Background
Kat Moody, Associate Solicitor in our Dispute Resolution team, was instructed by a client seeking repayment of a substantial personal loan debt.
Some of the loan advances dated back several years, creating a potential limitation issue. There were also concerns about the debtor’s ability to repay, with their main asset appearing to be a property.
Kat therefore needed to act promptly, not only to recover the money owed but also to secure the debt against the property.
The Challenge
The matter presented several practical and legal challenges from the outset. Kat sent a compliant pre-action letter in accordance with the relevant Debt Protocol. However, the debtor initially failed to engage meaningfully, causing delays and leaving the client with little option but to consider formal court proceedings.
There was also a potential limitation issue affecting some of the older loan advances. It was therefore important for Kat to act promptly to protect the client’s position before any part of the claim became time-barred.
Obtaining a court judgment was only part of the challenge. From an early stage, there were concerns about whether the debtor would have sufficient funds available to repay the debt. The information available suggested that their main asset was a property, but there was uncertainty surrounding their wider financial position and the level of equity available.
Our Approach
Kat pursued the matter with enforcement firmly in mind. Her strategy was not simply to obtain judgment, but to secure the debt against the debtor’s property through a charging order.
As the matter progressed, Kat also navigated procedural challenges, including delays within the court system. The debtor eventually engaged with the process and formally admitted the debt within the official Reply Form. Kat obtained judgment for the full amount owed, together with interest and legal costs.
She then progressed enforcement action and successfully secured the debt against the debtor’s property.
The Outcome
As a result of the charging order, Kat’s client is now a secured creditor and has priority over unsecured creditors.
The charge also gives the client the option to apply for an order for sale of the property should they decide that further enforcement action is necessary.
This case demonstrates that effective debt recovery is not simply about issuing court proceedings and obtaining judgment.
By identifying the limitation and enforcement risks at an early stage, acting promptly and considering how the debt could ultimately be recovered, Kat was able to protect her client’s position and achieve a successful result.
HOW CAN WE HELP
If you are owed money, acting quickly can be important, particularly where there are concerns about limitation, the debtor’s financial position or the likelihood of successfully enforcing a judgment.
Our Dispute Resolution team can support you throughout the debt recovery process, from sending a formal letter before action and issuing court proceedings to obtaining judgment and considering the most effective enforcement options available.
We provide clear, practical advice focused not only on proving that the money is owed, but also on giving you the best possible chance of recovering it.
To discuss a personal or business debt, contact Kat Moody or a member of our Dispute Resolution team.
To speak to a member of our team, contact Richard Reed Solicitors today.