Debt Recovery

With debts being a regular occurrence in both business and individual arenas, our Solicitors are well equipped to efficiently assist in such disputes, contested or otherwise, so as to achieve results either before or after Court proceedings, as circumstances dictate.

Our pricing for comprehensive advice on debt recovery matters are indicated below for each course of action of debt recovery e.g. Pre-Action Letter, Court Proceedings to secure Judgments and Enforcement Actions, Statutory Demands, Winding Up Petitions/Bankruptcy Petitions.

Each case will be handled by a trusted member of our experienced team and once a member has been allocated to the case, the team member will be duly introduced. Regardless of the team member allocated to the case, they will be supervised by one of the partners. For more information about the Solicitors in our firm, please see: Solicitors at Alpha Lexis Law Firm

Our fees for taking instructions on matters where the debt is no more than £100,000 and based on clear information and documentation being received from you and for considering the same is based on our hourly rates namely £225 plus VAT for junior members of our Firm to £350 plus VAT for senior members inclusive of Partners. The aforementioned work is likely to involve 3 – 4 hours work and provided clear instructions and documentation are received, such fees will cover a face-to-face meeting, taking full instructions about the debt that is owed and advising on the specific scenarios and will include the calculation of interest (and compensation if appropriate) that might be payable in relation to the debt, drafting of a pre-action letter of claim in line with the debt claims Pre-action protocol.

Conversely, if information/documentation provided is not comprehensive in content and clarification is required to ascertain specific and requisite points, then such work that we will be required to carry out could increase the fee.

Where possible, we will allocate a junior member of our Firm to deal with matters, however, the complexity of the matter may result in the need for a more senior member of our Firm to deal with the matter either partly or in its entirety, however, this will be discussed at the relevant stage as will the costings.

Please note that the above fee does not include provision of advice regarding responses received and further fee estimates based on the above hourly rates will be provided for the work required to be carried out based on responses received.

Where no response is received, we will suggest consideration be given to issuing court proceedings, which will involve some or all of the following steps to be actioned, depending upon the reaction and conduct of the parties: -

• Taking instructions, reviewing papers and advising on merits and likely compensation and chances of recovery.
• If the opposition is a Company or Limited Liability Partnership, Companies House records will be reviewed to ascertain whether the Company or LLP is still trading and whether a winding-up petition has been presented.
• Where applicable and appropriate, calculating interest and any compensation.
• Drafting court proceedings namely, claim form and particulars of claim and issuing the same with the Court.
• Reviewing and advising on the claim or the response from the debtor.
• Entering Judgment in default, if no acknowledgement of service is received or no defence is filed and served.
• Upon receipt of judgment in default, sending the same to the opposition and demanding payment.
• If debt is contested via the filing of a Defence by the Defendant, the same will be considered and advice will be given on the merits of the Defence, negotiating settlement, if appropriate and advising on the benefits or otherwise of the making of Part 36 or Calderbank offers.
• Preparing or considering a schedule of loss.
• Preparing for (and attending) any preliminary hearings or other interlocutory applications.
• If claims are defended, exchanging documents with the other party and agreeing a bundle of documents.
• Taking instructions for witness statements and agreeing their content with witnesses.
• Drafting witness statements.
• Preparing bundle of documents.
• Reviewing and advising on the other party’s witness statements.
• Preparation and attendance at the final hearing, including instructions to counsel where appropriate.

For an undefended debt recovery claim where there is minimal dispute on the amount claimed yet issuing court proceedings is deemed necessary to prompt response or payment, our fees will be in the region of £1,750 – £4,000 plus VAT plus Disbursements in the form of Court Fees set out further below.

Where the opposing party disputes the claim at any point and the matter proceeds to a final hearing at Trial, timescales of the case could be 12 – 18 months and our fees will need to be discussed further, as the fees set out above will no longer be applicable and by way indication, our costs could be in the region of £10,000 – £20,000 plus VAT plus Disbursements in the form of Court Fees as referred to below and Barrister’s Fees, who charge on a case by case basis after reviewing the paperwork and so, quotations will be obtained and agreed with you prior to instructing the Barrister.

The Court Fees that will become payable to issue proceedings are set by HM Courts and Tribunals Service on a scale basis, which increases as the amount of debt to be recovered increases as reflected on their website HMCTS Court Fees

Interest and compensation (if appropriate) added on to the principal debt is likely to take the total debt amount into a higher Court Fee bracket, however we will confirm the Court Fee which is payable before the claim is issued.

If the opposition is not forthcoming with payment of the judgment and it is necessary to take enforcement proceedings in the form of instructing of bailiffs, applying to Court for a charging order, or attachment of earnings orders etc. additional fees will apply, which we shall highlight as and when the same is applicable.

