Does your company have a customer who is not paying your invoices? Our debt recovery lawyers have the means to make your debtor pay as yet. From the moment you hand your debt recovery matter over to us, we will do our utmost to collect your money. We, a debt recovery law firm, have more than sixty years of knowledge and experience at our disposal to assist you with your commercial debt recovery.
Suggestions when your customer is not paying:
- Immediately contact the debtor and ask why there has been no payment;
- Is there no response? Then send a demand letter;
- Your customer may be waiting until you engage a lawyer, as this is common in England;
- It is customary to send a final demand letter prior to handing your claim to us for recovery. This should contain the following information:
- Details about the claim;
- A payment period between 7 and 21 days;
- Consequences in the event the customer does not pay within this time period.
You Are at an Advantage with a Debt Recovery Lawyer
Debt recovery lawyers have more means at their disposal to put pressure on your debtor than a debt recovery agency or bailiff. In addition, we can assist you during both the extrajudicial and the extrajudicial phase. This saves you time and money.
We will always provide you with straightforward advice concerning the likelihood of success of your debt recovery matter. Putting your interests first is important to us. So we invariably consider what would be your best option. That is the reason our core values are integrity and justice.
Customised Debt Recovery
Our commercial debt recovery approach is customised to each unique case, and we provide you with tailor-made advice.
We will always give our honest advice on the chances of success in your debt recovery matter. Putting your interests first is important to us; we endeavour to provide you with your options, as well as our advice on the best route to take. It’s easy to see how we put our core values of integrity and justice into practice.
The Debt Collection Process
The debt collection process can be divided into two stages. During the extrajudicial phase, collection takes place without Court intervention. During the judicial phase, we do involve the Court. Because we are a law firm, we can assist you during both stages. Most matters are resolved during the extrajudicial phase, without Court intervention.
1. Extrajudicial Debt Collection
In principle, we always start the debt collection process with the extrajudicial phase. During this phase, we try to prevent Court intervention. We will contact your debtor to ensure that your debtor pays as yet. At this stage, we have the following options:
- Written demand letters and phone calls: We send the debtor a written demand letter and contact them by telephone, requesting that they pay your claim within a few days;
- To effect a settlement: Our lawyers will use their knowledge of the customs of trade and regulations to arrive at a settlement with your debtor. Reaching a settlement is a very popular means in the United Kingdom to encourage your customer pay. This can also be used during legal proceedings;
- Alternative dispute resolution (ADR): This is a cheaper, faster and easier way to settle disputes without Court intervention. One example is ‘Mediation’. It can offer both parties certainty in a shorter time period, as there is no need to wait for a court decision. ADR is actively encouraged by the courts, in fact, they do not like it if a party has unreasonably refused to engaged in ADR. Which method of ADR is right for your case largely depends on whether the debtor is willing to engage, and the type of contractual relationship you have;
- Announcing legal proceedings: Often, announcing legal proceedings will convince your British debtor to pay.
2. Judicial Debt Collection
If the debtor does not pay within a set period of time, we can, in consultation with you, commence legal proceedings. We will always provide you with information in advance regarding the potential costs, and we only proceed after obtaining your permission. We have the following options to proceed against your debtor:
- Order for payment: unlike many European countries, there is no national equivalent in England & Wales to an ‘Order for payment procedure’. Ordinary civil proceedings must be commenced.
- Ordinary civil proceedings: In England & Wales, court proceedings are dealt with in the following three categories:
- “Small claims”: Claims smaller than £10,000 are dealt with as ‘small claims’. Usually, hearings are not as long as those for higher value claims. Sometimes there is no hearing at all. One disadvantage is that the costs of these proceedings are rarely charged to the losing party; “Fast track”: These proceedings are used for higher value, non-complex claims (usually up to £25,000). These proceedings tend to take more time than ‘small claims’. Also, the court will sometimes order that at least part of the costs of the proceedings should be paid by the losing party. However, the amount is at the discretion of the Court;
- “Multi track”: Claims larger than £25,000, or particularly complex cases, are dealt with in ‘multi track’ proceedings. On average, these proceedings take longer, with the final hearing usually lasting more than one day. There is a greater willingness on the part of the Court to order that the losing party has to pay the costs of the proceedings, although again, the amount is at the discretion of the court;
- Winding-up / bankruptcy petition: Unlike in other European countries (for example, the Netherlands), petitioning for bankruptcy is not very fast or cheap in the United Kingdom. It is seen as a ‘last resort’ in the debt recovery process. In England and Wales, it takes several months and is quite expensive. Therefore, it’s crucial to discuss whether this is right for your case with a Solicitor.
European order for payment proceedings:
- In the event of an undisputed claim between two parties based in EU Member States (except Denmark), it is possible to commence European Order for Payment proceedings. The lawyer handling your case can assess whether this kind of procedure is suitable in your case.
- For European Order for Payment proceedings, the creditor usually completes a standard form and submits this to the Court. The Court then issues a European Order for Payment. The debtor then has 30 days to state whether they object to the claim. If there is no response within the 30-day period, you may ask the Court to make the order for payment final (called a “declaration of enforceability”). This is a valid and enforceable judgment which is accepted in any Member State (except Denmark). The European Order for Payment is never appropriate for disputed matters (so not in cases where there is an argument about the invoice). The advantage of this procedure are speed and low costs (some Member States don’t even charge a court fee), but the disadvantage is that if it becomes disputed, the procedure comes to an end and an ordinary civil procedure will have to be started if the creditor wants to continue.