Our specialist team of commercial debt recovery solicitors can pursue and defend outstanding debts that might be impeding your cash flow, including unpaid invoices and disputed debts that may require specialist legal advice as to the merits of a potential claim.
We will carefully consider the commercial reality and economic viability of pursuing or defending your debts; weighing up the cost-effectiveness of issuing or defending court proceedings against the ultimate prospect of recovery and the sums of money involved.
We find that most debtors tend to respond to our letters before legal action. If they don’t reply our expert solicitors will advise you on the next steps involved in the debt recovery process while pursuing your claim. If necessary we will issue court proceedings on your behalf.
Our specialist debt recovery solicitors regularly advise a variety of clients, including businesses and individuals, in relation to debt collection disputes and frequently deal with multiple matters concerning late payments at any one time.
When collecting a Commercial debt, there are four main steps:
Before legal proceedings can be issued, a Letter Before Action must be sent to the debtor. The letter should set out the details of the claim, how long the debtor has to pay and what actions will be taken if the debtor fails to pay. Most cases are settled at this stage and there is no need for further litigation.
If there is no satisfactory response to the LBA, the net step is to issue court proceedings at the County Court. Once the court serves the claim form on the debtor, they have 14 days to pay the debt, start negotiations or defend the claim.
If the County Court decides that the debtor does owe the money, it will issue a County Court Judgment (CCJ). The CCJ allows you to take enforcement action against the debtor to recover the debt. If the debtor cannot afford to pay back the money, they may ask to change the terms of (vary) the judgment or pay it back in instalments via a payment agreement.
If the payment is still not made, there are several ways to enforce the Order.
A statutory demand can be made by anyone, you don’t need a lawyer. A statutory demand is a formal written demand for payment of a debt within 21 days. It can be used to support a bankruptcy order or winding-up order.
Normally you have 6 years from the debt arising to issue court proceedings. If you fail to issue a claim within 6 years, the claim is likely to be statute-barred.
A charging order is an imposed court order which can secure debt against a debtor’s assets (usually property) in order to secure payment.
This can depend on factors such as whether the fees involved are more than the debt owed, or if the debt isn’t being paid because the debtor can’t afford to, or if there is a dispute. It is often better to accept a payment agreement over a period of time rather than pursuing legal action. Our debt recovery team can give you further advice that is more specific to your circumstances.
Unsecured creditors will only receive payment during insolvency once secured creditors have been paid. Secured creditors will commonly include banks, lenders or invoice factoring companies, while unsecured creditors will usually include suppliers, customers or contractors.
If the interest rate is not specified in the contract, you can charge 8% plus the Bank of England base rate. You can only charge interest once the invoice becomes overdue.
