Outstanding debt owed to you can be a frustrating and unsettling time. It can have a significant effect on your livelihood and business if you are unable to pay your own bills or pay your employee’s wages.
Our specialist solicitors can assist in the recovery of debt that has not been paid to you or your business, whether it is disputed or not by the debtor.
There are 3 possible stages in which outstanding debt can be recovered. These are:
During this stage, we will write to the debtor and demand them to pay the outstanding amount within 7 days. If this is not complied with, we will threaten County Court or insolvency proceedings.
If the debtor has not complied with stage 1, we will commence court proceedings. We can follow two routes:
- A County Court claim can be issued against the debtor. They will be required to pay the outstanding debt or reply to the court within 14 days.
If the debt isn’t settled or disputed at this stage, we’ll advise you on the next course of action.
- A statutory demand can be issued to the debtor threatening insolvency proceedings if they do not pay the outstanding amount.
However, this route is only available if more than £750 is owed by a company or more than £5,000 is owed by an individual.
If the debt is not settled or disputed within 21 days, we will advise you on the most appropriate method of enforcement.
If stages 1 and 2 have not been successful in obtaining the outstanding debt, enforcement procedures will be required. The type of enforcement methods can include:
- Writ or Warrant of Control
- Attachment of Earnings Order
- Third Party Debt Order
- Charging Order on debtors property
The cost of enforcement will vary depending on the option that is chosen to recover the debt. We can provide you with an estimate of fees upon your request.
If you’re needing advice on debt recovery, contact our specialist debt recovery department to discuss your options.
We operate a fixed fee scheme for helping you to recover your unpaid debts. Our fees are based on the value of your debt and are split into three stages of work.
Stage 1 – Pre Court action
We will advise you of the process and write to your debtor demanding your money back. If this is not complied with after seven days we will follow this up with a threat of either County Court or Insolvency proceedings.
This stage will take around two weeks
For this stage we charge the following:-
|Value of Debt||Our fees|
|Up to £1,000||£50 plus VAT|
|£1,001 to £10,000||£90 plus VAT|
|Over £10,000||£150 plus VAT|
Stage 2 – Legal Proceedings
At this stage you will have two options; you can either issue a County court claim against your debtor or, if the debt meets a minimum threshold, you can issue a Statutory Demand as the first step in Insolvency proceedings.
County Court proceedings
If you choose to go down the County Court claim route, then we will prepare a claim form and send it to the Court for you. Your debtor will then have 14 days to either respond to the claim or settle the debt. If they do not then we will apply for Judgment on your behalf and advise you on the best course of enforcement.
This stage will take XX weeks providing there are no delays in the Court dealing with the matter.
At this stage you will need to pay a Court fee in addition to our fixed costs. The Court fee itself will depend on the value of the claim but is not subject to VAT.
We will charge you the following for this stage:-
|Value of Debt||Our fees||Court fee|
|Up to £1,000||£100 plus VAT||£25 to £60|
|£1,001 to £10,000||£160 plus VAT||£70 to £410|
|£10,001 to £100,000||£250 plus VAT||4.5% of the claim value|
|£100,001 to £200,000||£300 plus VAT||5% of the claim value|
Our fees in this do not cover dealing with a disputed debt and if the debtor does dispute the debt then we will provide you with an individual estimate for dealing with the dispute.
Stage 3 – Enforcement Action
If stages 1 and 2 have not been successful in recovering your debt then you will need to move onto enforcing your County Court Judgment. There are several different ways in which you can enforce the Judgment and which option is best is likely to depend on what you know of your debtor’s circumstances.
We will advise you on the most appropriate course of enforcement and what each option entails. The following enforcement options are available:-
Order to Attend Court
We can apply for an order for the debtor to attend Court for questioning about their finances. This work would include advising you, preparing the application and questions to be asked, issuing the application with the Court and instructing a process server to serve the order on the debtor. The process is likely to take up to 12 weeks, depending on Court listing times.
Our fixed fee for this would be £75 plus VAT and you would also need to pay a Court fee of £50 and the process server’s fee which is likely to be between £60 and £100.
High Court Bailiff
We can apply for a “writ of control” which would enable a High Court Bailiff to be instructed to attend the debtor’s home or place of business and seize goods to pay the debt. Our fees would include advising you in relation to this, preparing the Court application and instructing the Bailiff. The process is likely to take around 3 to 4 weeks
Our fixed fee for this would be £75 plus VAT and you would also need to pay a Court fee of £110. If the Bailiff is successful they will recover their fee from the debtor, however if they are not successful you would need to pay them a fee of £75 plus VAT
Attachment of Earnings Order
We can apply for an order that the debtor’s employer deducts the debt from their wages in monthly instalments and pays it to you directly. Our fees would include advising you, preparing the Court application and sending the Order to the debtor’s employer. The process is likely to take around 4 to 6 weeks if you have the details for the employer; if you do not have these details, the process is likely to take up to 12 weeks depending on Court listing times.
Our fixed fee for this would be £75 plus VAT and you would also need to pay a Court fee of £110.
Third Party Debt Order
If the debtor has a bank account with sufficient funds, we can apply for an order that the bank pays the debt directly to you from those funds. Our fees would include advising you, preparing the Court application and instructing someone to represent you at Court. The process is likely to take up to 12 weeks, depending on Court listing times
Our fixed fee for this would be £75 plus VAT and you would also need to pay a Court fee of £110 and the costs of representation at Court which is likely to be around £300 plus VAT.
We can also take steps to apply for a charging order on a property owned by the debtor. This would mean that the debtor could not sell their property without paying you from the sale proceeds. Our fees would include advising you, obtaining confirmation that the debtor owns the property, preparing the Court application and sending required notices to anyone who already has a charge on the property, instructing someone to represent you at Court and registering the Order with the Land Registry.
The first stage of issuing and registering the Interim Order is likely to take around 6 weeks. To obtain the Final Order is likely to take around 12 weeks, depending on Court listing times.
We are not able to carry this work out on a fixed fee, but would be charge on the basis of the time spent at an hourly rate of £146. Our fees for an application for a charging order are usually between £500 and £600 plus VAT. In addition, you would need to pay a Court fee of £110, Land Registry fees of £46 and the costs of representation at Court which is likely to be around £300 plus VAT
If you wished to go down the insolvency proceedings route we would issue a Statutory Demand to the debtor. A statutory demand can however only be issued to a company if the debt is over £750 and to an individual if the debt is over £5,000.
Our fees for this will cover the following:
- advising you
- preparing the paperwork
- arranging for this paperwork to be served on the debtor.
If the debtor fails to settle or respond to the statutory demand then we would advise you as to the steps you can take to commence insolvency proceedings. This process is likely to take around 4 weeks.
Our fees for carrying out this work would be:
- £200 plus VAT for a debt up to £10,000
- £300 plus VAT for a debt over £10,000
There would be no other costs you would need to pay, however our charges do not extend to any work needed to commence insolvency proceedings. We will discuss the costs with you at that stage if this is required.
Why use a solicitor?
- There is a legal procedure to be followed when recovering outstanding debt.
- A solicitor can use specific methods of debt recovery that are unavailable to individuals.
- A solicitor can represent you in court if necessary.
Why Watson Woodhouse?
- Our specialist solicitors are experts in debt recovery issues.
- We will seek to ensure that you are kept updated throughout your case.
- We will provide you with a realistic expectation of the likely outcome.
- Our aim will be to recover all outstanding debt owed to you.