Has another client or customer failed to pay a bill?
Are you owed money by a colleague or friend ?
Are you being chased for money you do not owe or you dispute the amount ?

You want to spend your time earning, not chasing money due to you. You want to enforce your rights but are not sure how. You don’t want to spend more money recovering the debt than what is actually owed.

What to do if you are owed money

A new Pre-Action Protocol has been introduced for all civil disputes. If it is not followed, then the court could make an order for costs against the party not complying.

If you wish to bring a claim using the Pre-Action Protocol you should:

  • Write to the other party giving full details of the claim;
  • Enclose copies of the documents that support your claim (such as an unpaid invoice);
  • Ask for a reply by a specific date (usually 4 weeks hence);
  • State that court proceedings will be started if a response is not received within that time.

If they dispute the claim:

  • Ask for copies of any relevant documents which the opponent has which support his case.
  • State whether you wish to mediate, and explain that the court may impose sanctions for failure to comply with the Pre-Action Protocol.

You may be entitled to Interest on the outstanding debt

The Late Payment of Commercial Debts (Interest) Act 1998 allows for all businesses to claim interest from each other on debts due. If there is no contractual rate of interest, you may be entitled to the statutory interest rate of 8% above base.

This is applicable from any agreed date, or 30 days from the time that either you provided the goods or services that you were contracted for or when the purchaser received notice of the sum due.

A defendant must provide a substantial alternative to this statutory right to interest if he wishes to opt out of paying and it will be subject to the court’s view as to whether the alternative is reasonable or not. There are also other penalties which may be claimed.

Terms and Conditions

To avoid future difficulties enforcing payments due, we can assist by ensuring your terms and conditions of trading are appropriate.

If the situation cannot be resolved, it is now vital for you to take the right action. Thomas Dunton’s Commercial Debt Recovery team are here to ensure that you do.

What to do if you are defending a claim and receive a Pre-Action Protocol letter

  • Acknowledge receipt within 21 days.
  • Say when you will give a full response and explain why if this will be longer than the time allowed by the Claimant.
  • When you make a full response you should say whether the claim is accepted as a whole, in part, or not at all and make proposals for settlement if appropriate.

If you do not accept the claim:

  • Give detailed reasons why the claim is not accepted, what is agreed and what is in dispute;
  • Enclose copies of the documents that support your position;
  • Ask for any documents that Claimant has that are relevant and have not been provided to you, and state whether you would be prepared to consider mediation;
  • Where documents are disclosed they should normally only be used to resolve the dispute, not for any other purpose unless the other party agrees.


Please contact out specialist Debt and Insolvency Team to discuss your specific details.

Please call us on 01689 822554 or email enquiry@thomasdunton.co.uk

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