If you’ve run into issues with a debtor, and decided to pursue the route of taking legal action, obtaining a County Court Judgment (CCJ) order is only half the battle. It’s value lies in your practical ability to turn it into a payment. In this article, we discuss how to enforce a county court judgment, and walk you through the key steps.
What Does CCJ Enforcement Actually Mean?
A CCJ (County Court Judgment) is a court order which declares a debtor must pay their creditors a set sum, either in full or in instalments. However, simply obtaining the order isn’t enough to reach a successful resolution. To guarantee payment, you need to know how to enforce a CCJ – in other words, you need to know the proper steps you should take in order to compel the debtor to comply with the order.
There are various CCJ enforcement mechanisms you can use if your debtor fails to obey the order (whether that’s not keeping to their instalment schedule, or not paying altogether), and you have six years from the date of obtaining the order to enforce it.
Factors to Consider Before Enforcing a CCJ
Before you jump into action, here are some things to consider about your CCJ enforcement:
Validity: As a first step, it is crucial to determine whether the order you are seeking to enforce is enforceable. Has the deadline given for the other party to pay the judgment passed? If the Defendant has been given 14 days to pay the judgment, you cannot enforce a CCJ until after the 14 days have ended.
Appeal process: It also necessary to consider whether the judgment is subject to an appeal, or if an application has been made to set aside the judgment. The court would be unlikely to grant a CCJ enforcement order whilst there is an ongoing challenge to the original decision reached by the court.
Benefit vs costs: As with all stages of litigation, the benefit achieved through CCJ enforcement should be weighed up against the associated costs. It is also worth considering whether the defaulting party has any other judgments against them to determine the viability of proceeding. In money claims, the value of the dispute is important, as certain options are only available if the financial value of the dispute exceeds a minimum threshold.
Debtor type: The identity of the defaulting party is also a necessary consideration. Some CCJ enforcement options are only available against individuals, rather than companies, and vice versa. It is therefore essential to properly identify the defaulting party as well as the assets and sources of income available to them.
What CCJ Enforcement Options Do I Have?
The exact process of enforcing a CCJ would depend on the option(s) pursued. Some of the available county court judgment enforcement options include:
- A warrant of control – In money claims, bailiffs or High Court Enforcement Officers (HCEO) can be appointed to attend the defaulting party’s property to either collect the money owed or to take items owed by the defaulting party to sell at auction to raise funds to settle monies owed.
If you intend to use this CCJ enforcement option, consider transferring your judgment to the High Court. Some HCEOs will do this for you. The benefit of proceeding in this way is that HCEO can charge a poundage which incentivises them to make a recovery. They consequently tend to be more effective than the County Court bailiffs.
In addition, if your judgment is below £5,000, it will only accrue interest if it is transferred to the High Court. If you anticipate that it may take years to recover your money, the interest element of enforcing a CCJ this way could be substantial.
- Attachment of earnings order – In money claims, this CCJ enforcement option results in deductions from the salary payable to the defaulting party by their employer. This only works if the defaulting party is an individual and in employment (as opposed to self- employed). If the defaulting party changes employers, this method of enforcing a CCJ order will no longer apply.
- A third-party debt order – An order is made that someone who owes money to the defaulting party pay you that money instead, to be applied against your judgment debt. This is mainly used to recover money directly from the defaulting party’s bank account. When doing so, bear in mind that the third-party debt order only applies against the account at the moment it is served upon the bank.
If you are aware that the defaulting party is paid at the start of the month, you should try to time your CCJ enforcement application so that it “hits” the defaulting party’s bank account at the beginning of the month, when money is more likely to be in it. As well as bank accounts, you can use this method of CCJ enforcement if you are aware that the defaulting party is owed money by someone else, such as a customer or a tenant.
- A charging order – An order is made for a charge to be placed on the defaulting party’s property, so that you can be paid monies owed to you under a court order in the event it is sold. Such an order should be immediately protected by the registration of a restriction at the Land Registry.
If the charging order still does not result in any payment and you are confident that there is substantial equity within the property, an application for forced sale can be made as a way of enforcing a CCJ. This is an order that the property is sold, and the judgment debt repaid from the sale proceeds after the costs of sale and any prior charges are paid.
- Bankrupting an individual or winding up a company – Although these procedures are not designed to be used for CCJ enforcement, the threat of being made bankrupt or having their company wound up can incentivise debtors into making payment.
Keep in mind, if you make the defaulting party bankrupt or wind them up, you may not receive any priority over other creditors, and there is a significant risk that you will only recover a minimal amount of the money owed to you. Bankruptcy petitions must be preceded by the service of a statutory demand. It is also prudent to serve one before issuing a winding up petition. The statutory demand does not force you to issue a petition, and it can often pressure the defaulting party into payment.
If you are unsure what assets a judgment debtor holds, you can apply for them to attend court to provide details of their assets, income, expenses, and liabilities.
How to Enforce a CCJ Using a Solicitor
As you can see from all the preliminary considerations and CCJ enforcement options available, county court judgement enforcement can be quite a complex procedure. Many creditors turn to experienced solicitors for support, relying on their extensive procedural rules knowledge.
Working with a trusted solicitor team also means they can assess which the best method to enforce a CCJ is for your circumstances, and handle any debtor appeals or other challenges.
Our Dispute Resolution Team has significant experience in all stages of litigation and county court judgement enforcement. If you require advice and support on how to enforce a CCJ, please do not hesitate to get in touch.
