But when the Court Case is over all too many claimants find it isn't when they try to retrieve their money. Claire Turner, a Solicitor with Bevan Ashford, highlights the legal pitfalls when recovering debts both in the UK and abroad.
Many people believe that obtaining a Court judgment against a debtor, either at trial or by default if the debtor does not defend the claim, means the end of Court involvement. This is true only if the debtor pays the judgment debt. If they fail to pay within the time stipulated by the Court Order, then obtaining the judgment itself can be just the start of a long, and potentially costly procedure. Here are some answers to frequently asked questions on recovering debts and enforcing judgments.
I have obtained judgment against a debtor but he has not paid it. What can I do?
There are a number of methods which can be used to try and enforce a judgment debt, which include, if the debtor is in, or has assets in England and Wales, putting a charge on the debtor's property, obtaining an attachment of earnings order against the debtor's salary, getting an order that the debtor's bank pay funds directly to you from the debtor's account, or instructing the Court bailiffs to seize goods to the value of the debt. A further possibility is to commence bankruptcy proceedings in the case of an individual, or winding up proceedings where the debt is owed by a company. The choice of which method to use depends on the individual circumstances of the case. It is always worth taking legal advice as to the likely costs and time involved, before embarking on enforcement proceedings.
What further costs are involved?
All these methods require the further involvement of the Courts, and Court fees need to be paid up-front. The Court fees and some costs can normally be added to the debt to be recovered, but the harsh reality is that it is very difficult to recover more than a proportion of the costs that you incur enforcing a judgment.
However, none of these methods guarantee recovery of the debt if the debtor is particularly elusive or does not have any assets to attack, and knowledge of the assets and means of the debtor is invaluable in deciding which route to follow. A useful weapon in this regard is that it is possible to ask the Court for an order requiring the debtor to attend Court to answer specific questions as to his means and assets. If he fails to attend two such Court appointments, he can be imprisoned for contempt of...