Petty Debts Guide

A Brief Guide to Petty Debt Procedures

Petty Debts

Petty debts proceedings in the Magistrate’s Court can be pursued by a person or company (the Plaintiff, referred to in this leaflet as the claimant) who believes they are owed money by an individual or a company and where all other options for recovery have failed.

The limit is £10,000 per claim or aggregate of multiple claims; claims for higher amounts must go through the Royal Court. You cannot divide a large sum into smaller amounts in order to take it to the Petty Debts Court.

It is worth considering whether the party that owes the money will have the means (whether in cash or in other personal property that might be used in enforcement of any judgment) to pay it otherwise a judgement in your favour may still not result in your receiving payment.

Examples of claims you can make include (but are not limited to):

• Claims for debts
• Claims for damage to your property
• Damage to vehicles caused in road traffic incidents
• Disputes over rent or deposit held
• Claims for arrears of child maintenance
• Unpaid invoices

If the alleged debt relates to a contractual agreement, such as a lease, which contains a clause stating that any dispute must be referred to arbitration, the Court will not be able to hear the
claim.

It is important to prepare properly and to understand how the proceedings work. Although this is a court procedure, it is designed for people to be able to represent themselves without the need for legal representation. Indeed, if an advocate is employed, that cost cannot be claimed from the other party.

Court office staff can help with the process but cannot give legal advice.

Before starting petty debts proceedings you should ensure that you can show that you have tried to obtain payment by writing to the debtor setting out your claim. If no satisfactory response is received, you could write again, stating that if you do not receive payment within a certain period (say 7 or 14 days) you will commence proceedings. You should keep copies of these letters for use in Court if necessary.

Procedure for issuing summons

1. You can complete a Petty Debts claim form (available on the Royal Court website or at HM Sheriff’s office at the Royal Court House). You will need to give your details and those of the defendant (the debtor), ensuring that you use the correct full name and address of the person or limited company. You will need a home address if the defendant is an individual, not an address of a place of employment. If the defendant is a company you will need the registered office address. If the defendant is a tradesman using a name other than his own you should use the personal name followed by “(trading as [trading name])”. You will need to give details of the claim, clearly setting out how the debt arose; and provide two copies of the final statement, invoice or letter asking for payment.

If you have any difficulties with the above you can seek advice from HM Sheriff’s staff.

2. The defendant must be at least 18 years old. If the defendant is younger than 18 the summons can only be served on him through his parent or guardian.

3. If the claimant believes that the debtor is about to leave the island he can ask the Greffe for “expedited service” of the summons (for an extra fee).

4. The claim form should be submitted to HM Sheriff together with payment of the appropriate fee (summons fee of £79 paid upfront; the Court fee for the first hearing of £167 must be paid before the first Court hearing). These fees may be recoverable from the defendant if your claim is successful, but you should always consider whether it is worth your while pursuing the claim taking into account these costs and the possibility that they might not be recoverable. In particular, the Court fees will increase by £167 per hour or part thereof if there is a contested hearing before the Court and there will be further fees for enforcement by the Sheriff if that becomes necessary.

5. If there are adjournments and/or a contested hearing the claimant will receive a further account from the Greffe, in addition to the basic fees.

6. If the effect of the service of the summons is that the defendant offers to settle theclaim, you could negotiate with the defendant for reimbursement of the costs of the summons and court fees as a condition of agreeing to settle.

Initial Court proceedings

1. Once the claim form is accepted and the summons fee paid, a date for the initial hearing will be given to you. If payment of the debt is received or arranged prior to the hearing date, you should inform the Sheriff and withdraw the proceedings to avoid having to pay the Court fee. Otherwise, you should attend at the Sheriff’s office between 2–2.15pm on the day of the first hearing to pay the Court fee of £167 before going to the Magistrate’s Court at 2.30pm. The purpose of the first hearing is to establish whether there is a dispute and, if so, to set a date for a contested hearing. You should take a diary and know the availability of any witnesses who you will need to call if there a contested hearing. No evidence will be heard at this initial hearing.

