We regard suing as a last resort. There is however inevitably a small percentage of debtors whom we have not managed to persuade to pay whether in instalments or at all. Principally they fall into two groups. Those whom we guage to have the money yet will not pay and those who think they know best and want a fight.

Suing is not expensive, nor in the early stages is it time consuming. If the debtor is an individual there is a new (and tiresome) pre-litigation protocol. We do it all. The purpose of the protocol is to reduce the number of cases in the Small Claims Court (debts below £10,000) and involves sending full details of the debt, the contract (if any) who was there who signed it and then an explanation of the cause of action together with several forms, which the debtor has to complete and return within 30 days or longer if he wants a solicitor to get involved.

There is no such protocol or delay where the debtor is a limited company. Creditors need to beware though that any claim has to be served at the company’s registered office.

We can set the claim up, generally on line. The creditor pays the Court issue fee (about 10% of the amount claimed (including the interest and compensation we add) and the debtor has 14 days from service to acknowledge or to pay. If he does neither of these then we remind the debtor promptly and he can request judgment. The debtor then has 14 days to pay.

What happens if the debtor defends? The Court sends out to both parties a simple questionnaire designed to determine where the matter is to be heard. The Claimant can walk away and discontinue without further cost. It will be followed by a notice from the court where the matter is to be listed giving directions about who is to file and serve witness statements etc and informing the parties the date of the hearing and the time allowed for it.

We expect to advise on the preparation and content of witness statements, but it is all low-key, simple stuff. So is the hearing itself.

We never sue without full consultation with our client. The last word is always theirs. And when we allow them to sue, of course, they win.

LMWise FCA
Barrister-at-Law