A new Pre-Action Action Protocol for Debt Claims (the Debt Protocol) came into force on 1st October 2017. Subject to certain exceptions, the Protocol applies to any business, including sole traders and public bodies, claiming payment of a debt from an individual (including a sole trader).The Protocol does not apply though to business-to-business de...
On 1 October 2017, a new Pre-Action Protocol for Debt Claims came into force.
The Protocol sets out criteria which a creditor must follow prior to issuing a claim. It applies to any business claiming payment of a debt from an individual (including a sole trader) but is not applicable to business-to-business debts unless the debtor is a sole trader.
The Protocol aims to encourage early engagement and enable the parties to resolve the matter without the need for court proceedings.
steps to be taken by the Creditor
A Letter of Claim must be sent to the debtor. It should include the information specified in the Protocol, for example:
the amount of the debt;
whether interest or other charges are continuing;
details of the agreement which the debt arises from;