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Our Debt Recovery fees and service
Our debt recovery service includes:
• Taking your instructions
• Reviewing relevant correspondence
• Drafting a letter before action
• Receiving payment on your behalf, or if the debt is not paid, advising you on the next steps.
Our fees for this service are as follows:
• Debts of £1,000 or less – our fees will be 10% of the gross sum recovered (including VAT) plus VAT
• Debts from £1,000 to £25,000– our fees will be £100 plus VAT plus 7% (plus VAT) of the recovered debt
• Debts more than £25,000 – our fees will be £100 plus 7% (plus VAT) of the first £25,000 with an additional 3% (plus VAT) of any part of the recovered debt that exceeds £25,000
• If we fail to deliver recovery of the debt the charge will only be £100 plus VAT.
Here are two examples to help you work this out.
A Statutory Demand is a direct route to starting insolvency proceedings. Without a Court judgment, before you can serve a bankruptcy or winding up petition upon a debtor, you must serve a Statutory Demand for outstanding debt. You can only use a Statutory Demand if the debt is more than £750 and is not disputed.
If a debtor fails to pay within the time limit, then insolvency proceedings may be started without notice to the debtor. A Statutory Demand can be a very powerful collection tool. We will advise when it is appropriate to take steps to issue a Statutory Demand.
Our fixed fee for this service including service by post, is £150 plus VAT, whether there is a recovery of the debt or not. If personal service is required, the cost of personal service will be charged in addition to this cost.
If your debt can not be collected through pre-action correspondence, we may advise you that it is commercially viable to issue Court proceedings. If you decide to do so, then our team will sue the debtor for the original debt plus any interest or compensation you are due.
Our fees for this service will be charged on a fixed fee between £100 to £200 plus VAT, in addition to the fee plus VAT, permitted by Court rules. A more detailed breakdown of our costs can be found here:
Obtaining a Court Judgment
If the debtor does not file an acknowledgement within 14 days and/or a defence within 28 days, you will be entitled to request a Court judgment. Our fees for obtaining judgment will be a fixed fee of £50.00 plus VAT, plus the recoverable fixed Court fees plus VAT.
The Court allows you to recover some of these sums from the debtor, although the exact amount you can recover changes from time to time. Here’s the list
Further costs may be incurred when pursuing recovery of your debt. We will always tell you what they are before we commission the service.
How long does it take?
If matters can be resolved without the need to issue Court proceedings, they will usually take between 2 to 8 weeks from receipt of instructions from you to receipt of payment from the other side (depending on the level of correspondence required.)
If Court proceedings are required, matters will usually take between 16 to 24 weeks from receipt of instructions from you to receipt of payment from the other side. This is on the basis that the other side pays promptly on receipt of judgment in default. If enforcement action is needed, the matter will take longer to resolve.
If the debt you are pursuing becomes disputed (i.e. a defence is filed) the case will be dealt with by a member of our litigation team.
Cases will only be referred, and fees will only be incurred in this way, having obtained your express instructions to do so.
Our hourly fees are (from 1 January 2019)
• Directors – £295.00 plus VAT
• Associate/ senior solicitors – £235.00 plus VAT
• Solicitors and Chartered Legal Executives – £195 plus VAT
• Trainees solicitors – £150 plus VAT
• Paralegals – £125.00 plus VAT