Hopefully this newsletter finds you all safe and well and that you are all starting to get some normality back into your lives with the easing of restrictions.
We would like to welcome on board a new member of staff, Jamie Kavanagh, our new Business Development Manager. He will be responsible from introduction through to fulfilment transition. We also extend a warm welcome to all of our new clients.
We have some important information on the new “Breathing Space Scheme”. This is a Treasury initiative which comes into force 4th May 2021 and seeks to assist individuals in debt by providing a pause in civil enforcement. There are two types of breathing space under the scheme, “standard” where the pause automatically ends after 60 days and “mental health crisis” breathing space if the individual is undergoing mental health crisis treatment, which does not have an automatic end date.
This is important new legislation as it does mean that it will effectively put a hold on actions going through the Court irrespective of the stage i.e. Claim Form / Judgment or enforcement. The onus is on you the creditor to let us know if we are dealing with one of your cases that has entered the breathing space scheme. It is also possible that we will get notified if the debtor is aware of our involvement in the collection of their debt and of course we will advise you if we are notified of the breathing space where it appears you may not be already aware.
Please read the attached document : Breathing Space info for Creditors.pdf
We will endeavour to keep you updated with any further news or information on this.
Winding up Petitions and Stat Demands – restriction extended till 30th June 2021
You may have been aware that during the pandemic The Corporate Insolvency and Governance Act 2020 (Coronavirus) (Extension of the Relevant Period) Regulations 2021 has restricted the presentation of a winding up petition based upon the service of a statutory demand until 31 March 2021. It now seems that this restriction has been extended until 30 June 2021. What this means is that although a statutory demand may be served, it is essentially a pointless exercise as no further action can be taken.
A winding up petition may also be presented upon the basis of an unpaid CCJ where enforcement action has failed. We would still however need to satisfy the court that coronavirus has not had a financial effect on the debtor company, or that the debtor company would be insolvent irrespective of any financial effect of coronavirus.
Further, in most cases, the service of a statutory demand is a last attempt to prompt payment where all other methods of collection have failed. If the debtor company is in fact insolvent, the substantial costs of a winding up action would simply be throwing good money after bad.
New cases
We continue to encourage clients to send new cases as normal. We still anticipate that once everything else reverts to ‘business as usual’, there maybe a further uplift of instructions across the industry which could cause a considerable backlog at the courts. This way we can help to avoid potential lengthy delays. We know that many debtors are still on furlough until the end of September, so it’s a good idea to refer new cases to us sooner rather than later.
Significantly, we have also been obtaining many payments in full and payment arrangements over the last few months due to our continued outbound activity of calling, messaging, emailing and lettering efforts.
Outstanding Instructions
We would greatly appreciate it if you get time to go through your outstanding instructions on workflow. If you need any help or advice please get in touch with the client services team.
Contact
We will endeavour to keep you updated with any significant changes. Please do not hesitate to contact client services with any concerns or questions or if you need any training on the debt recovery process or our online portal “Debt Manager”.
When emailing the office, please use the team email addresses rather than (or as well as) individual ones, just to ensure that your email gets dealt with swiftly if the member of staff you are emailing is not available.
- Legal: legalteam@legalrecoveries.com
- Pre Legal: recoveriesteam@legalrecoveries.com
- Client Services: clientservices@legalrecoveries.com
- Finance: finance@legalrecoveries.com
- IT: it@legalrecoveries.com
