Debt Recovery Pricing
Our Debt Recovery specialists are solicitor Jason Washington and Legal Executive Shannan Sutton. Jason (over 20 years of experience) and Shannan (qualified in 2022) have a track records of delivering outstanding service to our clients in all aspects of Debt Recovery matters. They have particular expertise in contested claims such as disputed terms and conditions or disputing the quality or type of goods/service supplied
Jason Washington and Shannan Sutton are supervised by Paul Woolliscroft, Legal and Commercial Director and Head of Litigation.
Our Approach To Pricing For Debt Recovery
The cost of pursuing a debt will always depend on the facts of the individual case. It will depend principally on whether the debt is disputed or not.
Tinsdills does not undertake debt collection work on a fixed cost basis.
Typically, our charges are calculated by reference to an hourly rate for work undertaken. This is with exception of cases of particularly high value or complexity, in which case a value element is also charged.
The hourly rates will vary according to the experience and qualifications of the staff member carrying out the work, and also the complexity and urgency of the work required.
Hourly rates start from £90 plus VAT per hour for a junior staff member undertaking simple uncontested debt collection work, to £250 plus VAT per hour for an experienced solicitor undertaking more complex work. These hourly rates are subject to the addition of VAT charged at 20%.
Before we commence work, we will agree what work we are undertaking for you. We will also provide you with details of who will be handling the matter, their qualifications, the applicable hourly rate(s), estimate of charges, details of the disbursements and a timescale estimate.
A fee is payable to the court on the issue of proceedings. That fee depends on the amount claimed and increases in bands. That fee ranges from £35 to £455 for claims up to £10,000.
Claims for £10,000 or more have an issue fee of 5% of the sum claimed up to a maximum court issue fee of £10,000.
If the claim reaches trial, a hearing fee is payable. That fee ranges from £27 to £346 for claims up to £10,000. The fee for fast track (typically claims between £10,000 and £25,000) is £545 and for multi-track claims (typically claims over £25,000) is £1,175.
Details of court fees may be found on HM Court and Tribunal Service website at the link below:
It may also be necessary to incur barrister’s fees, either where the claim is particularly complex or where it involves attendance at trial or at a hearing out of the area (if the claim is transferred to the Defendant’s home county court). Barrister’s fees will depend on the nature of the claim and the work that they are asked to carry out.
They are typically calculated by reference to an hourly rate and will range from £50 plus VAT per hour for a pupil or newly-qualified barrister to £300+ plus VAT per hour for an experienced (non-King’s Counsel) barrister. These hourly rates are usually subject to the addition of VAT charged at 20%.
Where there are specific technical issues that require an expert witness to provide evidence to assist the court in determining them, there may also be additional expert’s fees. These depend very heavily on the nature of the expert required and are generally determined by the amount of time that the expert takes in preparing their report. It’s therefore very difficult to generalise about the likely scale of those costs. We would always seek to obtain a quote from an expert before instructing them on your behalf.
A claim in respect of unpaid invoices totalling £15,000 where the Defendant has raised no issue in relation to the goods or services supplied and has simply failed to pay the invoices within the contractual period for payment
We would undertake the following steps:
- Review documentation and any relevant contractual terms.
- In the case of a company, check to see whether there is any indication at Companies House that the company had already been declared insolvent.
- Prepare and serve a letter of claim which complies, where applicable, with the Pre-action Protocol for Debt Claims.
- If payment is not made on receipt of the letter of claim, prepare and issue court proceedings.
- If the Defendant fails to file either an Acknowledgement of Service or a substantive Defence, file a Request for Judgment with the court.
In this case, it would typically take 2-3 months from first instruction to filing the Request for Judgment in default.
Where the Pre-action Protocol applies (i.e. where the Defendant is an individual or sole trader), the letter of claim must allow at least 30 days for them to respond, and potentially longer if the debtor indicates that s/he is seeking legal advice or requests additional documents.
Where the Pre-action Protocol does not apply (i.e. business to business), the letter of claim must allow a “reasonable period” for the Defendant to consider and respond to the claim. This period is typically between 14 and 28 days, depending on the nature and complexity of the claim.
Much also depends on how long it takes the court (which typically has a backlog of work) to process the court papers and serve them on the Defendant.
If the Defendant still did not pay on judgment in default being entered, it would be necessary to consider ways of enforcing the judgment, which will add further time and cost to the process.
In the example above, we anticipate that Tinsdills’ costs would typically be in the region of £300 plus VAT charged at 20% to £500 plus VAT charged at 20%, together with a court fee of £750.
Where a debt is undisputed, the cost to pursue it could be as little as £40 – £100 plus VAT charged at 20%, if the pre-action letter of claim elicits payment without the need to issue court proceedings.
However, in the case of the Defendant contesting the claim – for example, on the basis that the goods supplied were not of satisfactory quality or failed to comply with the contractual specification – costs will be increase significantly.
If court proceedings have to be issued, there are a number of factors which may affect the cost of pursuing a claim, including:
- Whether there is a dispute as to the terms of the contract.
- Whether there is a contract in writing.
- Whether there is a dispute about the quality or type of goods/services supplied.
- How much documentation has to be reviewed.
- How many witnesses are required to provide statements for use at trial.
- Whether there are issues that will require expert evidence to be provided to the court.
- The location and duration of the trial.
It is much more difficult to generalise about costs where a claim is contested, since so much depends on the precise nature of the dispute, and in particular whether it is necessary to involve a barrister and an expert witness. As such, costs can vary widely.
Typically, we would anticipate a contested one day trial to take somewhere in the region of 12 to 15 months to resolve and would expect total costs (i.e. Tinsdills’ costs, together with a barrister to represent you at trial and court fees – but not requiring expert evidence) somewhere in the range of £8000 to £12,000 plus VAT charged at 20% for legal representation plus courts fees which may be found on HM Court and Tribunal Service website link below and are based on the amount claimed:
However, in more complex matters, or where expert evidence is required, it is possible for these cases to take upwards of 18 months to resolve and costs (i.e. Tinsdills’ costs together with a barrister to represent you at trial, and an expert’s fees and court fees) could be in the region of £15,000 to £20,000 plus VAT charged at 20% for legal representation plus experts fees which could be in the region of £5,000 (some experts are not VAT registered in which case no VAT would be charged on these fees, others are VAT registered in which case VAT at 20% will be charged in addition) plus courts fees which may be found on HM Court and Tribunal Service website link below and are based on the amount claimed:
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