Late Payment/Debt Recovery

[Nick S]

I have a complicated and related question that I'm having trouble with - anyone got any ideas (apart from consult a lawyer, which I suspect I will have to, but I wanted to get an idea beforehand):

 

I'm owed money from a job with a foreign company (again, not a huge amount, but enough to pursue it, about £500). Neither of us are disputing the amounts or the fact it is owed (yet). This company is based outside of the EU. However, they run a UK subsidiary which they own outright. Does anyone know if I can take the UK subsidiary to small claims to enforce the debt? Basically, are subsidiary companies liable for debt their parent companies owe?

[Hilary Watts]

Does anyone know if I can take the UK subsidiary to small claims to enforce the debt? Basically, are subsidiary companies liable for debt their parent companies owe?

 

 

No, unfortunately for you, the underlying principle of company law is that each company is a totally separate legal entity so that in the absence of a specific contractual liability the subsidiary will not be liable for the parent company's debts or vice versa.

[Guest lightnix]

Some other countries have Small Claims Courts, too. A quick :) for small claims [country] might just offer an avenue :)

[Nick S]

Yeah, that's what I thought. It's going to be complicated :)

 

Sadly it's a country where you don't really get small claims courts, and also a place where if you're not a certain religion you're pretty much screwed. I might try filing papers in the UK anyway, because the subsidiary is an agent of the parent (its only purpose being to conduct the business of the parent, rather than having any other role or product), and it's £25...you never know, they might not show up!

[Bryson]

So, I won my claim by default today. No response was filed.

 

But, even though I've "won", I still have to chase the money down. Sigh.

[Ynot]

So, I won my claim by default today. No response was filed.

 

But, even though I've "won", I still have to chase the money down. Sigh.

That's precisely what's happened in our case. Yet we're still struggling. In fact I'm just back from a meeting where our next steps were discussed...

[cfmonk]

Hi All,

 

EXACTLY this situation was the one I was up against recently. There is a thread on it somewhere.

 

We had success by submitting an "Application for order that debtor attend court for questioning" using an N316 (http://www.hmcourts-service.gov.uk/HMCSCourtFinder/GetForm.do?court_forms_id=547)

 

This has two effects:

1. It means that the debtor MUST attend court, they have three chances to do this on a scheduled date and if they do not then they are in Contempt and a warrant can be issued for their arrest. This often can give them a nudge which might make them cough up.

 

2. They must produce all their bank statements etc. for your inspection. Once you have the details of where they have some money you can apply for a Garnishee (aka Third Party Debt) Order which allows you to freeze their bank account and get the money directly from their bank.

 

Of course, if you know they have money in an account anyways then you can skip straight to the latter part of section 2.

 

Hope that helps!

 

Chris

[David Lee]

Just to say, MCOL worked for me. Received full payment in the post. Why oh why didn't they just pay up when it was due -it has now cost them an extra £110 for their troubles and (more imprtantly) is reducing the number of techs willing to work for them.

[Guest lightnix]

Just to say, MCOL worked for me. Received full payment in the post. Why oh why didn't they just pay up when it was due -it has now cost them an extra £110 for their troubles and (more imprtantly) is reducing the number of techs willing to work for them.

Name and shame, I say - it would hardly be defamation

[David Lee]

So true. The company is the Royal United Services Institute and they have self employed techs go in and look after their venue for meetings with AV requirement. Most of the staff their are absolutely lovely and the jobs are a pleasure. Trouble is the accounts dept. seem to live on another planet and refuse to pay, answer letters and only contact you when you are forced to go down the late payments and debt recovery route.

 

(I'll report my own post to the mods just in case there is a problem, though I cannot see anything wrong as, by default, they have admitted the money was owed.)

[paulears]

Moderation: My understanding of the rules is that we only tend to act in a forum protective manner when info is based on hearsay, or lacking in proper background - or, as happened recently the tone becomes a little threatening.

 

For the info to be useful to others, I guess it has to be reliable, robust and sufficient. Modland is a democracy, so no doubt there will be many other opinions, but David's post seems balanced to me.

Paul

[Guest lightnix]

For the info to be useful to others, I guess it has to be reliable, robust and sufficient...

Now that everybody pays by BACS, I'd say that invoices and bank statements alone, are enough to provide reliable, robust and sufficient evidence of late payment - no CCJ required

 

MCOL worked well for me last year, when I was forced to pursue S2 Events (current incarnation of serial phoenix company, Supotco) over a partially paid invoice. As in David's case, the people "on the floor" were great to deal with, but the minute I gave the company 10 seconds' credit (against my better judgement, based on previous dealings)...

 

It took nearly a year to get paid in full and when we finally did, their accountant 'phoned up HQ and started screaming at the poor girl on the other end, about how I was the most unprofessional person he'd ever dealt with and how they should sack me immediately - now that's defamation :)