Ok, so maybe your debt isn’t as big as the current international debt which is owed by Greece, but what if you have lent a substantial amount of money to a friend, colleague, family member or John from down the road, and they are now refusing to pay it back?
First things first, when was the money lent? For debt claims you will usually need to bring the claim within 6 years of the initial lending. Any later than that and you risk being time barred from pursuing the claim.
Secondly, how much is the debt worth? If the debt is under £10,000 then this will be dealt with by the small claims track in the civil courts. In the small claims track not all your legal costs may be recoverable. It is worth taking the time and conducting a cost benefit analysis. Depending on the nature of the claim, we may be able to offer fixed fee assistance for different stages of the claim which can help keep costs under control.
Lastly, before you decide on how best to pursue the claim, consider the status of the proposed defendant. Even if you have the strongest case in the world and get awarded a judgment in your favour, it does not mean that you will receive the judgment debt from the defendant if they don’t have the money to pay you. We have come across debtors with large judgments against them but who don’t have a penny to their name. In these circumstances your only recourse may be to accept a nominal monthly payment which may take years to pay off the debt. At another end of the spectrum are defendants who can pay but don’t want to. If you want to enforce a judgment against a debtor you will need to be able to find them or their assets; sometimes this will just not be possible.
Before you think about how to pursue a debt, it is always worth considering these three things first.
Instead of “stop, look, listen”, think “when, how much, and can they pay?” Not as snappy but it may be just as useful!
If you have debts which you are struggling to recover, give our specialist debt recovery team a call on 0113 244 9931.
