Many people are frightened of courts, especially when they feel guilty because they owe money. The county court is not there to judge anyone guilty or innocent, but to settle disputes about money owed and how to repay it. The court is not there to serve the interests of the creditors alone.
If court action is taken, you will not usually have to go to a court hearing. Most of the procedure is done through the post.
WHAT WILL HAPPEN IF SOMEONE TAKES COURT ACTION AGAINST ME?
You will receive a "Claim Form" from the court (this used to be called a Default Summons). This will come through the post and tell you how much the creditor says you owe. The claim form will usually include details of the debt known as the "Particulars of Claim" but the creditor can send this separately with in 14 days.
IF YOU AGREE YOU OWE THE DEBT - how to reply
There will be a Reply Form with the Claim Form for you to make your offer of repayment. This is called the "Admission Form" or N9a. There are instructions included on how to fill in the form. It looks quite like a Personal Budget Sheet and asks for similar information on income and essential outgoings. When filling in this form -
JOINT DEBTS - make sure you both reply
If your debt is in joint names your creditor may send out separate Claim Forms to you and the other person who is liable for the debt. You will both need to fill in separate Reply Forms and make sure you put an offer of payment in the 'OFFER OF PAYMENT' box on each form (section 11).
If you leave one form blank, or only send back one Reply Form, one of you may get a judgment telling them to pay the debt in one lump sum. If you have worked out offers of payment to creditors put half of the offer on each Reply Form and enclose a full personal budget sheet and list of creditors.
IF YOUR OFFER IS ACCEPTED
You will receive an Order from the court to pay your offer in monthly instalments. You should send your payments to the creditor - not the court. Keep a record of what you have paid and when.
IF YOUR OFFER IS NOT ACCEPTED
The court will decide (or "determine") what you should pay each month and send an Order confirming this.
If you owe less than £5000 the court staff will decide what you should pay without a hearing.
If you owe more than £5000 the District Judge decides either (a) by looking at the papers or (b) at a hearing in your local county court.
If you cannot afford what the court has decided you should pay, you can apply to the court to look at your offer again. This is called a "Re-determination". There is no fee for doing this. You must do this within 14 days of getting the Order. A District Judge will do the “Re-determination”.
HOW DOES A 'RE-DETERMINATION' WORK?
'Where the Order was made by the court staff (you owe less than £5000), the District Judge can decide to have a hearing or make a decision by looking at the papers. You can ask for a hearing when you write to the court to ask them to look at your case again.
If the Order was made by a District Judge without a hearing (you owe more than £5000) then the "Re-determination" of your offer must be decided at a hearing.
If the Order was made District Judge after a hearing you cannot apply for a "Re-determination" - you can only apply for the monthly payments to be reduced or "varied".
If there is a hearing at any stage, the case will automatically be transferred to your local county court so you can attend. The court will give you a hearing date. You must go to the hearing which should be in the District Judge's Rooms (in private). Take a copy of your Personal Budget Sheet.
IF YOU DISAGREE WITH WHAT THE CREDITOR SAYS YOU OWE
If you don't agree with the amount of the debt they say you owe then you must either: -
Putting in a Defence or Counterclaim is complicated. Phone us for advice.
REDUCING PAYMENTS ON COURT ORDERS
The monthly payments you have been ordered to make can be reduced if your circumstances change or if you can't afford them. You can apply for a reduction using form N245 that you can get from the local county court office.
There will usually be a fee to pay with your application. You can ask the court to waive the fee in some circumstances. The form you will need to fill in is called an EX160 "Application for a fee exemption or remission". This form needs to go to the court with your main application. If the court agrees you will not have to pay the fee.
Exemptions from Fees: If you are on Income Support or income-based Jobseeker's Allowance (JSA) you can ask the court for exemption from the fee. You need to give the court proof that you are getting the benefit. If you are on Working Families Tax Credit or Disabled Persons Tax Credit you will be exempt from the court fee if you get the maximum tax credit or if £70 or less a week has been taken off the maximum tax credit payable. You will need to show the court your Working Families Tax Credit or Disabled Persons Tax Credit Award Notice as proof. If your tax credit has more than £70 taken off a week then you can ask for the fee to be remitted or waived by the court.
Ask the court for the fee to be remitted (or waived) if it will cause you hardship. You may be on a low income or a benefit that does not exempt you from the fee. Give as much information about your circumstances as you can.
Remember: You can always phone us for advice.
WHAT IF I CANNOT AFFORD THE REPAYMENTS ORDERED?
If you find that you cannot afford to pay the amounts ordered for any reason, such as a drop in income, multiple debts, a relationship breakdown, a new baby or illness:
WHAT HAPPENS IF I AM ORDERED TO ATTEND COURT AT ANY STAGE?
It is very important that you go to any court hearing. If you do not attend, the court has the power to issue:
When you attend the court hearing the court will ask for details of your income, expenditure and any other debts you may have. Make sure you take your completed personal budget to the hearing.
The court should take into account your income, expenditure and any other debts when deciding the rate you should pay your fine.
The court may accept a fixed amount of £2.70 per week from someone who is on Income Support/Jobseeker's Allowance or on a low income. It is helpful to take some money to offer to the court, even if it is only your weekly/monthly offer of payment. This will show the court you are not refusing to pay. However, be careful; the court does have the power to search.
WHAT CAN THE COURT DO?
At the court hearing the court can do one of the following:
If the court imposes a suspended prison sentence it is essential you keep up with the repayments as ordered by the court. If you fall behind with payments again another court hearing will be set.
If you do not attend this hearing, the prison sentence will be activated and private bailiffs can be instructed to arrest you and take you into custody. It may be possible to prevent this happening by writing to the court explaining the reason why you didn't go to the hearing and why you have not paid. Another court date may then be set to consider your circumstances.
Following a case in the European Court of Human Rights in 1996 you are entitled to ask for legal help at a court hearing relating to non-payment of a fine. You may be able to get the Duty Solicitor at the court to speak on your behalf at the hearing. If you have a court hearing coming up contact us straight away.
Most courts now use private firms of bailiffs to collect fines by taking your goods and selling them to pay the fine. This is called a "Warrant of Distraint". If your fine is passed to bailiffs you need to check our page about Bailiffs or call us for advice.
If you are suffering with debt problems then Royal Exchange can help. We provide confidential and impartial advice to people throughout the UK no matter what their financial circumstances.
For more information call us on freephone 0800 028 4422 or complete our enquiry form and one of our advisors will call you back.