2. If the defendant fails to appear at the first hearing, and he has been properly served by the Sheriff, judgment by default will be awarded against the defendant and the costs of the summons and initial court hearing may be included in the judgment. An Act of Court will be produced for you to enforce (see below).

3. If the defendant appears in Court and indicates that he wishes to dispute the alleged debt, a date will be set for the full hearing. You will be given instructions by the Court as to how to proceed but you will need to bring all your documentary evidence and witnesses to the next hearing. The fee for the contested hearing will be £167 per hour or part thereof and an invoice will be sent to the claimant after the hearing. Note also that either party may be ordered to pay a witness allowance for each half day when a witness is required to give evidence.

Procedure at final (contested) hearing

It is very important that you prepare your evidence well before attending the Court hearing. This could be a timetable of events, copies of letters or invoices or anything else which might help to prove your side of the story.

Copies of all documents you produce at the contested hearing should be provided both to the Court and the other party 7 days in advance or as directed by the Judge. Only direct evidence is acceptable: if you produce a letter, for example, it will only be evidence of its contents if the person who wrote it is a witness. If it is intended to produce photographic evidence the photographer should be called as a witness.

Ensure that all the relevant witnesses are present: HM Sergeant can issue a summons if needed. Also plan what questions you will need to ask the other party and their witnesses to help prove your case.

It is possible to be represented by an Advocate (at your own cost). A “friend” who can quietly offer advice may be taken into court with you, but only with the permission of the Magistrate. If you intend to employ an Advocate, you should find out the hourly rate before proceedings commence.

The burden is on the claimant to prove his case on the balance of probabilities (meaning that the Judge is satisfied that the claimant’s case is more likely than not correct). The claimant will begin and present his evidence. The defendant can then ask questions of the claimant’s witnesses in cross-examination.

The defendant’s case is then heard with any witnesses being called. The witnesses are then cross-examined by the claimant. At the end the defendant will be able to sum up his case, followed by the claimant’s summing up. The Magistrate then gives the decision. The decision might be wholly in favour of, or wholly against, the claimant; or the Magistrate might rule that only part of the amount claimed by the claimant should be allowed. Depending on the circumstances, the Magistrate may decide that the defendant should pay the legal costs of the summons and Court costs or he might make no order as to costs in which case the claimant will have to bear those costs.

Appeal Procedure

If one of the parties wishes to appeal against the judgment, written notice of appeal (obtainable from the Greffe) can be made to the Royal Court within seven days of the judgment. This will incur additional costs including the cost of a transcript of the hearing. At this stage it might be advisable to take legal advice as to the prospects of success.

Remission of Court Fees

Any person liable to pay Court fees can apply to the Magistrate’s Court to reduce the fees he is liable to pay. This should be done at the sitting where judgment is given.

Enforcement procedure

When a claimant has been awarded judgement by the Court, an Act of Court, which is a certificate confirming the details of the judgement, will be produced by the Greffe.

If the claimant is, despite having been awarded judgment, still unable to collect the money owed directly from the judgment debtor, he can take the Act of Court to HM Sheriff for enforcement. Enforcement fees will be payable upfront which will be recoverable from the debtor if funds are available. The Sheriff will try to arrange enforcement, by immediate payment or via a payment plan, but if this is not possible it may be necessary to arrest the debtor’s funds in bank accounts, seize and sell goods to recover the money owed or arrange for a wage arrest if the judgment debtor is employed.

A more detailed guide is available from the Court.

General disclaimer

The purpose of this note is to provide general guidance. While it is believed to be accurate and up to date, it is not authoritative and has no legal effect. No warranty is given that the text is free of errors and omissions, and no liability is accepted for any loss arising from its use. Users of this guidance note are encouraged to exercise their own skill and care in relation to the information contained in this guidance note and to obtain relevant professional advice.