The journey of a judgment

HCE

For claimants, being awarded judgment may feel like the end of a long journey. And it will be if the debtor pays the full amount awarded.

But if no payment is received, the claimant must decide whether to take enforcement action.  In terms of commercial debt, the options include:

• Enforcement by a High Court Enforcement Officer (HCEO) – the focus of this article
• Enforcement by a County Court bailiff (CCB)
• Third party debt order
• Winding up petition

HCEOs are only paid on results. They work outside standard working hours and at the weekend, which can make for better results.

The claimant can choose an HCEO themselves or also ask Registry Trust to allocate them one. Once instructed, the HCEO manages the transfer up of the judgment to the High Court to get the writ. Most do not charge a fee for this.

Once the writ is sealed, the first stage of enforcement is the compliance stage, when notice of enforcement is served on the debtor, giving 7 clear days to make payment in full, including the original judgment debt, judgment interest, court fees and the compliance stage fee of £75 plus VAT. If paid, the enforcement process is complete

If there is no response or the debtor wants a payment arrangement, we proceed to enforcement stage 1. An enforcement agent (EA), working under the authority of the authorised HCEO, attends the debtor’s premises. 

• The fixed fee for enforcement stage 1 is: £190 plus 7.5% of the value of the sum to be recovered above £1,000. VAT is added
• If the debtor pays in full at this stage (including interest, court and enforcement fees), enforcement is complete

 If the debtor wants a payment arrangement, the EA takes an inventory and completes a controlled goods agreement, signed by the debtor, to confirm that the goods are under the control of the HCEO.

It is a criminal offence for the debtor to remove or sell the goods.

With a controlled goods agreement, the EA can reattend at any time to inspect or remove the goods.

If payment is not made or the debtor refuses to agree an arrangement, we move into enforcement stage 2. If a payment arrangement is broken, the EA will reattend under enforcement stage 2.

There is a flat fee of £495 plus VAT for this stage.

The final stage of the journey is the sale stage, where the controlled goods are sold at public auction to satisfy the debt. The fee for this stage is £525 plus 7.5% of the sums to be recovered above £1,000, all plus VAT.

Enforcement rarely goes as far as sale stage; if there are assets available, payment (in full or installments) is more likely.

If enforcement is not possible, all the creditor pays is a £75 + VAT compliance fee, plus the £66 court fee for the writ.

If enforcement is successful, then court fees, enforcement fees, judgment interest and the original debt are paid by the debtor.