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The 4 steps for unpaid invoice legal action ✔️

The 4 steps for unpaid invoice legal action ✔️ Federal Management

Unpaid Invoice Legal Action

As a business owner, one of the most frustrating things is facing to do unpaid invoice legal action. If you have been having to chase down clients for payment of an unpaid invoice, they could be an option you’re considering.  It can be time-consuming and stressful, but sometimes it’s necessary to take legal action to recover what you’re owed.

A County Court Judgment is not usually necessary to collect a debt. As a premier Debt Collection agency, less than 1% of the cases we deal with require expensive court action. However, if you feel unpaid invoice legal action is your preferred option then we can always help once the judgment has been granted. Whatever the unpaid invoice is for, from non-payment of goods to unpaid locum fees, the process is the same.

In this article, we’ll discuss the steps for unpaid invoice legal action when it is absolutely necessary.

The 4 steps for unpaid invoice legal action ✔️ Federal Management

Step 1: Send a Letter of claim

Before taking legal action, it’s important to give your client one last chance to pay their outstanding balance. You can do this by sending a demand letter. This letter should include:

  • The amount owed
  • The date the invoice was due
  • A request for payment within a certain timeframe (usually 7-14 days)
  • A warning that legal action will be taken if payment is not received

Sending a demand letter shows your client that you are serious about collecting the debt and gives them one final opportunity to pay before you escalate the matter. If there is no response to the letter before action, then step 2 will be needed.

Step 2: Issue a claim

If your client still hasn’t paid after receiving a demand letter, it’s time to file a claim via the small claims court. This involves going through the court system and can be a lengthy process. Here are the steps involved:

  1. Determine which court has jurisdiction over your case – this will depend on where your business is located and where the client is located.
  2. Draft and file a complaint – this document outlines your case against the client and explains why they owe you money.
  3. Serve the complaint on the client – this means delivering a copy of the complaint to them in person or by mail.
  4. Wait for their response – they will have a certain amount of time (usually around 30 days) to respond to the complaint.
  5. Attend court hearings – there may be several hearings before a judgment is reached.

It’s important to note that filing a court claim can be expensive, so it’s worth considering whether it’s worth pursuing if the amount owed is relatively small. If you are confused as to the civil procedure rules, you may need to seek the help of debt collection solicitors. Be prepared for expensive costs.

Step 3: Obtain Judgment

Assuming you win your case in court (i.e., the judge rules in your favour), you will obtain a judgment against your client. This means that they are legally obligated to pay you what they owe.

However, obtaining judgment doesn’t necessarily mean that you’ll receive payment right away. Your client may still refuse to pay or may not have sufficient funds available at that time. Enforcing a CCJ can also present its own challenges.

Step 4: Collect Payment

If your client still hasn’t paid after obtaining judgment, there are several options available for collecting payment:

  • Attachment of earnings – this involves having their employer deduct money from their paycheck each month until the debt is paid off.
  • Third party debt order – this allows you to seize funds from their bank account.
  • Property charge – this gives you an interest in any property they own until the debt is paid off.
  • Bailiff / Collection agency – hiring private debt collectors to enforce payment of the debt

It’s important to note that some of these options are only available in England and Wales. If your debtor is in Scotland, debt collection in Scotland comes with its own parameters. It is worth consulting with a debt recovery professional if in doubt.

Unpaid invoice legal action conclusion

Recovering an unpaid invoice through legal means can be stressful and time-consuming, but sometimes it’s necessary if other methods have failed. By following these steps, you’ll increase your chances of successfully recovering what you’re owed.

Remember that prevention is always better than cure when it comes to unpaid invoices. Make sure you have clear payment terms outlined in all contracts and invoices, send reminders when payments are due, and follow up promptly if payments are late.

Going down the route of unpaid invoice legal action is not necessary. Less than 1% of the invoices we are instructed to recover need court action. This saves our clients, time and money and ensures their monies are recovered quickly. Debt Collection solicitors or Debt Collection agency may also pose a question.

For expert advice, contact us today for professional help.


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