A county court claim landing on the mat is alarming, but it is not the end of the road. What you do next — engage or ignore — makes all the difference.
Do not ignore it
A claim has deadlines. Ignoring it can lead to a judgment being entered against the company by default, which is far harder to deal with than the original claim. Read it carefully and note the dates.
Respond within the time limit
You can admit the debt and propose to pay, dispute it if you genuinely disagree, or negotiate a settlement. Even at this stage, an agreed payment plan often resolves matters. Take advice if you are unsure how to respond.
Keep talking to the creditor
A court claim does not stop you agreeing terms directly with the creditor. Many are settled by arrangement even after a claim is issued. The same is true of any debt with us — talk to us.
Free advice on court claims is available — Business Debtline gives free, confidential debt advice to small businesses and the self-employed at businessdebtline.org or on 0800 197 6026.
We lend only to UK limited companies and LLPs, and the loan is to the company with no director personal guarantee. As business finance outside the consumer-credit regime, it is not covered by the Financial Ombudsman Service or FSCS.
See also: How to talk to creditors when your business is struggling, What recovery steps can we take, and in what order?, Where to get free business debt advice.