On the 1st October 2017, the Government introduced the new Pre-Action Protocol (PAP) that applies to any business that is claiming a debt from an individual (including sole traders and public bodies) The protocol however does not apply for business to business debts.
So how does it work?
Pre-action protocols are a series of steps to be taken by a person or business that wishes to bring a claim to court. These steps are intended to be easy to follow and to ensure that everyone involved is aware of the problem in dispute and what each side states has happened.
In order to ease the pressure associated court proceedings on late payments, the Protocol encourages early communication with hopes that this will lead to a quick resolution without needing to begin legal proceedings. PAP aims to encourage the parties to settle disputes through the use of Alternative Dispute Resolution (ADR) such as mediation and arbitration.
The principle behind this is that all parties should attempt to discuss a solution. If there is no option but to take things the legal route, the Pre-Action steps should support the efficient management of court proceedings. Where a party refuses to act in a suitable way and the case goes to court, the party who has failed to attempt to sort out the problem may have to pay the costs of the other party. If you, as the creditor; have followed every step then it will work in your favour. If you fail to comply with the Protocol, however, you may face major delays when collecting the debt.
Anyone considering litigation should always ensure that they gather all relevant information, documentation and reports; keeping them safe until they need to be produced.
If you have been involved in a dispute regarding a debt and want to avoid taking things legal, then you can outsource the debt recovery services with the appropriate ADR solutions and Pre-action Protocol advice. At Swift resolution we handle debt recovery professionally and avoid getting aggressive as we are not personally involved. This usually produces better results than legal action, and it also allows you to maintain important customer relationships. For more information you can contact us on: 0808 145 1886, e-mail firstname.lastname@example.org
Keep a look out for our next blog for a more detailed step by step guide on Pre-Action protocol.