A CCJ is a type of Court Order that might be registered against you if you fail to repay money you owe.
The claim should not come out of the blue; before this stage a creditor will issue a demand (probably either a default notice or letter before action) to advise that legal proceedings will follow in the absence of settlement by a specified deadline.
What are your options?
When you receive a claim form you only have 14 days to reply. Your options include:
Submitting an acknowledgement of service if you intend to defend the claim, but require more than 14 days to consider and prepare your defence;
Filing a defence if you disagree with the amount you owe;
Admitting the claim if you agree you owe the amount demanded. You should also fill in the accompanying form to provide the Court with details of your financial circumstances
Do nothing, in which case the Court will make a Judgment by default and you will possibly be required to settle the debt forthwith without your financial circumstances being taken into account.
What are the creditor’s options?
Once a creditor has obtained a CCJ, and if you fail to adhere to its terms, the CCJ can be enforced in a number of ways:
Bailiff action, which will more than likely result in a bailiff attending your home or business to collect money or seize goods;
An application to Court for an Attachment of Earnings Order, whereby your employer may be required to make a deduction from your earnings;
An application for a Charging Order, secured against your property, which could result in you losing your home.
Whether you personally, or your business has received a CCJ, more often than not it is sign of impending financial difficulty which will have ramifications if the matter is not properly dealt with. The existence of an unsatisfied CCJ also constitutes an insolvent position, given the inability to settle the debt when it fell due, meaning that subsequent actions will be subject to close scrutiny if formal insolvency, such as bankruptcy or insolvent liquidation for example, ensues.
It is therefore vital that early advice is sought. Bishop Fleming’s business recovery and insolvency team would be pleased to speak with you on a no-charge-no-obligation basis initially if the situation arises.
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