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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience:  Solicitor with 5+ years experience
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I require some assistance with a commercial agreement which

Resolved Question:

I require some assistance with a commercial agreement which has been breached. I have lent some money to my accountant who I have known for over 20 years. He offered to pay me a fixed amount of interest on the money which he would deposit in a clients' account if I would lend him the cash for a two week period. This was in Nov 2013. He has part paid back the original amount ( around 45 % ) without any interest after nearly 5 months delay and has still not paid the remainder, nor the interest payment he agreed.
I have an agreement and an amendment for penalty payments which he has executed but has breached all the dates promised in the agreement.
What is my recourse ?
Submitted: 3 years ago.
Category: Law
Expert:  Ash replied 3 years ago.
Alex Watts :

Hello my name is ***** ***** I will help you with this.

Alex Watts :

How much was lent and how much is outstanding please?

Customer:

£250k original sum; paid back £115k ; remaining £135k plus interest payment of around £24k and penalty payment of £25k

Alex Watts :

In the event of default does it allow you to sue for the balance or just arrears?

Alex Watts :

Does he have any assets please?

Customer:

The agreement was between his firm and my firm. But he and his partner are personal guarantors also. There is no clause on default in the agreement

Alex Watts :

Ok.

Customer:

Yes, he does have assets - his company assets as well as his personal assets

Alex Watts :

Ok.

Alex Watts :

You have two options

Alex Watts :

1) Ask for a charge on assets such as property. This is preferred as this secures the debt

Alex Watts :

You can ask for a charge on the accountant property, if any and also as guarantors the personal homes

Alex Watts :

This is the best and cheapest option

Alex Watts :

Otherwise you need to write and set out your losses and request a payment within 14 days or say you will go to Court within 14 days. You should make sure you send this recorded delivery and keep a copy.


Alex Watts :

If they do not pay you then you can issue proceedings in the County Court. You can either do this online at: www.moneyclaim.gov.uk or by completing form N1 http://hmctsformfinder.justice.gov.uk/courtfinder/forms/n001-eng.pdf and take it to your local County Court.

Alex Watts :

You can also seek to claim interest at 8% pursuant to the County Courts Act 1984

Alex Watts :

The Court will then issue a claim which a copy will be sent to the Defendant who will have a limited time to defend it, if not you can enter Judgment and enforce. This can include a charge etc.

Alex Watts :

If the matter is defended it will be set down for a trial. As the claim is for £10,000 or less it will be a small claim and you will need representation.

Customer:

I have set out the penalty as £1000/day for every business day he delays by...

Alex Watts :

However you can issue against the Company and the guarantors at the same time

Alex Watts :

Can I clarify anything for you about this today please?

Customer:

sorry, the claim is for £135,000 plus £24,000 odd interest plus £25,000 penalty payments thus far

Alex Watts :

Ok - the Court may have an issue of you claiming interest on late payments and a penalty.

Alex Watts :

But first see if they agree to a charge.

Alex Watts :

This is the best option

Customer:

But, I want the money back for my business as I had only lent it on a 2 week period. Having a charge is of little value to me..

Alex Watts :

Ok - but if they dont have the cash then even if you get Judgement you still have the same problem getting the physical cash

Alex Watts :

Unless they have it sat in their bank account then you would have a paper Judgment

Alex Watts :

You would still have to enforce it

Customer:

I think that they do have the cash ....

Customer:

but sitting in a Singapore account

Alex Watts :

Ok - well issue proceedings against all 3 after having called in the loan and arrears.

Alex Watts :

Can I clarify anything else for you about this today please?

Customer:

so, basically, the best option is still to continue to talk with them to get back the money rather that go to court - would that sum up the situaton?

Alex Watts :

I really would consider a charge, because that's easier to enforce

Alex Watts :

And you don't need a CCJ

Alex Watts :

You can go straight for an order for sale

Alex Watts :

And it makes the debt secure

Alex Watts :

That's a real key - but it is a matter for you

Alex Watts :

Can I clarify anything else for you?

Customer:

OK, I understand. thanks

Alex Watts :

Does this answer the question for you today?

Customer:

can I get a transcript of this chat ?

Alex Watts :

Once you rate the format changes and you can copy and paste it, or come back to it at any time

Alex Watts :

If this does answer the question might I invite you to rate my answer

Alex Watts :

If the system wont let you or you need more help please click reply

Customer:

ok, thanks

Alex Watts :

Thank you and have a good weekend

Ash and other Law Specialists are ready to help you