DEBT RECOVERY SOLICITORS

When pursuing a third party for an outstanding debt there are several steps that you will need to comply with:

1. Letter Before Action. You will need to send the debtor a Letter Before Action (LBA).

• Prior to issuing court proceedings you must send to the debtor an LBA.
• The LBA is a formal letter that sets out what is owed and the circumstances of the claim.
• Most cases normally settle following receipt of a LBA but if it doesn’t then you will need to consider formal court proceedings.

2. Formal Proceedings. If the debt remains unpaid following the LBA you have several options including court and insolvency proceedings.

Court Proceedings.

• To commence court proceedings, we would first need to prepare court documents and arrange for these to be issued at court.
• The court will then arrange for the documents to be served on the debtor.
• The debtor will have 14 days to acknowledge receipt of the court documents and a further 14 days to pay the debt together with interest and costs.
• If it is a commercial debt, the Late Payment of Commercial Debts (Interest) Act 1998 will also apply. This will result in an additional £40 – £100 per invoice being added to the value of the claim.
• We will deal with court proceedings to conclusion including representing you at any trial.
• At the trial of the case the matter will be heard by a judge who will make a final decision. Providing you are successful the court will make a County Court Judgment (CCJ) in your favour. A CCJ is a court order that confirms that the debtor is liable to pay your debt.
• The debtor will have 21 days to pay the debt otherwise you will be free to begin enforcement action.

Insolvency Proceedings.

• If the debtor is an individual, we can arrange for a statutory demand to be served on the debtor. Should the debtor not settle the debt within 21 days of receipt of the statutory demand you can then apply to the Court and commence bankruptcy proceedings.
• If the debtor is a business, we can arrange for a statutory demand to be served on the debtor. Should the debtor not settle the debt within 21 days of receipt of the statutory demand you can then apply to the Court and commence insolvency proceedings in order to wind up the business.

3. Enforcement. This may include taking insolvency and/or bankruptcy action against the Debtor.

• Once we have obtained a CCJ we can then look to enforce the debt.
• There are a number of options available including commencing insolvency and/or bankruptcy proceedings as well as attachment of earnings orders or charging orders.
• It also includes instructing a Bailiff or High Court Enforcement Officer to visit the debtor’s address and seize goods to the value of the debt.
• We can discuss your options and advise you on the best method available depending upon your individual circumstances.

If you are being pursued for an outstanding debt it is important to act quickly. As soon as you are notified of the potential claim you should seek legal advice.

If you dispute the debt, then it is important that you set out the reasons why clearly prior to the commencement of court or bankruptcy proceedings. You should be given the opportunity to respond to the claim and it is important that you set out why you believe the debt is not due. If you don’t dispute the debt, then it is important to engage with the creditor as soon as possible to avoid matters escalating and the debt increasing.

We can discuss the various options available during our initial consultation. More details of our fixed fee arrangements can be found below.

Claim	Solicitors Costs
Up to £5,000	£150 plus VAT
£5,001 – £10,000	£200 plus VAT
£10,001 – £50,000	£250 plus VAT
£50,001 – £200,000	£500 plus VAT

Claim	Solicitors Costs	Court fees
Up to £5,000	£500 plus VAT	Between £35 – £205 depending upon the value of the claim.
£5,001 – £10,000	£1,000 plus VAT	£455
£10,001 – £50,000	£2,000 plus VAT	5% of the value of the claim.
£50,001 – £200,000	£2,500 plus VAT	5% of the value of the claim.
£200,001 or more	£3,500 plus VAT	£10,000

 

Depending upon the value and complexities of the case we may need to instruct a barrister to prepare the court documents or attend court. If necessary, we will take instructions from you in advance of anything being incurred.

Claim	Solicitors Costs	Court fees
Up to £5,000	£1,500 plus VAT	Between £35 – £205 depending upon the value of the claim.
£5,001 – £10,000	£2,500 plus VAT	£455
£10,001 – £200,000	Hourly rate of £150 plus VAT per hour	5% of the value of the claim.
£200,001 or more	Hourly rate of £150 plus VAT per hour	£10,000

 

Depending upon the value and complexities of the case we may need to instruct a barrister to prepare the court documents or attend court. If necessary, we will take instructions from you in advance of anything being incurred.

Description	Costs	Disbursements
Writ of Control. Instructing and liaising with the High Court Enforcement Officer. We will also update and advise you regarding the enforcement process.	£500 plus VAT £75 plus VAT payable to the High Court Enforcement Officer if they are not able to successfully recover the debt.	£2 bankruptcy search per name. £75 High Court Enforcement fee.
Charging Order (per property). Investigating property assets to determine ownership. Drafting application for charging order and serving/ registering an interim charging order. We will prepare and file a certificate of service and deal with the final charging order.	£750 plus VAT	£2 bankruptcy search per name. £10 Land Registry search fee. £20 Land Registry application fee. £119 Court Fee.
Order to attend Court for Questioning. Drafting and filing the application. Arranging for order to be served on the Defendant and advising you of the outcome.	£750 plus VAT	£2 bankruptcy search per name. £10 Land Registry search fee. £59 Court fee per debtor. £150 – £200 plus VAT process server fee.
Third Party Debt Order. Drafting and filing the application. Arranging for the interim order/ final order to be served on the Defendant.	£750 plus VAT	£2 bankruptcy search per name. £119 Court Fee per party. £150 – £200 plus VAT for process server.
Statutory Demand. Preparing statutory demand and arranging service of the demand on the debtor.	£300 plus VAT	£2 bankruptcy search per name. £150 – £200 plus VAT for process server.
Bankruptcy Proceedings. Preparing and filing petition and arranging service of the petition on the debtor. We will also prepare for and arrange attendance at the court hearing. If proceedings contested, we will provide a further estimate of costs.	£1,000 plus VAT	£302 court fee. £1,500 Official Receiver’s deposit. £150 – £200 plus VAT for process server £2 bankruptcy search per name.
Winding Up Proceedings. Preparing and filing petition and arranging service of the petition on the debtor. Advertising the petition in the Gazette. We will also prepare for and arrange attendance at the court hearing. If proceedings contested, we will provide a further estimate of costs.	£1,250 plus VAT	£302 court fee. £2,600 Official Receiver’s deposit. £150 – £200 plus VAT for process server. £84.60 plus VAT advertisement fee.

 

Depending upon the value and complexities of the case we may need to instruct a barrister to prepare the court documents or attend court. If necessary, we will take instructions from you in advance of anything being incurred.