Tel: Loughborough 01509 238822 | Melton Mowbray 01664 563012

Debt Recovery – Price Transparency

Debt Recovery Costs 

Where debt is under £100,000

 

We act for businesses and individuals seeking to recover unpaid debts (“the creditors”) from those owing the debts (“the debtor”) in a variety of matters, from simple undisputed debts, to more complex contested debts. We are able to utilise numerous mechanisms to ensure that you can maximise your recovery.

We set out below our estimate of the costs and works included for the recovery of an unpaid debt which is both undisputed and disputed.

Please see our terms and conditions of business with regard to our hourly rates. (please note that our fees are subject to VAT).

The nature and complexity of matters can vary greatly and consequently the figures below are merely indicative. A fuller estimate be provided to you upon meeting with you to take your detailed instructions and upon reviewing any documentary evidence in support.

 

Undisputed Debt Costs

Very often the most cost effective way to pursue these is by way of a statutory demand.

The costs include:

  1. The initial consultation fee;
  2. Our estimated fee for the matter, and
  3. If necessary, the cost of issuing a statutory demand – this includes our fees and the costs of a Process Server to serve the statutory demand upon the other party.

 

Debt value Initial Consultation Our estimated fee  in addition  Sub-Total Statutory Demand fee        Total Estimate
Up to £5,000.00 £100.00 £250.00 £350.00 £91.50 £441.50
£5,001.00 to  £10,000.00 £100.00 £350.00 £450.00 £91.50 £541.50
£10,001.00 to £50,000.00 £100.00 7.5% value of the claim £850.08 to £3,850.00 £91.50 £941.58 to £3,941.50
£50,001.00 to

£100,000.00

£100.00 7.5% value of the claim £3,850.00 to £7,600.00 £91.50 £3,941.50 to £7,691.50

 

Works included

  • An initial consultation;
  • Reviewing documentation;
  • Provision of written  advice;
  • Undertaking appropriate searches (additional disbursement fees may apply);
  • Sending a letter demanding payment to the other side;
  • Receiving payment and sending it onto you, or if the debt is not paid, drafting and issuing a statutory demand (see below);
  • If payment is not received within 21 days, providing you with advice on the next steps and the likely costs, and
  • The fee estimate does not include disbursements not specifically referenced above (such as tracing agent costs).

 

Statutory Demand

A statutory demand is a written demand for payment of a debt served on an individual or a company. An individual or company that owes a debt, that has been due for more than three weeks, and exceeds £750 (for companies), or £5,000 (for individuals), risks having a bankruptcy or winding-up petition issued against it.

For this reason, the service of a statutory demand is often the initial step taken by creditors in the insolvency process. We will advise more fully on the advantages and disadvantages of this procedure where necessary.

 

Disputed Debt Costs

If the other party disputes your claim at any point, the following estimate of costs will apply, if more extensive work is required we will discuss this  with you at such time and prior to the work being undertaken. Please see our terms and conditions of business with regard to our hourly rates.

The estimate includes:

  1. The initial consultation fee;
  2. The court issue fee (a detailed breakdown of court fees can be found here), and
  3. Our estimated fee for the matter.

 


Debt value
Initial Consultation Court fee as at November 2018 Our estimated fee  in addition  Total
Up to £5,000.00 £100.00 £35.00 to £205.00 £495.00 Up to £800.00
£5,000.01 to £10,000.00 £100.00 £455 £575.00 Up to £1,130.00
£10,000.01 to £50,000.00 £100.00 5% of the value of the claim Up to 7.5% of the value of the claim £1,350.00 to £6,350.00
£50,001.00 to

£100,000.00

£100.00 5% of the value of the claim Up to 7.5% value of the claim £6,350.00 to £12,600.00

Works included

  • An initial consultation;
  • Reviewing documentation;
  • Provision of written advice;
  • Undertaking appropriate searches;
  • Sending a pre-action letter to the other side;
  • Receiving payment and sending it onto you, or if the debt is not paid, preparing, drafting and issuing a claim;
  • Attempting to engage in Alternative Dispute Resolution (see below);
  • Where no Acknowledgement of Service or Defence is received, applying to the court to enter Judgement in default;
  • When Judgement in default is received, we will write to the other side to request payment;
  • If Acknowledgement of Service or Defence is received, providing you with advice on the next steps and the likely costs in preparing for trial, and
  • The fee estimate does not include disbursements not specifically referenced above (such as tracing costs).

 

Alternative Dispute Resolution (ADR)

Where a debt is disputed we will endeavour to settle the matter out of court utilising ADR. We have extensive experience settling matters through mediation and adjudication and we will make every effort to assess each case’s suitability for ADR. The costs of preparing for ADR may be lower than preparing for a court trial and we will advise on this at a later date.

 

Timeline

Matters can usually take anything from 2-4 weeks from receipt of instructions from you to receipt of payment from the other side if the debt is uncontested.

If the debt is contested and proceedings have to be issued then it can take in excess of 9 months for the matter to be dealt with in the County Court (up to final hearing) and potentially significantly longer  if the matter is to proceed to a fully contested trial in the High Court (complex matter).

We can discuss timescales in greater detail with you once we have the full details of your matter.

If enforcement action is needed, the matter will take longer to resolve and a separate estimate of these costs will be provided upon request.

 

Stipulations

Anyone wishing to proceed with a claim should note that:

  • Any claims under £10,000 will ordinarily be allocated to the small claims track, where there is limited recovery of costs from the other party;
  • Interest and compensation may take the debt into a higher banding, with a higher cost;
  • The estimates do not cover the costs of the enforcement of an order where necessary; and
  • The estimates do not include disbursements not specifically referenced above (such as tracing costs).
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