In the following instances, we will discuss our costs further, as the additional work required to deal with the complexities and further elements in the case will result in the fees being increased: -

• additional correspondence including agreements required to be exchanged with the opposing party and others.
• the case is more complex in issues or requires expert evidence.
• involvement of multiple parties.
• case spans over more than 1 day

For debts more than £100,000, please enquire further so that we can provide indication of steps involved and costs associated with the recovery of the same.

Please note that it is not guaranteed that all or part of the costs outlined above will be recovered from the opposition and details as to the extent of recovery will be relayed at the appropriate time. Furthermore, the VAT element of our fees cannot be reclaimed from the debtor.

Statutory Demands as an initial step to insolvency can be utilised for debt recovery against individuals, companies and LLPs. Such a course of action imposes payment of the debt to be made by the debtor within 21 days of the service of the Statutory Demand. Non-payment of the Statutory Demand evidences that the debtor is unable to pay debts as they fall due, which will make way for a petition to be issued.

Statutory Demands can only be served upon an individual if that individual owes more than £5,000 and on Companies and LLPs if they owe more than £750.

Our fees for the following work in connection with a Statutory Demand will be in the region of £1,500 plus VAT plus Disbursements: -

• Taking instructions and reviewing papers
• If the opposition is a Company or Limited Liability Partnership, Companies House records will be reviewed to ascertain whether the Company or LLP is still trading and whether a winding-up petition has been presented.
• If the debtor is an individual, carrying out a Bankruptcy Register search of the Land Charges Register. Search fees are approximately £2 for individuals or £10 for companies or LLPs.
• Where applicable and appropriate, calculating interest and any compensation.
• Drafting the Statutory Demand and arranging personal service of the same via Process Server whose fees are estimated to be in the region of £150-£250 plus VAT with an uplift in fees if the Statutory Demand is required to be served urgently and/or if personal service transpires to be difficult.

It is likely to take 6 weeks from receipt of the instructions stage to the date by which payment stemming from the Statutory Demand is received on the proviso that no obstacles are encountered with service of the Statutory Demand.

In the event that the debt becomes disputed and/or an application to set aside the Statutory Demand is made and where we are required to engage in correspondence with the debtor or their representatives then our fees will need to be discussed further to factor in such change in events. Furthermore, the VAT element of our fees cannot be reclaimed from the debtor.

Winding Up Petitions/Bankruptcy Petitions are considered if a debtor fails to make payment demanded via a Statutory Demand and so, on the basis that a Statutory Demand has been served, the Petition is not being resisted and only one hearing is required, our fees for dealing with the below are likely to be £2,500 – £4,000 plus VAT Disbursements in the form of Court Fees and Barrister’s fees as referred to further below: -

• Taking instructions and reviewing papers.
• If the opposition is a Company or Limited Liability Partnership, Companies House records will be reviewed to ascertain whether the Company or LLP is still trading and whether a winding-up petition has been presented.
• If the debtor is an individual, carrying out a Bankruptcy Register search of the Land Charges Register. Search fees are approximately £2 for individuals or £10 for companies or LLPs.
• Drafting Petition and supporting witness statement and arranging for the Petition to be issued with the Court and arranging personal service of the same via Process Server and requesting they provide Certificate of Service, and their fees are estimated to be in the region of £150-£250 plus VAT with an uplift in fees if the Petition is required to be served urgently and/or if personal service transpires to be difficult.
• Preparing and arranging advertisement of the Petition in the London Gazette.
• Instructing Barrister to attend the hearing(s).
• Preparing and filing certificate of compliance for a Winding Up Petition or a certificate of continuing debt for a Bankruptcy Petition.
• Preparing and filing list/notice of appearances.

In the event that the Petition or advertisement of the same is being resisted where we are required to engage in correspondence with the debtor or their representatives and if more than one hearing is required then our fees will need to be discussed further to factor in such change in events. Furthermore, the VAT element of our fees cannot be reclaimed from the debtor.

The Court Fee that will become payable to issue the Petition are set by HM Courts and Tribunals Service on their website HMCTS Court Fees

An Official Receiver's deposit is also payable on issue of the Petition, which is currently £990 for Bankruptcy Petition and £1,600 for a Winding Up Petition, however such fees are subject to change.

An advertising fee to advertise on the London Gazette is also payable for Winding Up only after issue of Petition and such a fee is set by The Gazette Price list: 2023 | The Gazette

With reference to the disbursement of Barrister’s Fees, they charge on a case-by-case basis after reviewing the paperwork and so, quotations will be obtained and agreed with you prior to instructing the Barrister.

VAT at the prevailing rate of 20% is set by the Government.