Government consults on reforming Default Judgment process
Thursday 28th December 2017
The Government has started a consultation on potential reforms to the default county court judgment procedure. This follows concerns that unscrupulous creditors are intentionally using old debtor addresses, meaning that the debtor doesn’t have an opportunity to defend the claim resulting in an automatic judgment being entered against them. This in turn has an impact on their credit rating, which may not come to light until years later when they apply for credit.
I agree that practices like this, and the debt collection companies that adopt them, have no place in our society; more often than not, they bring further misery on individuals who are already finding it hard to make ends meet. However, any new procedures put in place must balance the needs of the individual debtor against those of the creditor. The Government must not forget that a large proportion of creditors using the county court are small and medium size businesses and larger organisations chasing relatively small debts; both are reliant on a robust and efficient court process to have any chance of recovering money that is genuinely owed. The Government must not place all the burden on creditors to prove 100% that a debtor has received a claim form, moving away from the current rule that a creditor must have taken reasonable steps to serve on the debtor’s address. Those owing money must take responsibility to ensure that they tell their creditors where they are, and should be informed via Government campaigns that, if they don’t, it could result in a judgment being entered against them without being told.
I agree that the process could be tightened up, especially when it comes to the impact on credit ratings, but this should not be at the expense of reputable creditors who follow the process properly, and are having to regularly deal with debtors who are simply trying to avoid service and are sticking their head in the sand. We must not forget that creditors rely on those using their goods or services to actually pay for them, so they in turn can pay their staff, suppliers and make a return for investors.
The consultation can be found at: