AJJB Law undertakes volume debt recovery work for referred clients from third party introducers. AJJB’s clients are normally regulated by the FCA or another similar statutory body. The costs below are indicative of the costs AJJB charge such clients. However these can be subject to negotiation depending on the type of client and volume of work.

The work is undertaken by a team of paralegals who specialise in debt recovery. Further details of their qualifications and experience are available to clients on request. Legal work undertaken by them is supervised by Leonard Thomas James a solicitor with over 20 years of experience in debt recovery issues. Where cases are defended or enforcement action is required, the work is undertaken by paralegals, also supervised by Leonard Thomas James. Details of this team, including their experience and qualifications are available here.

We set out our standard fees below and some brief information about time scales. These relate to undefended claims where the amount owed is not disputed.

Our charges are made up of:

1. our fees for the legal work; and
2. ‘disbursements’ – disbursements are costs related to your matter that are payable to other people, such as court fees and payments to High Court Enforcement Officers or process servers. We handle the payment of the disbursements on your behalf to ensure a smoother process.

Where VAT is referred to below please note that this will be charged at the applicable rate, which is currently 20%. VAT is not charged on court fees. Where a fixed fee set by the Court is charged the VAT element will not normally be recoverable from the Defendant.

Letter Before Claim

A Letter Before Claim (“LBC”) is a letter which formally demands payment from the person who owes you money (the ‘debtor’). This is the first step for any debt recovery process before starting court proceedings.

AJJB will on your instruction draft and send an initial LBC .The LBC will have a timeline for when payment or a response is to be received. The timeline for an LBC to be responded to is either 30 days (individual) or 14 days (business) depending upon the nature of the debt.

The fixed fee for preparing and issuing the LBC is £50.00 plus VAT (currently 20%). This is subject to discussions with volume providers. This cost includes:

• Undertaking appropriate searches
• Sending a letter before action
• Receiving payment and sending onto you, where applicable

Some cases may be more complicated and require us to charge on a different basis and may take longer than usual. Contact us for a quote tailored to your circumstances.

Unless specified in your terms and conditions, all charges above are not recoverable from the debtor/customer.

If the debtor does not respond within the deadlines referred to above, AJJB will inform you that AJJB are ready to issue the Claim.

Issuing Court Proceedings

County Court Proceedings issued via the Civil National Business Centre (CNBC)

If the LBC does not prompt a response or payment of your debt, AJJB will prepare a Claim Form and send it to Court for proceedings to be issued. The Court will then send the Claim Form to the Defendant. If the Defendant does not file a defence within the relevant time we will enter judgment in default of a defence. If the Defendant files a defence we will then consult with you as to whether you wish to deal with this matter as a defended claim on the basis of our defended costs.

Where it is necessary to issue a claim and the Defendant does not respond at all it usually takes about 21 days from issue of the claim to entering default judgment. If enforcement action is needed, the matter will take longer to resolve. This is in addition to the time period a potential Defendant has to reply to an LBC as discussed above. Anyone wishing to proceed with a claim should note that:

• The VAT element of our fee cannot be reclaimed from your debtor.
• Interest and compensation may take the debt into a higher banding, with a higher cost (as set out below).

The costs quoted below for issuing a claim and obtaining judgment do not include where enforcement action is needed to collect your debt. These costs are discussed below under the heading “Enforcement of a Judgment”

The fixed fees below include:

• drafting and issuing a claim
• Where no Acknowledgment of Service or Defence is received, applying to the court to enter Judgment in default
• When Judgment in default in received, writing to the other side to request payment
• If payment is not received within 14 days, providing you with advice on next steps and likely costs

Fixed costs for undefended claims

The Court fees and solicitors fixed costs up to judgment by default are set by the Court. These costs are added to the claim and form part of the amount claimed on judgment. In respect of the solicitors fixed costs referred to below, we add VAT at 20% when billing you.

 

Value of Claim	Issue fee (£)	Solicitors fixed costs on issue (£)	Solicitors fixed costs on judgment in default	Total
Greater than £300	50	50	25	125
Greater than £500	70	70	25	165
Greater than £1000	80	80	25	185
Greater than £1500	115	80	25	220
Greater than £3000	205	80	25	310
Greater than £5000	455	100	35	590
Greater than £10000	5% of value of claim	100	35	N/A
Greater than £200000	10,000	100	35	10,135

Where a matter is ended by entering judgment in default of a defence we would normally expect it to be concluded within 21 days of the issue of proceedings. If an acknowledgement of service is filed but no defence then it may take 35 days.

Anyone wishing to proceed with a claim should note that:

• The VAT element of our fee cannot be reclaimed from your debtor.
• Interest and compensation may take the debt into a higher banding, with a higher cost.
• The costs quoted above are not for matters where enforcement action, such as the County Court Bailiff or High Court Enforcement Officer, is needed to collect your debt.

Our fees (as set out in the table above) include:

• drafting and issuing claim
• Where no Acknowledgment of Service or Defence is received, applying to the court to enter Judgment in default
• When Judgment in default is received, contacting the other side to request payment

Matters usually take 21 days from the issue of proceedings to obtaining judgment. This may extend to 35 days if an acknowledgement of service is filed but is not followed by a formal defence. If enforcement action is needed, the matter will take longer to resolve.

