Pre-Action Protocol – has the dust settled?….
Incredibly, it’s only 4 months since the much-maligned Pre-Action Protocol (PAP) for Debt Claims was introduced. It already seems as though it’s much longer! Here at Court Enforcement Services, we thought we’d start to get the views of our clients and professional network, as to how you’re finding it so far. Has there been a noticeable downturn in the number of claims issued? Have any debtors ‘taken advantage’ of the protocol? Many of our clients will be well versed in terms of protocol, but now the dust has settled – is it business as usual?
Prior to joining us, our new Head of Business Development, Michael Whitaker, worked at a client of ours, a respected Debt Recovery Legal Practice. He spent 6 months preparing clients and prospects for the changes ahead owing to PAP.
Michael commented at the time ‘The Pre-Action Protocol has a wide-reaching affect and the view was that inevitably it would make it harder for creditors to recover debt. Previously, 14 days was typically given to an individual or sole trader debtor as a final demand before commencing proceedings. However with the new 30-day period, together with further time for requesting documentation and seeking advice, means that there are opportunities for the debtor to deliberately delay payment further’.
‘The focus and message to clients was therefore “prevention, rather than cure” and we asked businesses to make sure they knew who they were trading with, e.g. obtain the name of the individual sole trader, review terms and conditions and consider a cost shifting clause to deter late payment and most of all, review your credit control strategy and consider shortening any internal time period to factor in the new 30 day period’.
Despite the undoubted onerous implications of Pre-Action Protocol, what Michael attempted to do was put a sense of perspective to creditor clients and put a positive spin on proceedings. Michael explained that, ‘prior to the protocol, there was inevitably a gloomy outlook. It however had to be remembered that for any sanctions to be imposed on the creditor for failure to comply with the protocol, first of all the claim would have to be defended. Even then the Court is unlikely to be concerned with any minor technical infringements by the creditor. And let’s not forget, the Court would also not look too kindly upon a Defendant that has had sufficient opportunity to respond and that’s been abusing the process somewhat’.
Ultimately, in the majority of cases, it is widely predicted that debtors will continue to bury their heads. In turn what that means is just a further 16-day period is added before creditors can begin legal proceedings.
Access to Justice through the Courts is still very much alive!
Michael Whitaker – 07866 840983