What Happens When Your Debtor Doesn’t Pay Their CCJ?
As a business owner or an individual, it can be quite frustrating and stressful when someone owes you money. You may have tried to collect the debt through various means, but your debtor still hasn’t paid up. In this situation, you may consider taking legal action by obtaining a County Court Judgment (CCJ) against them. However, what happens when your debtor still doesn’t pay their CCJ? Let’s explore this scenario in more detail.
Firstly, let’s understand what a CCJ is and how it works. A CCJ is a court order that forces someone to repay a debt that they owe. It is usually obtained through the County Court after a claim has been made against the debtor. This process involves filling out the necessary forms and providing evidence of the debt owed. Once the CCJ is granted, it will state the amount owed and a deadline for payment to be made.
Sending a Reminder Letter
Now, let’s discuss what happens when your debtor doesn’t pay their CCJ. The first step is to send them a letter reminding them of their obligation to pay. This letter should include the details of the CCJ and the deadline by which payment must be made. It is important to keep a record of this letter as it may be required as evidence in court if further action needs to be taken.
Enforcing the CCJ
If the debtor still fails to pay after receiving the letter, the next course of action would be to enforce the CCJ. This means taking further legal action to recover the debt. There are several methods of enforcement available, and the best option will depend on the individual circumstances of your case.
Attachment of Earnings Order
One of the most common methods of enforcing a CCJ is through an attachment of earnings order. This means that money will be taken directly from the debtor’s wages before they are paid. This method is only available if the debtor is employed and earning enough to make regular payments towards the debt.
Warrant of Control
Another option is to apply for a warrant of control, also known as a bailiff’s warrant. This allows a bailiff to visit the debtor’s property and seize goods to sell at auction to pay off the debt. However, this method may not be successful if the debtor does not have any valuable assets or if they refuse to let the bailiff into their property.
Charging Order
If these methods are not viable, you may consider applying for a charging order. This means that a legal charge will be placed on the debtor’s property, and when it is sold, the money from the sale will be used to repay the debt. However, this can be a lengthy and costly process, and there is no guarantee that the debtor will have enough equity in their property to cover the debt.
Order for Sale
In cases where all other methods have been exhausted, you may consider applying for an order for sale. This means that the court will force the sale of the debtor’s property to recover the debt. However, this should only be used as a last resort as it can have severe consequences for the debtor, and they may end up losing their home.
Professional Legal Advice
It is essential to note that all of these enforcement methods require further court action and can be time-consuming and expensive. It is advisable to seek professional legal advice before taking any further action.
Writing Off the Debt
If your debtor still does not pay after all of these enforcement methods have been exhausted, you may need to consider writing off the debt. This means accepting that you are unlikely to recover the money owed and closing your case. However, it is important to keep all records of your attempts to recover the debt in case the debtor’s financial situation changes in the future.
Debtor Bankruptcy
In some cases, you may find that your debtor has declared themselves bankrupt. In this situation, you will need to contact their bankruptcy trustee to register your claim as a creditor. However, it is important to note that if your debtor has been declared bankrupt, it is unlikely that you will be able to recover the debt owed.
Impact of a CCJ on Credit Score
Now, let’s discuss the impact of a CCJ on your debtor’s credit score. A CCJ will remain on their credit file for six years, starting from the date that it was issued. This can have a significant impact on their ability to obtain credit in the future as it will flag them as a high-risk borrower. Therefore, it is in your debtor’s best interest to pay off the debt and have the CCJ marked as satisfied on their credit file.
Conclusion
In conclusion, obtaining a CCJ against a debtor is not a guaranteed way to recover a debt. It is essential to consider all the available options and seek professional legal advice before taking any further action. Remember to keep detailed records of all communication with your debtor and any attempts to enforce the CCJ. And, if all else fails, you may need to accept that the debt may never be repaid.