Advice and costs regarding enforcement are provided after judgment has been obtained and are discussed below.

Key Stages of your case

The costs of an LBC and issuing a claim as described above cover all of the work in relation to the following key stages of the debt recovery process:

• Discussing your case with you and, where appropriate, reviewing documents you provide
• Performing relevant checks and searches
• Sending a letter before claim
• Receiving payment and forwarding payment to you or, if a debt is not paid, drafting and issuing court proceedings
• If no response is received, applying to the Court for Judgment in Default, subject to the additional costs for doing so as detailed above being paid;
• If Judgment in Default is received, writing to the other side to demand payment
• If payment is still not received within the specified timescale, providing you with guidance on the next steps and likely costs

It would not normally be necessary to undertake other work or incur costs other than those described above. However, we would be very happy to provide you with a more tailored quote for all stages of your particular case once we know about your specific circumstances.

Defended and Disputed Claims

AJJB charges hourly rates (see below) if the Claim is defended. AJJB will take your instructions at this stage and advise on the prospects of success in dismissing the Defence and obtaining Judgment on your behalf. Arrangements in this regard may differ with certain volume clients.

We would also discuss with you the likely costs of pursuing a defended claim to a final hearing. We will also discuss the extent to which the Court will order the other side to pay those costs if we are successful in the claim. It is unusual to recover all of the costs you have incurred even if you are successful. There is also no guarantee of a costs recovery if ordered by the Court, in the event the Defendant has insufficient funds.

Where a matter is defended or disputed in this way we would normally expect it to be concluded between 40 – 65 weeks of our letter before claim. However, the time scale is mainly governed by the time the court takes in processing paperwork after a defence has been filed and delays in listing the matter for a final hearing.

Disbursements

You will need to pay for ‘disbursements’ in addition to our costs as described above. In a debt recovery matter the most common disbursement is the Court fee and the cost for these are listed in the table above. If we need to go to Court then a barrister (sometimes called ‘Counsel’), or a specialised advocacy service, is often used to deal with the hearing. In cases where we are seeking to recover less than £10,000 and the claim has been allocated to the small claims track we normally use a specialised advocacy service rather than a barrister. This typically costs £150 plus VAT per hearing. We will however guide you on this as to when such costs need to be incurred.

Where the amount to be recovered is for more than £10,000 and has been allocated to what is known as the intermediate track, we would normally instruct a barrister. That cost is very dependent on the nature and complication of the case. Barristers’ fees tend to be in the region of £750 – £1000 (plus VAT at 20%) per day. However, we will always obtain an estimate from the Barrister as to the cost of the representation and agree it with you first.

Enforcement of a judgment

AJJB can act on your behalf in commencing enforcement action of the judgment. It is not possible to estimate at this stage how long enforcement would take and what the costs would be. This will depend upon how much time and money the client wishes to invest in pursuing the debt. AJJB can discuss this process with you regarding the timelines and costs before any action is subsequently taken. Both Defended and Enforcement work would normally be undertaken on an hourly rate basis. Our standard hourly rates are detailed below.

Hourly rate – Our typical hourly rates are as follows excluding VAT

1. Solicitors and legal executives with over 8 years’ experience £217
2. Solicitors and legal executives with over 4 years’ experience £192
3. Other solicitors or legal executives and fee earners of equivalent experience £161
4. Trainee solicitors, paralegals and other fee earners £118

These hourly fees exclude VAT, currently chargeable at 20%.

Details of our team, including their experience and qualifications are available on our website here .We set out below 2 typical costs and time scales for enforcement

High Court Enforcement

For example if a debt is over £600 and below £5,000 we would normally advise instructing a High Court Enforcement Officer (HCEO) to enforce the debt by seeking to seize the Debtor’s goods. The obtaining of a court document known as a writ would normally cost £122.75 including our costs and the court fees. A further fee of £75 may be payable to the HCEO for enforcement. These fees are added to the judgment debt and recoverable from the debtor if the HCEO is successful in recovering monies. The HCEO’s fees are deducted first before any money is handed over by them.

Further details on HCEOs fees can be found here:

https://www.hceoa.org.uk/fees-charges/fees-charges-for-recovering-a-debt

The HCEO is require to give notice of their intention to levy execution on a debt. It typically takes about a month from you instructing us to instruct an HCEO to a successful (or unsuccessful) attempt to recover the debt.

Bankruptcy costs

If you are owed over £5,000 it is possible to seek to bankrupt the person who owes you money (the Debtor).

Our costs will be £500 plus VAT (currently chargeable at 20%) for a straightforward unopposed petition with one hearing.

There are then additional fees of:

• £1,500 petition deposit (for managing the bankruptcy). This fee is paid to the Official Receiver. However it is refunded if payment is received from the Debtor before the bankruptcy order is made.
• £302 for court costs
• £150 for serving the petition personally on the debtor
• £150 for an agent to appear at each bankruptcy hearing. Note sometimes these hearing are adjourned as the Debtor pleads for more time, for example to realise an asset.

It takes approximately 3 months from instruction on a bankruptcy petition to an order being made. Once a bankruptcy order has been made there is no certainty that you will receive payment.

There are many different methods of enforcement and we are happy to discuss appropriate methods and bespoke costs for each proposed enforcement procedure.