If you have entered into and won in a Court case, then you will know how satisfying it can be if a judgement is obtained in your favour against your opponent. However, what happens when this victory is cut short when your opponent, the now debtor, does not pay?
A judgement can be “enforced” to ensure payment of the outstanding sum due to you, and there are several legal routes that can be taken when considering enforcement of a judgement. We hasten to add that the decision as to what option to take is not always a simple one, and is determined by several factors, including financial considerations, the speed at which enforcement can achieved, and the assets available to enforce against. As each case is unique, we recommend discussing your case with a solicitor to obtain a greater idea on the best next steps for you.
(1) Enforcement Officers
One option available is to instruct enforcement officers, known as bailiffs for County Court applications, and High Court Enforcement Officers (HCEOs) for all other matters.
Any judgment over £600, including interest and costs, can be transferred up to the High Court for enforcement, which can be quicker and more effective, as HCEOs work on a commission only basis. This element means it is in their interest for a debt to collected as soon as possible. Enforcement Officers, whilst they cannot force entry into premises, may not be asked to leave once admitted and can seize goods up and including the value of the debt which can be sold to realise the amount due. A HCEO can be a cost-effective way of enforcing the debt as, if successful, all the fees will be paid by the debtor as part of the judgment debt.
(2) Charging Order
The second way of enforcing the judgment is by a charging order. This will involve placing a restriction on the title of the debtor’s property, meaning that when the property is sold, it cannot be transferred to the new owners until the debt is cleared. This option can secure the debt for future repayment if the debtor owns a property, but it can be many years until the charge is realised and the debt therefore paid. This option can, however, be attractive if the debtor is unlikely to have assets to repay the debt now but owns property that is likely to be sold at a later date.
(3) Third Party Debt Order
Another option is to seek to apply a third-party debt order against a bank account owned by the debtor. This bank account can be held with any bank or building society.
The third party will be obliged to carry out a search for any accounts held by the debtor and will be required to hold the amount secured by the debt until a hearing is held to determine whether the order should be made final, typically between a few weeks and a few months after an interim order is granted. At the hearing, a judge will decide whether to make the order final.
The methods described above are just some of the most common ways in which a debt can be enforced. Other less common options are also available including bankruptcy and an attachment of earnings. However, these methods can be expensive to put in place and will only be effective if more information about the debtor and their circumstances are known. They may not, therefore be appropriate for small, personal debts between individuals.