Money Claims Online

[NamedyChangedy]

A building contractor owes me a large sum of money, and has repeatedly promised to pay but keeps delaying for various reasons. I've run out of patience.

I'm thinking of using the Money Claims Online service - can someone with experience of it please let me know if there's any potential risk to doing this? It looks like the cost would be 5% of the amount owed, which I'm comfortable with. Would I ever get it back though?

Also, I'm thinking he never had any intention of paying, and may even declare bankruptcy to get out of it. Would that be an option for him?

You can reclaim the cost of using MCOL from the building contractor. However, no-one on here can tell you whether you will get your money. If he has the resources to pay he can be made to do so but he can't be forced to pay money he doesn't have.

So if they can't force him to pay, then what's the consequence of non-payment for him? Wouldn't he have to pay it back eventually, once he does get the money?

Bailiff or sheriff.

If he goes bankrupt and you are in it then no you don't get paid.

If you go through MCOL you get a court order. If he still doesn't pay you can go back to court and ask them to enforce. There are various enforcement mechanisms - bailiffs, attachment of earnings, freezing their bank account, a charge against their assets or forcing them into bankruptcy. This assumes you are in England - the options in Scotland are a little different.

If the contractor has a limited company and they owe you money, you would be taking action against the company rather than the person. The contractor is not personally liable for his company's debts, so you would need to make sure the business can afford to pay.

If he goes bankrupt you may get some of your money but it is unlikely you would get all of it. When he is discharged from bankruptcy most of the debts he had when he became bankrupt would be cancelled.

If he does not go bankrupt he should pay the debt eventually but it can take a long time. You may have to agree to him repaying in instalments if he cannot afford to pay it all immediately.

Thanks so much prh47, that's all very useful to know. And yes, I'm in England.

Our contract with him was through his limited company - is there a way I can look into the business' ability to pay?

We have already offered instalments but he still wouldn't pay. He said yes instalments are a good idea, I'll pay you in Dec, then Jan, then Feb, now it's March etc etc. I know he's a dishonest person because that's how we ended up in this situation in the first place.

I've just had enough of it now - I'd like a resolution even if I end up not getting the full amount, as it'll mean I can move on with my life. At the moment everything is in limbo as I don't know what I'll be able to afford if / when I get the money back. I've tried one last time and then it's MCOL, with fingers tightly crossed.

Companies House will have the most recent accounts he filed which will give you some idea. The risk is that he might decide to close the company in which case you may get only a fraction of what you are owed. But you should certainly look into it.

Before taking legal action you need to send a "letter before action". This should set out how much he owes you, give him a reasonable deadline to pay and state that you will take legal action if he does not pay by the deadline.

I looked up 'letter before action' and I've actually sent him everything that citizens advice suggest you include, however I've sent it all in an email. Just so we're 100% covered I'll also send him a letter.

Thanks again for your help, am feeling much more in control now, rather than being entirely at his mercy.