Can’t Pay? We take it away

I have to admit that this month I have been subjected to many episodes of “Can’t Pay? We take it away.” It is a firm favourite of my husbands. It isn’t because he likes watching other people’s misfortune it is more a case of “Why did they bury their head in the sand?”
As a result, I wonder how many small businesses in our area realise that a High Court Enforcement Order can be granted for sums as low as £600.
The small claim courts process is now an easy to do online process and many businesses who are owed money can use the service for a small fee of £25 for claims of £300 up to £410 for claims of £10,000. There has to be a significant amount of paperwork submitted with the claim to justify the application and the possibility of a court appearance. Many people at this point do not submit the correct and suitable paperwork that an experienced solicitor would prepare and often these claims fail.
For those claims that are granted by the court it means that the person owing the money now has a CCJ (County Court Judgement) against them or their business and this can have an adverse effect on credit ratings. It is however quite shocking to realise the number of people and businesses who ignore these CCJ’s when they pop through the letter box and refuse to pay the monies out of a sense of injustice or bury their head in the sand. This is where they go so horribly wrong. If the CCJ amount is over £600 the person owed the money can apply to the HCEA, High Court Enforcement Agency, to recover the money owed. County Court Bailiffs can be used to enforce sums under £600.
This now means that 1 or 2 nice people will arrive at your house or place of work and ask for payment of the amount in the judgement plus fees and interest which can be quite a lot more on an initial small debt. If it is a business they have the authority to remove goods to the value of the debt but not items under finance or which are tangible to the work done. If the business has personal guarantors then they too are liable for the debt as well. Too many small business owners do not realise that if they personally guarantee a company debt even though it is a limited company they are still as liable as the company and that means that the HCEA can go to your house and takes goods out of your house to cover that debt.
Many of the disputes and money claims can be negotiated between parties or legal representatives before it gets as far as the HCEA and it always a good starting point. Often a legal letter explaining the legal positions is sufficient to resolve the issue. It is also prudent to make sure that Terms and Conditions and Purchasing contracts are fully read and understood before entering into business dealings in case anything goes wrong further down the process.
No-one wants the HCE officers knocking on the door but it happens, more than we realise. Be business smart – check your Terms & Conditions and guarantees before you agree contracts.
Until next month –Be Safe and stay Legal.


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