Sometimes, you just cannot get paid. You may have done all the right things, yet the money is still outstanding. The decision you will have to make at that stage is whether a debt is worth pursuing.  We can work with you to help you make that decision on an informed basis.

At MKB, you do not pay over the odds for a premium debt recovery partner.

First Step

The first step once you decide to go ahead with recovering your debt is preparing a Letter Before Action which must be sent before Court proceedings are issued. The Letter Before Action gives a summary of the factual background, summarises your losses and expenses and confirms the amount sought.

It is very easy to try a one-size-fits-all approach to debt recovery however this is not always the best way. We have found, through experience, that a specifically designed Letter Before Action and bespoke tailored procedures dramatically increase your prospects of recovery.

We agree pricing with our business clients based on their business needs, the volume of debts, size of the debt, sector, and many other business-specific considerations. We may offer bespoke fixed fees, contingent fees, monthly retainers, reduced hourly rates and/or a combination of these depending on the factors set out above.

We pride ourselves on having no standard packages and no one-size-fits-all approach and we do not have a standard or fixed range of fees in most cases.

When we are instructed on individual debt recovery matters, those matters would be undertaken on a time spent, hourly rate basis.

Our usual hourly rates (all exclusive of VAT) for matters on a time spent basis are as set out in the table below:

Debt recovery matters usually involve sending letters, emails and making calls to a debtor with the threat of court action if payment is not made. Where court action is necessary, this involves issuing a claim at court to recover the debt owed.

Second Step

Often, correspondence from a Solicitor holds weight and gets results.  In our experience many debts are paid at this stage as you have demonstrated your willingness to pursue the debt through whatever means necessary. However, if the Letter Before Action does not prove successful it may not be appropriate to proceed immediately with Court action, and we always consider the debtor’s profile and their type of business when deciding how to progress your case. Therefore, it is useful to put in place a step-by-step process for collection which we will follow.

On the basis that you want to proceed immediately to Court action then proceedings are commenced either by issuing a claim at the Court or using Money Claims Online.  Either way, you will be required to pay a fee which is set dependent on the size of your claim.  If using solicitors, you are also entitled to add a small amount of their fixed costs to the debt; again at a rate fixed by the Court.  In addition, you are entitled to claim interest; either statutory or contractual.

Where a debt remains unpaid, enforcement action may be necessary, such as instructing a bailiff. Where your debt is disputed at any point, we will discuss further work required and provide you with revised advice about likely costs based on the specific circumstances and issues involved in the dispute.

Anyone wishing to proceed with a claim should note that:

• Where a debt is paid pre-issue, usually no fees can be reclaimed from your debtor.
• Where a claim is issued at court, court issue fees apply. These fees range, dependent upon the debt value, from £35.00 to 5% of the value of the claim.
• Where a court claim is not defended, only those court issue fees paid above, and court prescribed fixed costs, which range from £50.00 to £110.00, can be reclaimed from your debtor.
• Interest and compensation may take the debt into a higher banding, with a higher cost.
• Where enforcement action, such as the bailiff, is needed to collect your debt, further court fees will need to be paid, some (but not all) of which can be reclaimed from your debtor, the extent of which depends on the actions necessary, but will usually range from £55.00 to £110.00 plus VAT.
• Where a debt is defended, further expenditure may be required on court fees and barrister fees for dealing with additional court stages including disclosure of documents, witness evidence and a final trial, the extent of which depends on the specific circumstances and issues involved in the dispute, but will usually range from £500.00 to £25,000.00 plus VAT.

Usual steps in uncontested debt recovery matters include:

• Taking your instructions and reviewing documentation.
• Undertaking appropriate searches.
• Sending a Letter Before Action.
• Receiving payment and sending onto you, or if the debt is not paid, drafting and issuing the claim.
• Where no acknowledgement of service or defence is received, applying to the court to enter judgment in default.
• When the judgment in default in received, write to the other side to request payment.
• If payment is not received within ‘X’ days, providing you with advice on next steps and likely costs.

Such matters usually take between 2 and 20 weeks from receipt of instructions from you to receipt of payment from the other side, depending on whether or not it is necessary to issue a claim.

This is on the basis that the other side pays promptly on receipt of a Letter Before Action, issuing a claim or judgment in default. If enforcement action is needed, the matter will take longer to resolve. Whether or not the debt is paid also depends on the ability of the debtor to pay the debt.

On average, this type of work takes between 2 and 10 hours to complete. This means that on average our charges will be between £300.00 and £2,000.00 plus VAT.

The exact number of hours it will take depends on the circumstances of your case, such as:

• If your debtor can pay the debt.
• If your debtor wants to pay the debt.
• If court action and/or enforcement action is required.

If your debtor is willing and able to pay the debt early, our charges are likely to be at the lower end of this range.

How else can we help?

We can work with you to minimise any unpaid debt that you incur and ensure that when you are owed money, you are in the best position to recover it as quickly as possible.

Certain steps that you can take, which we can help you with are:

1. An ounce of prevention is worth a pound of cure. We can work with you to ensure you have the appropriate documents and processes in place.
2. Terms and conditions. Well drafted terms and conditions can minimise the ability of a debtor to evade payment and maximise your chances of recovery.
3. We can deliver bespoke training to ensure that your staff understand how to implement your terms and conditions of business as well as implement and improve your debt recovery processes.

Our services can be tailored to your business’ needs. For a confidential exploratory discussion about your debt recovery processes please contact our team on 01226 210 000.

For details of members of the team who may work on your matter please view our profiles section.