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How should I deal with a county court judgment for debt?

This article was first published in The Gazette, and the original article can be found online here.

A county court judgment (CCJ) is a court order to repay money you owe to a creditor.

You may receive a CCJ if someone issued a claim against you and you didn't respond. The CCJ will include details of the amount owed, who you owe, how to pay, and the deadline to pay. Records of CCJs are kept for six years on the Register of Judgments, Orders and Fines, and can affect your ability to get credit.

If you pay the CCJ within one month, you can have it removed from the register. If you pay after one month, the CCJ can be marked as ’satisfied’  in the register, but will still remain on the register for the six-year period.

To set aside a CCJ

If you believe that you don't owe the debt, or that you didn’t receive the claim documentation, you can apply to have the CCJ set aside (cancelled). To set aside a CCJ, you will need to send an application form to the court, along with a court fee of £255. You will need to explain your reasons for applying to set aside the CCJ, and include any paperwork or evidence that might be relevant. You may have to attend a hearing to explain why you disagree with the CCJ, or why the claim did not reach you (eg it was wrongly addressed).

If the court decides that you don't owe anything, or that the claim or service can be disputed, the CCJ will be set aside. If the court decides that you don't owe the full amount in the CCJ, it may issue a new CCJ with the correct amount of debt.

Paying what's owed by instalments

If you agree that the money is owed, you should arrange to pay the debt before the specified deadline. If you can’t afford to pay, you can apply to vary the CCJ so that you can pay by instalments, or reduce the instalment amounts if they have been set too high. You will need to send an application form to court, along with a court fee of £50. You could, alternatively, agree instalment payments with the claimant, so that they don’t enforce the judgment.

The application, if made, should include details of your income and expenditure, and you should provide an indication of how much you are able to pay each month. If the creditor agrees with your proposed monthly instalments, a CCJ will be drawn up with these amounts. If the creditor disagrees, the court will decide on a monthly payment that it feels is fair. While this application is being processed, you should continue to make payments against the debt to avoid enforcement action being taken by the creditor.

Enforcement action

If you don’t deal with the CCJ, the creditor could proceed with enforcement action. This may include instructing bailiffs to attend your property to collect the debt. You will receive a warrant notifying that the bailiffs will be attending and you will be given seven days to pay. Provided you reply to this with an offer to repay the debt, whether by instalments or outright, the warrant will be stopped.

If you are a home owner, the creditor may also apply to secure the CCJ against your property. Alternatively, they may apply to court to deduct monthly instalments directly from your employer or take money from your bank account. If the amount of the debt is more than £5,000, the creditor may also apply to make you bankrupt (following service of a statutory demand or an unsatisfied attempt to execute against your assets by the bailiff/High Court enforcement officers).

However you decide to deal with a CCJ, it is clear that ignoring one or delaying your response could have serious consequences, so you should deal with a CCJ as soon as you receive it.

Often it can be best to speak to the claimant to agree instalments where possible, as it keeps the costs you have to pay to a minimum. In some cases, for example if you have been unwell, or are otherwise vulnerable, the claimant may agree to freeze interest or accept a lesser amount, despite the judgment.