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Enforcing a Claim

There are a number of ways of enforcing a claim:

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With over 40 years’ experience, Fisher Jones Greenwood is a long-established Essex Solicitors. With nine offices around Essex, Suffolk and London. Phone us on 08455 435 700 or email us and we’ll call you back to arrange a meeting with a solicitor or lawyer.

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Ways Of Enforcing A Claim

Registering a Judgment

If someone fails to pay a County Court judgment within the time stipulated by the Judge, details of that judgment will be entered on the Register of County Court judgments. Those entries stay on the Register for 6 years. The fact that a judgment has been registered against someone makes it difficult for that person to obtain credit.

Although a paid judgment can be marked as “satisfied” a judgment can only be removed from the Register with the agreement of the Court. Not all judgments are easily removed and it is better to avoid them being registered in the first place. If you want to know how to remove a judgment from the Register, please contact 01206 835 231 or email [email protected].

Warrant of Execution

This is a request to the County Court Bailiff to call at the Debtor’s home or business premises and remove goods for sale. The purpose of the Warrant is to recover sufficient money to pay off the amount outstanding under a judgment. Second-hand goods do not make very much money when sold in this way and the process can be very time-consuming.

If you want to request a Warrant of Execution you must send a completed form (N323) to the Court with a fee of £100 (where the sum to be recovered is more than £125).

A Warrant of Execution will only issue in the County Court for sums up to £5,000. If the amount involved is greater you will need to transfer the judgment. to the High Court and ask the Sheriff to enforce the judgment for you. With an amount of this size, it is advisable to obtain legal advice before proceeding.

A Bailiff cannot force his way into a Debtor’s premises in order to enforce a judgment. A Bailiff cannot remove items which the Debtor needs for his job or business such as tools of his trade. A Bailiff cannot take essential household items such as clothing or bedding. A Bailiff cannot take items which do not belong to the Debtor because for example they are rented or on hire purchase.

Many Debtors confronted with a Warrant of Execution will apply to suspend the Warrant and make an offer of payment by instalments. You will be informed of that offer which if not accepted will be the subject of a Court hearing to decide whether it is a fair proposal or not.

If the Bailiff is unable to remove sufficient items to cover the amount of your claim you may ask him to try other addresses but will have to pay a further fee. Although the Bailiff’s fees are added to your claim and payable by the Debtor they are not returned to you if no money is recovered.

Attachment of Earnings

An Attachment of Earnings Order is an Order sent by the Court to the Debtor’s employer requiring him to deduct money from a Debtor’s wages each payday and send it to the Court who pass it on to the Creditor.

An Attachment of Earnings Order cannot be made if the Debtor is unemployed, self-employed, in the Armed Forces, or a Merchant Seaman.

If the Debtor is in regular employment you should request an Attachment of Earnings Order by completing Form N337 and sending this into the Court with the fee of £100. The Court will then send the Debtor a form to complete about his or her income and outgoings. If the Debtor does not return the form the Court can require him or her to attend personally before the Judge and if this Order is disregarded the Debtor can be arrested and ultimately sent to prison if he or she fails to co-operate.

At the hearing – or on considering the returned form – the Judge will set a normal weekly or monthly deduction and a “Protected Earnings Rate”. This is the amount that the Judge considers the Debtor needs to live on. If the Debtor’s earnings fall below the Protected Earnings Rate in any week or month the normal deduction will not apply.

An Attachment of Earnings Order is a very effective method of enforcement against Debtors who are in regular and responsible employment.

Third Party Debt Order

A Third Party Debt Order is an Order freezing money owed to the Debtor by another person. If the Debtor has money in a bank or building society account in excess of the amount owed that money can be frozen and paid into Court for the benefit of the Judgment Creditor.

A Third Party Debt Order is obtained by completing Form N349 and sending it to the Court together with a fee of £100.

If a Judge is satisfied with the information that you have provided he will make an interim Third Party Debt Order. A copy is sent to you and to the Third Party and 7 days later sent to the Judgment Debtor. The effect is to ‘freeze’ the money in the Debtor’s account with the Third Party.

The Court also fixes a hearing date at which it considers whether to confirm the Third Party Debt Order, ie, to confirm whether or not the money in the bank or building society account should be paid into Court by the Third Party.

The bank or building society to whom a Third Party Debt Order is sent is entitled to deduct a fixed amount, currently £55, to cover their own expenses. The Creditor will only recover the amount of his debt if there is sufficient money in an account in the Debtor’s sole name to cover both those expenses and the debt.

