If you are in business, dealing with individuals who sometimes don’t pay, you may be thinking about “going legal“. The County Court rules relating to debt claims are due to change in October 2017 and you must be aware of the new protocol to follow or the Court will impose sanctions.
The main changes are the work that has to be done and the longer timescales before you can safely issue a court claim. You have to allow the debtor a lot more time, pre-action, providing more details of the debt itself and also listening more to any proposals for settlement. This may sound frustrating when you’ve done the work and expect to be paid, but there has been a trend for some time now for the Courts to require the parties to try to settle without using the Court’s time and resources, which are constantly under pressure – as are those who haven’t been paid, one might argue!
In particular, note that “individuals” now includes “sole traders” – so this not only relates to private debts but also could take in some commercial work.
The significant point is to make sure that you have all the details you need before you start chasing the debt so that you can keep up the pressure within the Court’s timeframe. The lesson to learn from all this is that it is more important than ever to keep accurate records, emails, evidence of communications etc when you’re in business and expect to be paid for the work you’ve done.
If you need any help with this, contact the Dispute Resolution team at Curwens – Rose Albay – 0208 363 4444.
Really ? How well do you get on with your neighbours ? Our Dispute Resolution team gets involved in so many property disputes between sellers/buyers and also neighbours over a whole range of problems.
When we buy a property, we rely on the Sellers’ Property Information form to tell us whether there have ever been any neighbour or boundary disputes – the answer is usually “No” – because you do know that “Yes” would be the kiss of death to the sale! The boundaries are also identified – left or right of the property.
One good tip when buying a house is to go back at various times and check out the surrounding area – including the evenings, after dark on a Friday or Saturday night, just to see what the noise level is like, particularly from the house next door.
So far, so good.
The problem arises, though, when you move in or you yourself get new neighbours and they start with the all-night parties – (housewarming – ok – you let that one go – but then the loud music carries on each week!) – or they decide to build a large extension (sometimes on the party wall) and have to move the boundary fence for that and replace the old fence……but a couple of feet over – or they let the leylandii shoot up like triffids – any of this starting to sound familiar ?
Clearly these examples (not exhaustive) sound extreme but they can cause no end of stress and at the worst, can ruin lives – because, when it’s your home, there is no escape.
If you do have neighbour issues, firstly, check your household insurance policies for the words “Legal Expense Insurance” (e.g. via ARAG). These policies often cover neighbour/ boundary disputes, so that would be your first port of call, to their helpline. If they think you need legal advice from a specialist firm of solicitors, they may refer it to someone like Curwens solicitors, the cost of which is covered by your policy as long as it’s a viable claim (and you follow our advice!).
For further advice, call 0208 363 444 and ask for Adrian Boulter, property dispute expert.
There is a lot to consider before starting court proceedings in England & Wales:
The court has to deal with matters “justly and at proportionate cost.”
Do a cost/benefit analysis before starting proceedings, including the cost of enforcement.
Check the other party is good for the money – there’s no point incurring the cost of litigation if you can’t enforce the judgment.
Don’t start proceedings if you don’t intend to see them through. Unless it’s a small claim (less than £10,ooo) you’ll almost certainly be liable for the other party’s costs if you discontinue the claim.
Be careful about always threatening to sue if you don’t mean it – don’t just “crywolf” – the word will get round to your contacts and damage your reputation.
Recovery of your legal costs depends on:
who wins or loses;
your conduct as well as compliance with court rules and orders (for example, a failure to comply with a pre-action protocol can have cost consequences even for the party that wins);
when the matter ends (whether before or after proceedings have been started);
the financial value of the claim and the “track” the claim is allocated;
how the claim is concluded (whether by agreement or at trial).
Reaching a settlement
Litigation can be disproportionately expensive to the sums being argued about, the outcome is uncertain, the court is only able to offer a limited range of remedies and litigation often destroys any prospect of the parties resuming a commercial relationship so consider alternatives -for example:
It might be possible to recover the debt or agree an alternative future course of action by opening a negotiation with the debtor.
This can be done verbally or in writing (which includes e-mails).
Parties usually negotiate on a without prejudice basis.
The without prejudice rule generally prevents statements made in a genuine attempt to settle an existing dispute from being used as evidence of admissions against the party which made them.
This rule means that, if the negotiation or mediation fails and the business then issues court proceedings, any statements that the parties made in a genuine attempt to settle the dispute (whether in writing or orally) will not be put before the court in the proceedings.
Mediation is a flexible, voluntary and confidential form of dispute resolution in which a neutral third party helps parties to work towards a negotiated settlement of their dispute.
The parties retain control of the decision whether or not to settle and on what terms.
You can always simply write off the sum but before taking this step, consider the:
Size of the debt.
Likely cost of recovering the debt.
Importance of the current relationship between the parties.
Likelihood of maintaining an on-going commercial relationship between the parties.