Response to Default County Court Judgments Consultation Paper
A: What is your name
Emily Wood, DMH Stallard LLP
B: What is your job title (or capacity in which you are responding to this consultation, e.g. member of the public)
Solicitor and member of the Property Litigation Association Law Reform Committee.
C: What is your email address?
D: What is your organisation (if applicable)?
The Property Litigation Association (PLA) Law Reform Committee. The PLA are the representative body of contentious and advisory Property lawyers. Our Law Reform committee is responsible for responding to formal consultations, working with other industry organisations and identifying and lobbying on areas where a change to the law is necessary or desirable for the PLA’s members. As well as changes in the law, we seek changes in procedure and the service we receive from the courts and tribunals. Our reform proposals are driven, not solely for the benefit of PLA members, but for court users engaged in property litigation and specifically those for whom we act who are the ultimate consumers of court services.
Question 1: – Are there any other key messages that would be valuable to consumers? If so, what are they?
We endorse the stated aim of improving public awareness of what to do to avoid a County Court judgment and the potential consequences of one.
Additional key messages should include
- Encouraging consumers to engage at an early stage with their creditors to avoid Court proceedings being issued in the first place.
- Educate consumers that there are serious consequences to taking no action when faced with court proceedings
- Emphasising to consumers that whether they take issue with the claim, or admit the monies are owed, in either case they should still respond to it
Question 2: Are there any other aims or responsible behaviours the improved public information should include, and why?
We endorse the suggested aims and responsible behaviours. These should also include
- The early engagement with creditors/their solicitors with the aim of avoiding County Court action in the first place;
- Seeking independent advise via Citizens Advise Bureau and other advice services, or a solicitor where proceedings have been issued; and
- Making contact with the Creditor/their solicitor as soon as proceedings are served with a view to trying to resolving the matter without judgment being entered/the Court proceedings progressing.
Question 3: Are there any other actions the Government could take to improve public information that are not included in this paper? Please give details.
We suggest the wider distribution of the proposed improved public information to ensure it reaches consumers including, for example, dissemination through court buildings, libraries, colleges and other educational establishments, as well as places of work and via employers, and available within GP practices and from charities such as Citizen’s Advice Bureau and StepChange
We also suggest that consumers be encouraged to provide alternative addresses to the DVLA and those supplying goods and services, including landlords. An alternative address may include an email or, for example, a family member or place of work. Whilst this alternative address could not be used as an address for service of court proceedings (without an appropriate order from the Court allowing such service), information could be sent to the alternative address to ensure it comes to the consumer’s attention.
Question 4: How can the advice sector and claimant organisations ensure that the industry actively signposts consumers to a government source of information?
We suggest that as well as the advice sector providing links to the information, and including such links on other government literature (for example from the DVLA), Claimant organisations could include within their initial and subsequent correspondence with individual consumers (as opposed to companies and organisations) links to the government source of information including at the point of purchase/entering into credit agreements. If this was to become the practise, it should be included within the existing pre-action protocol on debt claims.
Question 5: What options should be available to help people who are vulnerable or have difficulty accessing information get the guidance they need?
We suggest the provision of training/workshops and advice to those organisations supporting such vulnerable consumers, such as charities and advice services.
Question 6: Do you agree with this proposal? If you do not, please explain your answer.
We are concerned that if default judgments can be set aside because “the documents were served at an address where the defendant could not have been aware of the claim”, this may serve as an encouragement for consumers not to provide creditors with up to date addresses. In such cases, defendants can already apply to have a judgment set aside under CPR 13 if they have a defence and can prove that they did not receive the claim.
However in cases where a claim is deliberately not served at the address which had previously been provided to the creditor by the consumer and the court is satisfied that the defendant was unaware of the claim/judgement when it was originally issued, and has only just become aware of it, then this should amount to a ground for setting aside a judgment in default. Further in our members experience, in this scenario consumers are more likely to pay monies that are owed if there is the incentive of removing the judgment completely rather than it become marked as ‘satisfied’. A proposal in this limited form should therefore encourage the settlement of claims and discourage the prolonging of Court proceedings.
Question 7: How should a defendant satisfy the Court that they did not have prior knowledge of the County Court judgment?
We would suggest that independent documentary evidence proving to the Court the address of the Defendant at the time of service must be provided together with a written statement including a statement of truth. The Court should warn the consumer of the consequences of providing false information i.e. contempt of court which may ultimately lead to a fine or imprisonment. Oral evidence should be insufficient.
Question 8: Does the current six-year period for County Court judgments remaining on the Register strike the right balance between, on the one hand, ensuring that people do not experience excessive detriment from past debts, while on the other ensuring that banks and other lenders have the information they need to decide who to lend to?
Those we canvassed are divided as to whether 6 years is an excessive detriment. Concern has been raised that 6 years does seem excessive when, in some member’s experience, debts are often incurred by young consumers before entering work. There is therefore some support for reducing the period, say to 3 years.
Question 9: Should other steps be taken to alert a person that a default judgment has been entered against them? If so what are they, and who should take them?
Assuming the adequate dissemination of the improved public information as proposed, together with the introduction of the proposal (as limited above) at question 6, we consider there need be no other steps taken. It is a responsible behaviour for consumers to make contact with creditors at an early stage if arrears are likely to accrue. If proceedings are issued, then again timely engagement with the creditor/its solicitor is to be encouraged. The policy proposal at question 6 (as limited above), together with the existing grounds on which judgments in default can be set aside, afford sufficient protection to the consumer and the opportunity to defend a claim, or remove a judgment.
Question 10: Do you have experience of, or information about, County Court judgments that have been entered against a debtor without their knowledge where claimants are deliberately using an old address? If you do, please give details
We have no knowledge of any Claimants deliberately using an old address in order to get a County Court judgment entered against a consumer. Further in our view such practise would not assist our members’ clients as ultimately, they are seeking to recover the payment of a debt, not simply enter judgments against consumers.
Question 11: How can this be avoided?
In so far as this practise exists, we anticipate that the proposal to enable consumers to set aside judgments in default where the defendant is unaware of the claim/judgment will provide some discouragement. We would also suggest possibly including on claim forms a warning that the claimant is confirming the accuracy of the defendant’s address and deliberately providing false information may ultimately result in a fine or imprisonment. Alternatively, and to avoid overloading claim forms, the request for default judgement could include a declaration by the claimant that, to the best of their knowledge, the address given on the claim form is the defendant’s correct current or most recent address.
21 February 2018