For the cash flow for a business, it is vital for a business and that includes the collection of debts. Late payments and people trying to avoid paying can be very common. Business debt collection and recovery is part of every business.
The first stage is to chase the debt. This could be by sending out reminders via email, post or giving them a call. If that does not work it may be appropriate to take more formal action.
Where the relationship is between a business and an individual, for example, a customer, there is a pre-action protocol that should be followed. If not, the court may not award the debt or the business’ costs for pursuing the debt due to their failure to comply.
This means that the business could be worse off than if they had not chased the debt in the first place considering the time and money spent.
If you require commercial debt collection then we can advise you from the outset of the options open to your business. Sometimes it is not always the best course of action to litigate. In other situations, it may be the only option.
It is common that businesses try to start formal proceedings themselves without following the correct procedure. If they have failed to follow the correct procedure they then may seek legal advice to rectify the issues. Unfortunately, sometimes it is more expensive to rectify the mistake than the amount of the debt.
We would, therefore, recommend that you contact us before taking any formal action. We will be able to ensure that the correct procedures are followed and give you the best chance to recover the debt.
Depending on the value we may also be able to recover the cost of recovering the debt.
When a claim is made to the Court for commercial debt, interest at 8% plus the current bank base rate can be added and calculated forward to the date of Judgement. This can produce a significant sum itself but the correct wording must be used as otherwise the claim may not be allowed.
If you would like to find out details of the costs involved in our business debt collection service, please click here.
Established in 1905, Lovedays Solicitors have been helping businesses deal commercial legal issues for many years. We have offices in both Matlock and Wirksworth and cover Ashbourne, Bakewell and throughout Derbyshire.
