The Threat of Court Action Results in Payment

The creditor had been commissioned to build a new website for a start-up business. The project was completed within the three months agreed, and an invoice was issued upon completion and sign off by the client. The creditor then spent over nine months chasing for payment, receiving one excuse after the other until the debtor ceased responding altogether.

Dealing with a Devious Director

Upon receiving the instruction and carrying out some initial investigations, it became clear that recovering the debt would not be straightforward. The debtor was the sole director of several limited companies, all of which were registered to a generic postal address in London. The companies had varying listings at Companies House, active, non-trading and about to be struck off. There were also several dissolved companies where the debtor had been a director. Most of the current and previous companies had at least one County Court Judgment registered against it. In their correspondence with our client, the debtor had used three different company names, and this appeared to be a deliberate ploy to add confusion as to which company was responsible for payment.

The creditor also carried out some investigations before our instruction and shared the information with us, including the debtor’s current home address in the North West and the details of a nearby business in which they suspected the debtor was a partner.

Given the debtor’s previous conduct in dissolving companies and incurring CCJ’s, it was doubtful that the threat of Court action against any of the limited companies would result in payment. On studying the contract signed by the debtor, we found that yet another business name was used, and crucially it was not that of a limited company. It was decided that the debtor would be pursued as a sole trader, and any Court action would be in his name trading as.

Late Payment Charges and Costs

The debt of £3,060.00 dated back to December 2020 incurring substantial late payment charges, which were added to the total amount claimed along with the debt recovery costs. We issued a 7-day Notice by post to the debtor’s home address and sent copies by email to several email addresses he used. There was no response, and telephone calls and messages went unanswered. On the expiry of the Notice, a 7-day Final Demand Notice was issued, including additional charges and costs. This Notice explained in no uncertain terms the consequences of a Count Court Judgment being registered in the name of the debtor and the effect it would have on his personal credit rating.

The response to the Final Demand Notice was immediate. We received a call from the debtor who alleged hardship and the inability to pay in full and an offer to pay in monthly instalments of £200.00. The debtor was reminded of the age of the debt and our client’s considerable time and effort spent chasing for payment. The debtor was advised to put forward a more realistic offer in writing. There followed an exchange of emails where the debtor made several unacceptable offers. Finally, we received an offer to pay in two equal instalments and forwarded it to our client for consideration.

Full Payment including Interest and Costs in 14 Days

Our client was agreeable to receiving payment in two instalments, provided that the initial instalment was paid immediately and the second 14 days later. The debtor maintained that it was not possible for them to make an immediate payment and that payment would be at the end of the month and the following month-end. This was unacceptable, and an ultimatum was issued. Failure to pay the initial instalment prior to the expiry of the Final Demand Notice would result in the immediate issue of Court proceedings and additional costs.

The initial instalment was paid the following day. Upon sending a reminder before the second instalment became due for payment, the debtor again alleged it would not be possible to pay on the date requested. A further ultimatum was issued, and payment of the remaining balance, including the late payment charges, was paid as demanded.

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