The below sets out the step-by-step process for collecting debts, including where a claim is issued at Court, where the claim is subject to the jurisdiction of the Courts of England and Wales only.
If you require advice and information on insolvency please contact our Commercial Litigation Department.
The below is not intended to constitute legal advice.
The charges detailed below apply to each step and will accumulate depending on the number of steps taken.
Fees will be payable as each step is completed.
Our standard costs in preparing and sending a Letter Before Action (LBA) based upon undisputed outstanding invoices are £54.00 (exclusive of VAT). In addition, and as a matter of course, we carry out initial debtor enquiries which may include (but are not limited to) land registry searches at a cost of £3.00 per search (which does not attract VAT).
VAT is currently 20%
We will endeavour to get a letter sent out to the debtor on the next working day after instructions are received.
Pre-action correspondence sent to an individual (including sole traders) will fall within the Pre-Action Protocol for Debt Claims and a response will be requested from the debtor within 30 days.
Pre-action correspondence sent to other debtors (e.g. partnerships and / or limited companies) will usually request a response from the debtor within 7 days.
Letters to debtors who are carrying on a business will seek payment of either contractual or statutory interest and statutory late payment compensation. In the event that the compensation is paid at this stage, we will take as our fee the full late payment compensation recovered from the debtor plus VAT on the same which will be payable by you (as VAT is not claimable from the debtor) and not charge our standard fee referred to above.
At this stage, if a response is received disputing the debt our fees to review the matter and thereafter advise you will be outside of this fixed fee arrangement and payable at the applicable hourly rate (**).
If no dispute is raised and / or no payment is received and you ask us to issue a claim for recovery of the debt, the following costs will usually apply.
N.B. Interest and compensation may take the debt into a higher banding, with a higher cost.
|Value of your claim||Court Issue Fee (added to sum claimed)||Court Fixed Costs (added to sum claimed)||Our charge to you (exclusive of VAT).|
|Greater than||£300.00||but no more than||£500.00||£50.00||£50.00||£130.00|
|Greater than||£500.00||but no more than||£1,000.00||£70.00||£70.00||£130.00|
|Greater than||£1,000.00||but no more than||£1,500.00||£80.00||£80.00||£130.00|
|Greater than||£1,500.00||but no more than||£3,000.00||£115.00||£80.00||£130.00|
|Greater than||£3,000.00||but no more than||£5,000.00||£205.00||£80.00||£130.00|
|Greater than||£5,000.00||but no more than||£10,000.00||£455.00||£100.00||£195.00|
|Greater than||£10,000.00||but no more than||£100,000.00||5% of value of claim||£100.00||£260.00|
We will endeavour to get the claim drafted and filed at Court on the next working day after instructions are received.
The claim will then be issued by the Court and we will advise you once the notice of issue has been received. We are unable to provide a timescale for the Court processing the claim.
The debtor has 14 days to respond to the claim once it has been issued and served by the Court. If the debtor files an acknowledgment of service within these 14 days, they will have a further 14 days to file and serve a defence.
With regards to debtors who are carrying on a business, in the event that the debtor pays the entire claimed amount following the issuing of proceedings, we will take as our fee whichever is the greater between;
If following the issue of your claim, the other party files and serves a defence, our fees will be outside of this fixed fee arrangement and any further advice will be payable at the applicable hourly rate (**).
If the debtor does not respond or defend the claim we will notify you on the due date of the relevant step and request instructions to seek judgment (CCJ). If you ask us to apply to the court to enter judgment on your behalf, the following costs will usually apply.
|Fixed Costs added to the claim where the Judgment does not exceed £5,000||Fixed Costs added to the claim here the Judgment exceeds £5,000||Our charge to you (exclusive of VAT)|
|Judgment where no response at all||£22.00||£30.00||£40.00|
|Judgment where an acknowledgement of service has been filed but no defence||£25.00||£35.00||£55.00|
|Judgment on Admission (where the debtor has made an offer which you have accepted)||£40.00||£55.00||£65.00|
|Judgment on Admission (where the debtor makes an offer which you refuse and the Court then decides the amount to be paid)||£55.00||£70.00||£70.00|
We will endeavour to draft the relevant documentation and file it at Court on the next working day after instructions are received.
The Court will normally then provide a sealed judgment for enforcement. We are unable to provide a timescale for the Court processing the request for judgment.
We will endeavour to write to the debtor demanding payment of the judgment within 7 days, the next working day after receiving the judgment. We will not charge a fee for this letter.
With regards to debtors who are carrying on a business, in the event that the debtor pays the judgment sum following the demand for payment, we will take as our fee whichever is the greater between;
If the judgment is not paid, we will then provide advice and take your instructions on enforcement action.
There are various methods of enforcement the appropriateness of which will vary dependent upon the information you hold on the debtor and the circumstances of the debtor.
Indicative fees, where enforcement is required, are as follows:
Debt under £600.00 – Fee for County Court bailiff £110.00 and our hourly rates will apply (**).
Debt over £600.00 – Fee for High Court Enforcement Officer (“HCEO”) £66.00 and our hourly rates will apply (**). If the HCEO is unable to recover the debt, they will raise an additional abortive fee of £75.00 plus VAT. If the HCEO does recover the debt, its fees (including the £66.00 referred to above) will be recovered from and paid by the debtor.
Charging Order – if the debtor owns property solely or jointly and we are instructed to seek a charging order against that property our hourly rates will apply (**) together with the Court fee of £110.00, land registry search fee £3.00, land registry fee for registering charge £42.00.
Attachment of Earnings Order – our hourly rates will apply (**) together with the Court fee of £110.00.
Third Party Debt Order – our hourly rates will apply (**) together with the Court fee of £100.00.
Order for Questioning – our hourly rates will apply (**) together with the Court fees of £55.00 for issue and £110.00 for the bailiff to personally serve the Order.
Our Litigation and Dispute Resolution team is headed by Richard Moose. Richard was called to the Bar in 1999 and has a broad experience in civil and commercial litigation and dispute resolution, acting on behalf of clients in respect of contract disputes, professional negligence, partnership disputes and claims relating to land with a particular interest in shareholder and company disputes. Richard’s current hourly rate is £295 plus VAT.
Lindsey Jenkins is a Solicitor in the Litigation and Dispute Resolution department. Lindsey qualified in 2016 but benefits from an additional four years’ experience in a legal context working at city firms. Lindsey’s current hourly rate is £250 plus VAT.
Rachel Shone is a solicitor in the Litigation and Dispute Resolution department. Rachel qualified in 2015 but benefits from an additional six years’ experience in a legal context as a paralegal with national and international law firms. Rachel’s current hourly rate is £250 plus VAT.
James Calrow is a solicitor in the Litigation and Dispute Resolution department. James qualified in 2015 and his current hourly rate is £250 plus VAT.