When someone is in your debt, owing you money and refusing to pay, it can be very stressful to know what to do next. Therefore, it is wise to know the best cause of action available when relatively small sums of money are in contention.
Firstly, the most important thing you can do to counteract this scenario, is prevent it from happening in the first place. Regardless of circumstance, seeking professional advice from regulated financial planning authorities, such as Coles Financial Planning, shall alleviate any worries you may presently have and prevent situations requiring resolve emerging in the first place.
However, if grievances are unavoidable there is an easy route for all to take that will guarantee a victory for those who deserve it. Unfortunately, this may come at a cost that is more than financial. For example, if you are a freelancer with a highly lucrative client who is refusing to pay, you should seriously consider the reasons behind their decision and whether or not it is worth pursuing a legal route and relinquishing any further contracts with this organization in the future. Do not let the mists of anger force you into a legal struggle where you will actually lose out in the long run due to loss of business. Sadly, you occasionally have to cut your losses.
Conversely, if you have loaned money to a family member or a friend, the consequences can be equally troubling should legal proceedings be unavoidable. Even though your losses shall be repatriated, the bad blood that will inevitably linger can cause severe personal problems for both yourself and your social circles, so always try, wherever possible, to meet some beneficial compromise out of court.
The final scenario that is very common in the UK is that of unrecieved payments from previous employers. When leaving a company, many businesses get confused by the process and fail to pay the departing staff member everything they owe. Should this not come to the attention of either party until a while later, problems can occur as the proof perishes with time. The best thing you can do in this situation is act fast and correspond with your former employer as soon as you can. However, try to keep it civil and friendly – or as merry as humanly possible. The more pleasant the exchange, then the more chance the issue shall be dealt with out of court, an outcome always preferable by both parties.
Should the issue not resolve itself through any of these channels then it is time to follow the legal route and take the guilty party to court.
In the UK, this is easily achieved through a small claims court. Here, the process will not cost the claimant the earth and in many cases will not require either party to formally hire a solicitor. In a small claims court hearings are ostensibly smaller, with the risks being ostensibly smaller – generally resulting in a simpler and more straightforward process for all involved.
To begin the process you need to ‘register as an individual’ by visiting the HM Courts and Tribunal Services website. The process will then begin, and you can expect to see a proposed hearing date in several weeks’ time. During this waiting period we highly recommend that you seek professional advice from debt recovery experts. From there, the process should be relatively straight forward, just bear in mind that the cogs of due process move very slowly.
Where there is ample evidence of the complaint in question, a fine shall be imposed upon the defendant and they shall be forced to pay a fee administered by the court. In cases where interest can be added on, such as in money lending disputes or where the value of a service is relative, this can (and shall usually) be taken into account.
Whatever your individual circumstances, the only way to truly protect yourself against these situations is with wise and responsible financial planning. However, hindsight is a beautiful thing and most of us will get caught up in a struggle like this at some point during our lives. The best thing you can ultimately do is be calm, assertive and moral about your grievance and fight for an outcome that is just, and not fight for an outcome as punishment.