No creditor would wish to dedicate important resources to regaining debt in which this can be prevented. It's important that where cash that you are owed has not been paid, you've got the assistance of specialist attorneys which could pursue this to you as a matter of urgency. Sometimes taking rapid action is likely to make the difference in whether it is possible to recover the debt successful.
Recovering Commercial Debt in Scotland
At BBM Solicitors, our commercial team know the intricacies of being made to recover federal debt, frequently working with companies to place contracts and systems in place that mitigate the risk of bad debts. However, we also appreciate that cases do arise in which the repayment of debt will be withheld or simply cannot be paid, requiring more formal action. Our team provide an expert service, navigating our customers through the legal procedures required to recoup the commercial debt they are due.
Recovering Due Debts: Engage with the debtor
It's highly advisable that when debts fall due, a creditor needs to speak to the individual or organisation in question, making them aware of the situation. It's very important to get into some kind of dialogue with a lien: outstanding debt might be caused by absentmindedness in their part, and a gentle reminder might be enough to cause payment. However, it may be possible they're refusing, or lack the funds, to make payment to the debt.
It is important that when contacting a debtor, a creditor makes them aware of the consequences of failing to repay debt:
Where the contract permits it, or where the client is a company covered by the late payment of commercial loans laws, interest could possibly be put on the amount they owe. In the case of commercial loans, interest of 8% could be applied, plus the Bank of England base rate for business to business transactions of 0.5 percent.
It's very important that lenders give borrowers honest warning of the chance of legal actions being taken against them should they don't make payment in a reasonable interval, e.g. 7 days.
In BBM Solicitors, we often engage with debtors on their lenders' behalf. It is our adventures that getting in contact with a borrower, and informing them of the consequences of the actions, will generally yield results for creditors.
Taking proper legal action to Recoup debt
When a debtor fails to make payment in an outstanding debt, and continues to be given notice of the results of their actions, then a creditor may then move to raise formal legal proceedings against them.
Pursuing Insolvency Options
Regardless as to whether a borrower is a corporate body or an individual, it's possible for creditors to take advantage of the bankruptcy regime to recover the debt. The principles, but are somewhat different for each kind of debtor:
Where a borrower is a limited company and the debt is undisputed, often the very best method of forcing payment would be a 72 hour winding up need, which demands the satisfaction of their debt within the timeframe. This involves Sheriff Officers operating a demand notice we've resisted, calling for payment of the debt. Where payment isn't forthcoming (and not disputed), a creditor may then find the court's permission to set the business into liquidation, and also to appoint a liquidator. This type of demand will prompt a response!
Where a borrower is a person having some interest in property, it is likely to place them into bankruptcy to secure debt. This is called'sequestration'. However, there are limits on what could be achieved with a debtor's home, particularly when their household lives with them.
Proceeding with Diligence
Assuming that a debtor has not responded to, either or secured against, a lender's attempts to recover commercial debt, and that the insolvency regime would not be useful, a creditor may ask the court to issue an order (called in Scotland as a decree) recognising that the debt is due. This frees creditors to pursue a selection of enforcement mechanisms to recover the outstanding debt called'diligence'.
Depending upon the value of the outstanding debt, then a petition for a court to grant decree should be increased in one or two places. The Sheriff Court will handle all legal disputes concerning debt retrieval, while legal action concerning debts of a top price, e.g. over #100,000 who are extremely complicated, ought to be brought before the Court of Session. The value of this debt will also determine the court procedure and time frames that need to be viewed.
There are a variety of options available to creditors pursuing diligence from a debtor. The usefulness of the measures will be based on the situation in question. The choices available are as follows
Earnings Arrestment
This is an order from the courts that instructs a debtor's employer to deduct the cash owed to creditors straight from their monthly salary. However, there is a limitation on the sum which may be taken from a borrower's salary, depending on how much they earn.
Arrestment
It is open to creditors to prevent debtors from getting cash that they have in their own bank account, although specific minimum amounts may be left. This step will entail paperwork being completed by debtors, so stipulating that money be deducted from their accounts and paid to creditors, through the courts, in fulfillment of the debt that was outstanding.
Inhibition
Where a borrower has no savings or is unemployed, but does possess property, a creditor might prevent them from selling it. This secures the worth of their property for the lenders for a period of up to five decades.
Attachment
A creditor, with no other means of regaining outstanding debt, can find the permission of this court to force a sale of the debtor's moveable property. This entails Sheriff Officers creating a list of property capable of being marketed, e.g. non-refundable things owned by the borrower such as a car, that can be captured and sold to repay the outstanding debt. Attachment doesn't include property in a debtor's house. This will only be capable of seizure where an'Outstanding Attachment order' has been granted by the judges.
In BBM Solicitors we have a long, strong history of working with companies to secure the payment of debts. Our team offers assistance and advice that reflects our client's needs, providing effective solutions to legal issues. We can take care of all aspects of your case, such as calling debtors, raising court actions, and representing your own interests when required. Should you require assistance in recovering commercial debt, then please contact our commercial team at BBM Solicitors.
We're debt collectors at Glasgow City and we're here to assist.
If your company is located in Glasgow City and someone owes you money, talk to us. You are welcome to telephone us 0800 634 0187 to explore your debt collection needs in assurance.
We have local agents to Assist You and we have customers across Glasgow City out of Linn to Maryhill and out of Cardonald to Ballieston.
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