Pre-Action Protocol for Debt Claims

Pre-Action Protocol for Debt Claims image

From the 1st October 2017 the Pre-Action Protocol for Debt Claims came into effect.

Who does it apply to?

The Protocol applies to businesses (including sole traders and public bodies) claiming money from an individual (including sole traders).

What is the purpose of it?

This Protocol’s aims include:–

  1. encouraging early engagement and communication between the parties; and
  2. enabling the parties to resolve the matter without the need to start proceedings; and
  3. encouraging the parties to act in a reasonable and proportionate manner.

What information should be provided to the debtor?

The creditor should send a letter of claim to the debtor before proceedings are started, which should contain various information, such as:-

  1. the amount of the debt; and
  2. whether interest or other charges are continuing; and
  3. for an oral agreement, who made the agreement, what was agreed and when and where it was agreed; and
  4. for a written agreement, the date of the agreement, the parties to it and other key details.

The letter of claim should enclose:-

  1. an up-to-date statement of account; and
  2. a copy Information Sheet and Reply Form; and
  3. a Financial Statement form.

What are the timescales?

The debtor should be given 30 days in which to respond to the creditor’s letter of claim. If the debtor does not respond, the creditor can then issue court proceedings.

If the debtor is disputing the debt, the parties should exchange information and disclose documents to enable them to understand each other’s position. Furthermore, the creditor must provide any documentation or information requested, or give reasons why the document or information is unavailable, within 30 days of receipt of the request.

How will this impact the creditor?

The Protocol will inevitably become more involved for creditors and will make the recovery of debt more difficult. In particular:-

  • there are now set timescales that must be adhered to. This will mean that a debtor will have the chance to extend the process and delay paying even further by requesting further information, even where such requests are not appropriate; and
  • there is an emphasis on the exchange on the documentation and creditor is now required to provide certain information and documentation; and
  • businesses will need to re-visit and change their existing credit control and debt recovery procedures to ensure that they are compliant with the new protocol.

Failure to comply with the Protocol?

Failure to comply with the Protocol may result in:-

  • delays in proceedings; and
  • a failure to recover costs; and
  • the inability to recover interest from the debtor.

Our Debt Recovery Team at Farnfields is fully versed in the recovery of debt and we ensure that the new Protocol is taken into consideration with each relevant case. We know that chasing debts from clients can be time-consuming, especially when you are trying to focus on the running of your business. Farnfields can take this worry away and can actively manage and pursue the debts owed to you, giving you more time to focus on the important matters.

If you would like any further information, please contact Jordan Griffiths ACILEx- Paralegal on 01747 825432 or

Website content note:

This is not legal advice; it is intended to provide information of general interest about current legal issues


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