Know your debtor

November 21, 2012 11:50 am Published by

A common problem when chasing a debt through the courts is that creditors do not know who their debtors are and in what capacity they were acting because they do not get the necessary information about their customers at the start of the business relationship. The customer is only known as “Brad Debtor” and all dealings are done on a friendly, personal level with “Brad”. This is all very well, until Mr Debtor stops paying the invoices and court action is needed.

The claim form must contain the debtor’s correct and full details, which will vary depending on the capacity he was acting in:

Personal capacity: Full name, which could be “Mr Bradly Debtor-Smith”, at his full residential address.

Sole trader trading under his own name: As above.

Sole trader trading as “Handyman Brad”: “Mr Bradly Debtor-Smith t/a Handyman Brad” at his full trading or residential address.

Partnership: “Debtor-Smith Swindling (A Firm)” at their trading address.

Company: Full company name, “Debtor-Smith Limited” at their main trading or registered address.

The customer’s address must also be correct and complete:

It could be that Mr Debtor-Smith stayed with his mother for a few weeks while his house was flooded and he gave her address as the address for delivery. Proceedings cannot be issued at this address, because that is not his residential or trading address.

A company cannot be sued at a residential address except if that address is also the registered or trading address.

Judgments can only be enforced against the debtor’s property. Even if you get judgment entered at a wrong address it cannot be enforced because there is nothing of the debtor on the property.

It costs money to issue proceedings and obtain judgments. If you do not use the correct details, that money may well be wasted.

The above is general comment only and individual advice should be taken

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