BUSINESS ADVICE
The simple way to guarantee you get your money
» NOT ALL CUSTOMERS PAY ON TIME and occasionally , you get one who plans to never pay . Benjamin Dyer , CEO of app supplier Powered Now , looks at how you can use the small claims court to sort out the problem .
So , your customer hasn ’ t just been tardy in paying , they ’ ve made all sorts of promises , none of which they ’ ve kept . You ’ re now thinking they will never pay . The question is what can you do about it ?
The short answer is to use the “ small claims court ”. This article is designed to give you some pointers on how to sue someone using this route .
Just remember this article is not formal legal advice . To be absolutely certain of your ground , pay a qualified solicitor for advice .
Why use the small claims court ?
The difficulty with asking for money is that you do all the running . If the debtor ignores you , there are no consequences for them .
That changes if you go to the small claims court . If they do nothing all sorts of nasty things can happen to them including a County Court Judgement that will blight their credit record and a bailiff turning up to seize their goods .
However , before you start you must have stated your claim in writing and warned them you will take court action if they don ’ t pay by a stated date .
Background information
It ’ s best if you have a written agreement about the work and cost but remember that a verbal agreement is still legally binding . It ’ s also good if you have proof of the work with pictures showing what happened plus emails etc where you chased them for payment . If you used an app for generating quotes and invoices , such as Powered Now from my Company , this record will be useful evidence about the work and that will help .
When can you use the small claims court ?
The total amount claimed can only be up to £ 10,000 (£ 5,000 in Scotland and £ 3,000 in Northern Ireland ). Claims in England , Wales and Northern Ireland must be lodged within 6 years and within 5 years in Scotland .
You are encouraged to try mediation but this isn ’ t compulsory . If there is a genuine dispute rather than the debtor simply won ’ t pay , this may be a better route to try , see civilmediation . org / for-thepublic / about-mediation /.
How much does it cost ?
The costs go from £ 25 for under £ 300 claims up to £ 410 for £ 5,000 to £ 10,000 . Never leave the “ Amount claimed ” blank . You may get interest too but don ’ t include this in your “ Amount claimed ”.
Making the case
File the case online at www . gov . uk / make-money-claim . It ’ s cheaper and more efficient .
You will be asked to explain :
• How you have attempted to resolve the dispute
• Your details
• Their details
• Claim amount listing each claim and amount but excluding interest and court costs
• Claim details explaining what happened , who is responsible and why . State the facts in plain unemotional terms
The next page has the list of evidence . Try to make it as easy as possible for the judge to find things by listing everything in date order and clearly stating what each item is . The evidence consists of :
• Contracts and agreements
• Expert witness statement ( only
allowed if the court has previously agreed to this )
• Letters , emails and other correspondence
• Photo evidence
• Receipts
• Statements of account
• Other evidence
Your objective is to establish that what you are claiming is on the balance of probabilities the truth . Remember if someone is given a contract and pays the money related to it and the work is done , the contract exists whether it has been signed or not as it has been “ accepted by conduct ”.
The next step
Both you and the defendant will be sent copies of the claim and the defendant receives a response pack which they can use to state their
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