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Introduction
This new Act makes some changes to the processes and procedures in the recovery of debts through the Courts.  It gives me an opportunity to review not only the Act but the general process of recovering money owed.

The changes come at a time when record numbers of people are in debt with a rather depressing picture emerging.  Figures indicate that already by 2006, i.e., before the on-set of the current severe recession, numbers of cases of debt problems referred to CAB were increasing dramatically (20% up in 2006 on 2005 for example).  In addition there have been a huge increase in Individual Voluntary Arrangements (IVAs) and Bankruptcies between 1998 and 2006 – the former up 900% and the latter 320% (the rise in bankruptcies partly explained by the reduction in the period in which a Bankrupt can seek release - now one year).

Partly as a result of the increasing numbers entering into insolvency, many (probably the majority) of Court Judgments are not paid.
For many creditors it is particularly annoying to take Court action, obtain Judgments and then find that these cannot be enforced.  In our experience the obtaining of a Judgment can be quite simple and straight forward and it is the enforcement (i.e., actually obtaining the money) which creates problems.
The new Act has sought to strike a balance between assisting the better enforceability of Judgments whilst at the same time protecting vulnerable debtors who genuinely cannot pay (there tends to be a distinction between the “professional” debtor who is particularly adept at “working the system” and the more genuine person who simple does not have the wherewithal to pay perhaps despite a sincere desire to do so).

• There is a new Information Order and Departmental Information Request system – designed to allow the creditor to more readily obtain information about the personal financial circumstances of the debtor.
• Enforcement rights – closer and more centralised regulation of bailiffs (or enforcement officers as they are now known).
• A new system known as “taking control of goods” - the traditional method available to landlords to exercise distress on a tenant’s goods being removed.
• Tinkering with the Attachment of Earnings system but the more important change in this area is that other methods of enforcement may be taken at the same time as an Attachment Order being sought and obtained.

Once a Judgment has been obtained, creditors can themselves select the most appropriate enforcement method.  The main ones are:

• Writ or Warrant of Control – this is the traditional Writ of Fieri Facias (or Writ of Execution), effectively enabling an enforcement officer to seize a debtor’s goods and, if necessary, sell them to realise the monies to clear the debt.
• Third Party Debt Order (formerly a Garnishee Order) – this compels a third party (such a debtor’s bank) to pay money to the creditor.
• Charging Order – this is a form of enforceable Charge (Mortgage) over the debtor’s property (usually freehold or leasehold property);  it can be followed by an Order for a sale of that property.
• Attachment of Earnings – this is an Order that an employer should pay part of the debtor’s earnings direct to the creditor.
• Appointment of a Receiver.
• Committal or sequestration – these only come in force where a debtor fails to comply with a Court Order to do something, usually by a certain time.  This can give rise to someone being committed for a short term in prison.

The Register of Judgments, Orders & Fines
This is a new unified Register of which the old County Court Judgment Register is one. 

It is important to note that if a Judgment debt is paid in full within one month of it being made then there is no entry in the Register.

The Register can be searched against on line and gives information on the name/address of the debtor, the Court where the Judgment was made, the date of Judgment and also the amount of the original Judgment sum.

It is extremely important for individuals to avoid their names being placed on this Register as it severely affects anyone’s credit rating.

Once names are included on the Register, the process of removing them is not straight forward. 

Conclusion
We at Stapleton & Son have years of experience in taking actions for debt recovery. We are abreast of all the most up to date methods and are happy to assist clients seeking to recover monies owed to them.

The lesson for people conducting any sort of business is much closer and more efficient credit control; certainly most firms of solicitors these days seek to obtain monies on account from many clients and are very strong on interim billing as work progresses.

For debtors (and one is not being virtuous about this situation as it applies to so many different people from all walks of life) the guiding principle these days (perhaps more than it has ever been before) must be to try to live within one means and to remember that borrowing money is an expensive operation in itself, i.e., how many credit companies pass on the current lower interest rates but instead still impose massive rates with the excuse that an applicant is not entirely credit worthy in their eyes?