A Third Party Debt Order is a very good way of enforcing a County Court Judgment if you have had previous dealings with the Debtor and have details of his or her bank account.

Charging Order

A Charging Order is an order made by the Court that “charges” land or securities (such as stocks and shares) with payment of the judgment debt.

The most common Charging Order is against land owned by the Debtor whether in his or her sole name or jointly with another person.

If you know that the Debtor owns land you can ask the Court to make a Charging Order against the Debtor’s interest in that land by completing form N379 which sets out:-

  • the name and address of the Debtor;
  • the name and address of the Judgment Creditor;
  • the amount of the debt
  • the address of the property to be “charged”;
  • the reasons why you believe the Debtor has an interest in the land.

This form is sent to the Court together with the fee of £100. If the Judge is satisfied that the Debtor appears to own an interest in land he will make an Interim Charging Order against the Debtor and fix a hearing at which he will decide whether to make that Charging Order Final. He will only make the order Final if satisfied that the Debtor does have an interest in the land in question.

Once an Interim Charging Order has been made it should be registered either at the Land Charges Registry or the Land Registry depending upon whether title to the land is registered or not. You should seek legal advice about how to do this since the charge is only effective against other creditors once it has been registered.

Once a Charging Order has been registered it can be enforced by a sale of the property in question but often it is simply left as a secured debt which has to be paid as and when the property is sold, particularly if there are young children living in the property.

Order to obtain information from a debtor

Very often a Judgment Creditor will not have any up to date information about a Debtor’s financial circumstances. To find out more the debtor can be required to attend Court and give evidence on oath about those circumstances. Once that information is known the judgment Creditor will be in a better position to decide how to enforce his or her judgment.

An Order to obtain information from a debtor is requested by lodging Form N316 with the Court together with a fee of £50. The Judgment Debtor will be ordered to attend Court and answer questions about his or her finances. Failure to do so can lead to imprisonment.

Judgement Summons

If a debt relates to unpaid maintenance under a Court Order the Judgment Creditor can apply for a Judgment Summons.

You will need to complete a Request for Judgment Summons (Form N342) and pay a fee of £100.

The Court will fix a hearing date which the Debtor will be required to attend. At the hearing, the Debtor will have to answer questions on oath and may be ordered to pay the debt by instalments.

If the Judge is satisfied that the Debtor has the ability to pay the debt but is simply refusing to do so he or she can be sent to prison.

If the Debtor fails to attend the hearing the Court can issue a Warrant for his or her arrest.

A Judgment Summons is a good method of enforcing matrimonial maintenance payments where the Debtor is a professional person and his or her refusal to pay is motivated by an unwillingness, rather than an inability, to pay.

Bankruptcy

Bankruptcy can be a very effective threat where the Judgment Debtor is a small businessman or company director.

The debt needs to be more than £5000 before bankruptcy proceedings can be started.

The first step is to serve on the debtor a “Statutory Demand” which sets out why you say that money is due and details of the judgment obtained.

If the debt is not paid within 3 weeks of serving the Statutory Demand you can “Petition” the Court for a Bankruptcy Order to be made against the Debtor.

You must complete and send to the Debtor’s local Court a “Creditor’s Petition” and a Court fee of £280. In addition to the Court fee, you will have to pay a deposit to the Court of £990 to cover the Official Receiver’s expenses in dealing with the Bankruptcy. This will be returned to you if no Bankruptcy order is made.

Bankruptcy is not a cheap option although if the Debtor avoids a Bankruptcy Order being made against him or her the deposit will be returned to you.

Once the Court receives the Creditor’s Petition, fee, and proof of the Statutory Demand having been brought to the Debtor’s attention it will fix a date for the hearing of the Bankruptcy Petition.

At the hearing the Court may:-

  • Adjourn to another date to give the Debtor time to pay the debt;
  • Make a Bankruptcy Order
  • Approve a proposal for payment.

If a Bankruptcy Order is made the Court will appoint a “Trustee in Bankruptcy” who is a member of the Official Receiver’s office to deal with the Debtor’s affairs.

Once a Debtor has been made bankrupt no other Court proceedings can be started against him. His “Trustee” will collect together his assets and debts and will share out any surplus between his creditors.

If the debtor has other secured creditors they take priority over your debt.

Bankruptcy is not necessarily the right choice of enforcement where the Debtor has lots of other creditors since there may not be enough money to go round. Since being made bankrupt prevents a person from acting as a Company Director it can be a useful weapon if they are just ‘playing for time’.

If the debtor is a limited company the equivalent proceedings are for a ” Winding Up Petition”. Please contact us for further details.

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