What Can You Do if Someone Owes You Money and You Need to Collect it?

For individuals and businesses alike, juggling finances and trying to call in money you’re owed is hard enough at the best of times but even worse after the last couple of years. Not to mention the fact that chasing someone who owes money and who is having difficulties can seem pretty heartless and even unkind. On the other hand, you may also be struggling and need to survive. So what’s the answer?

The soft touch

Possibly the best way to proceed is to approach the other party by making ‘gentle’ contact to say that this invoice/debt is outstanding and, while you understand that times are hard, would there be a possibility of paying it off by instalments? If they are amenable and accept that the money is outstanding, you can then negotiate a regular payment that would be acceptable to both parties.

If every individual or business acted in this way, it may give an opportunity for those that are struggling, to return to some semblance of financial stability.

The ‘soft’ touch e.g. negotiation is the key, but if this doesn’t work, then only as a last resort, you can institute court proceedings.

How to go proceed to court

There is a ‘pre-action protocol’ that must be done before any court proceedings are commenced; otherwise referred to as a ‘letter before action’, which must state who you are and why you are asking for the debt to be paid. You must put all the relevant details in the letter and include with it any evidence such as a fee invoice that you submitted, or a copy of a contract signed by both parties, etc. The letter should also give the other party a timeframe to respond either to make payment in full, or to make contact to negotiate how to pay it off.

The letter should also make it clear that you’re open to discussion, but that if you have not had a response by the chosen date, then you may decide to commence legal proceedings without further notice. This is where it gets serious. There’s a rule of thumb which says, you should never threaten legal proceedings unless you’re intent on carrying that through. Therefore, you should not mention this lightly unless you are seriously willing to proceed.

You should also always ensure you have sufficient evidence and reason for taking court action before you commence a claim.

Online form and costs

You can commence court proceedings online if it’s a straightforward small claim without complications. And online fees to do so are slightly less than sending in paper versions. The fees go on a sliding scale dependent on how much is owed. For example, for claim amounts from below £300 up to £1,500, the court fee is between £35-£70 if you issue online – a little more if not. Claims worth over £1,500 up to and beyond £10,000 cannot be issued online and the fees range from £110 – to 5% of the claim for any that are over £10,000.

The court usually sends the issued claim form to the other party (the defendant) with a response pack containing a number of documents and information on the options that the defendant can choose e.g. to pay the debt in full, to acknowledge service of the claim form and indicate that they want to defend and various other options. However, whatever the defendant decides to do, they must contact the court within 14 days, failing which, you may have the right to get a default judgment against them.

Further details on how to make a claim and the fees can be found at: https://www.gov.uk/make-court-claim-for-money/court-fees

It’s worth noting, that even if you do win a judgment against the other party and the court agrees they owe you the money and must pay it, that doesn’t automatically mean you will receive the money. You may need to enforce the judgment which can require additional time, money and court paperwork.

Although the small claims system is relatively straightforward, if you feel you need assistance, you can always call upon the services of a paralegal who’ll be able to help you at a reasonable cost. Sometimes calling on a professional debt collector can be the easiest and least stressful option. They will charge a small fee but know the process of debt collection inside-out so often have a much better success rate. They generally are only worth it for debts above a certain amount so check carefully.


A few words of caution before you start… ask yourself if this debt is really worth the time and energy required to collect it, if you stand a good chance of receiving the money and if you are genuinely willing to take it all the way to the courts. If the answer to any of the above is ‘no’ then, frustrating as it may be, it can sometimes be better to write off the debt and move on.


Amanda Hamilton is Chief Executive of the National Association of Licenced Paralegals (NALP), a non-profit membership body and the only paralegal body that is recognised as an awarding organisation by Ofqual (the regulator of qualifications in England). Through its Centres around the country, accredited and recognised professional paralegal qualifications are offered for those looking for a career as a paralegal professional.

Web: http://www.nationalparalegals.co.uk