A company will often get a County Court Judgement (CCJ) if it fails to pay a debt owing to a creditor. The issue of this kind of court order is an instruction for you to pay the debt owing to your creditor. You could either repay the debt in one go or get in touch with your creditor to try to come to some sort of payment arrangement that suits both of you.
If, after securing a payment arrangement with your creditor, you miss a payment on your CCJ the creditor can use a county court bailiff to collect the debt. They will do this by issuing a warrant of control which allows a county court bailiff to remove goods for sale at auction if you do not or cannot pay.
Warrant of control
This will only be issued by the courts if you do not make payments towards your CCJ as agreed. Here is what to expect if a warrant of control is issued against your business.
- A county court bailiff will visit you to try and take control of your possessions. This should hopefully give you the push to pay what you owe to your creditors.
- You should be sent an enforcement notice which should give you seven days clear notice of their visit.
- After the warrant has been issued, bailiffs have the right to try to take control of your goods. If you move your goods or give them to someone else, they still have the right to take them.
- The bailiffs cannot force entry and you do not have to let the bailiffs in. They can only force entry if:
- You have previously let them into the premises
- They have already taken control of your goods and you have broken an agreement made with the bailiffs on their previous visit.
What if the bailiff has already entered the property?
If the bailiff has already entered the property, they can legally enter again with force or without. When they take items on this visit, they should not take:
- Any items that you are using at the time and may break the peace if removed
- Any items necessary for basic domestic needs such as clothing
- Any items you need to be able to do your job such as a work computer
If a bailiff takes control of any of these items, you can make a claim to the court for the goods to be returned to you.
It is unusual for bailiffs to take goods on their first visit to your property and they must not take goods that are worth more than you owe your creditor. On their first visit, they may ask you to sign an agreement, called a ‘controlled goods agreement’. Usually you can keep using the items held under this agreement but you cannot get rid of them or sell them on.
If you break the terms of the controlled goods agreement, the bailiff can return and take goods by force if necessary. However, they must provide you with two days clear notice before doing this. If you do not sign the controlled goods agreement, the bailiff may remove goods immediately or lock up goods on your premises.
What if goods belong to others, are on hire purchase or there are no goods?
Goods belonging to others:
Once you have let bailiffs into the business premises, they should not take any goods that belong to someone other than the limited company. In some situations, the bailiffs may ask you to prove that this item does not belong to the business. The best way to do this is to produce a receipt or credit agreement or you can give a sworn statement known as statutory declaration.
If bailiffs do take goods, the third party whose goods have wrongly been taken should write to the bailiff explaining the situation and if possible, providing proof of ownership. This information will then be passed on to the company’s creditor who will decide whether to accept or reject the claim. If they reject, you can appeal by going to the court but you will need to pay a fee for this.
Goods on hire purchase:
These goods should not be taken as until they are fully paid off, they are still technically the property of the lender who you have the hire purchase agreement with.
If there are no goods of sufficient value to cover the debts you owe, the bailiffs may decide to return at a later date to assess the situation again. They can do this at any time within 12 months of the date of the enforcement notice. If you had made a payment arrangement with the bailiff, the 12 month period starts from the date you broke the terms of the repayment arrangement.
How to stop or suspend the warrant of control
You can apply to suspend a warrant of control by filling in a N245 form and handing it into the court with your court fee. The court cannot refuse your application and they must review it. A bailiff can still visit your property after you have applied to suspend the warrant until the court agrees to suspend it.
Your creditor will be sent a copy of the application form and if they agree to your application, they will notify the court and send you details of what is agreed and how to pay. However, if your creditor does not agree to your payment offer, the court will look at the information they have and work out how much you should pay.
If your creditor objects to the suspension of the warrant, there will be a short hearing where you explain your situation and the judge will decide on how to proceed. On the occasion that the court orders you to pay more than you have offered or are due to pay, you have 14 days to appeal by filling in a N244 form asking the court to reconsider their findings.
Struggling to meet your CCJ repayments?
When you are struggling to meet the repayments on your CCJ, you should get in contact with your creditor to explain your situation and try to come to a new agreement which will work for both parties.
If you cannot reach a new agreement that you can afford, get in contact with Wilson Field on 0800 901 2475 as soon as possible. We can discuss your situation with you, find a solution which works for you and help put a stop to creditor pressure.