Debt collection is a term that strikes terror into business owners and individuals alike. The image of burly men banging on the door and taking away all your worldly goods hasn’t been helped over the years by the media’s portrayal of debt collectors on TV. However, there are limits to what debt collectors and court enforcement officers can actually do. Knowing your rights is important, so if you’re concerned about that ‘knock at the door’, here’s a brief guide to dealing with the bailiffs.
The difference between County Court bailiffs, HCEOs, and DCAs
The first thing is to understand that there’s a big difference between debt collection agencies (who are usually private firms) and enforcement officers (known as either High Court Enforcement Officers (HCEOs) or County Court Bailiffs). Regardless of who comes knocking, there has to be a set chain of events before the ‘bailiffs are called in’.
Initially, there should be plenty of contact between the creditor and the debtor, and the easiest way to avoid any type of debt collection situation is to keep the creditor fully apprised of your situation. If you are a creditor then you should first, try to recover the debt ‘in-house’ or at least negotiate with the debtor to arrange manageable payment plans to pay off the debt. If that fails, then you can take things to the next level by bringing in a Debt Collection Agency (DCA).
DCAs often work on a ‘no collection, no fee’ basis, and should go through a process of written contact and phone calls before moving onto personal visits. Bear in mind, though, that DCAs do not have any enforcement authority, so they can’t enter a property to take control of goods in lieu of payment. They also cannot threaten, intimidate or lie to the debtor about what they are allowed to do, and debtors have every right to refuse entry to DCA agents.
Going through the courts
If the use of in-house and DCA methods are still not garnering results for the creditor, then they can go through the courts. The most common route is to apply to the County Court for a County Court Judgment (CCJ). If the debtor still either can’t or won’t pay, then the creditor can apply to the court for enforcement.
Who carries out an enforcement order?
It’s usually a County Court Bailiff or a High Court Enforcement Officer who executes the Order. The debtor will be told of the decision to elevate the case to the Court and that they have seven days to pay before officers arrive at their doorstep. Unlike DCA agents, Court Officers do have the right of entry if you are a company and can seize goods to cover the cost of the debt, as long as they are sure the assets belong to the debtor. However if you are classed as an individual debtor or sole trader then the Court Officers have to be invited into your home in order to gain access and cannot force entry.
Bear in mind that if you are visited by a court officer pursuing a debt, then not only will you have to pay the debt itself, but there will also be additional charges depending on the size of the debt and the actions that the officers have to take to recover the debt.
I’m a creditor. What’s my best option?
The cheapest, and least effective, option is a no-collection-no-fee debt collection agency, but as their authority is limited, it may not produce the results you want. If you have demonstrated that you’ve given the debtor plenty of opportunities to pay and you have not received a response to a Letter Before Action sent either by you or a legal professional within the timeframe given, then the best option is to request a Notice of Issue via Money Claims Online (or speak with a legal professional who can do this for you for a fee), request Judgment and then elevate it to the County Court or High Court to enforce payment. You will have to pay a fee to issue a claim and to enforce in the County Court and/or High Court, but the chance of getting at least some of your money back is much higher. It is important to note however that there are other options available to you for enforcing a Judgment once this has been obtained such as: Third Party Debt Order, Charging Order, Attachment of Earnings and Orders to attend Court for questioning.
If you would like to discuss the various options available to you for pursuing or defending a debt, then please do not hesitate to get in contact with a member of our Debt Recovery team. The team can be contacted on 01206 574431 or by email at firstname.lastname@example.org.