First of all, it is always prudent to check the financial health of the debtor where practical and appropriate. If your debtor is a business, consider running credit reports by signing up to a reputable service, as well as checking the other party’s latest set of accounts, often available for free or a small fee on the Companies House website. Following that, here are some steps you could take to avoid having to divert your attention towards collecting any money that the business may be owed.

Have a clear set of terms, whether by way of standard terms and conditions or a bespoke agreement, and ensure that payment terms are spelt out clearly and are acceptable to you. Where possible, have consistent terms, such as asking customers to pay your invoices within a certain number of days from the date of each invoice.

Make sure your terms and conditions or a bespoke agreement are legally binding on the debtor in question (normally a customer) by having a consistent process and keeping records of their agreement, preferably in writing, such as via email, or by ticking an acceptance box on your website.

Review your payment terms in terms and conditions, contracts and agreements to make sure that they work for your business, including any pre-payment terms, % and administrative fees for late payment of your invoices, your ability to suspend or cancel your provision of goods/services, or collect delivered or installed items in case of late payment or non-payment.

Consider collecting payment in full or part prior to delivering your goods and/or providing services to customers, with the last installment, where applicable and possible, to be collected before completion of your part of the deal.

Take a look at your dispute resolution/ choice of law provisions in contracts. In some cases businesses prefer to have an escalation/ negotiation clause prior to any formal debt collection procedures. In other cases, a quick debt recovery procedure may be a better choice.

The team at is committed to actively pursuing a pre litigation route for every case. We often find that while our clients may have tried everything to get through to their debtor, using our pre litigation services it can take just one professional letter from us to settle the matter. If the debtor proves difficult to locate by mail or phone, we also provide a tracing service to help locate them and to complete the recovery process.

During our pre litigation service, we follow up our initial legal letter with regular, polite calls to the debtor to find out the status of their side of the claim. This allows us to update our clients on the status of their case daily if necessary. We will do everything in our power to avoid your case escalating to court proceedings.

Why choose pre litigation services? Firstly, and perhaps most importantly when you are already out of pocket, the cost of litigation is much higher than the cost of a pre-court resolution.

Secondly, by heading straight for litigation, any remaining relationship you have with that customer will undoubtedly be ended. That business will be lost forever. However, using pre litigation when there is already a solid relationship, we do our best to help you maintain it.

If we can resolve the issue before it goes to court, with the help of our polite, professional staff and our pre litigation services, we can help to make sure that the customer is happy at the end of the process, and no one feels victimised.

Thanks to the Late Payment of Commercial Debt Interest Act 1998, your debtors must pay interest on the amount that they owe and reimburse reasonable recovery costs to you. That means, whatever it costs for you to recover the money, including the cost of our pre litigation services, becomes their expense too. This means that if one of your customers does not pay for goods or services within 60 days (30 days for public authorities) you can exercise your right to request interest and a fee on top of the debt. The rate of this interest is the Bank of England base rate plus 8% per annum.

We have found that when a debtor becomes aware of this extra cost, and of how it will grow if the case is taken to litigation stage, they can become very keen to settle the debt as soon as possible within our pre litigation service. If you would like to find out more about your rights to compensation and our pre litigation service, get in touch with today.

If a dispute cannot be settled in the pre litigation stages, our Litigation Team takes over. Their extensive and diverse experience combined with a pro-active and professional approach to dispute resolution ensures a swift close to the matter. We understand that litigation is usually a very unwelcome end to a lengthy dispute, so we work diligently to ensure that it affects your business and daily life as little as possible. Get in touch with today to find out more.