Business

How to Serve a County Court Judgment (CCJ)

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Having debtors can cause significant problems for businesses. If other businesses or individuals owe your company or organisation money and don't pay up when the invoice is due, this can result in cashflow problems for you, and interfere with many aspects of the smooth day to day running of your usual business activities. Therefore, being able to recover debts is an important function for every business to have access to.

If your business has debtors who have not paid what they owe by the time it is due, you can start taking further action to hopefully prompt payment as soon as possible.

The first stage of debt recovery is to send a letter before action to the debtor if they are another business, or a letter before claim if the debtor is an individual or a sole trader. These letters are following what is known as the correct pre-action protocol and it is essential that these guidelines are adhered to in order for potential legal action to proceed if needed. Having an experienced debt recovery team send this communication on behalf of your business shows that you are taking the matter seriously and this action alone is often enough to prompt repayment of the debt.

However, if the pre-action protocols that were followed do not result in the debt being paid, you can then issue a County Court Claim against the debtor who owes the money. This involves applying to the Court, who will then inform the debtor and provide them with an opportunity to pay up before further action is taken, or they can choose to dispute the debt. If the matter is disputed, the Court can then set a date for a hearing, when both parties will be able to state their case and the Court will make a judgment on the debt. If the Court finds in your favour, then a County Court Judgment or 'CCJ' will be issued to the debtor.

However, if the Notice of Issue is ignored by the debtor, after 14 days we are able to apply for default judgment against the debtor, resulting in a County Court Judgment (CCJ). If the CCJ is satisfied (i.e. the full amount paid) within a month, the CCJ will not be recorded against the company or individual. However, if no payment is forthcoming even at this stage, it's down to the claimant (your business) to decide on how you want the CCJ to be served or enforced.

Options for enforcing unpaid County Court Judgments

For unsatisfied county court judgments, when the action taken so far hasn't persuaded the debtor to pay what they owe, the judgment will need to be served, or enforced, and you will need to choose how best to do this from the CCJ enforcement options available to you. It is recommended that you work with an experienced debt recovery team to ensure that you follow the route that is most likely to produce a positive outcome for your specific circumstances.

For smaller sums of money owed, one of the most common enforcement options is to use bailiffs for the county court judgment, using a Warrant of Execution for the CCJ. The Bailiff will attend the address of the debtor and attempt to secure repayment or goods with a resale value of the amount owed.

Another option that you can use as part of the enforcement for the County Court Judgments process, for debts with a value of more than £600.00 is a High Court Writ, where a High Court Enforcement Officer (HCEO) will visit the debtor's premises to recover the money owed. They have more powers than a standard Bailiff.

Other options for enforcement of the CCJ also include issuing winding up proceedings on the business that owes you money.

It is important that you take expert advice on the option that is best for your specific situation, to give your debt enforcement action the best chance of a successful outcome.

Can I charge interest on County Court Judgements?

The charging of interest on debts that are owed to your business can be complex, as much will depend on the specific terms of the original agreement between your business and the debtor about what happens when payment is late or missed. If there is no specific reference to interest in the original terms that the debtor agreed to, interest on business to business debts can be charged at a rate of 8% above the Bank of England Base Rate, per annum. For individuals, the Courts set the standard rate for interest at 8% per annum.There will also be Court fees to add to the amount owed and if you use one of the available enforcement methods, such as Bailiffs, there will also be associated fees for this to add to the original debt amount.

A full breakdown of fees, interest and how this has been calculated will need to be communicated to the debtor.

For more information about how we can help you with the entire debt recovery process for your business, including how best to enforce a CCJ against a debtor, get in touch with the team by calling 0800 689 4176, request a callback or use our online contact form.

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Sadie Butler

Sadie Butler

Head of Forbes Collect

Forbes Collect

PinCentral Lancashire

Call0333 207 9388

Annabel Kelly

Annabel Kelly

Paralegal

Forbes Collect

PinCentral Lancashire

Call0333 207 0702

Sophie Jackson

Sophie Jackson

Paralegal

Forbes Collect

PinCentral Lancashire

Call0333 207 1135

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Contacting Us

Monday to Friday: 09:00 to 17:00
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