which canthe debtor object. Again unless your claim is be considerable. If the Writ has been issued for lessdisputed you will not have to attend Court andthan 15,000, then the action may be remitted toJudgment may be obtained by completion of the County Court, to save costs.the relevant documentation The recoverable costs will be added to the debt and should be recoverable from the debtor, if recovery is achieved ultimately.High Court Outlay: If the debtor fails to pay after Judgment, you may wish to consider Enforcement Proceedings (please seeWrit200.00 Enforcement Section)Judgment75.00AffidavitExhibit 9.50We will gladly provide a fee proposal in each case. Please contact our Debt Department and/or emailSet-Down Fee (if required)300.00info@worthingtonslaw.co.ukwww.worthingtonslaw.co.uk 8 10. The The EJO has various powers; It can seize assets belonging to the Debtor,Enforcement Affix an Attachment of Earnings Order whereby part of the Debtors wages are paid direct to the EJO,of Judgments Attach an Instalment Order, should the debtor own their own business, Impose an Order Charging Land on theOffice debtors property.Other powers exist particularly in relation to securingbusiness assets/stocks/shares and other financial gainsreceived or due to be received by the debtor.Should a debtor fail to pay following Judgment,Procedureone method of pursuing further recovery isto refer the matter to the Enforcement of 1. otice of Intention to Enforce a NJudgments Office, or the EJO, as it is known.Money JudgmentThe EJO is a government body, empowered to will prepare the appropriate Notice, which mustWerecover or enforce Judgments, where possible, be issued and served prior to an Application for FullEnforcement, or Discovery. This is sent to the EJO inalbeit for a scale fee depending on the amountduplicate, together with the EJO outlay of 20.00,of debt to be recovered. Remember that theand served upon the debtor by the EJO. The NoticeEJO cannot recover what is not there, and you will make a claim for:may wish to apply for a Discovery Order as to the Judgment sumthe debtors means at the appropriate stage(see page 10). interest thereon @ 8% per annum any costs awarded by the Court and the EJO outlay of 20.00 further action may be taken for 10 days from theNodate of service of the Notice. If there is no responsethe next step is to make an Application for FullEnforcement or an Application for Discovery. (N.B.the Notice will be valid for a period of three monthsonly and will lapse if unserved)2.Application for Full Enforcement will prepare the Application for FullWeEnforcement/Discovery and lodge with the EJOon receipt of the EJO Fee, which is calculated withreference to the amount of the debt. The initial EJOFee of 20 and the Application Fee will be addedto the total amount to be pursued by the EJO.However, the EJO will only allow a nominal fee inrespect of our professional...</p>